TINA HOKWANA | Change to the Divorce Act will ensure fair division of assets
Redistribution discretion now available to community of property without accrual marriages
Part 1: The road to the constitutional challenge of s7(3) of the Divorce Act 70 of 1979
The constitutional court last week heard arguments by parties seeking to declare the Divorce Act unconstitutional.
On May 11 last year the Gauteng high court in Pretoria declared section 7(3)(a) of the Divorce Act (Divorce Act) unconstitutional.
What does the section say?
Section 7(3) of the Divorce Act provides the court granting a decree of divorce in respect of a marriage out of community of property concluded before 1 November 1984, with a discretion to make a redistribution order to the effect that any asset, or sum of money, may be transferred from one spouse to another, subject to the provisions of s 7(4), (5) and (6).
What does this mean?
In practical terms, s7(3) generally provides the divorce court with a discretion when dissolving a marriage out of community of property concluded on or before 1 November 1984, to transfer assets or part thereof from the financially stronger spouse to the financially weaker spouse.
Why would the court do this?
Before 1984, SA had only two marriage regimes: in community of property, which meant the couple shared all assets and debts; and out of community of property, which meant the couple’s assets and debts were separated.
The reason why this provision was made in the Divorce Act was to protect vulnerable women who were married out of community of property and contributed towards the growth of their husband’s estate, while their own was not growing due to the gender roles that they assumed during marriages.
It is thus on this premise that the legislator with the Divorce Act and specifically s 7(3) attempted to right the wrong of the previous legislation in protection of the financially vulnerable women.
Why does this section only apply to parties married on or before 1984?
After 1984, the accrual system was introduced into South African law by the Matrimonial Property Act of 1984 (MPA) and any party to a marriage could contractually agree to be married out of community of property with or without the accrual system.
A marriage out of community of property with accrual affords parties with the ability to have the best of both worlds. It allows you to retain separate property and act independently of your spouse, while still enjoying a form of “joint estate” whereby anything accrued during the marriage is shared between the spouses. We commonly hear of there being an accrual claim, meaning a claim to split assets acquired during the marriage by one of the spouses, either on death or divorce.
Therefore, the Divorce Act does not allow a court to make any order regarding redistribution of assets for couples married out of community of property, without accrual, after 1984.
A look at Greyling v Minister of Home Affairs
The facts of the case were briefly as follows:
The parties were married in March 1988 almost 30 years ago, out of community of property without accrual, a few years after the commencement of the Matrimonial Property Act.
Karen Greyling was 22 years old when she married her husband who was a farmer at the time. Shortly before their wedding, the husband’s father informed her and her husband that their marriage would be out of community of property without accrual and was subsequently presented with a one-page antenuptial contract by the family’s lawyer and instructed to sign it.
She and her husband lived on a very large farm in a rural area, and she raised their three children, all of whom became high achievers. Greyling raised three children to adulthood during the marriage.
She was very involved in their schooling, transported the children on a consistent basis, was a very good wife/mother and was deeply involved in community work. Her husband, on the other hand, was a very successful farmer who won awards for farming, excelled financially and was able to purchase more farms. The family lived a luxurious lifestyle, drove luxury cars, and enjoyed holidays overseas. However, as a result of abuse, the couple separated during 2016.
She then challenged what she believed was an unfair situation in which her pending divorce would ordinarily see her walk away with nothing more than a small inheritance she received from her mother and a possible maintenance claim.
The court was not called upon to determine whether Greyling would be granted a redistribution order in her divorce but to decide whether it was constitutional for spouses married out of community of property without the accrual system after November 1, 1984 to be deprived of the relief provided for in s 7(3) of the Divorce Act.
It was argued on behalf of Greyling that under the circumstances, it was unconstitutional that she should be precluded from the relief provided by s 7(3) simply because she was married without accrual after the commencement of the Matrimonial Property Act and the accrual system. In distinguishing between couples married before and after November 1, 1984, s 7(3)(a) prevents spouses in her position from applying for a redistribution order even where such a remedy would be fair and just.
In the judgment, the court took specific issue with the wording, “entered into before the commencement of the Matrimonial Property Act, 1984,” stating its phrasing was inconsistent with the Constitution and consequently invalid.
Judge Van Der Schyff found that the differentiation between those married before and after 1 November 1, 1984, resulting in the deprivation of s 7(3) relief, did amount to unconstitutional discrimination. Refusing an application for s 7(3) discretion impairs the applicant’s dignity and limits their recourse.
It was also noted that the choice provided by the Matrimonial Property Act to benefit from the accrual system was often illusory. Many vulnerable parties are frequently unaware of their options due to lack of education or unable to secure them due to the unequal bargaining power within their union. Thus, to extend the courts discretion would be just and equitable.
Ultimately, the court held that s 7(3)(a) of the Divorce Act was inconsistent with the Constitution and thus invalid. The court remedied the limited operation of s 7(3), for those married before the commencement of the MPA, by severing the offending words and reading in the appropriate amendment.
As a result, the redistribution discretion is now available to all marriages out of community of property without accrual regardless of the date on which they were married. Even if the parties signed an antenuptial contract to the contrary, they will still be entitled to request equitable division of assets accrued over the duration of their marriage.
What factors does the court look at before granting an order for redistribution of assets?
The spouse who asks for the redistribution order must prove that she or he contributed during the marriage to the maintenance or the growth of the other spouse's estate, for example, through the rendering of services and saving expenses.
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