matrimonial property

Matrimonial Property Regimes

In South Africa the way that a couple decides to get married is possibly one of the most important decisions that they will make. The Act which regulates this is called the Matrimonial Property Act 88 of 1984, which came into operation on 1 November 1984.

According to the Act there are three forms of matrimonial property regimes in South Africa, namely:

  • In Community of Property

  • Out of Community of Property with the Accrual

  • Out of Community of Property without the Accrual

Couples who do not sign an antenuptial contract prior to getting married are automatically married in community of property. Should you wish to be married out of community of property an antenuptial contract is to be signed in the presence of a Notary prior to your wedding and should subsequently be duly registered at the Deeds Office within 3 months from the date of marriage. It is important to note that the antenuptial contract can only be signed before the date of marriage and signature after the date of marriage would mean that the spouses are married in community of property.

To change the Matrimonial Property Regime post-divorce is possible however it is a costly process which involves a High Court Application for leave to register a post nuptial contract.

Let’s explore briefly what each of these matrimonial property regimes mean:

IN COMMUNITY OF PROPERTY

If no contract was entered into between the spouses prior to the marriage, then the parties will be married in community of property by default.

This means that the spouses will have one joint estate throughout the marriage and that all assets and liabilities belong to both parties in equal shares regardless of which party acquired an asset or incurred the debt.

Everything that each party has ever owned will fall into the joint estate as well, nothing is excluded, not even inheritances (unless specifically excluded from any matrimonial property in the Testator’s Will) or gifts. If judgments are obtained against one of the parties for outstanding debts for instance, then judgment will be obtained against both parties.

The parties are jointly liable for everything.
Upon divorce, the joint estate will be shared equally between the parties’ debts as well as assets unless the parties enter into a Settlement Agreement in which the parties agree to otherwise.

OUT OF COMMUNITY OF PROPERTY WITHOUT THE ACCRUAL

When spouses are married without the accrual system it simply means that each spouse will retain ownership of their own separate estates and that there will be no sharing of assets or liabilities on the dissolution of the marriage or death of one of the spouses.

OUT OF COMMUNITY OF PROPERTY WITH THE INCLUSION OF THE ACCRUAL SYSTEM

When this marital regime applies to a marriage it means the following in simple terms:

  • each spouse retains ownership of their separate estates during the subsistence of the marriage and can do with their separate estates as they please.

  • only upon the death of a spouse or upon divorce will the accrual be calculated.

  • the accrual is calculated by subtracting the smaller estate’s net asset value from the estate which had a bigger net asset value. The difference between the growth of the two estates is then split between the parties.

  • specific assets can be excluded in the antenuptial contract which means that it will be excluded from the accrual calculation.

  • certain assets are automatically excluded and do not have to be specifically mentioned in the antenuptial contract, for example inheritances, gifts, awards for patrimonial damages.

Should you require assistance with an Antenuptial contract, or a Post Nuptial contract please contact us here.