Finweek_English_Edition_-_March_19,_2020__

s

outh Africa’s second wave of the wedding

season is now in full swing. The number of

marriages tends to peak for a second time

after December, either in March or April,

depending on the month of the Easter holiday for that

particular year, reported Stats SA in its last survey on

marriages and divorces in 2016.

Although it may be the least romantic process,

choosing the type of matrimonial property system

• which provides for the creation or absence of
  a marital estate or union – is of importance in
  avoiding hiccups down the road (for those opting for
  cohabitation agreements).
  “For most brides and grooms, discussions and
  negotiations regarding the finances, assets and
  adverse future scenarios are a serious mood killer. In
  the sort of environment that we encounter today, an
  antenuptial agreement is no longer a nice-to-have.
  It’s an absolute necessity,” says Shani van Niekerk,
  senior associate at Adams & Adams.
  The same Stats SA survey showed that 4 out of 10
  marriages end in divorce before their 10th anniversary.
  Out of the 25 326 divorces in 2016, some 44.4%
  lasted for less than 10 years, the survey showed.
  To protect oneself, “an antenuptial agreement
  can be especially important if either of the parties
  are involved in high-risk business endeavours, have
  inherited or accrued large amounts of monies, have
  children from a previous relationship, or property
  registered in their names, and they wish to avoid the
  consequences of being married in community of
  property,” says Van Niekerk.
  So, which different matrimonial estate systems
  are available in SA?

In community of property

If the parties to a marriage or union don’t sign any

contract prior to or after they get married, they are

considered as married in community of property,

which is the default property regime that will

govern their union, says family law attorney

Ceri von Ludwig.

Deciding on a marriage in community of

property means that the assets and liabilities of

both spouses are grouped together in one joint

estate. Both parties will bear equal powers and

responsibilities in respect of the joint estate, says

Mervyn Vermeulen, director at Vermeulen Attorneys.

Some of the implications of a marriage in

community of property are that at the end of the

marriage the spouses share equally in the assets

on the money personal finance

By Timothy Rangongo

44 finweek 19 March 2020 http://www.fin24.com/finweek

In or out? With or without? Yes

South Africans who are soon to wed have several matrimonial property systems to choose from,

and liabilities forming part of the joint estate, says

Vermeulen. If there are any debts, the spouses are

equally liable for their repayments, according to him.

Out of community of property

Marriages out of community of property need an

antenuptial contract (see box) signed by both parties

in front of a notary public, says Von Ludwig. Where

spouses are married out of community of property, it

means that “both spouses retain their own assets and

liabilities during the marriage”, Vermeulen says. “Each

party has their own separate estate.”

Couples that opt for this property regime also

have two options to consider – out of community

of property with accrual or out of community of

property without accrual (see table courtesy of

Vermeulen). Von Ludwig says the two additional

property systems require the services of a notary

public before a couple can enter them.

As far as implications for this regime are

concerned, Von Ludwig says that “out of community

with accrual was designed to be the best of both of

the other two [in and out of community of property]

and usually is”.

She says that parties need to understand how

it works since many people think it means joint

ownership or “half-half” and do not understand that

the actual calculation of the accrual sharing happens

only on death or divorce. Until then, each spouse has

the freedom to do as they wish with their estates (if

it is not done with the intent to defraud the accrual).

Spouses also need to understand the exclusions

and commencement values that can be incorporated

into this type of contract, she says.

Common law marriages as opposed to

cohabitation

There is no such thing as a common law marriage

in SA law now, says Von Ludwig. “Just living

with someone as husband or wife, without any

sort of marriage being registered or any sort of

contract between them governing their assets

and liabilities, is a dangerous thing as there is no

automatic claim,” she says.

“The amount of time that a couple lives

together does not translate into a default

marriage. So, in a long-term relationship where

marriage is not considered or possible, a cohabitation

agreement is the smart way to live together without

the fear of the future,” says Van Niekerk.

“Such an agreement is in the best interests

Shani van Niekerk

Senior associate at

Adams & Adams

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SOURCE: Oxford University Press

The English word ‘accrual’

comes originally from the Latin

accrescere, which means

‘to become larger’.

What does

accrual mean?

Law firm Cliffe

Dekker Hofmeyr

describes an

antenuptial

contract as a

legal document

signed prior to

entering a marriage

which regulates

the financial

relationship

between a couple.

What is an

antenuptial

contract?