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In the “old” days before 1984, couples intending to get married could only choose between two marital regimes in terms of legislation. These were in community of property, which meant that the assets of both parties would be combined into one estate of which each spouse owned one half, undivided interest, and out of community of property, which entailed separation of assets and liabilities.

Upon divorce of people married in community of property, the distribution of assets is relatively simple, but that is not discussed in this article.

Upon divorce of couples married out of community of property, distribution was even simpler. However, the Matrimonial Property Act (MPA) was enacted in November 1984, which introduced the accrual system.

In terms of the accrual system, there is a formula based on the following:

– Initial assets of each party

– Inflation factor based on the period since marriage was entered into

– Value of assets at the end of the marriage, either by death or divorce

With the enactment of the MPA, discretion was given to the Court in terms of the Divorce Act to order a just distribution to a marriage partner married before 1984 should one of the partners, for example, have stayed at home to raise children while the other had the opportunity to build an estate. With marriages out of community of property that took place after 1984, there was no such discretion, and Section 7(3)(a) of the Divorce Act held that no discretion was possible and that each party would merely retain his/her assets.

This dispensation resulted in many people, especially women, being left financially disadvantaged, in spite of their contribution to the accumulation of assets, in the name of the spouse.

In the watershed case of GREYLING V MINISTER OF HOME AFFAIRS AND OTHERS (40023/21) the court found that Section 7(3)(a) of the Divorce Act was unconstitutional and should be removed after confirmation by the Constitutional Court.

The facts of the matter are that Mrs Greyling married a wealthy farmer out of community of property, without accrual, in 1988.

In her submission, the applicant held that the current system was irrational, arbitrary, and discriminatory and that spouses in her position may never receive any additional distribution of assets in spite of their contribution to the wealth of the other party.

Further submissions were that excluding the prejudiced parties from a just distribution of assets amounted to discrimination and that parties – especially women – were forced to stay in a marriage due to the inability to survive financially outside said marriage, which the applicant’s legal team described as “harmful and toxic.”

Expert testimony put forward held that especially women mostly agree to a certain marriage dispensation without the necessary knowledge of the consequences, thereby landing themselves in a highly prejudicial situation.

In her ruling, Justice van der Schyff said that the biggest disadvantage of a marriage out of community of property with the exclusion of accrual, in fact, lay in the complete division between the assets of the parties and, despite how long the marriage lasted and despite the contribution made by the other party, said the party had no right to discretion in the distribution of assets by the court.

The judge described it as unfair that any prejudiced party would have no recourse to rectify this inequity.

The gist of the matter is that readers should exercise utmost caution when considering marriage, and especially when advising children who get married after being involved in a business for some years. Make sure that both parties take an informed and considered decision regarding the marriage dispensation. The big lesson is that no contract should be drawn up in a slap-dash fashion and signed hastily.

Around every braai fire, one will find at least one “expert” on this issue. Rather pay a knowledgeable attorney who can assist in thinking through and finalising this very important matter.

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