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The Ex-Files: The family house and boat are in a trust - can I be forced out?
By Jeremy Sutton
NZ Herald·
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What claim do I have to the family home and boat - owned by my partner's trust - if I've made significant repayments during our relationship? Photo / 123RF
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A: The existence of a family trust in this situation complicates matters. I advise anyone in a similar position to consult a lawyer. The advice will depend very much on your specific circumstances.
I would first consider a notice of claim. This is a document which can be lodged against the title of a property to prevent the owner from selling the property. It is a powerful tool, if used properly.
You can lodge a notice of claim under the Property (Relationships) Act 1976 on the basis that you have an interest in the property pursuant to the Act.
However, the provisions of the Act generally apply to property personally owned by the parties to relationship. Since your family home is owned by a trust, it is not a straightforward application. Trusts may cause problems in getting a reasonable resolution.
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I’m being chased for child support and I haven’t seen the kids for two years - March 7
Q: After a split between my partner and I, things have turned sour. I have now been away from my partner for five years. I paid child support for 12 months through a private agreement but, recently, I’ve just been paying small sums to my ex-partner while setting up my new business. We have two children aged 12 and 9 and I live in Australia. My partner and children still live in New Zealand.
I haven’t been able to see my children for two years due to Covid but now I’m being chased for Child Support by the IRD, including interest and penalties. What is the best way to resolve the child support debt with IRD?
A: This does sound like a stressful situation. For any parent, not seeing their children for two years would be very hard.
However, you still have to pay child support regardless of whether or not you are seeing them. Child support is a system by which the more financially secure parent can assist the other parent. The parent paying child support is normally caring less for the child on a day-to-day basis.
Since 2018 the total amount of outstanding child support payments totalled $2.3 billion. This figure is made up of half a million in overdue child support payments, and $1.8 billion in penalties and fees. This fact alone illustrates the danger of not paying child support. The penalties and fees add up quickly.
Leaving your wealth to your children through estate planning - October 16
Q: I have been in a volatile relationship for a number of years.
My spouse has two children from a previous relationship and she is paying large amounts of child support. Is that debt separate or joint, involving me too? The children don’t live with us, and I didn’t know about the children until one year into the relationship.
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I am 20 years older than my partner and have an adult son from a prior relationship. I want to leave my wealth to my son. How can I ensure that happens, and will my separation change his entitlement?
A: These concerns are reasonable and often raised by my clients when they are deciding on whether to separate with their spouse or partner.
Whether child support debts for your partner’s children are joint can be very difficult.
Usually, debts paid during your relationship cannot be reversed. However, if you were not informed of the liability before the relationship started, then you could argue that it is not your debt, and should not be shared jointly.
If you would like to leave your estate to your adult son, then it is important to organise your affairs now.
The first step would be to examine your estate ownership and understand what would happen if you were to pass away.
The assets that you owned prior to the present relationship may be classified as separate property. You would have to establish that these assets were kept separate throughout the duration of the relationship.
My husband uses our joint funds for building supplies - what should I do? - May 1
Q. My partner and I are going through a difficult period in our relationship. He seems to work every day on his construction business. Although he has multiple projects, I know it’s becoming difficult to get building materials to complete the projects. The clients are also having difficulty in paying my partner in a timely way because of their own financial difficulties.
I am concerned because he is currently ordering materials from our joint funds.
We have three young children, and we rely on him for income. I would like to come to some sort of agreement with him where I am able to retain the family home and he keeps the construction companies if we were to separate. Is this possible?
A. You and your husband are able to enter into what we call a Contracting Out Agreement.
A Contracting Out Agreement (popularly known as a ‘pre-nup’ when it’s signed before you tie the knot) is a legal agreement between you and your partner, outlining how you will divide your assets if you separate. These agreements can address trust property.
To make the agreement legally binding, both you and your partner are required to receive independent legal advice.
Prior to giving independent legal advice, the lawyers will exchange what we call ‘disclosure’. This means that you and your partner will need to disclose your asset position with each other and the lawyers.
Mum needs a retirement unit, my partner refuses to contribute - September 20
Q: My mother lives on her own and is getting less confident about her decisions. She has four caregivers during the week. I think she is getting to the stage where my three siblings and I want to buy her a unit in a retirement village.
She is opposed to moving out of her rented property, and seems to have dementia, but has not been tested or assessed at all. My partner refuses to pay for the cost of the retirement village. She says it is my family’s issue to deal with ... Can you help?
A. My impression is that you have a lot to arrange for the care of your mother. I suggest you take her to her doctor and have her assessed.
Does your mother have a will and enduring power of attorney? The law presumes a person has capacity to make a will, and I assume that she does. Next, an enduring power of attorney is a legal document that sets out who can take care of personal or financial matters if you cannot. That person is called an attorney. You can complete the document with your lawyer.
Should you and your partner break up, there may be an issue concerning whether the financial support you provide your mother is a separate debt or a relationship debt. For any amount that you have to provide, you and your partner can categorise it as a separate debt rather than a relationship debt. This means that you would be solely responsible for the debt.
Executing a contracting out agreement about the financial support you advance to your mother or any other matters in your relationship can help reduce the stress involved in the event of a separation.
