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45 Years Too Late: Supreme Court Shuts Door on Out of Time Estate Claim

Wed, 27 May 2026 01:47:01 GMT

How long is too long to challenge a will? In Gibson v Makgill [2026] NZSC 43, the New Zealand courts gave a definitive answer — and it took three of them to do it.

The Story

In March 1976, Lewis Wait died of cancer, leaving behind a farm, a family, and a will that would take nearly half a century to be challenged.

The farm was owned equally between Lewis and his wife, Nellie. Under Lewis's will, Nellie received a life interest in his half-share, with the remainder to pass to their son, Robert, on her death on the condition that Robert pay each of his two sisters, Lynette and Gaylene, a sum equal to one-sixth of the estate's value as at the date of Lewis's death. Robert had already abandoned his university studies by then to run the farm, and Lewis's overriding objective was to provide for Nellie, who was still relatively young. The two sisters received comparatively little. Probate was granted in July 1976.

Lewis had also settled the LH Wait Family Trust, with his children and grandchildren among the beneficiaries. In 2021, the trust made a capital distribution of $520,000 to each of Gaylene and Lynette.

Lynette's position was that her father had promised her that Nellie would "level things up" between the three siblings after his death. That promise, she says, proved false. In 2016 (some 40 years after Lewis died) Nellie sold her own half-share in the farm to Robert's family trust for $4.544 million plus GST. Most of the purchase price was forgiven by gift. Lynette says she learned of the transaction in 2021 and only then realised the promise would not be honoured.

The following year, in August 2022, she filed a claim under the Family Protection Act 1955, alleging her father had breached his moral duty to provide for her. To get that claim before the court at all, she first needed permission to file approximately 45 years after the standard 12-month limitation period had expired.

That permission was never granted.

Through the Courts

The High Court refused the extension. The 45-year delay was "inexcusable," and that finding alone was sufficient to dispose of the application.

The Court of Appeal agreed. While both courts accepted there was an arguable case that Lewis may have breached his moral duty, they also found the delay itself was fatal. Lynette had known or ought to have known that she was to receive very little under her father's will. She also knew, on her own case, of the risk that Nellie might alienate her own share of the farm or never follow through on the alleged promise. Despite all of this, she did not act for decades.

The Court of Appeal went further, observing that Lynette's claim appeared to be directed more at her mother's conduct than her father's. As the Court put it, insofar as Lewis and Lynette had both assumed Nellie would level up the distributions, it was an unsound assumption. The courts also weighed the significant prejudice to Robert, who had built his entire adult life and career around the provisions of his father's will, though the Supreme Court later noted this aspect may have been more contestable.

Nellie, for what it is worth, died not long after the High Court hearing. She was 99 years old.

The applicant sought leave to appeal to the Supreme Court. Leave was declined. The Court found Lynette was essentially seeking to challenge factual findings, which raised no question of general or public importance. Nor did the Court see any risk of a substantial miscarriage of justice. The matter was at an end.

The Deeper Lesson: Don't Rely on the Surviving Parent to Do the Right Thing

Gibson v Makgill is, at its heart, a cautionary tale about a common assumption — that the surviving parent will, in time, make things right.

Lynette believed her father had promised that her mother would even things out between the siblings. She waited. And while she waited, Nellie sold her half-share of the farm to Robert's family trust for $4.544 million, most of which was forgiven by gift. By the time Lynette understood what had happened, it was too late to challenge her father's will, and her mother's estate was a separate matter entirely.

This pattern is more common than people realise. When a parent dies leaving less than you expected, it is tempting to hold off — to trust that the surviving parent will look after you, to avoid conflict, to wait and see. But that approach carries real risk, because you have no legal control over what the surviving parent does with their own assets during their lifetime. They can sell, gift, restructure, or transfer and, by the time you discover it, your ability to challenge the first parent's will may have long expired.

That risk is even greater where the surviving parent is a step-parent. If your parent has remarried, their spouse has their own family, their own loyalties, and their own estate to think about. Unless a specific estate planning mechanism has been put in place, there is no guarantee that you will receive from the surviving spouse’s estate. They may favour their own children. They may give away what you assumed would one day come to you. And unlike a biological parent, they may have little personal motivation to honour a promise made by someone else.

If you feel you were not adequately provided for when a parent died, the time to take advice is soon after the death — not years later, when the assets have moved on and the limitation period has closed.

What This Means in Practice

Three principles emerge clearly from the courts' reasoning:

Delay is the primary obstacle. An inexcusable delay will, on its own, defeat an application for an extension of time. Courts are not looking for reasons to excuse it.
Knowledge matters. Where a claimant knew or reasonably should have known of the basis for a claim and still did not act, that will weigh heavily against them. A late-arising trigger event does not reset the clock if the underlying facts were long apparent.
A strong claim is necessary, but not sufficient. Both lower courts accepted Lewis may have arguably breached his moral duty. It made no difference. The delay was simply too great.

The broader principle running through all three courts is one of finality. Estates are administered, assets are dealt with, and people build their lives on the basis of what a will says. The Family Protection Act 1955 does allow for extensions of time, but that discretion has limits and 45 years is well beyond them.

How to Avoid a Gibson v Makgill Situation: Planning for Blended Families

Cases like this are not inevitable. With careful estate planning, it is possible to provide for a surviving partner while also protecting the interests of children (or children from prior relationships in the case of a blended family). The key is to make binding, structural arrangements at the time of the first death, not to leave things to goodwill and assumption.

There are several tools available, each suited to different circumstances.

Mutual Wills

One option is for partners to enter into mutual wills — a legally binding arrangement under section 30 of the Wills Act 2007 where each agrees to dispose of their estate in a particular way and not to revoke or alter that arrangement without the other's consent. In a blended family, this can give the first to die confidence that their share of the combined assets will ultimately pass to their own children, while still allowing the survivor full flexibility to use those assets during their lifetime.

However, mutual wills come with significant drawbacks. They are inflexible, and if circumstances change after the first death (a new relationship, new family members, a shift in financial position), the survivor cannot easily update their will without risking a claim. Courts are also slow to find that mutual wills exist simply because two people made corresponding wills. For mutual wills to be effective, the arrangement must be clearly and expressly recorded.

Life Interests

A more commonly used structure is a life interest: the surviving partner receives the benefit of the deceased's estate or a specific asset such as the family home for their lifetime, with the capital passing to the deceased's children on the survivor's death. This preserves the capital for the children while ensuring the survivor is properly provided for.

Life interests are particularly valued by the courts as a way of balancing competing interests. As one court has put it, the benefit is that "the capital ultimately is preserved for the child and is not unfairly passed on to strangers in blood." Lewis Wait's will in Gibson v Makgill actually used a life interest structure — the problem was not the structure itself, but the reliance on Nellie (the surviving parent) to then deal fairly with her own separate assets.

Life interests require precise drafting. Poorly drafted provisions frequently cause disputes. Key considerations include what type of interest the survivor needs (income only, or access to capital?), how outgoings and maintenance are handled, what happens if the survivor moves into care, and whether the interest should end on certain events such as remarriage or entry into a new relationship.

Choosing the Right Executor

In blended family estates, the choice of executor matters enormously. Where the will gives one side of the family control over administration, conflicts of interest are almost inevitable, particularly if there are Family Protection Act claims in the mix. An independent executor is often the better choice, providing impartiality and reducing the risk of one set of beneficiaries feeling that the process is being managed against them.

Communication and Letters of Wishes

Finally, good communication within the family, supported by a clear letter of wishes explaining the reasoning behind estate planning decisions can significantly reduce the risk of misunderstanding and claims. People are far less likely to challenge an arrangement they understand and whose rationale has been explained to them.

PK Law advises on wills, estates, and family protection claims. If you have questions about your rights following a bereavement, we would be happy to talk.

How to Contest a Will in New Zealand: A Guide to Family Protection Claims

Mon, 25 May 2026 22:46:04 GMT

Contesting a Will in New Zealand: Your Guide to the Family Protection Act

Key Takeaways

The Family Protection Act 1955 allows specific family members to claim if a will fails to provide proper maintenance and support.
Claims must generally be filed within 12 months of the grant of administration to remain within the statutory timeframe.
Executors may legally distribute estate assets after six months if they have not received formal notice of a claim.
The court follows a principle of minimum intervention, only changing a will enough to remedy a breach of moral duty.
Dying without a will triggers strict intestacy rules that often leave surviving partners with inadequate financial support.

Losing a family member is a significant emotional event, and discovering that a will fails to provide for you can add a layer of distress and confusion. In New Zealand, the law recognises that while people should have the freedom to choose how their assets are distributed, they also have a moral duty to provide for those closest to them. When this duty is breached, the Family Protection Act 1955 provides a legal pathway to seek a fairer outcome.

At PK Law, we regularly advise on wills and estate disputes , helping clients understand whether they have a valid claim or assisting executors in managing a challenge. Our focus is on providing clear, empathetic guidance during what is often a highly charged time for families. Whether you have been excluded from a will or left with an amount that feels inadequate, understanding your rights is the first step toward resolution.

What is the Family Protection Act 1955?

The Family Protection Act 1955 is a piece of legislation designed to ensure that a deceased person provides proper maintenance and support for certain family members. It allows the High Court or Family Court to intervene if a will, or the default rules of intestacy, fails to meet this requirement. The core of any claim under this Act is proving that the deceased breached their moral duty to the claimant.

A breach of moral duty occurs when the provision made for a family member is insufficient given their needs and the size of the estate. The court considers several factors when deciding if a breach has occurred, including the claimant’s financial position, their age, their health, and the nature of their relationship with the deceased.

Who is eligible to contest a will?

The right to claim under the Family Protection Act is restricted to specific categories of relatives. This includes a spouse, civil union partner, or de facto partner who was living with the deceased at the time of death. Children of the deceased, including adult children, also have a right to claim. In some cases, grandchildren, stepchildren who were being maintained by the deceased, and parents may also be eligible if they can demonstrate a need for maintenance and support.

Before you can assess the fairness of a will, you must first see the document. In our experience, many people wrongly assume they have an automatic right to a copy of a relative's will immediately upon their passing. We have provided a detailed explanation of who has the right to see or request a copy of a will to help you navigate these early procedural hurdles. Once the terms of the will are clear, we can help you determine if the provision made for you aligns with the deceased's legal obligations.

The critical importance of timing

Time is of the essence when it comes to estate disputes. The law sets a strict deadline for filing a claim under the Family Protection Act. Generally, a claim must be filed within 12 months of the grant of administration. The grant of administration is the formal court order, such as probate, that authorises the executor to deal with the estate assets.

While the 12 month limit is the statutory rule, practical risks emerge much earlier. Executors are entitled to distribute an estate after six months from the date of grant of probate if they have not received a formal notice of a claim. If the assets have already been distributed to other beneficiaries, it becomes significantly more difficult, and sometimes impossible, to recover them. We always recommend seeking legal advice the moment you suspect a will may be unfair to ensure your interests are protected before the estate is wound up.

Why intestacy often leads to disputes

Disputes do not only arise when there is a written will. When someone dies without a valid will, they are said to have died intestate. In these cases, the Administration Act 1969 dictates how the assets are shared. These default rules are rigid and often produce outcomes that the deceased never intended, frequently leading to financial strain for the surviving partner.

For example, if a person dies intestate leaving a partner and children, the partner receives all personal chattels and a statutory legacy of $155,000. However, the partner only receives one third of the remaining estate, while the children take the other two thirds. This structure can create immediate hardship for a surviving spouse who may need those funds for their own housing and daily living costs. We discuss these risks further in our ultimate guide to NZ wills and estates , which highlights why a professionally drafted will is the best way to avoid such rigid outcomes. If you find yourself in this situation, a Family Protection Act claim can be used to ask the court to adjust these statutory shares to better provide for your needs.

How the court decides on a claim

The court does not aim for equal distribution among all family members. Instead, it focuses on whether the deceased met their obligation to provide proper maintenance and support. For adult children, this often means showing a financial need or a specific disadvantage. The focus remains on the claimant's actual circumstances rather than a mere expectation of receiving an equal share to their siblings.

When we review a potential claim, we look at the size of the estate and the competing claims of other beneficiaries. A large estate may allow for more generous provision, whereas a small estate may only allow for the most basic needs to be met. The court also considers any conduct by the claimant that might reduce the deceased's moral duty, such as a long term estrangement without justification. Our role is to help you weigh these factors early so you can make an informed decision about whether to proceed with a claim.

Seeking resolution without the High Court

While the law provides a path to court, we believe that litigation should be the final resort. High Court proceedings are expensive, time consuming, and can permanently damage family relationships. We focus on early assessment and negotiated settlements wherever possible. Mediation is often a highly effective tool in estate disputes, allowing families to reach a compromise in a private, less adversarial setting.

We act for both family members seeking provision and for executors who find themselves under pressure from potential claimants. Executors have a duty to defend the will but also a responsibility to act reasonably. We help executors assess the strength of a claim and determine when a settlement might be in the best interests of the estate as a whole. If a settlement cannot be reached, we provide robust representation in court to ensure the matter is resolved fairly.

Next steps and clear pricing

If you believe you have been unfairly treated in a will, or if you are an executor facing a potential challenge, getting expert advice early is essential.

Taking action to contest a will is a significant step, but you do not have to navigate it alone. We are here to provide the steady, professional support you need to reach a fair resolution.

_Disclaimer: This article provides general information only and does not constitute legal advice. Estate law is complex and depends on individual circumstances. Please consult with a legal professional regarding your specific situation._

The 7 Biggest Mistakes New Zealanders Make With Their Wills

Mon, 18 May 2026 05:00:48 GMT

Seven Critical Mistakes New Zealanders Make With Their Will and Estate Administration

Key Takeaways

Almost half of New Zealand adults currently lack a valid will, leaving their estate to be distributed by rigid government formulas rather than personal choice.
Failing to appoint a testamentary guardian is a common oversight that leaves the care of minor children to the discretion of the Family Court.
The Administration Act 1969 dictates asset distribution when no will exists, often resulting in a spouse receiving less than expected if there are children or parents involved.
DIY wills frequently fail due to incorrect witnessing or ambiguous wording, leading to expensive High Court applications to validate the document.
Digital assets and cross-border property require specific legal structuring to avoid frozen accounts and double taxation across different jurisdictions.

In our experience at PK Law, we see many families arrive at our office during the most difficult times of their lives, only to find that a simple mistake in a will has made a hard situation much worse. Most New Zealanders understand that they need a will, yet there is a significant gap between intention and action. We often hear people say they will get around to it when they are older, when they have more money, or when their family situation settles down. The reality is that life rarely waits for the perfect moment.

Recent research highlights the scale of this issue. In 2024, data cited by 1News found that almost half of New Zealand adults (47%) do not have a will . Even more concerning is that two-thirds of parents have not appointed a legal guardian for their children. This means that for nearly half of our population, the state, rather than the individual, decides how their legacy is handled. Whether you are a business owner in Auckland or a retiree in Napier, these mistakes carry heavy financial and emotional consequences.

Mistake 1: Assuming You Do Not Need a Will Yet

The most common mistake we observe is the belief that a will is only for the wealthy or the elderly. Many people assume that because they do not own a house or have a large investment portfolio, their estate is too small to worry about. However, New Zealand law has a very specific threshold. If you have more than $40,000 in any single institution, such as a bank account or a KiwiSaver fund, your family must apply for a grant of probate or letters of administration to access those funds.

Without a will, your family faces a court-driven process that is both slower and more expensive than standard probate. We recommend that anyone with more than $40,000 in savings, a life insurance policy, or a KiwiSaver account should have a professionally drafted document in place. At PK Law, we provide fixed fee Wills to ensure that getting this protection is straightforward and transparent. Waiting until you have more assets often means leaving your current assets in a state of legal limbo.

Mistake 2: Failing to Appoint Guardians for Your Children

For parents, a will is about much more than money. It is the only legal mechanism you have to nominate who should care for your children if you are no longer there. As noted in the 1News report, two-thirds of New Zealand parents have failed to appoint a testamentary guardian. A testamentary guardian is a person you choose to step into your shoes to make the big life decisions for your children, such as where they live and where they go to school.

If you die without appointing a guardian, the Family Court may have to decide who takes on that role. This can lead to conflict between well-meaning family members and causes unnecessary stress for children who are already grieving. We suggest discussing this role with your chosen person before naming them in your will to ensure they are willing and able to take on the responsibility. This simple step provides immense peace of mind for young families.

Mistake 3: Assuming Everything Automatically Goes to Your Partner

A dangerous misconception we frequently encounter is the idea that a spouse or de facto partner will automatically inherit everything. If you die without a will, you die "intestate," and your estate is distributed according to the Administration Act 1969. The Act uses a rigid formula that rarely aligns with what people actually want. For example, if you have a partner and children, your partner does not get everything. Instead, the partner receives the personal effects, the first $155,000 of the estate, and only one-third of the remainder. The other two-thirds are divided among your children.

This can create a situation where a surviving partner is forced to sell the family home to pay out the children's shares (this is particularly problematic when there are children from a previous relationship) . Understanding why it is important to have a will in New Zealand is often about protecting your partner from these unintended legal consequences.

Who is Most at Risk?

The lack of estate planning is not spread evenly across our communities. A survey by the Commission for Financial Capability of 2,000 New Zealanders found that only 47% of New Zealanders had a will . The breakdown shows that 44% of women have a will compared to 51% of men. There are also significant differences in uptake across different ethnicities. Only 53% of Europeans have a will, and that number drops to 31% for Māori, 25% for Asian, and 20% for Pasifika New Zealanders. These groups are statistically more likely to face the complexities of the intestacy regime, which can be particularly challenging for large, extended, or blended families.

Mistake 4: Failing to Update Your Will After Major Life Events

A will is not a document you write once and then forget for thirty years. We recommend that you review your will every three to five years, or whenever a major life event occurs. In New Zealand, certain life changes have an immediate legal effect on your will. For instance, getting married or entering a civil union automatically revokes any existing will unless the will specifically states it was made in contemplation of that marriage. If you forget to update your will after your wedding, you are effectively back to having no will at all.

Conversely, a divorce or the dissolution of a marriage does not automatically cancel your entire will, but it does remove your ex-spouse as an executor and cancels any gifts to them. However, a separation does not have this same effect. If you separate but have not yet legally dissolved the marriage, your ex-partner could still inherit according to a will you wrote years ago. Other triggers for an update include buying a property, starting a business, or the birth of a grandchild. Keeping your will current ensures it reflects your actual life, not a version of your life from a decade ago.

Mistake 5: Getting the Signing and Witnessing Wrong

The Wills Act 2007 sets out very strict formal requirements for a will to be valid. It must be in writing, signed by the will-maker, and witnessed by at least two people who are both present at the same time the will is signed. A common and devastating mistake is having a beneficiary (someone who is receiving a gift in the will) or their spouse act as a witness. Under New Zealand law, if a beneficiary witnesses the will, the will itself remains valid, but the gift to that witness is void. They get nothing.

We have seen cases where a friend or relative was asked to witness a document as a matter of convenience, only to find out later that they lost their entire inheritance because of it. While the High Court has the power to declare a defective will valid, this requires a specific and expensive legal application. It is much safer to ensure the formalities are handled correctly the first time. Our guide to protecting your legacy provides more detail on these formal requirements to help you avoid these technical traps.

Mistake 6: Overlooking Digital Assets and Online Accounts

In the modern era, our lives are increasingly stored online. This includes everything from social media accounts and digital photos to cryptocurrencies and online business accounts. Many traditional wills focus entirely on physical assets like jewellery and real estate, completely ignoring the digital world. This is a mistake because digital assets can have both high sentimental value and significant financial worth. If your executor does not know these assets exist or does not have the authority to access them, they may be lost forever.

We advise our clients to include specific provisions for their digital life. This involves identifying what you own and providing instructions on how you want those accounts handled. For example, do you want your Facebook page memorialised or deleted? Who should have access to your cloud-stored family photos? Dealing with these items requires a proactive approach. You can find more information on how to deal with digital assets and memories in your will through our specialised resources. Including these in your planning prevents your digital legacy from becoming a source of frustration for your family.

Mistake 7: DIY Wills and Ambiguous Wording

The rise of online wills and DIY kits has made it easier to create a document, but it has also increased the risk of errors. While these kits can work for very simple situations, they often fail to account for the complexities of New Zealand law, especially regarding the Family Protection Act 1955. This Act allows certain family members to claim against an estate if they feel they have not been "adequately provided for." If you want to exclude someone who would normally expect to inherit, a DIY will is rarely enough to protect your wishes.

Ambiguous language is another major pitfall. Phrases that seem clear to a layperson, such as "I leave my money to my friends," can be legally meaningless. Which friends? In what proportions? Does "money" include your shares or just your cash? These ambiguities lead directly to estate disputes. In our practice, we frequently advise on Family Protection Act and other estate claims that arise from simple will mistakes. If you find yourself in a situation where a will is being challenged,we can provide the necessary guidance. A professionally prepared will is an investment in preventing these costly legal battles.

The Real Cost of Dying Without a Will

Dying without a will is significantly more complex than the alternative. When there is no will, your family must apply for "Letters of Administration" rather than "Probate." This process requires additional searches to prove that no will exists and often requires independent legal advice for different family members to ensure the intestacy formula is applied correctly. In our experience, these applications take at least three weeks longer to be ready for the High Court than a standard probate application. During this time, your assets remain frozen. Your family cannot sell your house, access your bank accounts, or manage your investments. This delay can cause genuine financial hardship, especially if the deceased was the primary breadwinner.

Understanding the Costs of Professional Wills

We believe in transparency when it comes to legal fees. The cost of a will should reflect its complexity, ensuring you get the right level of advice for your specific situation. Our pricing structure is designed to be clear from the start.

For a Will at Complexity Level 1, which covers individuals without blended families or complex assets like trusts and businesses, the cost is $750.00 + GST. For a couple in the same situation, the fee is $1,400.00 + GST. If your situation involves a blended family, interests in a trust, or digital assets, this falls under Complexity Level 2, priced at $1,100.00 + GST for an individual or $2,000.00 + GST for a couple.

More complex cases involving donor capacity issues or a combination of many factors are Level 3, costing $2,000.00 + GST for an individual or $3,500.00 + GST for a couple. For those with international lives, our Cross-Border Assets service (Level 4) ranges from $2,000 to $3,000 + GST. This involves specialist domicile advice and liaising with overseas practitioners to ensure your assets in multiple countries are protected. We also offer an initial "Your Will, Your Way" consultation for $500.00 + GST. If you choose to proceed with a will, this cost is included in the final price. If you decide not to move forward, the fee is $500 + GST.

The Role of Enduring Power of Attorney (EPA)

While a will deals with what happens after you pass away, an Enduring Power of Attorney (EPA) is just as important for while you are alive. An EPA is a legal document that appoints someone you trust to make decisions for you if you lose the mental capacity to make them yourself. There are two types: one for Property and one for Personal Care and Welfare. Without these in place, your family may have to apply to the Family Court for the power to act on your behalf, which is a slow and invasive process. We often suggest that clients prepare their EPAs at the same time as their will to ensure full protection.

Common Questions About NZ Wills

Can you write a will without a lawyer in NZ?

You can legally write your own will in New Zealand, but it is risky. The High Court requires strict adherence to the Wills Act 2007. Any error in witnessing, signing, or wording can lead to the will being declared invalid. Given that the intergenerational wealth transfer in New Zealand is projected to reach $1.6 trillion by 2050, the risks of a DIY error are higher than ever. A lawyer ensures that your document is robust and will actually stand up in court if challenged.

What is the biggest mistake in drafting a will?

The biggest mistake is lack of clarity. Using vague terms or failing to account for what happens if a beneficiary dies before you can lead to the estate being administered in a way you never intended. Another major error is failing to consider how assets held in a family trust or joint tenancy interact with the will. Many people do not realise that jointly owned property often passes automatically to the survivor, regardless of what the will says.

Do all wills in NZ have to go through probate?

Not all wills require probate, but most do. If the deceased owned land or had more than $40,000 in any one institution, a grant of probate from the High Court is required. This grant gives the executor the legal authority to deal with the estate. If the estate is very small and does not include land, the executor may be able to administer the estate without a formal grant.

Taking the Next Step

Creating a will is one of the kindest things you can do for your family. It provides them with a clear roadmap during a time of grief and ensures that your hard-earned assets go to the people and causes you care about. Whether you need a simple document or a complex cross-border strategy, we are here to provide practical, steady advice. We pride ourselves on being straightforward and helping you achieve long-term peace of mind. If you are ready to protect your legacy, we invite you to contact us to discuss how we can help you get your affairs in order.

_Disclaimer: This article provides general information only and does not constitute legal advice. Estate law is complex and depends on individual circumstances. You should always consult with a qualified legal professional before making decisions about your will or estate planning.

New Zealand Trust Law: A Framework for Modern Asset Protection

Tue, 31 Mar 2026 22:24:58 GMT

Modern Trust Law in New Zealand: Protecting Assets and Navigating Tax Changes

Key Takeaways

The Trusts Act 2019 codifies trustee duties and requires greater transparency with beneficiaries.
Trustee income over $10,000 is now taxed at a 39 percent rate as of April 2024.
New Zealand remains a high-trust jurisdiction with an estimated 300,000 to 500,000 active trusts.
Regular reviews are essential to ensure trusts withstand relationship property and creditor claims.
Professional governance is the primary factor in maintaining a trust's legal integrity.

New Zealand has long held a unique relationship with trusts. For a population of about 5 million people, it is estimated that we have between 300,000 and 500,000 trusts. This high volume shows that sophisticated asset planning is a mainstream priority for Kiwi families, rather than something reserved for the ultra-wealthy. However, the landscape has shifted. The introduction of the Trusts Act 2019 and recent tax reforms mean that the old "set and forget" mentality is now a significant risk.

Recent data from Inland Revenue highlights the sheer scale of wealth involved. In the 2024 tax year, income from IR6 returns (the income tax return specifically for an estate or trust) totalled $47.3 billion. Trustee income, which is the income retained by the trust rather than paid out to beneficiaries, increased 167.5 percent to $40.6 billion. Dividends received by trusts also jumped 194 percent to $39.1 billion. These figures, updated by Inland Revenue , show how active trustees have become in the face of a rising tax rate.

The Impact of the 39 Percent Trustee Tax Rate

The most significant recent change for many of our clients is the increase in the trustee tax rate. From 1 April 2024, the tax rate for trustee income rose from 33 percent to 39 percent. This change aligns the trustee rate with the top personal tax rate, a move designed to reduce the use of trusts as a way to lower tax obligations. According to Deloitte , this shift affects approximately 400,000 trusts across the country.

There is some relief for smaller trusts. A 33 percent rate still applies to trustee income up to $10,000 after expenses. This threshold helps many "ordinary" family trusts that hold a family home and perhaps a small amount of savings. However, for those with significant investment portfolios or commercial assets, the 39 percent rate demands a more deliberate approach to income allocation. We often see clients needing to carefully balance retaining funds for trust growth against distributing income to beneficiaries in lower tax brackets.

Understanding the Trusts Act 2019

The Trusts Act 2019, which came into full effect on 30 January 2021, represents the first major overhaul of New Zealand trust law in over 60 years. It provides a much clearer framework for how trusts must be run. One of the most important changes is the codification of trustee duties. These are divided into mandatory duties, which cannot be changed by the trust deed, and default duties, which apply unless the deed specifically says otherwise. The Act also extended the maximum life of a trust from 80 years to 125 years, allowing for much better intergenerational planning.

In our experience, the biggest practical challenge under the new Act is the obligation to provide information to beneficiaries. Trustees now have a positive duty to consider what information should be shared so that beneficiaries can hold them accountable. This shift towards transparency means that "secret" trusts are a thing of the past. We have seen that robust documentation and clear communication are now the hallmarks of a healthy trust. Our team focuses on providing practical, not over-complicated, solutions for trusts and personal asset planning to help you meet these modern standards.

Is Your Trust Still Fit for Purpose?

A common mistake we observe is assuming a trust set up twenty years ago will still protect you today. Relationship property law and creditor protection rules have evolved alongside the Trusts Act. If a trust is seen as an "alter ego" of the settlor (the person who created the trust) or if it was established specifically to defeat the rights of a partner under the Property (Relationships) Act 1976, the courts can look through the structure. This makes the quality of your trust deed and the record of your decision-making more important than ever.

We believe that every trust should undergo a regular "fitness test." This involves reviewing the deed to ensure it allows for modern investment strategies and checking that all trustee resolutions are up to date. We have published several articles on these complex areas, including pieces on fiduciary duties, disclosure and trust variations . These resources examine how the courts are interpreting the new law, including the extent of disclosure required for beneficiaries and how variations can be made even if they might seem detrimental to some parties.

Practical Steps and Costs for Trust Management

Managing a trust effectively does not have to be an administrative burden, but it does require professional guidance. We offer a range of fixed-fee services to provide certainty for our clients. For those who are unsure where they stand, we offer "The Trust Fix," a one-hour initial consultation for $650.00. This fee is credited back against the cost of any establishment or variation work you choose to proceed with. You can see our fixed-fee pricing for a full range of services, including trust set-up, reviews, and wind-ups.

Whether you are looking to protect a family home or manage a complex commercial portfolio, the goal is the same: peace of mind. By ensuring your trust is compliant with the Trusts Act 2019 and optimised for the current tax environment, you can focus on what matters most: your family's future.

_Disclaimer: This article provides general information only and does not constitute legal or financial advice. Trust law and tax regulations are complex and subject to change. You should seek independent professional advice tailored to your specific circumstances before making any decisions regarding trust structures or asset planning._

Securing Your Legacy: A Definitive Guide to Estate Planning & Administration in NZ

Mon, 09 Feb 2026 21:06:42 GMT

Estate Planning and Administration in New Zealand: Protecting Your Family and Legacy

New Zealand is currently entering a period of unprecedented wealth movement. Research from Public Trust and JBWere indicates that intergenerational inheritances are expected to rise from approximately $27 billion in 2024 to a staggering $1.6 trillion by 2050 . This massive shift represents the hard work of generations, yet a significant gap exists in how this wealth is protected. Current data shows that only about 50% of adult New Zealanders have a will, leaving a vast amount of assets vulnerable to rigid legal rules and potential family disputes.

At PK Law, we view estate planning as a critical risk management tool rather than a simple administrative task. In our experience, high-net-worth individuals and families benefit most from a strategy that integrates wills, trusts, and enduring powers of attorney into a cohesive plan. Whether you are managing a business in Auckland or planning for retirement in Christchurch, professional guidance ensures your assets reach the right people at the right time.

Key Takeaways

The intergenerational wealth transfer in New Zealand will reach $1.6 trillion by 2050, making proactive planning essential for family legacy.
As of late 2025, the probate threshold has increased to $40,000, affecting how many estates require formal High Court involvement.
Dying without a will triggers specific statutory formulas that often distribute assets in ways the deceased did not intend.
Enduring Powers of Attorney are vital for moving personal care and property if you lose the capacity to make decisions.

We provide expert estate administration support to help families navigate these requirements with confidence and clarity.

The Foundation of Your Plan: Why a Will Matters

A professionally drafted will serves as the cornerstone of your estate. It allows you to choose your executors, appoint guardians for your children, and specify exactly how your assets should be distributed. Without this document, your estate is subject to the Administration Act 1969. Under these rules, if you leave a partner and children, your partner receives personal chattels, a statutory legacy of $155,000, and only one-third of the remaining estate, while the other two-thirds goes to your children. This often creates financial hardship for a surviving spouse who may have expected to inherit everything.

We recommend reading our ultimate guide to NZ wills and estates to understand why dying without a will is so costly and complex. Beyond simple distribution, a will provides the opportunity for philanthropy. Currently, only 1.3% of inheritances in New Zealand are allocated to charities. Including a charitable bequest allows you to support causes you care about as part of your lasting legacy.

Wills Pricing at PK Law

We provide fixed-fee drafting to give you certainty. All prices exclude GST.

Will Complexity Level 1 (Individual): $650.00
Wills Complexity Level 1 (Couple): $1,100.00
Will Complexity Level 2 (Individual): $800.00 (Includes life interests, businesses, or blended families)
Will Complexity Level 2 (Couple): $1,450.00
Will Complexity Level 3 (Individual): $1,200.00 (Includes capacity issues or high complexity)
Will Complexity Level 3 (Couple): $2,200.00

Estate Administration and the 2025 Probate Changes

Estate administration is the practical process of dealing with a person's assets and debts after they pass away. A major change occurred on 24 September 2025, when the probate threshold increased from $15,000 to $40,000 . This means that if a deceased person holds more than $40,000 in assets in their sole name at any single institution, the executors must apply for a grant of probate from the High Court.

This change is particularly relevant because the average KiwiSaver balance is now $37,079. Many New Zealanders who consider their estates modest will find that their KiwiSaver alone pushes them over the $40,000 limit. The High Court process for probate and letters of administration in New Zealand typically takes up to a couple of months, during which time assets remain frozen. Proactive structuring and correct titling of assets can sometimes simplify this process for your loved ones.

Administration Costs

Probate Application (Level 1): $2,500.00 plus $269 High Court filing fee.
Letters of Administration (Level 1): $3,300.00 plus disbursements (filing fee, will search, and status of children search).
Complexity Level 2 Applications: From $4,500.
Complexity Level 3 (Contested cases): From $7,000.

Protecting Your Interests with Trusts and EPAs

New Zealand has a high rate of trust ownership, with estimates suggesting there are between 300,000 and 500,000 trusts for a population of five million. While New Zealand has no estate or inheritance taxes, the trustee tax rate increased to 39% on 1 April 2024. This makes expert review of your trust structures essential to ensure they remain fit for purpose.

Equally important are Enduring Powers of Attorney (EPAs). These documents appoint someone to make decisions on your behalf if you become unable to do so. We've seen many cases where a lack of EPAs forced families into slow and expensive Family Court applications to appoint welfare guardians or property managers. Obtaining expert elder law advice ensures you have both Personal Care and Welfare and Property EPAs in place before they are needed.

Trust and EPA Pricing

Simple Trust Setup: $1,950.00.
Complex Trust Setup: $2,450.00.
Simple EPA (Property + Personal, Individual): $1,000.00.
Simple EPA (Property + Personal, Couple): $1,800.00.
Complex EPA (Property + Personal, Couple): $2,300.00.

Navigating Cross-Border and Complex Estates

Many New Zealand families now hold assets overseas, such as retirement accounts in Australia or property in the UK. We provide cross-border estate administration services, working with international legal experts to ensure foreign assets are handled correctly. Managing these complexities requires a steady hand and a clear understanding of how different legal jurisdictions interact.

If a dispute arises during administration, such as a claim under the Family Protection Act, we offer an Estate Resolution consultation for $750.00. This includes a full document review and initial assessment to help you understand your position and the likely path forward.

The PK Law Approach to Your Legacy

We believe that effective estate planning is a final act of care for your family. Our role is to provide the reassurance that comes with knowing your affairs are in order. By combining technical expertise with an empathetic approach, we help you build a plan that protects your wealth and honours your wishes. Whether you are reviewing a long-standing trust or drafting your first will, we are here to provide the straightforward, professional guidance you need.

_Disclaimer: The information provided in this article is for general informational purposes only and does not constitute legal or financial advice. Laws regarding estate planning, trusts, and probate are subject to change, and individual circumstances vary significantly. You should consult with a qualified legal professional at PK Law to obtain advice tailored to your specific situation before making any decisions based on this content._

Elder Law in New Zealand: Protecting Rights, Health, and Wealth in Your Later Years

Mon, 29 Dec 2025 23:25:47 GMT

A Practical Guide to Elder Law in New Zealand: Estate Planning & Key Issues

Key Takeaways

Elder Law is a specialised legal field in New Zealand that addresses the unique needs of older adults, including estate planning, healthcare decisions, and long-term care.
Enduring Powers of Attorney (EPAs) are critical documents that allow you to appoint someone you trust to make decisions about your property and personal welfare if you lose mental capacity.
Comprehensive estate planning involves more than just a will; it can include trusts and other strategies to protect your assets and ensure your wishes are followed.
Moving into a retirement village involves signing an Occupation Rights Agreement, which requires careful legal review before you commit.
Proactive legal planning provides strong legal protections against potential elder abuse and financial exploitation.

Planning for the future takes on a new sense of urgency as we, or our parents, get older. And in New Zealand, this conversation is becoming more important than ever. Our country is experiencing a significant demographic shift. New Zealand's population aged 65 and over is projected to reach one million by 2028 and 1.5 million by 2050. That means a quarter of our population will be in their golden years.

This reality brings a unique set of legal questions and challenges to the forefront. It’s why having a clear understanding of Elder Law is so essential for families across the country. This isn't about planning for the worst. It's about planning for the best possible future, ensuring your wishes are respected and your loved ones are protected.

We have created this guide to walk you through the key issues, drawing on our first-hand experience helping families navigate this important stage of life with dignity and confidence.

What is Elder Law in NZ?

Elder Law is a specialist area of law focused entirely on the legal needs of older New Zealanders and their families. It acknowledges that as we age, our legal requirements change. It covers a wide range of topics, from managing your assets and planning your estate to making decisions about your future healthcare and living arrangements. It’s about protecting your autonomy and ensuring you have the right legal protections in place for your later life.

The New Zealand Law convergence notes that as life expectancy increases, "Retirement is no longer just a short phase of life before death, and that changes everything." This shift impacts how people manage assets, plan for care, and structure their estate. As a result, the demand for clear, empathetic legal advice is growing. In fact, recent industry reports show that transactional work, which includes many elder law practice areas, grew by 2.1% in 2024 , reflecting this increased need.

The Cornerstones of Future-Proofing: Wills and EPAs

In our experience, the two most powerful tools for planning your future are a well-drafted will and properly established Enduring Powers of Attorney (EPAs). These documents form the foundation of any solid estate plan.

Wills and Estate Planning

A will is the instruction manual for your estate after you pass away. It details who should receive your assets and who you want to be in charge of carrying out your wishes. Without one, the law decides for you, which can lead to family disputes and outcomes you never intended.

But modern estate planning goes beyond just a will. For many, it also involves considering trusts to protect assets for future generations. We provide tailored legal solutions for personal asset planning, helping you create a structure that works for your unique family situation. The first step, however, is always ensuring you have a clear and legally sound will. Our approach to modern, fixed-fee Will drafting makes this crucial process straightforward and accessible.

Enduring Powers of Attorney (EPAs): Your Voice When You Can't Speak

What happens if you become mentally incapacitated through illness or injury and can't manage your own affairs? This is where Enduring Powers of Attorney, or EPAs, become absolutely critical.

There are two types in New Zealand:

EPA for Property: This allows your chosen person (your 'attorney') to manage your financial affairs, like paying bills or selling your house.
EPA for Personal Care and Welfare: This allows your attorney to make decisions about your health and wellbeing, such as where you live and the type of medical care you receive.

We've seen families face immense stress when a loved one becomes mentally incapacitated without EPAs in place. They are forced into a costly and slow application to the court to have a welfare guardian or property manager appointed. Setting up EPAs ahead of time ensures that someone you trust, who knows your values, can step in immediately to act in your best interests.

Navigating Long-Term Care Options

Deciding on future living arrangements is a major life decision with significant legal and financial implications. Whether considering downsizing your home, moving into a retirement village, or requiring rest home care, getting advice is key.

Retirement Villages and Occupation Right Agreements

Buying into a retirement village is different from a standard property purchase. You are typically not buying the property itself, but an 'Occupation Right Agreement' (ORA). This is a complex legal contract that gives you the right to live in a unit and use the village facilities.

A common mistake we observe is people signing these agreements without fully understanding the terms, especially around fees, transfer clauses, and what happens when they leave the village. These documents are long and full of legal terminology. It is absolutely essential to have them reviewed by a lawyer who understands the specific legal landscape of retirement villages.

Residential Care and Subsidies

If you or a loved one needs a higher level of care, like that offered in a rest home or hospital, you may be able to get financial help from the government’s residential care subsidy. However, eligibility for this subsidy is means-tested against strict asset and income thresholds. The rules around gifting to a family trust and what assets are counted are complex. Planning ahead with expert advice can help you understand your eligibility and navigate the application process.

Protecting Vulnerable Loved Ones: Elder Abuse and Financial Exploitation

It’s a difficult topic, but one we must address. Elder abuse, particularly financial abuse, is a growing concern. This can range from pressure to change a will to the misuse of funds by someone in a position of trust. Having clear legal structures in place is one of the strongest defences. A properly established EPA, for instance, creates legal duties for the person you appoint and a clear framework for how your personal affairs should be managed. It creates accountability and reduces the opportunity for exploitation.

Why You Need Specialist Elder Law Advice

Elder Law touches on some of the most personal aspects of our lives. It requires not only legal expertise but also sensitivity and understanding. As a firm, we are experienced in dealing with elderly clients. Our service model allows us to cater for elderly clients in a way that traditional law firms are not able to.

Whether you're just starting to think about estate planning, need to review an ORA for a retirement village, or are helping your parents make these important decisions, getting the right advice is the best thing you can do. It provides peace of mind and ensures you and your family are prepared for the future. If you need help protecting your rights in later years, we're here to provide clear, compassionate, and expert elder law advice .

_Disclaimer: The information contained in this article is for general guidance and informational purposes only. It does not constitute legal advice. You should not act or refrain from acting based on this information without first seeking specific professional legal advice._

Prenup Power: 5 Reasons Why You Need a Contracting Out Agreement

Mon, 01 Dec 2025 02:15:14 GMT

Prenups in New Zealand: 5 Reasons to Consider a Contracting Out Agreement

Key Takeaways

In New Zealand, a "prenup" is legally known as a Contracting Out Agreement (COA), which allows you to define how property is divided, opting out of the default 50/50 split.
A COA is crucial for protecting assets you owned before the relationship, as well as future inheritances and gifts, ensuring they remain your separate property.
These agreements provide security for children from previous relationships by ring-fencing assets intended for them.
For a COA to be legally binding, it must be in writing, and both partners must receive independent legal advice before signing.
Thinking about a COA isn't about expecting a relationship to fail; it’s a practical step for financial clarity and mutual respect.

Talking about a "prenup" can feel uncomfortable. It often brings to mind dramatic movie scenes rather than sensible financial planning. But in our experience, reframing the conversation is the key. A Contracting Out Agreement, as it's known in New Zealand, is one of the most powerful tools available to a couple for creating certainty and protecting their future.

It’s not about planning for a breakup. It’s about starting a relationship with honesty and clarity.

New Zealand’s Property (Relationships) Act 1976 governs how assets are divided when a marriage, civil union, or de facto relationship ends. The default position is simple: equal sharing of all relationship property. While that sounds fair, it doesn't always account for individual circumstances. A Contracting Out Agreement (COA) allows you and your partner to set your own rules, creating a plan that truly reflects your unique situation.

Here are five key reasons we advise clients to consider one.

1. To Protect Your Separate Property

Perhaps you’ve worked hard to buy a house, build up savings, or establish an investment portfolio before your relationship began. It’s a common assumption that what you bring into a relationship remains yours. However, the law is more complex.

Under the Act, after a relationship of three years or more, assets that were once separate can become relaitonship property, making them subject to the 50/50 division rule. We’ve seen this happen when the family home was owned by one partner beforehand, or when separate funds are used for shared benefit.

A COA clearly defines which assets are to remain separate, no matter how long the relationship lasts. This provides absolute peace of mind and removes any ambiguity.

2. To Safeguard Inheritances and Gifts

An inheritance or a significant gift from family is usually intended for you alone. While the law generally treats inheritances as separate property, they can easily become mixed with relationship property. For example, if you use inherited money to pay down the mortgage on the family home or deposit it into a joint bank account, it risks being reclassified as a shared asset.

A Contracting Out Agreement can specify that all current and future inheritances or gifts will remain your separate property. This honours your family’s intentions and ensures these assets are protected. It’s a vital component of robust personal asset planning, especially for those with family trusts or complex estates. You can learn more about how this fits into a wider strategy on our page about Trusts and Personal Asset Planning .

3. To Provide for Children from a Previous Relationship

When you have children from a previous relationship, you also have a lifelong commitment to their financial security. Many of our clients want to ensure the assets they have built can be passed on to their children.

Without a COA, your property could be subject to division in a way that reduces what you can leave to them. An agreement allows you to ring-fence specific assets—like a property, savings, or investments—and designate them for your children. It’s a responsible and caring way to balance your commitment to a new partner with your obligations to your children.

4. To Create Certainty for Your Business

If you own a business, its value is often one of your most significant assets. During a relationship, the increase in that business's value, or even the entire business itself, can be classified as relationship property. A separation could lead to a claim against your business, potentially forcing a sale or causing major operational disruption.

We've observed that this is a major point of anxiety for entrepreneurs and business owners. A COA can explicitly define your business as separate property. This protects it from being divided and gives you the security to continue growing your business, confident that your hard work is protected.

5. To Gain Clarity and Reduce Future Conflict

Ultimately, a Contracting Out Agreement is about communication. The process requires you and your partner to have open and honest conversations about finances, expectations, and the future. Getting these topics on the table early on builds a foundation of trust and mutual understanding.

And if the relationship does end, the benefits are immense. The period after a separation is when the couples go through intense stress and expense. A COA removes the uncertainty. You’ve already made the difficult decisions in a calm and collaborative environment, saving you both emotional turmoil and significant legal costs down the line.

How to Make an Agreement Legally Binding

A casual chat or a handwritten note won't hold up. For a Contracting Out Agreement to be valid in New Zealand, you must follow strict legal requirements.

In our practice, we ensure every detail is handled with precision. The agreement must be in writing and signed by both partners. Most importantly, each of you must receive independent legal advice from your own lawyer before you sign. Your lawyer's role is to explain the effects and implications of the agreement and certify that you understand it. This step is non-negotiable, without certification the agreement is not legally binding.

It's also important to know that a court can set aside an agreement if it's deemed to cause a "serious injustice." That’s why we work carefully to draft agreements that are fair, thorough, and designed to stand the test of time.

Start the Conversation Today

A Contracting Out Agreement is a mature and proactive step towards building a strong relationship on a foundation of transparency. It allows you to define your own future rather than leaving it to the default provisions of the law.

If you’re considering a COA or want to understand more about relationship property law in NZ , we are here to help. Our team provides confidential, expert guidance to help you protect your assets and gain peace of mind. Contact us to discuss your situation and see how we can assist you with your relationship property needs.

_Disclaimer: The information contained in this article is for general guidance only and is not a substitute for legal advice. You should speak to a qualified professional to discuss your unique circumstances._

The NZ Relationship Property Act: Defining Your Assets, Rights, and Future

Fri, 07 Nov 2025 21:31:02 GMT

A Practical Guide to the Property (Relationships) Act 1976

Key Takeaways

The Property (Relationships) Act 1976 is the primary law governing how property is divided when a qualifying relationship of three or more years ends in New Zealand.
The starting point for division is a 50/50 split of all 'relationship property', which includes the family home, joint assets, and income earned during the relationship.
Property is classified as either 'relationship' (shared) or 'separate' (owned by one partner), though separate property can become relationship property over time.
Couples can enter into a 'Contracting Out Agreement' (or 'prenup') to set their own rules for property division, bypassing the Act's default 50/50 rule.
Recent court decisions mean that assets held in trusts are facing greater scrutiny, making specialist legal advice more important than ever.

The end of a relationship is one of life’s most stressful events. Amid the emotional turmoil, the last thing anyone wants is a confusing and contentious process for dividing assets. Yet, in our experience, this is exactly what many people face. We believe that understanding your rights and obligations is the first step toward gaining clarity and control during a difficult time.

While it might feel like a distant problem, the reality is that many long-term relationships end. In 2024 alone, there were 7,497 divorces granted in New Zealand. And for every one of those, there are countless de facto relationships that also come to an end. This is where the Property (Relationships) Act 1976 comes in.

The Act provides the legal framework for dividing a couple's property. Its purpose is to recognise the equal contributions, both financial and non-financial, that each partner makes to a relationship. This guide is designed to walk you through the core principles of the Act, helping you understand what it means for you and your family.

What is a 'Qualifying Relationship' Under the Act?

The Act applies to couples who are married or a civil union and to a qualifying de facto relationship. For the Act to apply to a relationship, the relationship generally needs to have lasted for three years or more. If your relationship is shorter than three years and you have children with your partner or made a substantial contribution (whether financial or non-financial), you may still have a claim, but the division of property is often handled differently and is not presumed to be 50/50.

A de facto relationship is defined as two people over 18 living together as a couple. The court looks at various factors to determine if a de facto relationship exists, such as the duration of the relationship, the degree of financial interdependence, and whether you present publicly as a couple. It’s not always black and white, and we’ve seen cases where one partner was surprised to learn their relationship met the legal threshold.

Relationship Property vs. Separate Property: What's the Difference?

The Act splits property into two main categories. Understanding this distinction is fundamental.

Relationship property is the pool of assets to be shared. It typically includes:

The family home, regardless of whose name it is in.
All family chattels (furniture, appliances, vehicles, etc.).
Any property owned jointly by the couple.
Income earned and property acquired by either partner during the relationship.
Increases in the value of superannuation or KiwiSaver schemes during the relationship.

Separate property , on the other hand, belongs to one partner individually. This usually covers inheritances, gifts made to one partner, and assets owned before the relationship began. However, a common mistake we observe is assuming separate property will always remain separate. If you use an inheritance to pay down the mortgage on the family home, for instance, that money becomes "intermingled" and is likely to be classified as relationship property.

The 50/50 Rule: Is It Always an Equal Split?

For qualifying relationships of three years or more, the Act presumes an equal 50/50 division of all relationship property. This is a crucial point. The law explicitly recognises that non-financial contributions—like caring for children, managing the household, or supporting a partner's career—are just as valuable as bringing in an income. It’s a fair principle that prevents one partner from being disadvantaged simply because they weren't the primary earner.

This equal sharing applies to debts as well as assets. If a couple took out a joint loan to buy a car, that debt is also part of the relationship property pool to be divided.

There are rare exceptions where a court might order an unequal division, but the bar is very high. It requires "extraordinary circumstances" that make equal sharing "repugnant to justice." These are few and far between.

Can We Make Our Own Rules? Understanding Contracting Out Agreements

Yes, you can. The Act isn't a one-size-fits-all mandate. Under Section 21 of the Act, couples can "contract out" of the default rules by creating their own legally binding agreement. Commonly known as a "prenup," a Contracting Out Agreement allows you to define what is relationship property and what is separate property, and how it would be divided if you separate.

We often recommend these agreements for individuals entering a new relationship with significant personal assets, business owners, or those in second marriages. It’s not about anticipating failure; it’s about creating certainty and protecting both parties. A well-drafted agreement provides peace of mind and can save a huge amount of stress and expense down the track. Costs for these services can vary depending on the complexity of your assets, but the investment upfront is minimal compared to the potential cost of a dispute later.

The Elephant in the Room: How Are Trusts Treated?

For many of our clients, particularly those with significant assets, trusts are the biggest source of concern. Historically, trusts have been a primary vehicle for asset protection. Many people use them to structure their affairs to shield assets from future relationship property claims or other creditor claims . But the legal landscape is changing.

The courts are increasingly willing to look through trust structures. A landmark 2025 Supreme Court in Lassnig v Zhou [2025] NZSC 116 is a recent example of how courts treat a settlement made on a trust by the parties to a short term relationship. Although both parties were beneficiaries and trustees in a trust which held their family home, on separation, the court ruled on a 80/20 division in favour of Ms Zhou because her total contribution exceeded that of Mr Lassnig approximately five times. Had the parties entered into a contracting out agreement protecting Ms Zhou’s interests, she would not have needed to go through court to receive in order to achieve the outcome she was after. In short, simply having your assets in a trust is no longer a guaranteed shield. This is where our specialist knowledge of trust law gives us an ultimate advantage when advising on relationship property matters. We understand the nuances and can provide clear advice on how your trust might be viewed by a court.

Why Specialist Legal Advice is Non-Negotiable

The law in this area is constantly being updated by the courts to deal with modern life. We are now seeing claims over intangible assets that barely existed when the Act was written. For our latest analysis on recent Supreme Court rulings, including cases on everything from family trusts to the division of copyright in artwork , you can browse our publications.

Ending a relationship is hard enough. Trying to sort out your financial future based on guesswork or outdated information only adds to the pain. We believe in a holistic approach. That is why we partner with professionals like divorce coaches to support your emotional wellbeing and offer flexible funding solutions through JustFund to ease the financial pressure.

If you're facing separation or want to proactively protect your assets for the future, the first step is a conversation. To understand how we can help, particularly if a trust is involved, learn more about our dedicated relationship property services .

_Disclaimer: The information contained in this article is for general informational purposes only and does not constitute legal advice. It is not a substitute for obtaining legal advice from a qualified professional. You should not act or refrain from acting based on this information without first seeking specific legal advice tailored to your unique situation._

NZ Wills & Estates: Your Ultimate Guide to Protecting Your Legacy

Mon, 03 Nov 2025 01:03:54 GMT

Why Having a Will in New Zealand Isn't Optional

Key Takeaways

Dying without a will (intestacy) forces your estate through a costly and complex legal process governed by rigid, often unsuitable government rules.
A valid will is your only way to control who inherits your assets, appoint guardians for your children, and protect your loved ones from disputes.
For a will to be valid in New Zealand, it must be in writing, signed by the will-maker, and witnessed by two people who are not beneficiaries.
A will is a private document until the will-maker's death. Afterwards, the executor controls access, and there is no formal "reading of the will." Once a probate of a will is obtained, anyone can a request a copy of the will from the registry of the High Court.

Many people think of a will as a document that is only about death. We see it differently. A will is one of the most important documents you will ever create. It's a final act of care for the people you leave behind, providing clarity and security at a difficult time.

It's not something to put off. In our experience, the consequences of not having a professionally drafted will are far more severe than most people realise. It creates a legacy of stress, cost, and unintended outcomes for your family.

The High Cost of Dying Without a Will (Intestacy)

When a person dies without a valid will, they are said to have died "intestate." This doesn't just mean your assets are frozen; it means you have surrendered all control over your estate to a rigid legal formula.

Instead of your chosen executor applying for a simple Grant of Probate, a person pursuant who is first in priority under the Administration Act 1969 must apply for "Letters of Administration." We've guided many families through this, and we can tell you it is almost always more complex, expensive, and time-consuming than the probate process. This happens at the worst possible time, adding a heavy administrative and financial burden to a grieving family.

You lose your voice. The law decides who gets what.

How Your Assets Are Divided by Default

The Administration Act 1969 sets out a strict hierarchy for who inherits your property if you die intestate. The rules are inflexible and often lead to results you would never have wanted.

For example, if you die leaving a spouse or partner and children, your partner does not automatically inherit everything. They receive all personal chattels, a statutory legacy of $155,000, and just one-third of the remaining estate. Your children receive the other two-thirds. For many families, this outcome can cause immediate financial hardship for the surviving partner.

The situation changes with different family structures. If you have a spouse or partner and living parents but no children, your partner receives the chattels, the $155,000 legacy, and two-thirds of the remainder. Your parents would then inherit the final one-third, which can be a complete shock to everyone involved.

And if you have no eligible relatives at all? Your entire estate passes to the Crown. Your friends, carers, or favourite charities get nothing.

Taking Control: What a Will Allows You to Do

A will is your instruction manual for the future. It replaces the government's rigid formula with your own clear directions, ensuring your legacy is handled exactly as you intend.

Appoint Guardians for Your Children

This is one of the most critical functions of a will for parents with young children. A will is the only legal document where you can nominate who you want to care for your children if you die. Without it, the decision falls to the Family Court, leaving your children's future uncertain during an already traumatic time.

Protect Your Loved Ones from Disputes

A vague or non-existent will is an invitation for conflict. We have seen families torn apart by arguments over who was promised what. A professionally drafted will provides absolute clarity, defines who your beneficiaries are, and appoints an executor you trust to carry out your wishes. This precision is the best defence against potential wills and estate disputes , saving your family from costly and emotionally draining legal battles.

A Note on Trusts and Wills

A common mistake we observe is people assuming that having a trust means they do not need a will. This is incorrect. While a trust is an excellent tool for managing specific assets, you will almost certainly have personal property that sits outside the trust. Your will is needed to manage these remaining assets. A comprehensive estate plan uses both documents working in concert, and our expertise in trusts and personal asset planning ensures they are structured correctly.

The Blueprint for Valid New Zealand Wills

Creating a will isn't just about writing down your wishes; it must comply with specific legal formalities to be legally binding. The Wills Act 2007 sets out these rules.

The Formal Requirements

For a standard will to be valid in New Zealand, it must meet three core conditions. It must be:

In writing.
Signed by you (the will-maker or testator).
Witnessed by at least two people who are both present with you at the time you sign.

It's absolutely critical that your witnesses are not beneficiaries of the will. If a beneficiary acts as a witness, any gift to them in the will is voided. This is a simple but costly mistake we've seen people make when they try to create a will without professional guidance.

Testamentary Capacity: A Crucial Element

For a will to be valid, the will-maker must have "testamentary capacity" at the time of signing. This means you must understand you are making a will, be aware of the assets you own, and appreciate who has a moral claim on your estate. As specialists in elder law and mental capacity , we understand the importance of carefully documenting capacity, especially when health is a concern, to protect the will from future challenges.

What if a Will Isn't Perfect? The High Court's Power

What happens if a document that looks like a will doesn't meet all the formal rules? The New Zealand High Court has the power under the Wills Act 2007 to declare it a valid will. This can happen if the court is satisfied that the document truly expresses the deceased person's wishes.

However, this is a legal remedy, not a plan. Relying on it means your estate will certainly face a court application, creating the very cost, delay, and stress you sought to avoid. Getting it right the first time is always the best approach.

Who Can See Your Will? Understanding Access and Confidentiality

The question of who has the right to see a will is a frequent source of confusion. The rules are strict and change significantly upon the will-maker's death.

While You Are Alive

It's simple. Your will is a completely private and confidential document. No one has the right to see it or demand a copy without your express permission. Not your spouse, not your children, not your bank. You, and only you, are in control.

After You Have Passed Away

Once you die, the will ceases to be private and becomes a legal document for administering your estate. The original is held by your executor, who now controls access to it.

The cinematic "reading of the will" where the family gathers in a lawyer's office is a myth in New Zealand. It doesn't happen. Instead, the executor is generally required to provide a copy of the will to the beneficiaries named in it. If an executor is uncooperative, a beneficiary can often obtain a copy once the will has been filed with the High Court for probate.

Your Will Is a Living Document

Your will isn't a "set and forget" document. It should be reviewed every few years, or whenever you experience a major life event like a marriage, separation, the birth of a child, or a significant change in your financial circumstances.

An outdated will can be just as problematic as having no will at all.

Treating your will as a direct path to your family's future security is the key to unlocking its value. It's an investment in peace of mind. Don't leave it to chance. Contact our team to ensure your wishes are protected with a professionally prepared, legally sound will.

Unsigned Will? New Zealand High Court Can Validate Your Loved One True Wishes!

Wed, 22 Oct 2025 04:23:12 GMT

Can an Unsigned Document Be Declared a Valid Will in New Zealand?

Key Takeaways

The High Court of New Zealand has the power to declare an unsigned or improperly witnessed document a valid will if it truly reflects the deceased's final wishes.
The court's primary focus is on the deceased's "testamentary intention," meaning the substance of their wishes outweighs technical errors in the document's creation.
Strong evidence is essential for a successful validation, including emails, notes, draft documents, and statements the deceased made to others.
Validation avoids the rigid asset distribution rules of intestacy, which apply when there is no will and often lead to outcomes the deceased would not have wanted.

What happens when a loved one passes away, leaving behind a document that looks like a will, feels like a will, but isn't signed? In the past, the answer was simple and often heartbreaking: the document was invalid. This would leave families facing a future that looked very different from what their loved one had intended.

Fortunately, the law has evolved.

Today, New Zealand law provides a vital pathway to honour a person's final wishes, even if they're recorded in an informal document. In our experience as estate specialists, this power can make all the difference, turning a potentially difficult situation into one that respects the deceased's true intentions.

The High Court's Power: A Focus on Intention, Not Formality

The key to this process lies in the Wills Act 2007. Section 14 of the Wills Act can be used to validate a Will even if it fails to meet the standard legal requirements, such as being signed and witnessed correctly.

The court's primary goal is to determine if the document genuinely expresses the person's final wishes for the distribution of their property. The court can look beyond the missing signature and ask, "Is this what they really wanted?"

What Happens Without a Valid Will? The Pitfalls of Intestacy

To understand why validating an informal will is so important, we need to look at the alternative: dying "intestate." This is the legal term for passing away without a valid will. When this happens, your estate is distributed according to a strict formula set out in the Administration Act 1969.

This formula doesn't account for your unique family dynamics, relationships, or specific wishes.

For example, if you die intestate leaving a partner and children, the law dictates a specific split. Your partner receives all personal chattels, a prescribed amount of $155,000, and one-third of the remaining estate. Your children receive the other two-thirds. We've seen this cause immense difficulty, especially where the family home makes up most of the estate's value, as it may force a sale to pay out the children's share.

This rigid outcome is often far from what the deceased would have wanted. This is why having a Will is so crucial, and why the court's power to validate an informal one is such a valuable tool.

Building a Case: The Importance of Strong Evidence

An application to the High Court isn't a rubber-stamping exercise. To convince a judge to validate an unsigned document, you must present compelling evidence that it represents the deceased's final wishes.

The court will consider a wide range of information. This includes the document itself, any evidence about its creation, statements of the deceased made about their intentions, and other related correspondence. A common mistake we have observed is assuming the document alone is enough. Context is everything.

We have seen many types of documents successfully validated, including:

Unsigned draft wills prepared by a solicitor
Handwritten notes or letters
Emails outlining distribution wishes
Instructions saved on a computer
Even suicide notes

The stronger and clearer the evidence of final intention, the higher the chance of success. This process is a crucial part of the overall estate administration journey, ensuring the estate is managed and distributed as it should be.

When is a 'Draft' Not Enough? The Risk of Unsettled Intentions

It's important to understand that validation is not guaranteed. The court must be satisfied that the deceased's intentions were final and settled, not just a work in progress.

A clear example of this is the case of Robinson v Beaman. Here, the deceased had sent an email to his solicitor with a draft will attached, describing it as "a start." Because he framed it as a preliminary step rather than a final decision, the court ruled that his testamentary intentions were not yet finalized. As a result, the document could not be validated.

This case highlights a critical point: if the evidence suggests the person was still thinking things over or planned to make further changes, the court will be reluctant to declare the document a valid will. Navigating these complexities is where expert guidance on wills and estate disputes becomes invaluable.

Does Time Matter? The Effect of Delay

A question we are often asked is whether a long delay between the creation of a document and the person's death weakens the case for validation. What if an unsigned will was drafted five or ten years before they passed away?

The answer is that time alone isn't necessarily a barrier. As long as there is no evidence to suggest the deceased changed their mind in the intervening years, the document can still be considered a valid expression of their final wishes. The court will look for any indication of a change in heart, but a simple lapse of time does not automatically invalidate the document's intent.

The Best Path Forward: Formalise Your Wishes

The High Court's power to validate an informal document is a crucial safety net. It provides a way to achieve fairness and honour a person's last wishes in difficult circumstances.

But it should be seen as just that—a safety net, not a substitute for proper planning.

The court application process can be time-consuming, costly, and add stress to an already grieving family. The surest way to protect your loved ones and ensure your wishes are carried out exactly as you intend is to create a formal, signed, and witnessed will with professional guidance.

Doing so gives you and your family peace of mind, knowing that everything is clear, legally sound, and ready to be acted upon without complication.

Navigating Family Law in Auckland: From Separation to Resolution

Wed, 08 Oct 2025 23:38:30 GMT

Auckland Family Lawyers: Expert Legal Advice for Your Family Matters

Key Takeaways

Family law covers a wide range of personal and financial matters, from relationship property to care of children.
Choosing an experienced family lawyer in Auckland offers crucial support and guidance during challenging times.
Understanding your rights and obligations, especially regarding relationship property and parenting agreements, is vital.
Mediation and out-of-court settlements are often preferred for achieving the best possible outcome.
Legal aid may be available to help with the costs of legal services in Auckland.

Facing a family law issue can feel overwhelming. Whether you're dealing with separation, relationship property, or concerns about your children, it's a deeply personal journey. We understand the emotional toll these situations can take, and our goal is to provide clear, empathetic, and expert legal advice to guide you through it.

In our experience, having the right legal support makes all the difference.

What Does a Family Lawyer in Auckland Do?

A family lawyer in Auckland provides comprehensive legal services for a wide array of family matters. This includes offering legal advice on relationship property, guiding you through separation and divorce, and assisting with care of children arrangements. We specialise in drafting various agreements, such as contracting out agreements (often called "pre-nuptial agreements") and separation agreements, to protect your interests.

Our role extends beyond just legal documents; we offer support and guidance through what can be one of the most challenging periods in your life. We combine legal expertise with care, ensuring you understand every step of the legal process. For instance, we've seen many family disputes resolved effectively through mediation, which often leads to more amicable and lasting solutions than court proceedings.

Navigating Relationship Property in New Zealand

One of the most common areas of family law we deal with is relationship property. In New Zealand, the Property (Relationships) Act 1976 generally dictates an equal division of relationship property after separation, regardless of who earned what. This can apply to married couples, civil union partners, and de facto couples.

We provide expert legal advice on identifying what constitutes relationship property versus separate property, and how best to divide assets like the family home, investments, and superannuation.

A common mistake we observe is couples trying to sort this out themselves without independent legal advice, only to find complications later. A well drafted contracting out agreement can prevent future disputes by clearly defining how assets will be divided if a relationship ends.

Care of Children: Prioritising Their Well-being

When relationships end, the care of children is often the most sensitive and important aspect to resolve. We assist parents in reaching agreements regarding day-to-day care and contact arrangements, aiming for solutions that provide stability and support for your children.

If an agreement cannot be reached through discussion or mediation, we can assist you with applying to the Family Court for parenting orders. With the assistance of the barristers we work with, we will guide you through this process, always advocating for arrangements that foster healthy relationships between children and both parents.

Contracting Out Agreements: Planning for the Future

A contracting out agreement is a proactive step many couples take to protect their individual assets, especially if one partner brings significantly more property into the relationship or has specific assets they wish to keep separate. This agreement sets out how your property will be divided if your relationship ends, overriding the standard 50/50 split under the Property (Relationships) Act.

Both parties must obtain independent legal advice before signing such an agreement. In our practice, we've seen how these agreements provide clarity and peace of mind, allowing couples to focus on their relationship without future financial anxieties looming.

How Much Does It Cost to Hire a Lawyer in NZ?

The cost of hiring a lawyer in NZ can vary significantly depending on the complexity of your legal matters, the amount of time required, and the experience of the lawyer. We believe in transparency and will discuss our fees with you upfront.

It's an investment in your future and peace of mind. We always strive to be pragmatic in our approach, looking for cost effective solutions wherever possible, such as through mediation before resorting to court proceedings.

Why Choose Our Auckland Family Lawyers?

When you're looking to find a lawyer, especially for something as personal as family matters, you need a team you can trust. Our firm, PK Law , has built a reputation for providing exceptional legal services in Auckland.

We are known for our empathetic approach, clear communication, and unwavering commitment to our clients.

We are relationship law specialists. We will work closely with you, offering expert legal advice tailored to your unique situation. We pride ourselves on our experience and expertise, ensuring you receive the best possible support and guidance throughout your legal journey. We understand that family matters require not only legal acumen but also a deep sense of care and discretion. That's why our team combines legal expertise with genuine care for your well-being.

Next Steps: Seeking Legal Advice

If you are confronted with a family law issue, the best first step is to seek expert legal advice. Don't let uncertainty add to your stress.

Contact us today for a confidential discussion about your situation. Our experienced family lawyers in Auckland are here to provide the support and guidance you need to achieve the best possible outcome for you and your family.

Supreme Court Clarifies Division of Family Trusts After Short Marriage

Tue, 23 Sep 2025 21:30:45 GMT

When couples set up a family trust during their relationship, the big question on separation is: what happens to those trust assets? The Supreme Court has just addressed this in Lassnig v Zhou [2025] NZSC 116, a case that turned on contributions, expectations, and a marriage that lasted less than three years.

Background

The couple married in 2012, separated in 2015, and set up the Lassnig Family Trust shortly after their wedding.
The Trust owned three properties, funded by both parties’ loans and mortgages.
Ms Zhou’s contributions (around $1.2m) far outweighed Mr Lassnig’s (around $188k).
Both were trustees and beneficiaries, and the Trust was clearly for their joint benefit.

When the marriage ended, Ms Zhou sought resettlement of the Trust under s 182 of the Family Proceedings Act 1980.

Issues for Determination

Section 182 allows the Court to vary a nuptial settlement (such as a trust) when a marriage or civil union ends. The purpose is to adjust the trust so neither party unfairly benefits once the foundation of a “continuing marriage” has collapsed.

The key question for the Court was:

In a short marriage, with vastly unequal contributions and no dependent children, how should the trust assets be divided?

How the Courts Decided

Family Court – ordered a 50/50 split after repayment of loans.
High Court – adjusted to a 60/40 split in favour of Ms Zhou.
Court of Appeal – went further, awarding 80% to Ms Zhou, 20% to Mr Lassnig, reflecting their actual contributions.
Supreme Court – upheld the 80/20 split, confirming that in short marriages with no children, financial contributions will usually carry the most weight.

What This Means for You

Short marriages are treated differently – Courts will not default to a 50/50 split if the marriage was brief and contributions were unequal.
Financial contributions matter – If one partner has put in substantially more (for example, from pre-existing assets or trusts), that will likely determine the division.
Non-financial contributions are still relevant – but in the absence of children or other counter-balancing factors, they won’t override major financial disparities.
Trusts are not immune – Just because assets are in a trust does not mean they are protected from adjustment under s 182.

Our Perspective

At PK Law, we regularly advise clients who want to set up trusts to protect family assets, or are unwinding a trust after separation.

This case is a timely reminder that:

The Court’s focus is on fairness when the “marriage premise” fails.
Trust structures can be reshaped if they no longer reflect reality.
Careful planning (and legal advice at the time of settlement) can make all the difference.

Key takeaway: In short marriages without children, expect trust property to be divided broadly in line with the respective contributions of the parties.

Long Overdue Update – Changes to the Probate Threshold

Mon, 04 Aug 2025 04:07:18 GMT

Increase in Probate Threshold

On 31 July 2025, the government announced an increase in the probate threshold from $15,000 to $40,000. The threshold relates to the value of an individual asset.

Currently, if a person passes away leaving assets valued at over $15,000 in their sole name, a formal grant of administration (either probate or Letters of Administration) is typically required before those assets can be accessed or transferred. This $15,000 threshold has been in place since 2009 and has not kept up with increasing KiwiSaver balances, inflation or the realities of modern estate planning.

The threshold was established in 2009, prior to the introduction of KiwiSaver. This change has been long overdue. Under the existing framework, legal fees in an estate valued at $20,000 could see the family lose approximately 25% of the estate’s value - and even more in the case where a person died living no Will (intestacy).

The new threshold came into effect on 24 September 2025. The new threshold applies irrespective of the date of death. This means that if the deceased has less than $40,000 in each individual bank account / KiwiSaver etc, their assets may be accessible or transferable without the need for probate or Letters of Administration.

Who can access the Funds in a bank or KiwiSaver?

Section 65 of the Administration Act 1969 (Act) provides that any of the following persons can apply to receive the payment:

the widow, widower, surviving civil union partner, a surviving de facto partner of the deceased person or children of the deceased person:
the persons beneficially entitled to the estate of the deceased person under the will or on the intestacy of that person:
any person appearing to be entitled to obtain administration of the estate of the deceased person in New Zealand:
any person related by blood or marriage or civil union to the deceased person who undertakes to maintain the children of that person who are minors or any of them:
any person who has and is exercising the role of providing day-to-day care for any of the children of the deceased person who are minors:

What Does This Mean for You?

If you are an executor or managing an estate:

If you are managing an estate or providing estate planning advice, the higher threshold could offer a simpler, faster process when handling modest estates. In some cases, it may also reduce legal costs.

If you are considering whether to have a Will and Estate Planning:

Even with the increase in the probate threshold, it remains crucial to have a valid Will and an estate planning in place - especially if you have trusts, cross-border assets, or complex family dynamics.

Consider this:

You cannot control what the future holds. What if you are suddenly incapacitated and unable to execute a Will? Without proper estate planning, your loved ones could face complex and costly challenges in managing your estate.

Take the step now to ensure your wishes are clear and your family is protected.

The case of Alalääkkölä v Palmer: Copyright in Artwork as Relationship Property

Fri, 01 Aug 2025 03:08:40 GMT

Background

Earlier this year, the Supreme Court confirmed that copyright in artistic works qualifies as relationship property under the Property (Relationships) Act 1976 (PRA).

Sirpa Alalääkkölä and James Palmer were married for approximately two decades. Ms Alalääkkölä practised as a commercial artist, and her paintings constituted the couple’s main source of income. Mr Palmer assisted in the business “Art by Sirpa,” having substantially reduced his own professional activities to support his wife’s career.

Upon separation, the parties held a substantial unsold inventory of paintings created during the marriage. While they agreed that the physical canvases were relationship property, they diverged on the status of the underlying copyrights. Mr Palmer initially sought to retain both artworks and their copyrights in order to reproduce and sell copies independently. He later conceded that Ms Alalääkkölä should keep the copyrights, but maintained that he was nonetheless entitled to his share of their value in the overall property division.

Lower courts were split: the Family Court treated the copyrights as Ms Alalääkkölä’s separate property, whereas both the High Court and the Court of Appeal classified them as relationship property. The Supreme Court was therefore tasked with determining (1) whether copyright qualifies as 'property' under the PRA, and (2) if so, whether it is 'relationship property.'

Is Copyright “Property” under the PRA?

The Supreme Court began by examining the Copyright Act 1994, which expressly defines copyright as a proprietary right. The Act affords copyright owners the ability to sell or licence their rights, and to enforce them through injunctions, damages, and account of profits. These attributes, the Court held, align copyright with the concept of personal property under the PRA.

The Court rejected submissions that recognising copyright as relationship property would undermine creativity by granting non-author spouses a stake in an artist’s work. Emphasising the collaborative nature of marriage, it noted that spousal support and contribution are fundamental to the creation of value during a relationship.

Consistent with section 1N of the PRA, which treats all contributions as equal, the Court observed that artists concerned about preserving their copyright interests can protect them by entering into a contracting-out agreement under section 21.

The Court acknowledged practical concerns some artists may harbour - namely, the risk of reputational harm or misuse of their work post-separation - but held that such risks are best managed through tailored court orders designed to safeguard future earnings and moral rights, rather than by excluding copyright from property for PRA purposes.

Is Copyright “Relationship Property”?

Having concluded that copyright is property, the Court turned to whether it should be classified as relationship property. Under section 8(1)(e) of the PRA, relationship property includes assets “acquired during the relationship.” The Court interpreted “acquired” broadly, finding that each component of the copyright bundle vests as soon as the work is created. Accordingly, copyrights arising in the marriage fall within the scope of relationship property.

In its closing remarks, the Supreme Court emphasised the necessity of preserving an artist’s autonomy over unpublished works, even in the equal division of property:

“Given the close association between an artwork and the artist’s reputation, control over disclosure should be maintained so long as an equal division by value is achieved.”

While the default outcome is a 50/50 split in monetary terms, this can be implemented in a manner that respects the author’s exclusive right to publish or withhold her creations.

Practical Implications

For artists: To avoid PRA-driven sharing of copyright, contracting out agreements remain the most effective safeguard

For separating couples : Where copyrights have significant value, courts will strive to equalise financial interests without unnecessarily stripping the creator of control over future exploitation.

For advisors : Any property settlement dealing with copyright should include specific valuation methodologies and protective provisions to minimise conflict and protect moral rights.

So you have become a parent: what about your Will?

Mon, 23 Jun 2025 04:25:45 GMT

Becoming a parent brings a whole lot of new responsibilities - and one of the most important is making sure your children are protected if the unexpected happens. Appointing a testamentary guardian in your Will is a crucial step to ensure your child’s welfare is secured if you are no longer here.

Who is a Testamentary Guardian?

A testamentary guardian is someone you nominate in your Will to have a legal say in the key decisions affecting your child’s life after your death - decisions about their education, health, culture, language, religion, and where they live. It is important to understand that a testamentary guardian does not automatically become the day-to-day carer of your child; their role is to act as an overseer and advocate, particularly in major life decisions. However, if necessary, a testamentary guardian can apply to the Family Court for a parenting order if they wish to assume daily care responsibilities.

Ordinarily, the surviving parent will continue to have day-to-day care of the child. If both parents have died, the guardians named in each Will must decide care arrangements. If there is no testamentary guardian appointed, or if the guardians cannot agree, the Family Court will step in - potentially appointing someone you might not have chosen.

Why appoint a Testamentary Guardian?

Without a clear appointment, the question of who looks after your children could become a matter for the Family Court, introducing uncertainty and possible conflict. Appointing a testamentary guardian allows you to choose someone who understands your values, family background, and expectations - helping ensure your child’s upbringing remains aligned with your wishes.

When your intentions are set out in your Will, it reduces the likelihood of family disputes or confusion about your child’s care.

Alongside your Will, you can prepare a Letter of Wishes. While not legally binding, this document gives guidance to your guardians about what you want for your child’s upbringing - covering everything from schooling and activities to travel and cultural or religious values. This guidance can be invaluable in helping your chosen guardians make decisions that reflect your intentions.

Life with young children is busy, but putting a Will and Letter of Wishes in place is a straightforward step that gives lasting peace of mind. At PK Law, we help parents put practical, legally effective arrangements in place so that, whatever happens, your children’s wellbeing is protected by those you trust.

Важность Завещания и Долгосрочной Доверенности в Новой Зеландии

Tue, 22 Apr 2025 21:07:58 GMT

О важности Завещания и Долгосрочной Доверенности в Новой Зеландии: стоимость, риски и защита семьи

Завещание

1. Стоимость

В контексте юридической системы Новой Зеландии cмерть близкого без завещания обходится для близких гораздо дороже, чем если бы умершим было составлено завещание до смерти.

Для управления наследством человека, оставившего завещание, требуется лишь подать заявление в Высокий суд для получения подтверждения подлинности завещания (пробат). Если человек умирает без завещания, необходимо подавать заявление о наследовании по закону — это более сложный и дорогостоящий процесс.

Процесс наследования по закону (без завещания) включает поиск завещания, а если умерший был мужчиной — также получения справки об отцовстве (подтверждение от государственных органов о том, что у умершего не было детей о которых он или его близкие не знали). Если у умершего остался супруг/партнер, выживший супруг/партнер обязан получить независимую консультацию о своих правах в соответствии с законодательством о наследовании и потенциальных претензиях на имущество в рамках Закона о совместном имуществе. Пока такая консультация независимого юриста не получена, заявление на выдачу свидетельства о праве на управление имуществом не может быть подано в суд. Для пробата, когда у умершего есть завещание, этого требования нет.

Из-за дополнительных этапов подготовка заявления о наследовании по закону занимает как минимум на 4–5 недель дольше, чем подготовка пробата.

2. Непредсказуемость / Элемент сюрприза

Многие люди не знают положений о наследовании по закону, прописанных в Законе об управлении наследством 1969 года. Например, мало кто знает, что если у вас нет завещания, все ваши активы не достанутся вашему партнеру/супругу. Вместо этого партнер/супруг получит первые $155 000 плюс треть вашего имущества, а ваши дети — две трети.

Это особенно важно для смешанных семей. Если ваши активы скромны, дети от первого брака могут остаться ни с чем. С другой стороны, если ваше наследство значительное, ваши дети могут получить больше, чем ваш партнер/супруг (что может не соответствовать вашим намерениям).

Если вы умираете без детей и родителей, ваш партнер/супруг получает все имущество.

Если вы умираете без детей, но оставляете родителей, ваш партнер/супруг получает $155 000 + две трети, а родители — оставшуюся треть. Это часто становится сюрпризом для многих людей.

3. Проблемы с активами за границей

При наличии имущества за границей наличие завещания становится еще более важным. Проблемы часто возникают при наследовании активов в разных странах или активов в одной стране, когда умерший жил и умер в другой стране.

Например, если вы живете и умираете в Италии (где приобрели привычное место жительства), а большинство ваших активов находятся в Новой Зеландии, вероятно, что все ваши движимые активы (банковские счета, акции, KiwiSaver и т.д.) будут распределены в соответствии с итальянским законодательством. Это может не только сильно отличаться от ваших намерений, но и быть очень дорогостоящим. В Новой Зеландии потребуется подача заявления на управление наследством в Высокий суд, что само по себе является сложной процедурой.

Кроме того, поскольку умерший находился за границей, для движимых активов, расположенных по всему миру, потребуется предоставление аффидевита юриста, практикующего в стране смерти умершего. Это вовлекает нескольких юристов из разных юрисдикций, что быстро увеличивает затраты.

Эти дополнительные расходы и стресс для тех, кто остается после вас, можно легко избежать, составив завещание в Новой Зеландии перед отъездом за границу.

4. Опекунство

Если у вас есть маленькие дети, крайне важно назначить опекуна на случай, если вы и ваш супруг/партнер умрете. В противном случае вы не сможете быть уверены, кто будет заботиться о ваших детях и принимать важные решения, касающиеся их воспитания.

5. Трасты и завещания

Многие люди, у которых есть траст, считают, что им не нужно завещание, так как их активы принадлежат трасту. Хотя действительно большинство ценных активов принадлежит трасту, некоторые (неизбежно) останутся на ваше имя — например, KiwiSaver, личные банковские счета, автомобили, ценности и т.д.

Таким образом, наличие завещания важно даже в том случае, если большая часть ваших активов принадлежит трасту.

6. Развод при браке

Мало кто знает, что, если вы состоите в браке и разошлись, ваш супруг/супруга сохраняет право наследования вашего имущества до тех пор, пока не будет получен приказ о расторжении брака (это занимает 2 года). Если вы или ваш супруг умрете в течение этого периода (с момента раздельного проживания до расторжения брака), оставшийся супруг и/или дети (в зависимости от завещания или, при его отсутствии, от положений о наследовании по закону) унаследуют имущество.

Единственный способ избежать этого — обновить завещание (или составить его, если у вас его нет) сразу после расставания с супругом.

Долгосрочная Доверенность (Enduring Power of Attorney)

При рассмотрении вопросов планирования наследства мы часто думаем только о необходимости составления завещания. Однако не менее важно учитывать, что произойдет, если вы окажетесь неспособны принимать решения из-за серьезного физического или психического заболевания, такого как деменция.

Закон о защите личных и имущественных прав 1988 года (PPPR) позволяет вам, находясь в здравом уме, оформить долгосрочные доверенности (Enduring Powers of Attorney, EPOA) на заботу о личном благополучии и управление имущественными делами. Долгосрочная доверенность позволяет вам выбрать, кто будет управлять вашими личными или финансовыми делами и как именно это будет происходить, если вы окажетесь неспособны делать это самостоятельно.

Долгосрочная доверенность на заботу о личном благополучии (EPOA for Care and Welfare)

В рамках EPOA на заботу о личном благополучии:

Вы (доверитель) назначаете человека (доверенного лица), который будет уполномочен принимать решения, касающиеся вашего личного благополучия и ухода, например выбора места проживания и медицинского обслуживания. Вы можете указать, что доверенное лицо будет принимать решения по всем вопросам, связанным с вашим уходом, или только по определенным вопросам.
Только одно доверенное лицо может быть назначено для выполнения этой роли. Однако вы можете назначить преемника на случай, если ваш представитель не сможет выполнить свои обязанности.
EPOA на заботу о благополучии вступает в силу только тогда если вы становитесь неспособны принимать решения из-за психической неспособности. Для активации EPOA требуется сертификат от специалиста, квалифицированного для оценки психического состояния, подтверждающий, что вы не можете принимать решения по вопросам вашего ухода (сертификат о неспособности).

Долгосрочная доверенность на управление имуществом (EPOA for Property)

В рамках EPOA на управление имуществом:

Вы можете назначить одного или нескольких человек в качестве доверенных лиц или их преемников. Ваши доверенные лица будут уполномочены принимать решения, касающиеся ваших имущественных дел, например оплаты счетов, управления активами и продажи недвижимости. Вы можете указать, что доверенные лица будут управлять всеми вашими имущественными вопросами или только определенными.
Если вы назначаете более одного доверенного лица, вы можете указать, должны ли они действовать совместно или по отдельности.
Вы также можете выбрать, когда ваша EPOA на имущество вступает в силу:

когда вы становитесь психически неспособны (требуется сертификат о неспособности); или
пока вы находитесь в здравом уме и продолжает действовать и если вы потеряете дееспособность. Обратите внимание, что если вы выберете этот вариант, EPOA вступит в силу сразу после подписания и заверения.

Очень важно назначить доверенным лицом человека, которому вы доверяете и который сможет действовать в ваших интересах. Вы не обязаны назначать одно и то же лицо для EPOA на заботу о благополучии и для EPOA на управление имуществом.

Если вы не оформите долгосрочные доверенности, вашей семье или близким придется обращаться в суд для назначения опекуна или управляющего имуществом для представления ваших интересов. Этот процесс может быть затратным, долгим и стрессовым в сложный для всех период. Обычно этот процесс по стоимости обходится, как минимум, в три раза дороже чем составление нужных доверенностей.

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Полина — основатель и директор PK Law. PK Law консультирует по вопросам планирования наследования, структурирования имущества, управления имуществом, права пожилых людей, деление и структурирование имущества пар находящегося в отношениях (до и после брака, а также разделение имущества) и споров, связанных с завещаниями, трастами, имуществом и разделом имущества, находящегося в отношениях.

Полина часто помогает русскоговорящим клиентам по вышеперечисленным вопросам и всегда рада ответить на вопросы.

www.pklaw.nz

+64 22 381 2878

PODCAST: Polina Kozlova's Guide to Estate Protection

Thu, 20 Feb 2025 20:55:23 GMT

As a specialist private client lawyer, in this podcast with That Home Loan Hub, Polina unpacks the critical importance of contracting out agreements and shares her expert insights on the complexities of estate planning, particularly within blended families.

This podcast also sheds light on probate process and the vital role it plays in avoiding costly and unintended consequences. Polina shares real-life examples to highlight the significance of proactive estate planning, ensuring your intentions are honoured and your loved ones are spared unnecessary burdens.

If you are interested in learning more about the intersection of the relationship property law, elder law, and the intricacies of estate management - this is for you.

A Christmas Present: Supreme Court Ruling Clarifies Trust Powers in Relationship Property Disputes

Wed, 05 Feb 2025 00:30:11 GMT

On 20 December 2024, Supreme Court of New Zealand delivered a long awaited decision in the case of Cooper v Pinney, addressing the extent to which powers held by a trustee over a family trust can constitute "property" under the Property (Relationships) Act 1976 (PRA). The case has been making its way through the courts since 2018. The decision clarifies the application of the landmark Clayton v Clayton case and provides further guidance on how trust structures impact relationship property disputes.

Background

Raewyn Phyllis Cooper, the appellant, was in a de facto relationship with Marcus Robert William Pinney from 2004 to 2014. During their relationship, they worked together on a farm held in the MRW Pinney Family Trust (MRWT). The central issue before the Supreme Court was whether Mr Pinney’s powers as a trustee and discretionary beneficiary under the MRWT should be treated as "property" for the purposes of relationship property division.

Key Issue

Ms Cooper argued that Mr Pinney exercised effective control over the trust assets and that his rights and powers should therefore be considered "property" under the PRA. She relied on the Supreme Court’s earlier decision in Clayton v Clayton [2016] NZSC 29, which held that extensive control over trust assets could amount to a property interest.

Supreme Court’s Decision

The Court dismissed Ms Cooper’s appeal, finding that while Mr Pinney had significant powers within the MRWT, they were constrained by fiduciary duties and did not amount to a general power of appointment akin to outright ownership. The key points from the judgment include:

Fiduciary Nature of Trustee Powers: The Court emphasized that the power to appoint and remove trustees remains a fiduciary power that must be exercised in the best interests of all beneficiaries.
Comparison with Clayton v Clayton: Unlike the trust deed in Clayton, the MRWT deed did not grant Mr Pinney absolute discretion to benefit himself at the exclusion of others. The trust required at least two trustees to act unanimously, providing a safeguard against unilateral control.
Distinction Between Discretionary Beneficiaries and Property Owners: The Court reaffirmed that a discretionary beneficiary does not have a proprietary interest in the trust assets until a distribution is made in their favour.

Implications for Trusts and Relationship Property

This decision provides clarity for those using trusts in the context of asset protection and estate planning. It confirms that while trust structures can be scrutinized in relationship property disputes, the existence of proper fiduciary duties and independent trustees can help preserve the integrity of the trust.

For individuals in relationships where assets are held in trust, this case highlights the importance of clear trust governance and documentation. Ensuring that trusts are not structured in a way that grants a single person unchecked control may be crucial in protecting assets from future claims.

Why this matters for you

The decision reaffirms that trusts remain a legitimate tool for asset management and protection, provided they are properly structured and administered. This case underscores the balance courts must strike between recognizing valid trust arrangements and preventing them from being used to circumvent relationship property laws.

For those concerned about the implications of trusts in their personal or business affairs, seeking legal advice early can help ensure that trust structures align with both legal requirements and personal objectives. It is no longer (and has not been for a while) enough to just have a trust to protect your interests. Every trust structure needs to be carefully considered and regularly reviewed by a specialist trust lawyer to ensure that you will get the protection you have set up the trust for.

If you have any questions about how this decision might affect your estate planning or relationship property matters, feel free to contact PK Law for expert guidance.

No Remedy For Abuse

Wed, 18 Dec 2024 20:01:55 GMT

In 2022, our Director, Polina wrote an article (see copy below) for the STEP Journal summarising the decisions of the High Court and the Court of Appeal in the case of A, B and C v D, where children issued Family Protection Act proceedings against their father’s estate. The claim was complicated by the fact that their father shortly before his death, transferred most of his assets to a discretionary family trust of which the children were not beneficiaries.

The children argued that their father owned fiduciary duty to them which continued well into their adulthood due to the abuse suffered by them in their father's hands.

On 28 November 2024 the Supreme Court has issued its judgment, siding with the decision of the Court of Appeal. The court declined to recognise a fiduciary relationship between a parent and an adult child and would have only done so in circumstances where the parent had assumed some sort of an ongoing care / responsibility over the child. The Court acknowledged that there is a gap in the law, which may eventually end up being addressed on the legislative level.

Polina will be writing a full update on the Supreme Court's decision and what it means for lawyers and clients going forward for Issue 2 (2025) of the STEP Journal.

Who Has the Right to See or Request a Copy of a Will?

Sat, 16 Nov 2024 11:57:01 GMT

Law firms in New Zealand often receive inquiries from individuals asking for a copy of their own Will, a the Will of a spouse or other person. Many are surprised to learn that they cannot simply access another person’s Will without that person's written consent.

While a Will-maker is alive, they retain full control over their Will. Only the Will-maker can authorize a copy to be released or accessed.

After the Will-maker passes away, this authority shifts to the executor(s) named in the Will. Only the executor(s) can approve the release or copying of the Will.

There is no formal "reading of the Will” in New Zealand. Instead, the executor(s) may choose to send copies of the Will to beneficiaries, allowing them to review its terms and see what they are entitled to inherit. The law firm managing the estate can only share copies with beneficiaries upon receiving authorization from the executor(s).

If you are a beneficiary but are not an executor, you will need the executor(s)’ permission to receive a copy of the Will.

If you think you may be a beneficiary but do not know who the executors are or the executors won’t release a copy of the Will to you, you can conduct a Probate Search (you would be able to do that once a probate of the Will has been granted). This can be done by contacting the High Court registry closest to the city where the person passed away. There is a small fee for obtaining these copies.

Can I get divorced in NZ if I got married overseas?

Sat, 16 Nov 2024 11:53:27 GMT

Many New Zealand residents who married abroad—whether as migrants or New Zealanders who returned home after marrying overseas—may wonder if they can legally end their marriage in New Zealand. We frequently assist clients in dissolving their overseas marriages.

The answer is yes, provided specific conditions are met. Either you or your spouse must consider New Zealand your permanent home at the time of your application, and you must have lived separately for at least two years. In New Zealand, the legal term for divorce is "dissolution of a marriage or civil union."

New Zealand's divorce process is often simpler than in other countries for several reasons:

No-Fault Dissolution: New Zealand operates as a "no-fault" jurisdiction, meaning that you don’t need to provide reasons or assign blame for the dissolution. The only requirement is that the parties have been separated for at least two years, without exception.
No Court Attendance if Both Parties Agree: If both parties agree to the dissolution, there is no need for either spouse to attend a court hearing.
Streamlined Process: Divorce proceedings in New Zealand are straightforward and often quicker. If both parties reside in New Zealand, the order can be issued in as little as 21 days; if one party is in Australia, it takes 30 days, and for other countries, 50 days.

It’s important to remember that dissolving a marriage is separate from arranging care for children or dividing relationship property. Generally, by the time a couple applies for a divorce, it is expected that their relationship property would have already been divided.

How to Apply

To initiate a divorce, you need to file an application with the Family Court. There are two types of applications: joint and single.

Joint Application: If both parties agree to divorce, they can file a joint application, even if one spouse resides outside New Zealand.
Single (One-Party) Application: If only one spouse wants the divorce, they may apply individually, serving the other spouse with the application. The other party is given time to respond, depending on their location. If they agree, they simply let the Order proceed. Most single applications are unopposed, and court attendance is rarely required.

If there is opposition, the respondent can submit a Notice of Defence and an Affidavit, in which case both parties would need to attend a court hearing for a judge’s decision. Seeking legal advice in these situations is highly recommended.

Can I commence new relationship before my divorce?

While either party may begin a new relationship at any time, they must wait until the dissolution Order is finalized before remarrying or entering a new civil union.

The team at pk law has extensive experience in assisting clients with divorces and specializes in dissolution matters.

Why it is important to have a Will in New Zealand

Sat, 16 Nov 2024 11:37:51 GMT

1. Cost

Dying without a will is far more expensive than paying a lawyer to have your will sorted.

All that is required to administer an estate of a person who died leaving a will is to apply to a High Court for probate of the will. Dying without a will involves an application for intestacy, which is more complicated and costly than a probate application.

Intestacy involves a search for a will and if the deceased is a male, also a paternity search. If a person dies leaving a spouse/partner, the surviving spouse/partner is required obtain independent advice on his/her entitlement under intestacy provisions and potential claims against the estate under the Property (Relationships) Act 1976. Until such advice from an independent lawyer has been obtained, the application for letters of administration on intestacy cannot be submitted to the court. Obtaining such independent advice prior to lodging an application is not a requirement for a probate application (when a person dies leaving a will).

Because of these additional steps that needs to be undertaken, it takes at least three weeks longer to get the intestacy application ready to be sent to the court as opposed to a probate application.

Think about this, you may die leaving behind family members who cannot access your assets for a significant period of time.

2. Unpredictability/Surprise Element

A lot of people are not aware of intestacy provisions that are provided for in the Administration Act 1969. Most people do not know that if you don’t have a will all of your assets won’t go to your partner/spouse. Instead, your partner/spouse will receive the first $155K + 1/3 of your estate and your children will receive 2/3.

This is particularly important for blended families. If your asset pool is modest, your children from the first marriage, may be left with nothing. And, on the other hand, if your estate is large, your children may end up receiving more than your partner/spouse (which may not be what you intend).

If you die leaving no children and parents, your partner/spouse takes all of your estate.

If you die leaving no children but leaving parents, your partner/spouse takes $155K + 2/3, with your parents receiving the remaining 1/3. This often comes as a surprise to people.

3. Cross Border Issues

This is where having a will becomes even more important. Issues often arise with succession involving assets in different countries or assets located in one country and the deceased having lived and died in another country.

If you live and die in Italy (and have acquired a habitual residence there) while most of your assets are in New Zealand, it is likely that all of your moveable assets (i.e. bank accounts, shares, KiwiSaver etc) will be distributed under Italy’s laws. Not only may this be very different from what you intended, it can also be very costly. An application for letters of administration to the NZ High Court will be required (since the assets are located in NZ), which is more complicated to begin with. .

However, because a person died overseas and overseas law applies to moveable assets situated worldwide, the NZ court will require affidavit from a lawyer practicing in the country where the deceased person died as well. This requires multiple lawyers from different jurisdictions to be involved and can quickly become very expensive.

This additional cost and stress for those you leave behind can easily be avoided by making a Will in NZ before heading overseas.

4. Guardian

If you have young children, it is really important that you nominate someone to be their guardian in the event that you and your partner/spouse die. If you don’t do that, you have no certainty over who will look after your young children and be involved in important decisions relating to their upbringing.

5. Trusts and Wills

A lot of people who have a trust believe that they don’t need a will because their assets are owned by a trust. Although it is true that most valuable assets will be owned by a trust, some (inevitably) will still be in your name - for example, KiwiSaver, personal bank accounts, vehicles, valuable jewellery etc.

It is therefore still important to have a will even if most of your assets are owned by a trust.

6. Separation when Married

Most people are not aware of the fact that if you are married and you have separated, your spouse stands to inherit your assets until the moment you have a marriage dissolution order (which takes 2 years to obtain). Should you die or your spouse die within that period (from the date of separation until the date the dissolution is granted, the survivor and/or the children (depending on the terms of the will if any or otherwise depending on intestacy provisions) will inherit the estate.

The only way to avoid this is to update your will (or make a will if you don’t have one) as soon as your separate from your spouse.

Digital Assets and Memories - how to deal with them on your death

Sat, 16 Nov 2024 11:37:30 GMT

What can you do to ensure your valuable digital assets pass to your family on your death as intended?

You should let your lawyer know that you hold valuable digital assets and what those assets are, so that they can make relevant provisions for those assets in your will.
You should make an inventory list of your digital assets and review it as necessary (perhaps, every time a valuable asset is acquired or disposed of). It may be appropriate for your solicitor to keep a copy of the inventory together with the original will.
You need to ensure the safe-keeping of the digital wallet, username/private keys and passwords and discuss with your lawyer whether it may be appropriate for records of those to be kept with the original will.
Although none of us plan to die, it is a good idea to obtain tax advice in respect of your valuable digital assets sooner rather than later, including advice in respect of tax involved when the asset passes to a beneficiary under the estate. If you intend the beneficiary to keep the digital asset, you may need to consider whether tax will be payable and whether a beneficiary can afford it. NFTs are also capable of generating income and tax advice should be sought in that regard as well.
There may be circumstances where it may be appropriate to not gift the asset outright to a beneficiary but perhaps for your executors to hold the asset for a certain period (for example a gift to a beneficiary who is a minor). If that is the case, you may want to leave some specific instructions to your executors on how to deal with the asset. One such instruction may be a specific direction not to panic and dispose of the asset if it plummets in value as this can be normal course for the crypto market.
You may want to consider whether a life interest is more appropriate than an outright gift. For example, you want your spouse to use the income generated for his/her life and for the asset itself to pass to your children upon your spouse’s death. Such decisions may be dependent upon tax advice but also upon the will-maker’s personal circumstances.
At present, courts around the globe are faced with the question of intellectual property rights in NFTs. The US case of trademark infringement brought by Hermes against Rothchild for trademark infringement over its luxury handbag (Rothchild created MetaBirkins’ NFTs) will serve as one of the first instances that explore how intellectual property law is applied to NFTs. It is important that your will and your estate plan generally deals with the intellectual rights aspects of NFTs and how those rights pass.

If you own or are planning to acquire digital assets and need assistance with estate planning or separation, please contact us to discuss.

It is safe to assume that nowadays most of us have a “digital life”. Digital life, which inevitably one day will become a “digital estate”. Although the concept of digital assets of sentimental value is not new, the concept of monetary valuable digital assets is. We are now at the point where our online lives need to be considered when declaring our wishes in wills or when separating.

Many questions remain regarding estate planning and trust administration when cryptoassets are involved. It is important therefore that your legal advisor has at least some basic knowledge of the crypto and NFT market, so they are equipped to provide you with advice in relation to a separation from your spouse or partner, estate planning and eventually, estate administration.

When it comes to digital memories, (things like your iCloud storage, Instagram, Facebook and Google accounts) there are simple steps you can take to ensure that access passes to someone you trust on your death. A number of service providers have already enabled a “legacy service”. That service allows you to nominate someone who will have control of your account after your death. Although, some providers (for example, Instagram) don’t have that service just yet, it is likely that they will in the future. For those social accounts that don’t provide the function yet, consider letting your executor know what those accounts are and where the passwords for them can be located. A simple step like nominating someone for those social accounts which already allow you to do so goes a long way and can prevent unnecessary litigation and the need for court orders in the future. Given the majority of these providers are based outside of New Zealand, navigating the legal requirements to obtain access can be difficult and costly. The last thing you would want is for your family to not have access to precious memories.

Cryptocurrency and NFTs (non-fungible tokens), on the other hand, might not be as easy to deal with, which is concerning, given the value that these assets can hold. The majority of holders of cryptocurrency and NFTs may not realise that certain considerations need to be given to these assets in their wills and wider estate planning to ensure that these assets can be dealt with in accordance with their expectations and wishes.