Are you hoping that your loved one is going to pop the question soon, are you currently planning your dream wedding or are you ready and waiting for your wedding date to arrive? In all the excitement don’t forget to finalize your antenuptial contract (“ANC”) before getting married. An ANC does not simply protect one's own interests but can also protect the financial interests of your spouse by stipulating the marital property regime that will govern your marriage.
South African law recognises 3 types of matrimonial property regimes. The first regime is a marriage “in the community of property” which in essence means that the separate estates of each spouse will become one joint estate from the date of marriage. This is the default position in our law should a couple not complete and sign an antenuptial contract.
The other regimes are either a marriage which is “out of community of property with the accrual” or a marriage which is “out of community of property without the accrual”.
Getting married “out of community of property without the accrual system” ensures that the respective estates of each spouse remain separate from one another. In other words, there will be no joint estate and no combining of growth during the subsistence of the marriage.
In contrast to the aforementioned, the “out of community of property with the accrual regime” means, in broad terms, that the parties to the marriage will, at the dissolution of the marriage, share in the growth that has accrued to their respective estates during the existence of the marriage.
Other than setting out the marital property regime of a couple's marriage there are many reasons why couples should consider having an ANC drafted. We list a few reasons below:
- ANCs exist to protect you and your spouse against creditors, legal action and legal fees and are designed to ensure fair arrangements for both parties both during the marriage and in the event of death or divorce.
- Should one spouse own a business, it is important to have an ANC in place in order to prevent creditors of the business from claiming the assets of the other spouse, in order to settle debts of the business. The spouse who is the business owner should also ensure that they protect their business as their asset and not an asset to which the other spouse is also entitled to in the event of a divorce.
- ANCs are also extremely useful for estate planning as they help you to ensure that your assets are distributed according to your wishes upon your death. An ANC has the power to override the family law rights your spouse may have if you were married “in community of property”.
- Not only does an ANC allow you to safeguard particular assets and separate certain financial aspects of each spouse’s estates, but can offer a form of compensation in the event that one spouse makes financial sacrifices by, for example, being a stay-at-home parent.
We suggest that couples consult with a Notary Public before they walk down the aisle. ANCs are drafted and attested (confirmed) by Notaries Public who are in essence specialised attorneys who have completed further exams in order to be admitted as a Notary Public by the High Court of South Africa. An ANC should be signed in the presence of an admitted and practising Notary Public and two witnesses. There are strict timelines involved when signing an ANC, it must be signed prior to the couple getting married and it needs to be registered within a particular timeframe at the Deeds Office.
Should a couple fail to have executed an ANC, they will then be married “in community of property”. It is, however, still possible to change the matrimonial property regime after being married, albeit this is a far more complicated and expensive process.
It is clear that it is important to consider all your options in relation to the matrimonial property regime chosen when deciding to marry your spouse and to ensure the proper legal documents are in place to protect both your financial interests. CHM Attorneys would be happy to arrange a consultation with you to discuss the possibilities before you tie the knot!