Important Procedures for claims under The Property (Relationships) Act 1976.
The recent changes to the relationships property regime have been well publicised. Most people are well aware that you don't have to be married to be able to claim for community of property rights on separation. Most of the rules concerning division of property after separation will apply equally whether or not the parties are married or living in a de facto or civil union relationship.
Furthermore claims under The Property (Relationships) Act 1976 ("PRA") will also arise even though one of the partners or both are deceased. In a recent High Court decision of Justice Ellen France Her Honour has clarrified the position under the Act in relation to claims arising after the death of BOTH partners. The Judge ruled that where the surviving partner died before lodging a claim against the estate of the first deceased partner then the executors of the estate of the survivor could still claim under the PRA.
This means that the claim under s81 of the Act survives the death of the survivor and special leave is not required. see Nicholas and Another v Public Trust ( unreported Auckland High Court 30 June 2005 CIV 2004-404-005549, Justice Ellen France).
The case involved a same sex relationship of many years. Both partners died within 2 days of each other. All assets were in the name of the partner who first died and the survivor was not a beneficiary in his will. The children of the survivor wanted to bring a claim and the Judge said that the death of their father did not prevent the estate from going for half the assets.
The decision on that point was probably not surprising but the case also highlighted how important it is for the survivor or in this case the survivor's legal representatives on death to follow the procedures set out in the PRA.
Under the Act (s63) the survivor must, before a claim for half the assets can be raised, first follow the procedure set out in s65 and file in the High Court a certificate stating that the survivor formerly elects option A as defined in s61. This must be done within 6 months of the grant of probate relating to the deceased's will. If the survivor omits to elect option A under s65 then he/she is deemed by law to have elected option B(s68). Option B means that the survivor has elected to take under the will instaed of raising a claim under the PRA.
The new laws are a mixture of provisions relating to community of property between couples and the law of succession(wills). If the surviving partner is content to take whatever he/she receives under the will then that person would want to elect option B and waive his/her right to claim for half under the PRA.
However for the survivor who wants to raise a claim it is imperative that option A is first chosen and in time. If not then there could be all sorts of procedural hurdles to overcome before being able to proceed. An order under s69 will be required in order to reverse the deemed election of option B and then an order under s62(2) for leave to elect option A out of time. None of this will be possible if because of the delay the estate has been finally distributed to the beneficiaries named in the will (ss 62(4), 70 and 90(4)). Remember too that in some cases distribution will have been deemed to have occurred even though the executors and trustees are still holding on to the assets belonging to the estate.(see Sullivan v Brett [1981] 2 NZLR 202.
This part of the PRA is another example of where parliament has tried to simplify the law but instead has made it more complicated. It will take time before the Courts clarrify what the implications of these various sections are (se Part 8 PRA).
Article written 7/4/06. | 
