When a marriage comes to an end, one of the most significant practical questions is how the assets and liabilities of the spouses will be divided. The answer depends on the matrimonial property regime that governs the marriage which, in South Africa, is determined at the time of marriage and cannot be changed after the fact without a court order.

Marriage In Community of Property

If a couple marries without signing an antenuptial contract (ANC), the default regime is marriage in community of property. Under this regime, the spouses' separate estates are merged into a single joint estate. All assets acquired before and during the marriage form part of the joint estate, and all debts incurred by either spouse are debts of the joint estate.

On divorce, the joint estate is divided equally between the spouses. Each spouse is entitled to half of the net value of the joint estate that is, half of the total assets minus the total liabilities.

The principle of equal division is subject to limited exceptions. Section 7(3) of the Divorce Act 70 of 1979 allows the court to order a forfeiture of patrimonial benefits where a marriage was of short duration or where one spouse would benefit unduly from the marriage.

Marriage Out of Community of Property Without the Accrual System

Where the parties sign an ANC that excludes community of property and excludes the accrual system, each spouse retains their own separate estate. On divorce, each spouse keeps their own assets and is responsible for their own debts. There is no sharing of assets accumulated during the marriage.

This regime offers maximum financial independence during the marriage but can produce inequitable results on divorce particularly where one spouse sacrificed career opportunities to care for children while the other accumulated significant wealth.

Marriage Out of Community of Property With the Accrual System

The accrual system, introduced by the Matrimonial Property Act 88 of 1984, is the most common regime for marriages governed by an ANC. Under this system, each spouse retains their own separate estate during the marriage. However, on dissolution of the marriage, the growth in each spouse's estate during the marriage is compared. The spouse whose estate grew by a smaller amount has a claim against the other spouse for half the difference.

The accrual is calculated by determining each spouse's net asset value at the start of the marriage (declared in the ANC) and at the date of dissolution, and comparing the growth. The accrual system balances financial independence during the marriage with equitable sharing of the wealth accumulated through the partnership of marriage.

Redistribution Orders

Section 7(3) to 7(6) of the Divorce Act gives the court a discretionary power to make orders regarding the redistribution of assets in certain circumstances. For marriages in community of property, the court may order forfeiture of benefits. For marriages out of community of property entered into before the commencement of the Matrimonial Property Act (1 November 1984), the court may order a redistribution of assets.

Practical Implications

For individuals contemplating marriage, the choice of matrimonial property regime has profound long-term consequences. Legal advice should be sought before the marriage, not after it has broken down.

For individuals facing divorce, understanding the applicable regime is the first step in determining what you are entitled to. The firm assists clients with the identification, valuation, and division of matrimonial assets, ensuring that the division is conducted in accordance with the applicable legal framework and that the client's rights are fully protected.