What is a Contracting Out Agreement?

6 February, 2026 | Natalie Miller

The “prenup” New Zealanders don’t realise they need

Most people think prenups are something celebrities sign before a whirlwind wedding. But in New Zealand, a contracting out agreement is far more common, far more practical and, for many couples, essential.

Under the Property (Relationships) Act 1976 (“Act”), the guiding principle is that all relationship property should be shared equally when a de facto relationship, civil union, or marriage ends. There are certain exceptions – as always. The only way to avoid the presumed 50/50 sharing regime is to contract out of the Act. That is exactly what a contracting out agreement does. If the agreement meets the legal requirements, it allows couples to decide for themselves how their assets and liabilities will be divided if the relationship ends through separation or death.

What happens if you don’t have one?

If you are in a qualifying relationship and don’t have a contracting out agreement in place, most of what you own or owe could be divided equally if you separate or if one partner dies. Think you are safe because the asset is in your sole name or was gifted to you? Think again.  In certain circumstances these types of property could still be up for equal division.

Why you should seriously consider one

For many people, the primary motivation is protection. A contracting out agreement can ring fence specific assets so they remain your separate property, such as a home you purchased before the relationship or savings you built independently. It can also ensure you do not become responsible for your partner’s debt, such as a student loan or personal liabilities that you had no part in creating.

Just as importantly, a contracting out agreement sets clear expectations for how newly acquired assets and debts are owned and managed during the relationship and what will happen to those if the relationship ends. By defining everything upfront, the agreement can prevent confusion, conflict and costly disputes later.

When can you get a contracting out agreement?

A contracting out agreement can be put in place at almost any stage. Some couples arrange one at the very beginning of a relationship. Others do it after buying a home together, having children or blending finances. It is also possible to enter into one at the end of a relationship. However, the safest and cleanest approach is to get one as early as possible, ideally before the relationship becomes a qualifying relationship or before either partner acquires rights under the Act.

Want to know more?

If you would like to become a client of Smith and Partners to get advice about contracting out agreements, please contact Natalie Miller at natalie.miller@smithpartners.co.nz or phone 09 837 6843 or fill out the form below to set up an appointment.

We will require a retainer to be paid prior to your first meeting, and we cannot assist with legal aid matters. Please note that, in accordance with our obligations under the Lawyers and Conveyancers Act 2006, we cannot provide legal advice unless you have become a client of Smith and Partners and have received our Terms & Conditions of Engagement and Info for Clients.