There is a rebuttable presumption in our law that when two people are married, they are married in community of property. This presumption can be rebutted by proving:
- The parties entered into a valid Ante-nuptial Contract.
- The parties entered into a valid notarial contract in to which Community of Property is excluded (postnuptial).
1. The nature of universal community of property - The husband and wife become co-owners in undivided half-shares of all the assets and liabilities they both possess at the moment of their marriage, as well as of all the assets and liabilities acquired by them stante matrimonio.
- On marriage, the separate estates of the husband and wife are automatically merged into one joint estate, which is administered by the spouses concurrently.
- All the liabilities incurred by the husband or wife must be paid out of the joint estate.
- At the termination of the marriage, all liabilities are settled from the joint estate and the balance is then distributed equally between the husband and wife.
- Confirmed in De Wet v Jurgens and Estate Sayle v CIR
- NOTE: Although there is only one joint estate, the parties may own separate property which does not fall into the joint estate.
- In Du Plessis v Pienaar the creditors of both spouses married in community can look to the estates of both spouses for recovery of a joint debt. Thus, even the separate assets of a spouse can be attached for joint debts.
2. The content of universal community of property The joint estate consists of joint assets and joint liabilities.
a) Joint Assets - All the assets which the parties owned prior to the marriage as well as all the assets which they obtain after the marriage form part of the joint estate.
- Because transfer of assets takes place automatically by operation of law, no delivery or registration is necessary.
- Certain assets do not however, form part of the joint estate:
- Assets excluded by Antenuptial Contract.
- Assets excluded by will or donation.
- Assets subject to fidacommissum / usufruct.
- Jocalia (engagement gifts)
- Benefits under the Friendly Societies Act.
- Non patrimonial damages.
- Costs in a matrimonial action.
- Assets which replace separate assets.
1) Assets excluded in an Antenuptial Contract Note: the fruits form part of the joint estate unless also excluded in the anc.
2) Assets excluded by will or deed of donation - A third party can make a bequest/donation to a spouse subject to the condition that the asset must not become part of the joint estate.
- The fruits form part of the joint estate unless excluded as well.
- An important question is whether the assets excluded from the joint estate are protected against attachment for debts.
- Creditors of spouses who are married in community of property can look to the estates of both spouses for recovery of a joint debt.
- The fact that a spouse owns separate assets does not affect the ordinary right of a creditor to look to all the property of the debtor in satisfaction of the debt.
- If, for example, a testator excludes property from the heir's joint estate, the exclusion operates only as between the spouses and not as against third parties. This means that ALL property of both spouses falls into the insolvent estate if the spouses are sequestrated (De Wet v Jurgens ).
- A spouse's private creditors can attach his separate assets as well as assets belonging to the joint estate, but if the joint assets are attached, the spouse who did not incur the debt has a right of recourse when the joint estate is terminated.
- One spouse's separate assets may not be attached for the other spouse's separate debts.
3) Assets subject to a fideicommissum or usufruct Such property does not form part of the joint estate, but the proceeds do form part of the joint estate.
- What is a usufruct? Personal servitude that give the usufructuary the right to use the property of another, with the duty to eventually return it to the lawful owner.
- In a fideicommisum the testator leaves property to a person subject to the duty of handing it over in full ownership to another person at a certain time or upon the fulfillment of a certain condition.
4) Jocalia (small gifts) Arrhae sponsilatiae (usually the engagement ring) and
sponsilatia largitas (small gifts made with a view to marriage) do not form part of the joint estate.
5) Satisfaction recovered by a spouse - An amount received by a spouse for satisfaction for a delict does not form part of the joint estate.
- However, an amount received by a spouse for damages for patrimonial loss, does form part of the joint estate.
6) Costs in a matrimonial action If the husband and wife become involved in a matrimonial action without the marriage being dissolved, an order as to costs in favour of the wife, does not fall into the joint estate.
7) Assets which replace separate assets Where separate property is replaced by other assets, the substituted assets remain separate property.
b) Joint Liabilities - A marriage in community does not only result in community of assets, but also community of liabilities.
- All ante-nuptial debts and liabilities, as well as debts incurred stante matrimonio form part of the joint estate.
- In recent years, the SCA has favoured the view that the spouses are joint debtors (Nedbank v Van Zyl)
- The result of this view is that, one spouse who is married in community cannot stand surety for the other spouse's debts because these debts are joint debts and a person cannot stand surety for his own debts.
NEDBANK v VAN ZYL Legal Question: The nature of the liability of spouses for joint debts. Held: Spouses who are married in community of property are co-debtors in respect of liabilities that bind the joint estate. Thus, they cannot stand surety for each others debts.
1) Antenuptial Debts
Antenuptial debts include all contractual and delictual debts of the husband and the wife, as well as any maintenance obligations to parents, siblings and children from previous marriages.
2) Contractual debts incurred during the marriage (stante matrimonio)
If a spouse had capacity to incur the debt, the debts become joint debts which can be recovered from the joint estate.
3) Delictual debts incurred stante matrimonio
- S19 of the Matrimonial Property Act stipulates that when a spouse is liable for the payment of damages or satisfaction, the creditor can recover the amount from:
a) First from the separate property of the spouse who committed the delict.
b) Secondly, if there is no separate property from the Joint Estate.
- Provided that if damages are claimed from the joint estate, an adjustment shall be effected upon the division of the joint estate in favour of the other spouse.
- If the joint estate is too small to make the adjustment, the spouse has no remedy.
- The separate assets of the spouse who committed the delict must first be exhausted before joint assets can be seized.
- Spouses married in community of property cannot sue each other for patrimonial loss, but can sue each other for satisfaction for pain and suffering.
- However, s18(b) creates an important exception by permitting a spouse married in community to recover compensation for non-patrimonial loss in respect of bodily injuries caused by the other spouse.
- If a spouse claims satisfaction from the other spouse, where does the money come from?
Firstly, from the separate assets of the spouse who committed the delict. If they are insufficient or there were no separate assets, the amount is paid from the Joint Estate, but an adjustment will take place when the Joint Estate is dissolved. The amount received by the injured spouse becomes part of her separate assets.
- The injured spouse still cannot claim damages for patrimonial loss from the other spouse. This is so even if the other spouse has separate assets from which the patrimonial damages can be recovered.
4) Other separate debts incurred stante matrimonio
- This includes criminal fines, and a spouse's maintenance obligations
- At present the legal position is unclear
- Although s19 only covers delicts, it is submitted that s 19 should be extended to cover separate debts of spouses married in community of property as well.
- In other words, a criminal fine should be recoverable from the joint estate only if the guilty spouse has no or insufficient separate assets
•   The legislature should intervene to achieve legal certainty
