What is excluded from marriage in a community of property

What is excluded from marriage in a community of property?

In a marriage in community of property in South Africa, certain assets are excluded from the joint estate, meaning they are not shared between spouses and remain the sole property of one spouse. This setup is crucial for understanding how assets and liabilities are managed within such a marriage, and it impacts financial planning and legal considerations for married couples.

Definition of Community of Property

Basic Principles

Marriage in community of property means that the assets and liabilities of both spouses are merged into a single joint estate from the onset of their marriage. This includes assets acquired both before and during the marriage, as well as any debts incurred by either spouse.

Exclusions from the Joint Estate

Inheritances and Donations

Assets or funds acquired through inheritance or donations are excluded from the joint estate, provided that the will or donation stipulates that they must be excluded. If the will or donation does not specifically state that the assets are excluded, they will form part of the joint estate.

Insurance Payouts

Certain types of insurance payouts, particularly those related to personal injury claims (such as disability or disfigurement compensations), are excluded from the community of property. These are considered personal to the recipient and are meant to compensate for personal suffering and not for asset accumulation.

Damages Awards

Compensation for damages awarded for defamation or for pain and suffering is also excluded from the joint estate. These are considered personal to the individual who suffered the harm.

Property Owned Prior to Marriage

Property explicitly excluded by antenuptial contract (if one was signed before the switch to community of property) remains the property of the original owner. Without such a contract, pre-marriage property would typically be included in the joint estate, but can be excluded with specific legal stipulations.

Practical Implications and Examples

Factual Examples

1. Inheritance: If a spouse inherits a property from a relative and the will explicitly states that the property is to be excluded from the community of property, this property remains that spouse’s separate asset.
2. Personal Injury Compensation: A spouse involved in a car accident receives a substantial insurance payout for severe injuries. This compensation would not be part of the joint estate but would remain with the injured spouse.
3. Antenuptial Contract: Before marriage, one spouse owns a valuable art collection. They enter into an antenuptial contract to exclude this collection from the community of property, ensuring it remains their sole property post-marriage.

Legal and Financial Planning

Understanding these exclusions is essential for financial and estate planning within a marriage. Couples should consider how they handle inheritances, donations, and compensations, possibly seeking legal advice to ensure that these assets are managed according to their wishes and legal stipulations.

In conclusion, while the community of property regime suggests a total sharing of assets and liabilities, certain types of assets, such as those acquired through inheritance with specific exclusions, compensation for personal suffering, and assets protected by antenuptial contracts, remain separate. This ensures that personal compensation and gifts intended only for one spouse do not become communal, providing financial security and clarity in the management of personal assets.