• According to South African law, the parties who wish to become married out of community of property must enter into an antenuptial contract prior to the marriage ceremony being concluded.  
• If they fail to do so then they are automatically married in community of property. Of course, many people are unaware of this provision and should be able to satisfy the court that it should change their matrimonial property system if it was their express intention that they intended to be married out of community of property.

• There must be sound reasons for the proposed change.
• The Act requires that notice of the parties’ intention to change their matrimonial property regime must be given to the Registrar of Deeds, must be published in the Government Gazette and two local newspapers at least two weeks prior to the date on which the application will be heard and must be given by certified post to all the known creditors of the spouses.
• The court must be satisfied that no other person will be prejudiced by the proposed change. The court must be satisfied that the rights of creditors of the parties must be preserved in the proposed contract so the application must contain sufficient information about the parties’ assets and liabilities to enable the court to ascertain whether or not there are sound reasons for the proposed change and whether or not any particular person will be prejudiced by the change.

• The Matrimonial Property Act 88 OF 1984

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There are only two grounds for divorce, namely the irretrievable breakdown of the marriage; or mental illness or continued unconsciousness of one of the spouses.

Examples of the irretrievable breakdown of a marriage as a ground for divorce include:

1. the spouses not living together for a continuous period of one year;
2. abuse towards the spouse or the children;
3. adultery;
4. habitual criminality;
5. drunkenness or drug addiction; or
6. loss of love and affection between the spouses.

The court’s discretion to grant a divorce order

The court still has discretion not to grant a divorce order, and may postpone the proceedings or dismiss the claim if it appears to the court that there is a reasonable possibility that the parties may reconcile through counselling. If reconciliation is unsuccessful after a few months, the parties may proceed with the same summons. The summons will usually contain the averment that further counselling and/or treatment will not lead to any reconciliation. A court must, therefore, be satisfied that the marriage is really broken down and that there is no possibility of the continuation of a normal marriage.

What if the couple reconciles?

Where the parties reconcile and live together again after the summons was issued and served, it does not necessarily end the divorce proceedings. If, however, the reconciliation is unsuccessful after a few months, the parties may proceed with the same summons. It is extremely important to make sure that the summons is withdrawn formally if you do decide to reconcile. Withdrawal of the summons is formally affected when the plaintiff serves a document referred to as a notice of withdrawal of the summons on the defendant or his/her attorney. If this is not done, a divorce order may be obtained by default without the defendant being aware of it. If a divorce is obtained in this manner, the aggrieved party may approach the court to set aside the order.

Conclusion

Since the present law on divorce is no longer based on the principle of fault, defences like insanity or the plaintiff’s own adultery are no longer valid defences. Therefore, if a divorce is instituted on account of an irretrievable breakdown, there is in fact no defence to prevent the divorce from proceeding. But if the court finds that there is a reasonable possibility of reconciliation, it may postpone the proceedings in order that the parties attempt reconciliation; this, however, is not a defence, but merely amounts to a postponement.

References:

• Justive.gov.za
• Legalwise.co.za

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

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For newlyweds, one of the most important tasks to attend to is estate planning. The estate planning will depend on what the couple wants and what form of marriage they are in. It is therefore important to keep the following in mind when planning the years ahead together.

Marriage in community of property

There is a joint estate, with each spouse having a 50 percent share in each and every asset in the estate (no matter in whose name it is registered);

1. In the event of the death of one spouse, the surviving spouse will have a claim for 50 percent of the value of the combined estate. The estate is divided after all the debts have been settled in a deceased estate.
2. When drafting a Last Will and Testament, spouses married in community of property need to be aware that it is only half of any asset that he or she is able to bequeath.
3. Upon the death of one spouse, all banking accounts are frozen (even if they are in the name of one of the spouses), which could affect liquidity.

Marriage out of community of property without the accrual system

Each estate planner (spouse) retains possession of assets owned prior to the marriage. Each spouse’s estate is completely separated, even in the event of death. If you want your spouse to inherit something, you would need to outline this in your Will.

Marriage out of community of property with the accrual system

This is identical to a “marriage out of community of property” but the accrual system will be applicable. The accrual system is a formula that is used to calculate how much the larger estate must pay the smaller estate once the marriage comes to an end through death or divorce.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

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Domestic partnerships, also known as cohabitation relationships, are becoming more common in our modern day society, and it therefore becomes ever more important for parties to understand the different legal implications of being married and merely cohabiting. Parties to a domestic partnership do not enjoy the same legal protection as married couples upon termination of the partnership with regards to maintenance claims, property division or succession.

In the South African legal system, there are three forms of fully legally recognised unions, namely marriages, civil unions and customary marriages. However, in our modern society it is becoming more common for couples to live together in domestic partnerships, without ever getting married. It is important for parties to these partnerships to realise that little to no legal protection is provided upon the termination of such a relationship, either by agreement or due to the death of either party.

The general rule for domestic partnerships was laid down in Butters v Mncora: A domestic partnership does not give rise to any special legal consequences, such as that of a marriage or a civil union.

In 2006, the South African Law Reform Commission acknowledged the need for legal protection to be granted and drafted the “Draft Domestic Partnership Bill.” Parliament has however shown no urgency to pass the Draft Bill, and the legal position in South Africa thus remains unchanged.

Maintenance claims

The Maintenance of Surviving Spouses Act entitles a surviving spouse of a marriage, and a surviving civil partner of a civil union, to institute a claim for maintenance against the estate of the deceased. This provides for a claim of any reasonable maintenance needs that they cannot provide for by their own means, until such time that they remarry or pass away.

Parties of a domestic partnership should note that this protection does not extend to domestic partnerships, and thus no such maintenance claim can be made. Should the Domestic Partnership Bill be enacted in the future, section 28 will offer such an opportunity to claim for maintenance. However, at this stage no such protection is afforded.

Property Division

Parties to a marriage have a choice of two matrimonial property regimes.  Simply put this is to be married either in community of property, or out of community of property. Each property system will have different consequences flowing from it either by law or contractually due to an Antenuptial contract. However, no property regimes exist for domestic partnerships, and thus no joint estate can exist as it would in a marriage.

The Supreme Court of Appeal has recently portrayed an increased willingness to extend contract-based legal protection to parties of a domestic partnerships. Contracts can be concluded by parties in domestic partnerships to govern aspects such as division of property upon termination of the partnership. Although these types of contracts are legally enforceable, they may give rise to potential problems. The contract may be concluded solely for the benefit of one of the parties, or circumstances may occur that the parties had not anticipated when the contract was drawn up. In practice however, it seldom happens that parties to a domestic partnership actually enter into a contract.  This may be due to a mutual decision, or due to the fact that parties did not foresee a need for such contract.

Intestate Succession

In terms of the Intestate Succession Act, a spouse of a marriage will inherit if the deceased spouse dies without making a will. This has been extended to include partners of a civil union and customary marriage. Provision for inheritance by a partner of a permanent same-sex partnership has also been made in terms of this Act. This has however not been extended to the termination of heterosexual domestic partnerships, and thus no claim can be made in terms of the Intestate Succession Act on the estate of a deceased partner of a domestic partnership.

Couples living together in cohabitation relationships do not have similar rights to institute claims against the other party upon termination as they would have in a marriage or civil union. This could leave financially dependent parties in unanticipated vulnerable positions.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Reference List:

• Butters v Mncora 2012 (4) SA 1 (SCA).
• Barratt A “Private contract or automatic court discretion? Current trends in legal regulation of permanent life-partnerships” (2015) 26 Stellenbosch Law Review 110-131.
• Clark B “Families and domestic partnerships” (2002) 119 South African Law Journal 634-648.
• Intestate Succession Act 81 of 1987.
• Maintenance of Surviving Spouse Act 27 of 1990.
• Skeleton A (ed) Family Law in South Africa (2010), Cape Town: Oxford University Press.
• The Domestic Partnership bill in GG 30663 of 14-01-2008.

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If you don’t have an ANC, you are automatically married in community of property. This means that there is one estate between a husband and a wife. Everything is shared equally between spouses, which includes debts. However, with an antenuptial contract, the estates of each spouse remain separate. The difference comes with the addition of the accrual system.

What is an antenuptial contract?

An ANC determines whether a marriage will be out of community of property with/without the accrual system. It must be signed by the persons entering into a marriage, two witnesses and a notary public, and it must be registered in the Deeds Registries office within the prescribed time period.

What is the accrual system?

The accrual system is a formula that is used to calculate how much the spouse with the larger estate must pay the smaller estate if the marriage comes to an end through death or divorce. Only property acquired during the marriage can be considered when calculating the accrual.

• If there is no accrual system, then the spouses have their own estates which contain property and debts acquired prior to and during the marriage – nothing is shared.
• The underlying philosophy of the accrual system is that each spouse is entitled to take out the asset value that he or she brought into the marriage, and then they share what they have built up together.
• The accrual system only applies if the marriage ends – either by divorce or death. You cannot claim your share of the joint estate while you’re still married.

Whether or not you decide to include the accrual system in your antenuptial contract depends on the couple. Some may see the relevance while others do not.

It’s important that both of you consult the lawyer who’s drawing up the ANC because both spouses need to be fully aware of the consequences. It’s also important to see someone who’s neutral, and who can mediate what goes into your ANC, because emotions can cloud your judgment, and it can be a stressful negotiation if one spouse has a lot of assets and the other doesn’t, for example.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).

References:

http://www.biznews.com/thought-leaders/2014/11/09/nine-things-need-know-antenuptial-contracts/

https://www.legalwise.co.za/help-yourself/quicklaw-guides/marriages/

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An Antenuptial Contract is an important document that, under South African law, determines whether your marriage will exist in community of property or out of community of property, with or without the accrual system.

An Antenuptial Contract offers a number of benefits:

1. Preventing your intended marriage from automatically being in community of property
2. Offering transparency in your relationship by recording the rights, duties and consequences (legal and proprietary) of your marriage
3. Preventing unnecessary disputes with your spouse down the lineWhat is Marriage in Community of Property
There is one estate between a husband and a wife. Assets and liabilities acquired prior to or during the marriage are shared equally in undivided shares (50%). Both spouses are jointly liable to creditors.

What is an Antenuptial Contract?

This is a contract entered into to regulate whether a marriage will be out of community of property with/without the accrual system. An Antenuptial Contract must be signed by the persons entering into a marriage, two witnesses and a notary public, and it must be registered in the Deeds Registries office within the prescribed time period.

The Accrual System

In a marriage out of community of property WITHOUT the accrual system, the spouses have their own estates which contain property and debts acquired prior to and during the marriage (“what is mine is mine and what is yours is yours”). Each spouse is separately liable to his/her creditors. Prior to the marriage, an Antenuptial Contract must be entered into to indicate that the marriage will be out of community of property.

A marriage out of community of property WITH the accrual system is identical to a “marriage out of community of property” but the accrual system will be applicable. The accrual system is a formula that is used to calculate how much the larger estate must pay the smaller estate once the marriage comes to an end through death or divorce. Only property acquired during the marriage can be considered when calculating the accrual. The accrual system does not automatically apply and must be included in an Antenuptial Contract.

Conclusion

After marriage, the terms of the Antenuptial Contract become irrevocable unless they are amended by a court order or, in some cases, by a notarial contract which must be registered in a deeds registry.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Reference:
https://www.legalwise.co.za/help-yourself/quicklaw-guides/marriages/

Antenuptial Contracts

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The most important forms of marriage are: marriage in community of property, marriage out of community of property (without accrual), and marriage out of community of property (with accrual).

Marriage in community of property

1. There is no prior contractual arrangement, apart from getting married;
2. Spouses do not have two distinct estates;
3. There is a joint estate, with each spouse having a 50% share in each and every asset in the estate (no matter in whose name it is registered);
4. Applies to assets acquired before the marriage and during the marriage;
5. Should one spouse incur debts in his own name it will automatically bind his/her spouse, who will also become liable for the debt;
6. If a sequestration takes place (in the case of insolvency), the joint estate is sequestrated.

Marriage out of community of property without the accrual system

1. An antenuptial contract (ANC) is drawn up by an attorney (who is registered as a notary), before the marriage;

2. Where there is no contract, the marriage is automatically in community of property;

3. The values of each spouse’s estate on going into the marriage are stipulated in the contract;

4. A marriage by ANC means that all property owned by spouses before the date of the marriage will remain the sole property of each spouse;

5. Each spouse controls his/her own estate exclusively without interference from the other spouse, although each has a duty to contribute to the household expenses according to his/her means;

6. To allow for assets acquired by spouses during the marriage to remain the sole property of each spouse, the accrual system must be specifically excluded in the ANC.

Marriage out of community of property with the accrual system

1. The accrual system automatically applies unless expressly excluded in the antenuptial contract;
2. The accrual system addresses the question of the growth of each spouse’s estate after the date of marriage.

ESTATE PLANNING

Donations between spouses are exempt from donations tax and estate duty.

Marriage in community of property

1. In the event of the death of one spouse, the surviving spouse will have a claim for 50% of the value of the combined estate, thus reducing the actual value of the estate by 50%. The estate is divided after all the debts have been settled in a deceased estate (not including burial costs and estate duty, as these are the sole obligations of the deceased and not the joint estate).

2. When drafting a Last Will and Testament, spouses married in community of property need to be aware that it is only half of any asset that he or she is able to bequeath.

3. Upon the death of one spouse, all banking accounts are frozen (even if they are in the name of one of the spouses), which could affect liquidity.

4. Donations or bequests to someone married in community of property can be made to exclude the community of property; in other words, if the donor stipulates that the donation must not fall into the joint estate, then the donee can build up a separate estate. However, returns on such separate assets will go back to the joint estate.

Marriage out of community of property without the accrual system

Each estate planner (spouse) retains possession of assets owned prior to the marriage.

Marriage out of community of property with the accrual system

A donation from one spouse to the other spouse is excluded from the calculation of each spouse’s accrual; in other words, the recipient does not include it in his growth and the donor’s accrual is automatically reduced by the donation amount.

DIVORCE

In the event of divorce, the marriage will be dissolved by court decree, which will address such aspects as child maintenance, access, guardianship and custody, spousal maintenance, the division of assets, division of pension interests and so on.

COHABITATION AND DEFINITION OF “SPOUSE”

Cohabitation is defined as a stable, monogamous relationship where a couple who do not wish to or cannot get married, live together as spouses. The Taxation Laws Amendment Act has extended the definition of “spouses” to include “a same sex or heterosexual union which the Commissioner is satisfied is intended to be permanent”.

Many pieces of legislation, including the Pension Funds Amendment Act and the Taxation Laws Amendment Act, now define spouse to include a partner in a cohabitative relationship, the effects of which are that cohabitees will benefit from the Section 4(q) estate duty deduction in the Estate Duty Act, and the donations tax exemptions of the Income Tax Act.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

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At the beginning of August a section of the law dealing with the recognition of customary marriages has been ruled by the Limpopo High Court as being unconstitutional.

Joseph Netshituka was in a civil law marriage with Joyce Netshituka and in customary marriages with three other women. All of the three customary marriages were entered into before 1998, which means that according to the Recognition of Customary Marriages Act 120 of 1998 (“the Act”), polygamous customary marriages entered into prior to 1998 are not considered to be that of in community of property.  Therefore, land that Joseph acquired in Limpopo in 1991 was only in his and Joyce’s names as they were married in community of property according to civil law. This particular piece of land was sold in 1999, but Joseph re-acquired it in 2002.

The children of three of Joseph’s customary wives, who passed away, argued in the Limpopo High Court that it was unconstitutional to not recognise the customary marriages as being in community of property because they were entered into prior to 1998. Their parents were married before the legislation where their mothers had no right to their husband’s property. This therefore left the children in the cold, as only their siblings whose mother was married in terms of civil law, were allowed to inherit.

Acting Judge A Lamminga referred to these as “old” polygamous customary marriages and further said that wives who entered into these “old” marriages had no claim to their husband’s assets, including property, which were acquired during the marriage. It was argued in Court that women who are affected by the now invalid provisions are mostly poor, older and live in the rural areas of our country. Neither these women, nor their children may inherit anything after the death of their husbands. Acting Judge Lamminga further remarked that women who entered into the “old” marriages were still being excluded from benefiting from their husband’s property – this left the women and their children particularly vulnerable. The Judge said that this discriminating provision should not be allowed to remain on South Africa’s statute books.

The High Court heard the argument of the children and agreed with them that Section 7(1) of the Act “discriminates unjustifiably against women in polygamous customary marriages on the basis of gender, race and ethnic or social origin and is thus inconsistent with the constitution and must be declared invalid”.  The Judge furthermore held that “until such time that legislation is passed to govern the proprietary consequences of customary polygamous marriages that occurred before the Act was passed, the wives who are parties to such marriages shall have joint and equal rights of management and control over and in the marital property of their husbands.” In conclusion Judge Lamminga added: “The recognition of the equal worth and capacity of all partners in customary marriages is well overdue and it should not be delayed any further.”

This ruling is a massive legal victory for women who are in polygamous customary marriages and is definitely an exciting start to Women’s Month!

Compiled by: Annerine du Plessis

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

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In the last couple of months I have been quite busy with clients who have not given thought about the legal side of getting married prior to saying “I do”, and I find it rather alarming how people, even in modern times, do not consider the legal reality of tying the proverbial knot.

According to South African law a married couple is deemed to be married in community of property unless they expressly enter into and register an Antenuptial contract prior to getting married.

Here is a simple example of a scenario I was faced with a while back: Mr A and Mrs B are both originally from Timbuktu and have worked and resided in South Africa for the last twenty years. The South African law is entirely foreign and unknown to both of them. About seven years ago the couple rushed off to the Department of Home Affairs to get married. In their minds, that was it! A year ago Mr A bought a house. The Conveyancing attorney then brought it to Mr A’s attention that he and Mrs B are in fact married in community of property. The attorney had to explain exactly what the legal consequences are of being married in community. Mr A and Mrs B are both medical practitioners and in the event of something happening to one of their practices, the financial consequences could be devastating to the other spouse’s practice. It was purely by chance that the couple found out that they are married in community of property and after the impact of a joint estate was explained to the couple, they were worried.  Is this what is meant by the part where you say “for better or for worse”?

There is good news and bad news. The good news is that it is possible in South Africa to apply to Court for the change of your matrimonial property system. The bad news is that this type of application is costly. It is therefore strongly advised that couples consider all the legal aspects of marriage before walking down the aisle. Consult with a legal professional regarding the different options available on how to get married and what the legal implications are of the different matrimonial property systems.

Section 21 of the Matrimonial Property Act, Act 88 of 1984, makes provision for the change of your matrimonial property system. According to the Act a husband and wife may jointly apply to court for leave to change the matrimonial property system which applies to their marriage. The court will only grant an order to this effect if the court is satisfied that there are sound reasons for the proposed change, sufficient notice of the proposed change has been given to all the creditors of the spouses and no other person will be prejudiced by the proposed change. Should the parties be successful with such court application, the court will authorize them to enter into a notarial contract by which their future matrimonial property system will be regulated on such conditions as the court may deem fit.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).

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In our last month’s newsletter, we provided some insight into marriages which are classed as “In Community of Property”. In this month’s newsletter, we shall address “Out of Community of Property” marriages and the impact of the “accrual system”.

Should you wish to read last month’s article, you may find it on our website under the “News” tab, titled “Let Schnetler’s help you to tie the knot”.

ANTENUPTIAL CONTRACTS

An Antenuptial Contract is a marriage contract which is entered into between two persons who are intending to be married to one another. In this contract, the terms and conditions which will govern the marriage will be set out, more particularly the matrimonial property system which is to apply to their marriage.

There are two options of such Antenuptial Contract:

1. excluding the accrual system
2. including the accrual system

OUT OF COMMUNITY OF PROPERTY WITH THE ACCRUAL SYSTEM

The accrual system is, in theory, the best of all matrimonial property systems. During the subsistence of the marriage, the spouses have separate estates. The accrual of the estates of each spouse is the amount by which the nett value of the estate at dissolution of the marriage (either by death or divorce) exceeds the nett value of the estate at the commencement of the marriage. Hence, the nett value of the estate at date of marriage is deducted from the nett value of the estate at date of dissolution thereof. If the result is zero, then there has been no accrual.

There are, however, certain items which are not included in the value of the spouses’ estates at date of dissolution of the marriage:

1. Monies received by a spouse by way of damages for non-patrimonial loss e.g. payment received in a civil litigation for defamation of character.

2. Any asset which the spouse has excluded from the accrual in the Antenuptial Contract, as well as any asset which has been acquired by virtue of such excluded asset e.g. property which is sold with a new property being bought with these proceeds.

3. Inheritances, legacies and donations which accrued to the spouse during the marriage, as well as any asset acquired by virtue of such inheritance, legacy or donation.

4. Donations between the spouses.

OUT OF COMMUNITY OF PROPERTY WITHOUT THE ACCRUAL SYSTEM

The exclusion of the accrual system can be explained as follows – each spouse has a separate estate from the other. Thus, at termination of the marriage, each spouse retains their own estates, with there being no division whatsoever.

The main disadvantage of being married without the accrual system, is that no matter how long the marriage has endured, and how much one spouse has contributed to the other spouse’s success, he/she does not have a right to share in that person’s gains.

Should you wish to discuss the Marital Regime options further, or should you wish to have an Antenuptial Contract drafted, kindly contact one of our Notaries who will be pleased to help you reach the best decision for your future marriage.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).

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