14 April 2025

Is Copyright Relationship Property?

On 6 March 2025, the Supreme Court in Alalääkkölä v Palmer [2025] NZSC 9 confirmed that copyright is relationship property, and effectively up for grabs.  The decision is the latest chapter in a dispute dating back to 2017 between Sirpa Alalääkkölä and Paul Palmer.

Alalääkkölä v Palmer has been widely discussed as having a potential impact on artists, creatives and intellectual property.  But as the dust settles, how might this actually affect you? We take you through the decision, and some practical matters to be aware of.

Background

Sirpa Alalääkkölä (Ms Alalääkkölä) and Paul Palmer (Mr Palmer) separated in 2017, after 20 years of marriage.  Ms Alalääkkölä, an accomplished artist, provided the main source of income for the family.  On separation, Ms Alalääkkölä agreed Mr Palmer could keep several artworks as relationship property.  Mr Palmer then sought to copyright, reproduce, and sell copies of those paintings, which Ms Alalääkkölä objected to, setting the scene for a multi-year dispute centred around copyright.  This novel legal dispute covered previously unexplored territory between copyright and relationship property.

Legal Issues

The issues for the Supreme Court to decide were:

• Is copyright “property”, for the purposes of the Property (Relationships) Act 1976 (PRA)?
• If so, is copyright relationship property, or separate property, under the PRA?
• How should the financial value derived from copyright be allocated under the PRA?

Implications

Who Owns Copyright in a Relationship?

• The Copyright Act 1994 gives the author of a work a variety of rights, such as the right to reproduce, sell, and distribute copies. It also includes the ability to waive those rights.
• The long-standing approach in New Zealand is that copyright is a form of personal property. However, copyright created during a marriage holds an economic value.  That economic value, according to Alalääkkölä v Palmer [2025] NZSC 9, is relationship property.
• In short, while the owner of the copyright keeps the moral and personal rights of the copyright, the economic value derived from that copyright can be valued for the purposes of the PRA.
• The Courts will also choose a division which respects the copyright owner’s right to disclose to the public as they please, where it is consistent with a just division of relationship property.

Valuing Copyright

After confirming copyright as relationship property under the PRA, the Court made subsequent directions for the Family Court to deal with valuing Ms Alalääkkölä’s work, under several categories:

• incomplete, damaged or unsuitable;
• intended to be kept private;
• a unique piece;
• a piece (or pieces) with multiple copies.

The Court also emphasised that a market valuation should reflect whether copyright for specific artwork has been monetised in the past, and whether the artist intends to exploit it in the future.

Conclusion

The distinction between a right to create, and the financial benefits that flow from that right, can be difficult to define.  However, that distinction can clearly become the subject of dispute, as shown by Alalääkkölä v Palmer [2025] NZSC 9.

Our team at McCaw Lewis regularly deal with intricacies in the relationship property space. They can provide you with the right support and assistance, starting from the commencement of discussions, through to complex legal Court proceedings.  If your situation requires legal guidance, please get in touch with us.

Zane Mora is an Associate in our Dispute Resolution Team and can be contacted on 07 958 7431.