Matrimonial Property
Regimes in South Africa
Presentation by Caleb Kipa
LLB (Cum Laude) & Bcom Law – University of Johannesburg
Introduction
• Many couples wish journey to marriage
as stress free and pleasurable as
possible.
• Many couples disregard the importance
of the matrimonial property regime that
will govern their marriage.
• The unfortunate reality in South Africa
and most developed counties is that
many marriages end in divorce.
• There are three types of of matrimonial
property regimes in South Africa;
namely, marriage in community of
property; marriage out of community of
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property with the accrual; and marriage
out of community of property without the
accrual.
• These regimes are governed in terms of
the Matrimonial Property Act 88 of 1984.
Marriage in Community
of Property
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• The most popular regime is marriage in community of property. Which is also the default
position.
• The reason for this is due to the fact that it is the default regime and requires no
antenuptial contract.
• Being married in community of property results in the estate of the husband and wife
joining and becoming one joint estate.
• The implication of this means that the one spouse could be held responsible for any debt
incurred by one’s spouse, which includes debt that was incurred before marriage.
• What do we mean by joint estate – husband car, money and house before marriage and
wife's car, money and businesses before wedding – after wedding forms part of joint
estate and the husband and wife each are entitled to 50% of the value of each item in the
joint estate during the marriage and after divorce.
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• In general, subject to certain exceptions, a spouse in a MICOP may
perform any juristic act in respect of the joint estate without the
consent of the other spouse.
• However, because you are in a joint estate – the actions of the one
spouse affects the action of the other spouse. Therefore the law has
listed a number of actions which a spouse cannot do without the
permission of the other spouse I will list some of the below:
 Sell, mortgage any immovable property of the joint estate;
 Sell, cede or pleadge any shares, stocks, insurance policies that form part of the joint estate;
 Sell or pledge jewellery, coins, stamps or paintings that are held mainly as investments and
form part of the joint estate;
 Enter into a credit agreement as a consumer – incurring loans;
 Enter into a contract for the purchase of immovable property;
 Institute legal proceedings; or
 Binding oneself as a surety – quickly this means that you can not enter into an agreement in
which you offer to pay the debts of another if such person fails to pay the debts – without
permission of the other spouse.
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• In the event that you want to enter into an excluded transaction however the other spouse
unreasonably withholds consent, the spouse can apply to the court for permission to
enter into the transaction without the consent of their spouse, if the court is satisfied that
the consent has been unreasonably been withheld and there is good reason to dispense
with the consent. For example – you want to buy a house on auction – it is affordable, can
get it cash, or if on credit low interest rate – unreasonable to withhold consent especially
when we know property value always appreciates.
• It is also worth mentioning that certain assets are excluded from the joint estate for
example –
• Damages awarded to a spouse arising from a delictual claim (payout
from road accident fund for being involved in an accident).
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Marriage out
Community of Property
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• The most common reason why people elect to marry out of community of property is to
protect their assets and financial position prior to and during the marriage.
• How to conclude ANC – what are the requirements and procedures
 A marriage out of community of property is achieved by drawing up an antenuptial
contract (ANC). The ANC will be the most important contract that a married couple will
sign in their lifetime. Entered into before marriage, the purpose of the contract is to
change some or all of the automatic financial consequences of marriage.
 The ANC allows the husband and wife to tailor-make their very own matrimonial
property regime. They can include any provisions they like in their ANC, as long as the
provisions are not against the law, good morals or the nature of marriage.
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Registration of the ANC • Only an attorney who is a notary public may execute an ANC. It is important that both
parties consult with the notary public beforehand.
• Once the ANC has been drafted, both parties and the notary public must sign it in
duplicate prior to the marriage.
• The ANC will then be forwarded to the deeds office in the area where the parties reside to
be registered.
• Registration must be affected within three months of the date it was signed by the notary
public.
• Apart from the usual fees, a prescribed fee is payable to the deeds office upon
registration of the contract.
When you marry out of community of property, there are two options to consider regarding
your ANC – with accrual or without accrual.
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Marriage out
Community of Property
(with the accrual)
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• When you marry out of community of property it means that each spouse retain
ownership of the assets acquired before and during the marriage and the other spouse
does not have any claim or right of such assets.
• The ‘accrual’ is the extent to which the husband and wife have become richer by the end
of the marriage
• When you marry of community of property with the accrual it means that:
 At the dissolution of the marriage (whether by divorce or death of
one or both spouses), the spouse whose estate shows no accrual or
a smaller accrual than the estate of the other spouse acquires a claim
against the other spouse or his estate.
 The claim is for an amount equal to half of the difference between the
accrual of the respective estates of the spouses.
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• First we need to explain How is the accrual of the estate calculated:
• It is the difference between the net value of the spouses individual estate at the
commencement of the marriage against the net value of the spouses individual
estates at the dissolution of the marriage.
 Husband value of estate at date of wedding is R2 million and at date of
divorce is R3 million = therefore the accrual in his estate is R1 million.
 Wife value of estate at date of wedding R1,5 million and at date of divorce is
R1,7 million = therefore the accrual of the wife's estate is R200 000.
• The husbands estate is bigger compared to the wife’s. Therefore the wife has a
claim over the husbands estate.
• How does one calculate the wife’s claim?
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• Wife will be entitled to an amount equal to half of the difference between the
accrual of the two estates. The difference of the two estates is R1 million – R200
000 = R800 000 / 2 = R400 000. Therefore the wife will be entitled to R400 000 from
the husband's estate at divorce or death.
• The antenuptial agreement can exclude certain assets from the estate. For
example the husband can exclude a cars he buys during the marraige. If the car
is worth R300 000. The husbands accrual will not be 1 million but R700 000
because you excluded vehicles purchased from the calculation of the accrual.
Therefore the wifes claim would be calculated as R700 000k – R200 000 = R500
000 / 2 = R250 000.
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Marriage out
Community of Property
(with the accrual)
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What about inheritances, legacies and donations?
• Inheritances, a legacy or donation that a spouse acquires during the marriage
does not form part of the accrual of his estate. So if during the marriage the wife
inherited a house from her father and the value of the house was R5 million, you
would not include that R5 million into the calculation of the accrual of the wife’s
estates.
Forefeiture of right to accrual sharing or assets in joint estate
• The Divorce act provides that the court may make an order that the patrimonial
benefits of the marriage be forfeited by one party on favor of the other, if the
court having considered the duration of the marriage, the circumstances which
gave rise to the break-down of the marriage, or substantial misconduct by either
spouse, is satisified that if the order for forfeiture is not made, the one party will
in relation to the other be unduly benefited. Examples: married for a short period
(i.e 6 months) , abusive spouse, spouse cheated.
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Marriage out
Community of Property
(without the accrual)
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• There is no joining of the spouses’ estates into one joint estate.
• Each spouse has his/her own separate estate, consisting of his/her premarital assets and
debts, and all the assets and debts he/she acquires during the marriage.
• ANC must state that the marriage is out of community of property without accrual.
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Marriage out
Community of Property
(with the accrual)
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Advantages and
disadvantages of the
matrimonial property
regimes
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Advantages of marriage out of community of property:
•
Each spouse keeps his/her own assets and is free to deal with his/her own estate as he/she
likes.
•
Spouses are generally not liable for each other’s debts. Thus, if one spouse becomes
insolvent, creditors cannot touch the assets of the other spouse.
•
The financially stronger spouse does not have to share his/her estate with the financially
weaker spouse. This is subject to judicial discretion and forfeiture of benefits – unless
married out of community with the accrual then the financially weaker spouse has a claim.
Disadvantages of marriage out of community of property:
•
The economically weaker spouse, traditionally the woman, does not get to share in the estate
of the stronger spouse, even though she may have indirectly contributed to the estate by
running the household and looking after the children - unless married out of community with
the accrual then the financially weaker spouse has a claim.
•
An ANC has to be entered into in order to marry out of community of property. This costs
money, and the parties must pay the fees of a notary and costs of registration.
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Advantages of marriage in community of property:
• There are no upfront legal costs involved for the preparation of an antenuptial contract.
• As both parties are effectively working together for the benefit of the joint estate, this
form of a marital regime can encourage togetherness, equality and oneness of purpose.
Disadvantages of marriage in community of property:
• One of the greatest disadvantages of this marital regime is that the couple remains jointly
liable for each other’s debt, including debt that was incurred before the marriage. If one
spouse is unable to pay his/ her debts the credit may go after the other spouse for the
debt.
• The management of the joint estate can also be cumbersome as spousal consent is
needed in certain circumstances, such as selling fixed property, withdrawing from a joint
bank account, or selling assets from the joint estate.
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Post-nuptial
agreements
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• Couples are however allowed to amend their matrimonial property regime to one of out of
community of property.
• Section 21 (1) of the Matrimonial Property Act provides that a married couple may jointly
apply to court to amend their current matrimonial property regime.
• It is prudent to note at this point that there are quite a number of requirements that have
to be met in order to amend a marital regime.
• The court may order a change of the matrimonial property regime, if satisfied that—
o there are sound reasons for the proposed change;
o sufficient notice of the proposed change has been given to all the
creditors of the spouses; and
o no other person will be prejudiced by the proposed change.
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Conclusion
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• It is important to reiterate that it is of paramount importance that both parties to the
marriage understand the implications and consequences of the type of matrimonial
property regime they are entering into. Unfortunately, couples focus so much on the big
day that they disregard the implications of neglecting to make a well-informed decision
regarding the regime that will inevitably govern their marriage.
• It is important to bear in mind that should you get married in community of property and
later decide that you would prefer to change your matrimonial property regime to one out
of community, you can do so but it involves a High Court Application that is both
expensive and not guaranteed to be successful.
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The End.
Thank you!
Presentation by Caleb Kipa
LLB (Cum Laude) & Bcom Law
Admitted Attorney of the High Court