Contracting Out Agreements

Getting things clear before you’re all in.

Nobody puts "discuss a pre-nup" on their relationship bucket list. It's an awkward conversation to have when things are going well. But a contracting out agreement, done properly, isn't about expecting the worst — it's about you and your partner being honest with each other from the outset, and both walking in with your eyes open.

There's a genuine upside to this conversation that has nothing to do with property. Every relationship eventually hits a hard topic, and how you both handle this one — calmly, honestly, as a team — tells you something real about how you'll handle the next one. Better to find that out now.

Why this matters — and when to do something about it

Under the Property (Relationships) Act 1976, once you've been in a marriage, civil union, or de facto relationship for three years or more, the law generally splits relationship property 50/50 — regardless of who paid for what. (Marriages and civil unions are technically covered by the Act from day one, but the equal-sharing rule is softened for relationships under three years old, so in practice three years is the point most people should have this sorted by.)

A contracting out agreement (also called a pre-nup) lets the two of you set your own rules instead of relying on the Act's default.

There are two natural points to do this:

Before the 3-year mark

“the pre-nup”

This is the one everyone's heard of: you sign it before your relationship has legally become a "relationship" in the property-law sense. 

After the 3-year mark

What I call a “mid-nup”

Quick disclaimer: "mid-nup" isn't a real legal term — I made it up.

But it describes something genuinely useful: a contracting out agreement signed well into an existing relationship, long after the three-year mark has passed.

A common trigger is one of you receiving an inheritance you'd like to put towards the mortgage, which helps you both, without it dissolving into simply "ours" the moment it touches a joint account.

A mid-nup lets you do the sensible thing with the money while keeping a paper trail that says: this much was always yours. 

These agreements are common well beyond second relationships these days

— plenty of people just want financial clarity going in, or partway through.

How to actually raise it with your partner.

Fair question, and one I get often.

The honest answer: the earlier you have this conversation, the easier it tends to be. Frame it as something you're doing together, not something one of you is imposing on the other — an agreement that genuinely reflects both your interests isn't just more likely to hold up in court, it's a better foundation for the relationship itself.

If your partner feels pressured or resistant, that's worth pausing on — courts pay close attention to whether both people entered into an agreement freely and with a full understanding of it. One signed under pressure, or the week before the wedding, is far easier to challenge than one worked through calmly over time.

There are as many kinds of contracting out agreements as there are relationships.

No two agreements look the same, but a few structures come up again and again.

  • The smallest and cheapest of these. Rather than mapping out your whole financial life, you name one specific thing and agree it stays separate: an inheritance, the family bach, shares in a family business, a boat one of you brought in.

    Everything else carries on under the ordinary rules. It's often the agreement people actually need when they think they need something far bigger. One thing worth knowing: it still requires the full formalities — two lawyers, proper certification — because in the eyes of the law it's still a contracting out agreement. The drafting is simpler, so it costs less, but the process isn't a shortcut.

  • Protection that fades gradually over time. These tend to be cumbersome, and the real winners are usually the lawyers drafting and interpreting them. I don't recommend them.

  • Nothing is shared, full stop.

    Good for second relationships where you want to protect your children's inheritance.

    It demands real discipline: sign an agreement saying everything stays separate, then spend a decade mingling money in joint accounts and paying each other's bills, and your actual behaviour can undercut the paperwork. Ironclad agreements are also less permanent than people assume — the longer a relationship runs, the more a rigid agreement can start to look unfair, and a court can set one aside if enforcing it would cause serious injustice.

    I generally suggest revisiting one every three years for strong protection; some lawyers recommend every five.

  • More common for younger couples starting out.

    Rather than keeping everything separate, this protects what one of you brings to the relationship at the start (say, $100,000), while everything earned or gained from that point on becomes ordinary relationship property.

    Often the better fit when one partner is simply further ahead financially, rather than a couple wanting total separation.

What a contracting out agreement can do

  • Specify which property is relationship property and which stays separate
  • Protect assets you bring into the relationship from being shared if you separate
  • Ring-fence inheritances, gifts, or family contributions
  • Define how any increase in value of your assets is treated
  • Set out how relationship property will be divided if the relationship ends
  • Deal with what happens if one partner dies

What it can't do is guarantee total certainty forever, with zero risk. The Act sets limits, and the court can step in if an agreement causes serious injustice — more on that below.

Why you can't just write it up yourselves

To be legally binding, the agreement must be in writing, and each of you needs your own independent lawyer to certify it — confirming they explained it to you and that you understood it. That means you can't share a lawyer.

This isn't box-ticking. It's a legal requirement, and it exists to protect both of you. Skip it, and the agreement is void — leaving you with no protection at all if things go wrong later.

Can a court overturn it?

Yes, though the bar is reasonably high. A court can set aside an agreement if enforcing it would cause "serious injustice." When deciding that, courts tend to look at:

  • Whether the terms were fair when the agreement was signed
  • Whether circumstances have changed significantly since — children, career changes, health, or a big shift in wealth
  • Whether both parties genuinely understood what they were giving up
  • Whether the outcome, looking back over a long relationship, is wildly out of step with what each person put in

Agreements hold up best when both parties had proper independent advice, the terms were fair at the time, and the agreement didn't try to do too much. Courts respect people's right to make their own arrangements — but they won't wave through something genuinely unfair.

The tricky bit: economic disparity

This one catches people out, because it's easy to overlook at the start of a relationship. Under section 15 of the Act, a court can award compensation to a partner who ends up significantly worse off financially after separation — not because of how the property itself was split, but because of the role they played during the relationship. The classic example: one partner cuts back hours or leaves the workforce to care for children, and years later has lower income and fewer career prospects as a direct result.

You can address economic disparity in your agreement, or even contract out of that kind of claim — but it's genuinely hard to get right this early, since nobody quite knows yet whether there'll be kids, how careers will unfold, or who'll end up doing what. Worth talking to me if any of this sounds familiar:

  • One of you is likely to step back from work if you have children
  • There's already a noticeable gap in your earning capacity
  • One of you is giving up career opportunities to support the other's work or lifestyle
  • You're simply not sure how to handle this and want to talk through the options

If a trust is in the picture

If either of you holds assets in a trust, or is thinking about setting one up, that needs to be considered alongside the agreement, not bolted on afterwards. Trusts can add a useful layer of protection for pre-relationship assets, but they're not bulletproof — the courts have shown they're willing to look behind a trust if it seems designed to defeat a partner's legitimate claim. Tell me early if a trust is relevant, so the two can be designed to work together.

What to bring to your first appointment

The more of this you can gather before we meet, the less time — and cost — goes into me chasing it down for you.

  • A clear list of what you each own separately — property, savings, investments, KiwiSaver, vehicles, shares, business interests, and evidence of those assets
  • Any personal debts
  • Details of any inheritance received or expected
  • Details of any family money that's helped fund an asset (a contribution to a house deposit, for example)
  • A copy of the trust deed, if a trust is involved
  • Photo ID, for identity verification (this is a legal requirement for all law firms, not just something we've dreamed up)

How to name documents

If you are bringing the above documents in digitally then I recommend labelling as follows:

"Name of person it relates to" "year month day" "Item" "amount"

  • Tim 2026 07 12 ANZ KiwiSaver $54,987
  • Tim 2026 06 18 Toyota Land Cruiser $32,890
  • Beth 2026 07 11 BNZ KiwiSaver $123,989
  • Beth 2026 04 12 Mitsubishi Car $8,900

Let’s work together.

Please contact me, Lenny, if you would like to make an appointment or to discuss any of the information on this page.

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