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Can bad behaviour cost you during divorce or separation?

Can bad behaviour cost you during divorce or separation?

Written by:
Julia Warrington

Relationship breakdowns and separations are inherently stressful periods. If you find yourself subjected to ‘bad behaviour’ during this time, it can significantly compound the stress you're experiencing. One observation from my experience in family law and relationship property is the common misconceptions of what “bad behaviour” is, and when it can result in more money for the other partner. The influence of media portrayals of divorce, particularly those based on US law, often focus on infidelity, which doesn’t justify financial compensation in NZ law.

When sorting out the monetary side of separation, the Property (Relationships) Act 1976 ("the Act") sets out how property is to be divided for relationships that qualify. It generally aims to divide property (the assets and liabilities including houses, cars, superannuation, mortgage loans etc.) in a way that is “fair”. This means the starting point is that property is divided equally. However, there are some exceptions.

What is fair?

When tensions are running high what is “fair” can become unclear. In the law, what is considered “fair” depends on a number of factors such as the relationship history, how finances were managed before, during, and after the relationship, and whether there are children in the relationship. In some circumstances, each person’s separate contributions (whether monetary or non-monetary, positive or negative) to the relationship can mean compensation is needed to make it “fair”, including compensation for bad behaviour.

Bad behaviour

When it comes to the bad behaviour relevant to relationship property law, the Act calls it “misconduct”. Examples of behaviour that has been recognised as being “misconduct” under the Act are:

  • criminal behaviour or incarceration
  • significant spending on gambling or sex workers by one party unbeknownst to the other
  • mismanagement of company funds without the other’s knowledge, resulting in significant debt to the IRD which the parties would otherwise both be liable for
  • family violence - albeit only in very limited circumstances, such as where a party utilises violence to control the funds contributed to the relationship by the other party.


When trying to determine whether the “misconduct” justifies compensation to the other party, the Court assesses the type of behaviour, and then looks at the impact that behaviour has had on the value of relationship property. For example, a $20,000 gambling spend may be considered significant where the total relationship assets amount to around $200,000. However, if the relationship assets amounted to $2 million, the spending may not be considered significant enough to justify compensation.

It is important to note that getting “divorced” (dissolution of marriage) is a separate process and not affected by whether misconduct has occurred. New Zealand has a “no-fault” divorce system where a marriage can be dissolved once you have been separated for 2 years.

When separating or contemplating separation, it is important to obtain specific legal advice on your situation as soon as possible. Getting advice early can help you make decisions that are fully informed as you navigate a difficult and stressful time.

If you are seeking advice or have any questions related to this topic, please contact Julia:

© McVeagh Fleming 2024

This article is published for general information purposes only.  Legal content in this article is necessarily of a general nature and should not be relied upon as legal advice.  If you require specific legal advice in respect of any legal issue, you should always engage a lawyer to provide that advice.

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