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Article by listed attorney: Fawzia Khan

Apart from issues relating to the minor children, such as how much maintenance is to be paid and which parent the children will live with, the other hotly contested issue prevalent in many divorce actions relates to the question of how their assets are to be divided between them. The issue of division of the assets could feature if a couple are married in community of property or if they are married by ante-nuptial contract with the accrual system in place. A couple married in community of property are regarded as having a joint estate. This means that all assets, regardless of which spouse acquired it, or even in whose name it is in, forms part of the joint estate of both of them.

There is no joint estate for those couples that marry by ante-nuptial contract, as each of them retains their own separate estate and will continue to exercise full autonomy over all their affairs. No consent of such the other spouse is necessary for any transactions or future obligations. An ante-nuptial contract with the accrual system means that on dissolution of the marriage, either by death or divorce, the parties would need to establish the value of the assets of both of them in order to work out whose estate has grown more.  Both spouses would have indicated a ‘commencement value’ of their assets at the time they got married. This commencement value would be recorded in the ANC document itself. The spouse whose estate has grown the least would have a claim of accrual against the other spouse (whose estate has grown much bigger). The Matrimonial Property Act states that, ““At the dissolution of a marriage subject to the accrual system, by divorce or by the death of one or both of the spouses, the spouse whose estate shows no accrual or a smaller accrual than the estate of other spouse, or his estate if he is deceased, acquires a claim against the other spouse or his estate for an amount equal to half of the difference between the accrual of the respective estates of the spouses.” In terms of the Divorce Act 70 of 1979, couples that are married in community of property are encouraged to divide their joint estate by agreement. The settlement agreement will be made an order of the court when the decree of divorce is granted.

Where a divorce goes to full-blown trial, the presiding judge would normally make a ruling around the division of the assets. Sometimes the only remaining unresolved matter in a defended divorce is around determining the value of the assets of the parties and thereafter how to divide those assets between the couple. If the parties elect not to take pursue that issue to trial but still need outside intervention to deal with that impasse, either of them can approach the court for permission to have a receiver or liquidator to be appointed. Some of the functions of the receiver or liquidator would include the following:-

·         Demand that both parties to provide a true and proper account of all their assets;

·         To value all assets of the spouses both movable and immovable- (with the exception of their personal belongings);

·         To establish the true liabilities in the estate of the spouses;

·         To interrogate the parties as may be necessary;

·         Have access to any premises for purposes of valuating assets.

The appointment of the receiver or liquidator can even be done after the parties have divorced. The liquidator will then be allowed to investigate the assets of the disputing parties and divide their assets. The problem in pursuing this route lies in the fact that the costs for the appointment of the receiver or liquidator would come out of the joint estate. This obviously reduces the value of the joint estate, which the parties could otherwise have saved. Consequently parties are urged to try and reach agreement rather than make the application to court for such a liquidator to be appointed. In making such an application to the court, it’s important that the asset of the estate of the parties must not be a negligible amount.

The appointment for a receiver or liquidator is also considered where are couple are married by ante-nuptial contract with the accrual system. The court itself does have the power to order the division of an accrual estate. If the court is satisfied that a spouse’s right to share in the accrual would be seriously prejudiced because of the conduct of the other spouse, it can order the immediate division of the accrual of assets.

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