Media reports of the recent Constitutional Court decision holding a section of the Divorce Act unconstitutional and giving Parliament 24 months to remedy that haven’t always been clear about who needs to be aware of this, and who doesn’t.
Firstly, understand the three “marital regimes” available to you
Legally, marriage amounts to a binding contract, and you have the right to choose between three possible “regimes” –
- Marriage in community of property: All of your assets and liabilities are merged into one “joint estate” in which each of you has an undivided half share. On divorce or death the joint estate (including any profit or loss) is split equally between you, regardless of what each of you brought into the marriage or contributed to it thereafter. This is the “default” regime – so you will automatically be married in community of property if you don’t specify otherwise in an ANC (ante-nuptial contract) executed before you marry.
- Marriage out of community of property without the accrual system: Your own assets and liabilities, both what you bring in and what you acquire during the marriage, remain exclusively yours to do with as you wish. Note here that the “accrual system” (see option 3 below) will apply to you unless your ANC specifically excludes it.
- Marriage out of community of property with the accrual system: As with the previous option, your own assets and liabilities remain solely yours. On divorce or death however you also share equally in the “accrual” (growth) of your assets (with a few exceptions) during the marriage.
Secondly, what’s the new ruling all about?
If you were married out of community of property (a) without the accrual system (option 2 above) after (b) 1 November 1984, you previously could not ask the court for a “redistribution order” – a reallocation of assets between spouses to ensure a fair split. Your marriage could end (be it through divorce or death) with one of you in a strong financial position and the other in a dire financial position, with a court having no discretion to help the spouse with less or no assets. You could literally be left destitute after possibly decades of marriage, with no redress and no claim against your spouse’s assets.
A 2021 High Court order (now confirmed in a Constitutional Court decision) declared unconstitutional the section of the Divorce Act which led to that unhappy state of affairs, so that you can now ask the court for a redistribution order no matter when you were married.
What does it mean in practice?
- Does this change affect you? The change does not affect you if you were married –
o In community of property (option 1 above), or
o Out of community of property with accrual (option 3 above), or
o Out of community of property without accrual (option 2 above) before 1 November 1984.
The change does affect you if you were married out of community of property without accrual (option 2 above) after 1 November 1984.
- What new rights do you have? You now have the right – previously denied to you – to apply for a fair, court-ordered asset redistribution between spouses.
- Are you automatically entitled to a redistribution of assets? No – you will have to convince the court that “it is equitable and just by reason of the fact that the party in whose favour the order is granted, contributed directly or indirectly to the maintenance or increase of the estate of the other party during the subsistence of the marriage, either by the rendering of services, or the saving of expenses which would otherwise have been incurred, or in any other manner.” In other words, you must prove what contributions you made to the marriage to justify your claim to redistribution.
- Will the court take anything else into account? What about what you agreed to in your ANC? Importantly, the court can take into account “any other factor which should in the opinion of the court be taken into account”. What you agreed to in your ANC is bound to be a consideration, and as the Court here put it: “This is as wide as can be.The fact that the parties concluded an antenuptial contract excluding the accrual regime could be taken into account.The weight this factor should receive would depend on the circumstances.” Bottom line – the court can take anything relevant into account, including what you agreed to at the time of your marriage.
About to marry?
Which all confirms the importance of making the correct legal choices before you marry to avoid uncertainty, heartache and dispute down the line.
Contact Nicole Scholtz at Goldberg & de Villiers Inc. for professional legal assistance before you tie the knot.