Divorce - Can you Afford It?

Divorce - Can you Afford It?

Private Property South Africa
Anna-Marie Smith

For property owners, the key lies in understanding marriage contracts.The term ‘fair’ division of property depends on individual cases. Such as those whose misdemeanor causes a breakup.

The cost of running dual households, after becoming one of 50% of marriages ending in divorce, can become a crippling affair. In addition to paying legal fees, it often results in one spouse moving out and renting, or purchasing another home. Some have no alternative but moving into properties originally purchased for rental income. Divorce might also result in losing part of, or total ownership of property previously owned jointly.

Legal firm STBB - Smith Tabata Buchanan Boyes provided our journalist with the legal implications regarding property ownership. This week’s article comes first in a series of three, where we look at: Marriages within community of property

What does ‘joint estate’ in community of property mean?

  • Anybody who did not enter into an antenuptial agreement before marriage in SA, irrespective of same or opposite sexes, is by default married in community of property.

  • This constitutes a partnership between equal partners: their assets automatically combine to form a joint estate and each has joint and equal say with regard to the estate's assets. The joint assets include all movables and immovables, including property, whether acquired before or during the marriage. Spouses have 50/50 shares in every asset, exceptions being separate ownership due to donations, inheritances, etc.

What if a spouse becomes insolvent?

  • The joint estate is sequestrated and the other spouse is therefore also declared insolvent.

  • Any property that the spouses owned before the marriage or acquired during the marriage, will fall in the insolvent estate.

What happens on termination of the marriage?

The spouses are each entitled to a half share of the joint estate, regardless of individual earnings, or number of assets when they married.

  • Andrew and Beth, who bought a house prior to marriage, automatically became joint owners after becoming spouses. When they decided to get divorced, the value of their joint estate, including the property acquired prior to marriage, was R1 000 000. The value of their contributions in paying for the property was different. In this case Andrew, having contributed to the property now valued at R700 000, and Beth contributing R300 000 during the marriage. The general rule of equal division of the joint estate applies, with each party receiving assets to the value of R 500 000.

However, STBB Director of Family and Divorce Shereen Volks says in certain circumstances, such as equal share income, justice for both parties are done by the law.

  • After choosing to marry in community of property, Eric and Beata showed intent to divorce.

What became clear is that Eric’s misconduct caused the breakup. In this case the court might award Beata an order for partial or total forfeiture by Eric, of the benefits of the marriage in community of property, if it would achieve fairness between the spouses. On division of the joint estate, this may result into Eric possibly being ordered to forfeit, or becoming entitled only to a portion of his share in the joint estate.

What if the marriage is terminated by death of a spouse?

The joint estate is administered and the surviving spouse is entitled to his or her half only after the lengthy administration process is completed.

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