Postnuptial Contracts: A Guide To Securing Your Marital Regime
Marriage is a beautiful union, but it’s essential to consider the legal aspects that accompany it. If you didn’t sign an antenuptial agreement before getting married and wished that you had, it isn’t the end of the world, as other options are available. One such option is the postnuptial contract, a legal document that allows married couples to change their marital regime after they have tied the knot.
A postnuptial contract is an agreement married couples can enter after marriage that will regulate their future matrimonial property system. The application for a postnuptial contract must go before the High Court and will only become legally binding once the Court orders it.
To best understand whether or not this road is one that you and your spouse wish to travel, you will need to gain a more thorough understanding of what is a postnuptial contract. It is also good to know why other couples opt for them, the requirements involved, and the process of registering a postnuptial contract.
What Is A Postnuptial Contract?
A postnuptial or post-marital agreement is a legally binding document married couples use to redefine their financial and property arrangements.
Unlike an antenuptial agreement (ANC), which you would sign before marriage, a postnuptial contract is entered into after the marriage has already occurred. This contract allows couples to modify their marital regime and specify how assets, debts, and income will be shared or separated in the event of divorce, separation, or death.
Why Do Married Couples Enter Into Postnuptial Contracts?
For several reasons, married couples may choose to enter into postnuptial contracts. Some common motives include:
- Protecting Assets: Individuals who entered into a marriage without a prenuptial agreement or without choosing a different marital regime may seek a postnuptial contract to safeguard their assets, especially for significant financial changes or business interests.
- Changing Marital Regime: Couples who got married in community of property or failed to register an antenuptial contract within three months of their marriage may use a postnuptial contract to change their marital regime to one that better suits their financial goals and circumstances.
- Providing for Stay-at-Home Parents: In many marriages, one spouse may prioritize raising children or managing the household over pursuing a career outside the home. A postnuptial contract allows couples to address the financial implications of this.
- Protecting an Inheritance: Individuals who enter a marriage with significant inheritances may seek to safeguard these assets through a postnuptial contract.
- Clarifying Property and Debt Division: Married couples often enter into postnuptial contracts to establish clear guidelines for dividing property and debt accumulated during the marriage.
Postnuptial Contract Requirements
As set out in the Matrimonial Property Act No 88 of 1984 in Section 21(1), you must meet several specific requirements to ensure the validity and enforceability of a postnuptial contract. These typically include:
- Written Form: A postnuptial contract must be in writing to avoid any disputes or misunderstandings. Verbal agreements are not legally binding in this context.
- Voluntary Consent: Both parties must enter the contract willingly and without coercion or undue influence from external factors.
- Sound Reasons and Motivation: The Court will want to be convinced that there are valid and compelling reasons for the proposed change. These reasons must be fully motivated and clearly outlined in the application. It is crucial to explain why the current marital regime no longer suits the couple’s financial goals and circumstances.
- No Prejudice to Third Parties: The Court must be satisfied that the proposed change will not prejudice any other person, such as a child of the marriage or another dependent.
Postnuptial Contracts: The Process
Changing your marital regime through a postnuptial contract involves following a specific process and adhering to timelines. Here’s how it works:
- Consultation with an Attorney: Seek legal advice from an experienced attorney specializing in family law and postnuptial contracts. They will guide you through the process, explain the options, and protect your rights.
- Drafting the Contract: Your attorney will draft the postnuptial contract based on your specific requirements. This document should accurately reflect your desired changes to the marital regime.
- Notice to the Registrar of Deeds: As per section 97(1) of the Deeds Registry Act, you must notify the Registrar of Deeds. This notification ensures the relevant authority is aware of the intended change of marital regime.
- Annexing the Draft Postnuptial Contract: The proposed draft postnuptial contract must be attached to the application and initialled.
- Publication of Notice: A notice of intent to make the application must be published in the Government Gazette and two local newspapers at least two weeks before the hearing date. The notice should clearly state the application date and allow any interested party to submit written representations to the registrar of the High Court.
- Notification of Creditors: All known creditors of the spouses must be given a two-week notice via registered post. The application must include a list of creditors and proof of notification. This step ensures that creditors have the opportunity to raise any concerns or objections they may have regarding the proposed change.
- Disclosure of Assets and Liabilities: The application must include comprehensive information about the assets and liabilities of both parties. This information enables the Court to assess the validity of the proposed change and determine whether any third party may be prejudiced as a result. Providing this information is crucial in establishing sound reasons for the change and addressing any potential concerns.
Why Do You Have To Bring The Application Before A High Court?
The involvement of the Court ensures that the contract is fair, complies with the relevant legal provisions, and protects the interests of both parties involved. The Court’s approval provides a layer of legal validity and enforceability to the postnuptial contract. It gives couples peace of mind knowing their agreement will hold up in legal proceedings if required.
Postnuptial Contracts: 2 Types Of Marital Regimes
When entering into a postnuptial contract, couples have two main options for modifying their marital regime:
- Out of Community of Property with Accrual: This regime allows spouses to retain ownership of their assets and liabilities acquired before and during the marriage. However, upon dissolution of the marriage, the spouses may share in the increase in the value of their respective estates.
- Out of Community of Property without Accrual: Under this regime, each spouse’s assets and liabilities remain separate throughout the marriage without sharing the accrual. In divorce or separation, each party retains ownership of what they brought into the marriage without sharing the accumulated assets or debts.
A postnuptial contract allows married couples to redefine their marital regime, clarify financial responsibilities, and protect their assets. By understanding the process and requirements of registering a postnuptial contract, couples can make informed decisions about their financial future.
Consulting with an experienced attorney who specializes in family law is crucial to ensure that the contract is drafted correctly, notarized, and registered with the High Court. At Burnett Attorneys & Notaries, we have extensive experience with the postnuptial contract process. If you have any questions or want to sign a postnuptial contract with your spouse, please do not hesitate to contact us.