New Zealand Herald

Friday, May 26 2000

Wife's property-split plea could aid many

25.05.2000 - By AUDREY YOUNG and CATHERINE MASTERS
New Zealand Herald

When an Auckland wife won a portion of her wealthy husband's future earnings she opened a can of worms that could change marital property law forever.

The payout, despite being overturned by the Court of Appeal, caused a furore about inequities in relationships where one partner's career prospects and earnings are restricted by child-rearing.

The woman's lawyer at the time, Deborah Hollings, said yesterday that her client "Z" - her name was suppressed - would be delighted with the Matrimonial Property Amendment Bill.

The bill gives judges wider discretion to alter the traditional 50:50 property split if one partner has been economically disadvantaged during the relationship.

And it extends matrimonial property rights to de facto couples living together for three or more years, including same-sex couples.

"I think Mrs Z was one of the people who was responsible for the Government looking at this area of law," said Deborah Hollings.

"It was very stark on her facts; very stark, the difference in wages."

Had Z's husband not been required to pay maintenance, she would have ended up after 27 years of marriage on $8000 a year while he stayed on $300,000.

The National Party savaged the bill this week as a "gold-diggers' charter."

But Deborah Hollings said Australia had used the same system for years and it seemed to work well.

If one parent looked after the children and the other continued with a lucrative career, Australian judges could award up to 70 per cent of existing assets.

Once the principles were established in New Zealand, most cases should be settled by negotiation, she said.

"But it will take into account this terrible situation we have at the moment where custodial parents go into dreadful financial hardship and the other parent's financial circumstances actually improve on separation."

Two types of case would benefit most: when child-rearing affected a person's ability to earn income, and when a fulltime mother had supported her husband's career for many years.

Even if the children were grown up, the mother might be in her 50s and unable to earn much - or any - income.

"They end up on the 'women alone' benefit of $7000 a year. It's pathetic. It's for women who do not have dependent children ...

"And it's often middle-class families, so the husband is in peak professional career earning very substantial sums of money."

Stuart Cummings, of the Auckland District Law Society, said he supported the concept of the bill, but many factors had to be taken into account.

What if the non-custodial parent earning the money lost his or her job or became ill?

Judges already had the power to award spousal maintenance, but it was rarely used and could be a better way to address inequities.

It should also be expanded from needs-based to take account of accustomed standard of living.

Act MP Stephen Franks was worried that people such as sharemilkers, "who often settle for any company," would be vulnerable to gold-diggers.

He believed it might be fair in a marriage to compensate for economic disparity, but not in de facto relationships.

Girlfriends and "lazy low-life males" would hang around long enough to raise a credible case that they were in a relationship.

Using the example of a lonely sharemilker, Mr Franks said the bill could have unintended consequences. The sharemilker's girlfriend who turned down a chance to work in her parents' successful business elsewhere could later argue in court for compensation.

National's justice spokesman, Tony Ryall, said economic disparity would be better addressed through maintenance payments than tampering with the 50:50 principle.

National argues that wide discretion will oblige lawyers to take most matrimonial disputes to court, lining their pockets and ballooning the legal-aid budget.

But Attorney-General Margaret Wilson told Parliament that addressing an economic injustice was more important than the cost of the extra court work.

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