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Home / Business

The Ex-Files with Jeremy Sutton: She owned the Airbnb, I did all the work - can I get a cut?

NZ Herald
4 Jun, 2023 12:00 AM4 mins to read

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Photo / Getty Creative
Photo / Getty Creative

Photo / Getty Creative

OPINION

Q: My partner of two years has recently broken up with me.

During our relationship, we both had our own apartments but we lived mainly at mine.

Her apartment was in Freemans Bay with sea views, and she would rent it out on Airbnb to generate a second income.

I don’t know how much she earned in rental, but it would have been tens of thousands per annum.

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She never shared a cent with me - even though I would help her clean up after the Airbnb guests.

Now that the relationship is over, I feel bitter and resentful as I suspect she was just using me. I am curious as to what rights a person in my situation has.

A: You and your partner were only together for two years, whereas normally a couple needs to have been in a de facto relationship for three years for the relationship property legislation to apply.

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This does not mean you are excluded entirely from bringing a claim – but it would be difficult; potentially a lot more difficult.

The Court can make an order dividing relationship property in de facto relationships of less than three years where the person bringing the claim has made a substantial contribution to the relationship, and a failure by the Court to make the order would result in serious injustice. In these cases, the relationship property pool will not necessarily be divided equally (as is the usual practice).

The pool will be divided in accordance with each party’s contribution to the de facto relationship. So before embarking on a claim you and your legal representative should consider:

  • Whether it is likely that you meet the legal threshold. that is, you have made a substantial contribution so that failure to make an order would result in serious injustice; and if so:
  • What the overall division of assets is likely to be if divided in accordance with you and ex’s respective contributions to the de facto relationship (rather than on an equal sharing basis).

Beyond that, there are three issues to consider:

Issue 1: Are you in a de facto relationship?

The term de facto is defined in s 2D of the Property (Relationships) Act 1976. If you are not in a de facto, the Act does not apply. I would need more facts to be clear on this.

Issue 2: The legal threshold

Neither the terms “substantial contribution” or “serious injustice” are defined in the legislation. There is case law that indicates that the threshold should not be applied too stringently. In one case the judge commented that the contribution “need not be out of the ordinary or far beyond the norm” for the threshold to be met.

My view is that you would likely meet the legal threshold outlined above.

You allowed your ex to reside with you (presumably on a rent-free basis), freeing up her apartment to generate a second income for her. You have also assisted by cleaning the apartment at the end of the Airbnb stays.

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However, whether the threshold is met involves the exercise of the Judge’s discretion considering all relevant circumstances, so it is not possible to say definitively.

Issue 3: Is it worthwhile bringing a claim?

As I have indicated above, where an order is made under this provision, assets are divided in accordance with each partner’s contribution to the de facto relationship rather than on an “equal sharing” basis.

Financial and non-financial contributions (such as raising children, undertaking housework or assisting with property renovations) are relevant and are weighed up by the Judge to determine what the overall division of assets should be. It is possible your ex has made other relevant contributions that may offset (partially or fully) your contribution.

Read More

  • The Ex-Files: Jeremy Sutton on the spouse who took $15k from Sharesies kids’ account to treat himself
  • The Ex-Files: The family house and boat are in a trust - can I be forced out?

You should also be aware that the whole asset pool would be considered – her assets as well as yours. So, the first step would need to be the exchange of financial disclosure by both of you.

Once you have considered all the issues above you and your lawyer could attempt to negotiate a settlement with your ex.

If you are unsuccessful in negotiating a settlement, I suggest you take detailed legal advice (from a practitioner experienced in this area) as to your prospects of success in litigation and what your likely legal fees would be before filing legal proceedings.

I consider it is probably not worthwhile to bring the claim based on your facts. The costs of bringing a claim may outweigh the potential benefits.

It may be that you decide to chalk it up to experience and try to have a more balanced arrangement in future relationships.

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