How To Change From ‘In’ To ‘Out’ Of Community Of Property

More often than not couples rush into marriage before understanding the operation of the following matrimonial property regimes (In Community of Property’ and Out of Community of Property with or without the accrual system) and before they realise it, they are bound by South Africa’s default matrimonial property regime which is that of ‘In Community of Property’. This means that one joint estate belongs to both spouses in equal undivided shares. Couples can however choose to change their matrimonial property regime to ‘Out of Community of Property’ with or without the accrual system. This will depend on which accrual option is most suited to the parties’ circumstances. Changing your matrimonial property regime is provided for in the Matrimonial Property Act 88 of 1984. The provision of section 21 (1) of the Act stipulates that a married couple may jointly apply to court (High Court) in order to change the existing matrimonial property regime.

Requirements
In the judgement of Lourens et Uxor 1986 (2) SA 291 (C) the court confirmed the guiding principles which courts have to follow with regard to applications in terms of section 21(1) of the Matrimonial Property Act No. 88 of 1984.

In order for the parties to successfully change their matrimonial property system, the following requirements must be met:

  1. Notice of the applications must be given to the Registrar of Deeds in terms of section 97 (1) of the Deeds Registries Act 47 of 1937.
  2. The draft notarial contract which is proposed to register must be annexed to the application.
  3. Notice of intention to make the application must also be published in the Government Gazette and on two local newspaper at least two weeks before the date on which the application will be heard.
  4. The date upon which the application will be heard must be specified in the published notice, setting out what steps an objector to the order sought must take and where the application and draft contract can be inspected.
  5. In addition, at least two weeks’ prior notice of the application must be given by registered post to all creditors. A list of such creditors, confirmed by affidavit, shall be included in the application and proof that such notice has been given to them must be provided by an affidavit to which are annexed the relevant certificates of posting.
  6. Sufficient information regarding the assets and liabilities of the couple concerned must be set out in the application to enable the Court to decide whether or not there are sound reasons for the proposed change and whether or not any other person will be prejudiced by the proposed change.
  7. It should also be stated whether or not either of the applicants has been sequestrated in the past and, if so, when, and in what circumstances. The case number of any rehabilitation application must be furnished.
  8. It should also be stated whether or not there are any pending legal proceedings in which any creditor is seeking to recover payment of any alleged debt due by the couple or either of them.
  9. Care must be taken to motivate fully the proposed change in the existing matrimonial property system. Applicants must explain why no other person will be prejudiced by the proposed change. In any event, the order sought, and the contract which it is proposed to register, shall contain a provision which preserves the rights of pre-existing creditors.
  10. The application must disclose where the parties are domiciled and, if they are not resident there when the application is made, where they are resident. If there has been a recent change in domicile or residence it should be disclosed so that the court where the application is brought (the High Court) must be satisfied that no other person will be prejudiced by the future change. The court must be satisfied that the rights of creditors of the parties must be preserved in the planned contract so the application must contain adequate information about the parties’ assets and liabilities to allow the court to determine whether or not there are good reasons for the intended change and whether or not any other person will be prejudiced by such amendment.

If the court is satisfied that the requirements have been met, it can order that the existing matrimonial property system may no longer apply to the marriage and approve that the parties may enter into a Notarial contract by which their future matrimonial property regime will be regulated.

Sources

  1. Matrimonial Property Act 1984 [Act No. 88 of 1984]
  2. Deeds Registries Act 47 [Act No. of 1937]
  3. Lourens et Uxor 1986 (2) SA 291 (C)

Disclaimer: The articles on this website are provided merely for general educational purposes. Whilst care has been taken to ensure accuracy, the content provided is not intended as legal advice. Always consult a suitably qualified attorney on any specific legal issue or matter.

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