When you decide on forever, you want the adventure to begin as soon as possible, however there are a few wonderful stops that need to be made before you race, dance or skip up the aisle.
One of those stops ought to be a trip to your attorney to discuss the legal consequences of your marriage.
Your marriage is a contract that you enter into with your spouse, the terms of which are largely dependent on your individual circumstances, but most are uniform where you undertake to love and honour each other for the duration of your lives.
Related to marriage contracts are Antenuptial Contracts which determines how your assets will be dealt with, this has consequences not only for your “spouse to be” but also for all contracts that you enter into and for this reason it is registered in the deeds office.
An Antenuptial Contract is simply an agreement that precedes your marriage contract, where you agree to be married out of community of property. In order to fully understand the implications of this it is important to understand what it means to be married in community of property.
If you get married without an Antenuptial Contract you will automatically, in terms of South African Law, be married in community of property. All the property of both spouses shall then on marriage fall into a single estate.
This limits the individuals ability to contract, exposes the joint estate which includes all of the property belonging to both spouses to attachment by creditors and leaves the surviving spouse without access to funds in the event that one spouse pre-deceases the other, as the joint estate must then be wound up.
In an Antenuptial Contract the parties agree that they will not have a joint estate and that, notwithstanding the fact that they are getting married and they may have joint assets, they will not have a joint estate.
The effect of this is that only the property of the party whose creditors are foreclosing will be subject to attachment, only the estate of the deceased spouse, and not the joint estate, will need to be wound up in terms of the Administration of Deceased Estates Act and the party’s ability to contract is not limited in the same way as it is in a marriage in community of property.
In 1984 the Accrual System was introduced. This system allowed people to enter into Antenuptial Contracts, and on dissolution of the marriage, if one party had accrued more than the other, the party who had accrued less would then be entitled to half the difference in the value of the estates.
The Accrual System is often misunderstood to be a means of introducing a kind of “community of property” into a marriage out of community of property. This is not the case and if you get married out of community of property with or without the Accrual System you never become the co-owner of your spouse’s assets.
The Accrual System allows for a redistribution of the wealth acquired during the marriage through the mechanism of a claim that is calculated by valuing both party’s property, excluding any assets which were expressly excluded and deducting any commencement values which have been appreciated by the Consumer Price Index, and ultimately splitting the difference.
None of the assets of one spouse will automatically become the property of the other spouse, the accrual claim only arises on dissolution of the marriage unless the court orders otherwise.
There are also a number of automatic exclusions from the operation of the accrual system, including but not limited to, inheritances and donations.
So having read this short article on the basics we hope that you will see just how important it is to hop, run, skip or drive to an attorney to assist you with an Antenuptial Contract prior to getting married, and to give careful consideration to which matrimonial property regime is best suited to your individual circumstances.