Dividing relationship property in NZ

The Property (Relationships) Act 1976 states that if a couple have been living together for three or more years, all of their relationship property will be divided equally. The Act also covers situations where a couple have been living together for less than three years and where one party has made a substantial contribution to the relationship. The resolution of the iTunes account could apply to either situation, as this includes property acquired by either party during the relationship.

New challenges in separating relationship property: iTunes Account and Relationship Property

Decades ago couples would share a record collection, both enjoying it and adding to it over many years. For the most part, it wasn’t too difficult to divide in the event of a split. Content in an iTunes account can’t be split into two different accounts. You can access the content only by using the original account ID, which means if both parties wanted use of the content they would need to share the account, which is possible but problematic. Content downloaded through an old account can’t be merged with a new account so you are stuck with two different accounts forever, sectioned in to your pre and post-separation era’s. Also, iTunes content can only be download to a maximum of 5 devices.

Case example

A and B separate after 20 years together. Their iTunes collection is worth $10,000 and has been made over the last 10 years.

Option

A gets the money equivalent and B takes the iTunes account. The issue is in point 4 below.

Issues

1. Most people will want to retain the iTunes and not have a cash adjustment
2. Sentimental value or work items - people want to retain.
3. Takes time to input all the songs and books.
4. How iTunes Family Sharing works - unfortunately people who you share the library with retain the ability to make purchases on your account. So it doesn’t achieve the separation that you want.
5. There are up to 5 people on the account so other family members apart from A and B could have contributed, and therefore some of the $10,000 may not be relationship property.

Summary

A shared iTunes account is normally relationship property. It is messy to sort out. There are practical issues if you split to such an extent that it may be best to have separate accounts.

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