When a marriage, civil union, or de facto relationship ends in New Zealand, the starting point for dividing assets is equal sharing. Under section 11 of the Property (Relationships) Act 1976 (PRA), relationship property is generally divided 50/50.

However, equal division does not always result in a fair outcome. In some cases, one partner may be left in a significantly weaker financial position because of the roles they performed during the relationship. This is where section 15 of the PRA, often referred to as the “economic disparity” provision, becomes crucial.

At Core Legal Masterton & Wellington, we regularly advise clients throughout Masterton, Wellington, and the Wairarapa region on how section 15 claims can affect relationship property settlements.

What Is Section 15 – Economic Disparity?

Section 15 allows the Family Court to adjust a standard 50/50 property division where there is a significant difference in the parties’ future income and living standards due to the way responsibilities were divided during the relationship.

This provision recognises that relationships often involve a division of functions. For example:

• One partner focuses on paid employment and career advancement

• The other partner takes primary responsibility for childcare and domestic duties

While both roles contribute equally to the partnership, they can have very different long-term financial consequences.

Why Equal Division Is Not Always Fair

In many relationships, one partner may step back from career progression—sometimes permanently—to raise children or support the other partner’s career. At separation, that partner may face:

• Reduced earning capacity

• Limited career advancement opportunities

• Ongoing childcare responsibilities

• Lower long-term financial security

Section 15 was introduced because equal sharing alone did not adequately address this economic imbalance. Historically, this disproportionately affected stay-at-home partners, often women.

When Will Section 15 Apply?

The Court must be satisfied that:

1. After separation, one partner is likely to have significantly higher income and living standards than the other; and

2. The disparity is a result of how roles were divided during the relationship.

When assessing this, the Court may consider:

• Each partner’s likely earning capacity

• Ongoing care responsibilities for children

• The length of the relationship

• Any other relevant circumstances

Importantly, the disadvantage must arise from the division of roles within the relationship. If income disparity is caused by unrelated factors, section 15 may not apply.

What Orders Can the Court Make?

If economic disparity is established, the Court can:

• Order the advantaged partner to pay a lump sum from their share of relationship property; or

• Order a transfer of property to the disadvantaged partner.

This mechanism allows the Court to move away from rigid equal division to achieve substantive fairness.

Why Legal Advice Is Essential

Section 15 claims can be complex and often require detailed financial evidence, career projections, and analysis of relationship roles. Whether you believe you may be entitled to compensation—or are defending a claim—it is vital to obtain experienced legal advice early.

Core Legal Masterton & Wellington offers practical, cost-effective guidance, including fixed-fee initial consultations, to help you understand your position and protect your future financial security.

Frequently Asked Questions (FAQ)

What is economic disparity under the Property (Relationships) Act?
Economic disparity refers to a significant difference in future income and living standards between partners caused by how roles were divided during the relationship.

Does section 15 automatically apply in every separation?
No. The Court must be satisfied that a significant disparity exists and that it was caused by the division of functions within the relationship.

Is equal division always the rule in New Zealand?
Equal sharing is the starting point, but section 15 allows the Court to adjust that outcome where fairness requires it.

Can section 15 apply in de facto relationships?
Yes, provided the relationship qualifies under the Act (generally lasting three years or more).

How is compensation calculated?
There is no fixed formula. The Court assesses the extent of disparity and determines what adjustment is fair in the circumstances.

When should I seek legal advice about section 15?
You should seek advice as early as possible during separation discussions to ensure your financial position is properly protected.

If you are facing relationship property division in Masterton or Wellington and are concerned about fairness, understanding section 15 may be key to achieving a just outcome.