The Matrimonial Property Act 88 of 1984 (“the Act”) regulates matrimonial property and plays a significant role in determining how assets and liabilities are dealt with between spouses. Understanding its intricacies is crucial for couples who wish to protect their interests and plan for their future and how they would like to control their estates, especially prior to the marriage.

2. TYPES OF REGIMES

There are 2 main regimes recognised by the Act:

1. Marriages In community of Property
2. Marriages Out of Community of
   • In Community of Property

This is the most common marital regime. The estates of both the parties to the marriage are put in a hypothetical “pot” and each spouse has an equal share in the ownership of the assets and their liabilities irrespective of which spouse incurred the debt.

Contractual freedom is limited in such, spouses need the written consent of the other when contracting for example in the case of purchasing of a home.

• Out of Community of Property

For a marriage to be Out of Community of Property, the parties have to enter into what is called an antenuptial agreement. If no antenuptial agreement is entered into, the marriage is automatically considered to be one in community of property. An antenuptial contract is one that the parties enter into and it depicts how their assets and liabilities will be dealt with upon the dissolution of the parties. It is a contractual agreement that must meet the requirements of a valid contract. The parties’ antenuptial contract, having regard to the factual matrix and context, together with the parties’ conduct and understanding of the antenuptial contract, is not such that the contract is to be considered so vague and that the antenuptial contract must be regarded as void for vagueness as was the case in Bath v Bath (952/12) [2014] ZASCA 14 (24 MARCH 2014). It is important to note that the contract must not be vague and there must be consensus between the parties.

A marriage out of community of property two sub-regimes namely, inclusive or exclusive of the accrual.

Out of Community of Property with the operation of the Accrual system.

Section 3 of the Act provides for the effect of the accrual system. It follows:

“At the dissolution of a marriage subject to the accrual system, by divorce or by the death of one or both of the spouses, the spouse whose estate shows no accrual or a smaller accrual than the estate of the other spouse, or his estate if he is deceased, acquires a claim against the other spouse or his estate for an amount equal to half of the difference between the accrual of the respective estates of the spouses”.

A claim in the accrual arises at the dissolution of the marriage and the right of a spouse to share in terms of the Act in the accrual of the estate of the other spouse is during the subsistence of the marriage not transferrable or liable to attachment and does not form part of the insolvent estate.

The accrual is the amount which forms the net value of the spouse’s estate at the dissolution of his marriage. In determining the accrual the following is taken into account:

1. Any amount which accrued to that estate by way of damages, other than damages for patrimonial loss is left out of the account.
2. An asset which has been excluded from the accrual system in terms of the antenuptial contract of the spouses, as well as any other asset which he acquired by virtue of his possession or former possession of the first-mentioned asset, is not taken into account as part of that estate at the commencement or the dissolution of the marriage.

In the case of death, it is important to note that the accrual of the estate of a deceased spouse is determined before effect is given to any testamentary disposition, donation or succession out of that estate in terms of the law of intestate succession.

The calculation of the accrual is provided for in subsection 1(a). The nett value of the spouse’s estate, i.e by taking into account all of the spouse’s assets and liabilities at the end of the marriage is deducted from the nett value of that spouse’s estate at the commencement of the marriage. It is important to note that the spouses are at will to exclude one or more or all of their assets from the accrual. The assets the parties decide to exclude is excluded from accrual.

The assets that the spouse do not decide to exclude accrues in the estate of each of the parties during the subsistence of the marriage. These assets will be subject to accrual and the final determination of the spouse’ ultimate entitlement at the end of the marriage through divorce. The provisions of an antenuptial contract must be interpreted in context and against the background in which was concluded (Natal Joint Municipal Pension Fund v Endumeni Municipality [2012] ZASCA 13; 2012 (4) SA 593 SCA para 18).

3 THE OPERATION OF AN ANTENUPTIAL CONTRACT

In terms of Section 87 of the Deeds Registries Act 47 of 1937, an antenuptial contract must be signed/executed before a Notary and registered in a Deeds registry within three months, or any such extension a competent Court may condone.

This specifically requires that a Notary be present when it is executed and not any legal practitioner. Antenuptial contracts entered outside of South Africa must be executed according to the law prevailing in that jurisdiction.

For them to be valid in South Africa they must be registered with the Deeds registry within six months of execution in such foreign jurisdiction or within such period a competent Court may condone.

A distinction must also be made between formal and informal antenuptial contracts. A formal antenuptial contract is one which has been executed and registered in accordance with Section 87 of the Deeds Registries Act 47 of 1937, such formal antenuptial contract is effective against third parties.

An informal antenuptial contract can be verbal, for example, and is one which has been executed outside the formalities of the Act. It is effective inter partes (between the intended parties) but not against third parties.

A verbal antenuptial contract was upheld by the Court in the case of Odendaal v Odendaal 2002 (1) SA 763 (W) to the effect that it was binding between the intended spouses who were going through divorce.

An unregistered antenuptial contract is valid between the intended spouses, and this was held by the Court in the case of Honey v Honey 1992 (3) SA 609 (W).

One of the most basic tenets of the law of contracts is that the contents thereof must be lawful, and antenuptial contracts are not immune to this requirement. Some of the most important provisions of antenuptial contracts include the following:

1. The identification of the preferred matrimonial property regime e.g. either with or without the accrual system.
2. Marriage settlements g. donations between spouses.
3. Succession i.e. how their separate estates will devolve after the respective spouses pass on.
4. Right of recourse with regards to household necessities e.g. Section 23 (5) of the Matrimonial Property Act 88 of 1984 provides that the spouses are jointly and severally liable for debts of household necessities regardless of who incurred the debt between the spouses who are married out of community of property.

The adjustment of the matrimonial property regime post-marriage is possible, although it comes at a higher cost as it is fraught with added essential requirements.

The underlying philosophy in respect of the accrual system is that each party 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.

Under both options (with or without the accrual system), one spouse’s property cannot be sold to pay the other’s creditors if the other becomes insolvent – in contrast to the case where the parties are married in community of property.

CONCLUSION

In conclusion, an antenuptial contract is a legal agreement entered into by a couple before marriage to outline the division of assets and liabilities in the event of divorce or death. This contract provides clarity and protection for both parties, ensuring that their individual assets are safeguarded and that any potential disputes are resolved in a fair and amicable manner. It is important for couples to carefully consider and draft an antenuptial contract with the assistance of legal professionals to ensure that their interests are properly protected. Overall, the operation of an antenuptial contract can provide peace of mind and security for couples entering into marriage.