New court judgement has massive implications for marriages and divorces in South Africa.
On 11 May 2022 the Pretoria High Court ruled in the case of Greyling versus The Minister of Home Affairs and 4 others, case number 40023/21, in a somewhat contentious judgement, that the wording of a particular section of South Africa’s Divorce Act is unconstitutional, paving the way for serious changes for how divorces may be dealt with in future when spouses are married out community of property in South Africa, without the accrual. The Constitutional Court, however, still needs to confirm whether the judgement was indeed correct. The crucial aspect dealt with in this case was that the Divorce Act does not allow a court to make any order regarding a “redistribution of assets” for spouses married out of community of property, without accrual, after 1984 and this the Applicant contended was unconstitutional.
As Family and Divorce Law attorneys we have had countless cases wherein the woman got an unfair deal simply because she married out of community of property, without the accrual. Many women who have been homemakers are stuck in unhappy or abusive marriages simply because they realise that they will walk away with nothing when they divorce. In these kinds of divorces women are not properly compensated, and they are usually deprived from any "return" for investing in and raising the children and allowing the husband to amass a lucrative estate. To put it bluntly, they get a raw deal.
Frequently, one party becomes economically inactive, or less active than the other after the conclusion of the marriage. Although it was traditionally the wife who forfeited her career and exited the labour market or took up employment with family-compatible hours at reduced compensation to run the joint household and take care of the children, incidences of men fulfilling the traditional role of homemaker whilst their professional wives follow their careers are growing. The main downside of a marriage out of community of property with the exclusion of the accrual system, is that no matter how long the marriage has survived and how much the economically disadvantaged party has contributed to the other party's economic and financial success, the economically disadvantaged party does not have a right to share in the latter's increases. The benefit of a system of complete separation for the economically active party, is that at the breakup of the marriage through divorce, he or she reaps the fruits of both spouses' contribution, since only one estate increased during the time of the marriage. Women are, still, predominantly found in the position of the economically disadvantaged party. This is an international phenomenon and not distinctive to the South African context.
In the Greyling case, the court found that Section 7(3)(a) of the Divorce Act was inconsistent with the Constitution of South Africa and invalid, suggesting it amounts to unfair discrimination in respect of marriages ‘out of community of property’, without the accrual.
Section 7(3) of the Divorce Act deals with the division of assets of spouses married out of community of property. Nevertheless, Section 7(3)(a) lays out different rules for marriages that took place after the Matrimonial Property Act came into effect on 1 November 1984. This distinction, according to the Judge, amounted to unfair discrimination especially for economically disadvantaged people and limits the operation of Section 7(3).
As a result of this case the Constitutional Court will now have to consider whether the court’s order should be confirmed or not. Should the order be confirmed, it will have a vital and compelling effect on many marriages that end in divorce in South Africa.
The Matrimonial Regimes
In South Africa the primary matrimonial property system has always been, and still is, in community of property. If the spouses fail to elect their matrimonial property system before they enter into a marriage, the default matrimonial property system applicable to their marriage is in community of property. Our current default property system derives from the Roman-Dutch concept of universal community of property.
Prior to 1984 there were only two regimes:
After 1984:
The Matrimonial Property Act, 88 of 1984 (MPA) was enacted on 1 November 1984 and introduced the so-called “accrual system” and spouses have a choice to either exclude or include the accrual system. Anyone entering into an ANC that excludes community of property and community of profit and loss is automatically married under the accrual system. Spouses as stated above may, however, exclude the accrual system in their ANC, but if they do not do so expressly, the accrual applies. When the accrual is included, a spouse will be entitled to share in the growth of the two estates at divorce. Therefore, since the commencement of the MPA intending spouses can now choose between three matrimonial property systems:
When Parliament enacted the MPA it also had to introduce a new judicial discretion to redistribute assets in marriages out of community of property entered into before 1 November 1984 at the same time as creating the accrual system as the default marriage out of community of property.
Section 7 (3)(a) of the Divorce Act 70 of 1979
A new section 7(3)(a) was introduced into the Divorce Act 70 of 1979 (the “Divorce Act”) to give judges in divorce cases a discretion to distribute the assets of the spouses in marriages out of community of property which had been concluded before 1 November 1984, when the accrual regime did not exist. Section 7(3)(a) of the Divorce Act reads:
“(3) A court granting a decree of divorce in respect of a marriage out of community of property--
(a) entered into before the commencement of the Matrimonial Property Act, 1984, in terms of an antenuptial contract by which community of property, community of profit and loss and accrual sharing in any form are excluded may… on application by one of the parties to that marriage, in the absence of any agreement between them regarding the division of their assets, order that such assets, or such part of the assets, of the other party as the court may deem just be transferred to the first-mentioned party”.
Thus, where spouses were married out of community of property before 1 November 1984 and divorce thereafter a judge applies his discretion to redistribute the assets by awarding each party a percentage of the assets, based on certain factors.
Parliament’s aim in introducing such a judicial discretion at the time was to make it possible for spouses who did not previously have the option of accrual to ease their position through the reallocation of assets by the court. The provision was only intended to be an outlet valve to ease the unfairness in current marriages that had been made subject to the rigid predetermined matrimonial property systems. The discretion was for that reason only available for those spouses married out of community of property prior to the commencement date of the legislation, on 1 November 1984.
Discretion Expanded
The judicial discretion was expanded to civil marriages out of community of property carried out in terms of the Transkei Marriage Act 21 of 1978, from commencement of the Recognition of Customary Marriages Act to 2000 when the Transkei Marriage Act was repealed. As a result of the case of Holomisa v Holomisa 2019 (2) BCLR 247 (CC) a further type of marriage was added in the discretion to redistribute assets under section 7(3)(c) of the Divorce Act. They are marriages “…entered into in terms of any law applicable in a former homeland, without entering into an antenuptial contract or agreement in terms of such law”. The discretion was exercised if it was equitable and just by reason of the fact that the party in whose favour the order was granted, contributed directly or indirectly to the maintenance, or increase of the estate of the other party during the subsistence of the marriage, either by the rendering of services, or the saving of expenses which would otherwise have been incurred, or in any other manner.
In the matter of Gumede v President of the Republic of South Africa 2009 (3) SA 152 (CC), the Constitutional Court introduced an additional judicial discretion which pertains to customary marriages regardless of the date on which they were concluded and regardless of the matrimonial property system in place: “…every divorce court granting a divorce decree relating to a customary marriage has the power to order how the assets of the customary marriage should be divided between the parties, regard being had to what is just and equitable in relation to the facts of each particular case”.
Finally in the matter of President, RSA v Women’s Legal Centre Trust 2021 (2) SA 381 (SCA), the Supreme Court of Appeal ordered that: “Section 7(3) of the Divorce Act is inconsistent with sections 9, 10 and 34 of the Constitution insofar as it fails to provide for the redistribution of assets, on the dissolution of a Muslim marriage, when such redistribution would be just”. Even though the declaration of unconstitutionality was suspended for a period of two years to allow Parliament to adopt legislation to cure the constitutional defect, this created yet another category of marriages to which the judicial discretion applied, regardless of the dates of the marriages.
Indeed, there are therefore numerous different dates which determine if the discretion in section 7(3) would be available to a marriage out of community of property and few bear any relation to the original purpose of the legislature. One may argue that these different rules pertaining to the availability of the discretion can be said to discriminate on the basis of marital status, race and religion.
The Greyling Case
The Greyling case seems to suggest that a redistribution discretion should be available in all marriages out of community of property without the accrual system irrespective of the dates on which these marriages were concluded.
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.
According to the MPA when married out of community of property with the inclusion of accrual, spouses will, at divorce, share equally in the growth of the spouses’ estates during the marriage. Spouses are also able to exclude certain assets in the ANC or include a commencement value on their respective estates. If a spouse’s estate grows larger than the other, at the time of divorce, the spouse with the smaller estate can make a claim against the larger estate for half of the difference in the accrual. Assets that were excluded in the ANC would not form part of the accrual. If a spouse included a commencement value in the ANC the amount so included plus inflation thereon, reckoned from the date of marriage until the divorce would also fall beyond the scope of an accrual calculation.
When married out of community of property without accrual, after 1 November 1984 there is no sharing of any assets at divorce, whether accumulated before or during the marriage. This current regime has left many people, mainly women, financially barren, even though they had contributed to the household, raised the children, and assisted their spouses to accumulate assets over the years.
In terms of the Divorce Act, a wife for example, would not be entitled to make any kind of claim from the husband, not a portion of what they owned, and nothing of what they accumulated during their years together, simply because she did not bring in an income.
The Facts of the Greyling Case
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, excluding the accrual, a few years after the commencement of the MPA. Mrs. Greyling (the “Applicant”) raised three children to adulthood during the marriage. The Applicant was 22 years of age 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 to be that no community of property and accrual would apply to the marriage and the applicant was presented with a one-page antenuptial contract by the family’s lawyer and she was 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. This meant that the Applicant was very involved in their schooling, transported the children on a consistent basis, was a very good wife and mother and was deeply involved in community work. Her husband, on the other hand, was a very successful farmer who won awards for farming, he 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. The Applicant 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.
What the Court had to decide
The court was not called upon to determine whether the Applicant would be granted a redistribution order in her divorce but to decide whether it was constitutional for spouses married out of community of property with the exclusion of the accrual system after 1 November 1984 to be deprived of the relief provided for in s 7(3) of the Divorce Act.
The Applicant’s (Wife’s) case
The applicant submitted that s 7(3)(a) arbitrarily and irrationally differentiated between people married before and after 1 November 1984, being the date on which the MPA commenced and contended that it was irrational that she would be protected by section 7(3) if she had married four years earlier. The Applicant relied on various expert reports. A psychologist who was called as an expert witness on the applicant’s behalf stated:
'Before the Matrimonial Property Act came into effect, the law entrenched a patriarchal system in which a man was legally entitled to control his wife and where women had a weak bargaining position. On the assumption that the husband's headship of the family was only removed in 1993 it means that the patriarchal system persisted for 9 years after the Matrimonial Property Act came into force, but a woman lost the ability to make an application under section 7(3) of the Divorce Act when the accrual system was introduced.'
The applicant further contended that no legitimate government purpose justified the differentiation that denied persons married out of community of property with the exclusion of the accrual system after 1 November 1984,the potential protection of a just and equitable remedial judicial order. Counsel for the applicant addressed the assumption that the purpose of limiting the benefit of s 7(3)(a) of the Divorce Act to marriages concluded before 1 November 1984, was to give effect to the choice of the parties to get married out of community of property without the accrual system, and that s 7(3)(a) held them to that choice. He submitted that the choice-argument was illusionary for the following reasons:
The applicant further contended that the cut-off date in section 7(3)(a) (1 November 1984) disproportionately impacted women and that the blanket deprivation of excluding spouses from the potential benefits of a just and equitable redistribution order constituted unfair discrimination based on sex, gender, marital status, culture, race, and religion. As a result, it was contended on her behalf that it operated to trap predominantly women in harmful and toxic relationships, when they lacked the financial means to survive outside of the marriage.
The applicant also relied on the views of two expert witnesses, namely Professor Elsje Bonthuys and Dr. Anzille Coetzee (the “Bonthuys & Coetzee report”). Bonthuys and Coetzee opined that even today, twenty-five years after the transition to democracy, the intersecting inequalities of gender, race, and class still render many women unable to access and realize their rights. They referred to a 2016 study wherein it was found that South African women and women-headed households were significantly more likely to be 'multidimensionally poor' than males or male-headed households. Black women remained the poorest group in South Africa. As a result of their disproportionate poverty, women depend economically on male family members, husbandsand intimate partners for their survival and that of their children. The cumulative effect of a number of inequalities, e.g., gender income gap, unequal access to land and education and women being disproportionately situated outside the formal economy, is that women often enter into marriage on a weaker footing than men, with high levels of economic precarity and financial dependence. They contended that:
“The decision to get married is there for one that many women make with less autonomy than men, and with less agency to insist on terms that would be advantageous to them.”
Bonthuys and Coetzee expressed that a women's ability to generate an income is reduced by marriage, and that this is statistically proven, that women bear more responsibility for housework and caring labour, and that a marriage out of community of property with the exclusion of the accrual system would generally favour men. The effects of gender equality are also exacerbated by high levels of physical, sexual, and other forms of violence which characterize intimate relationships. They also expressed the view that courts do not have the discretion to affect adjustments to a matrimonial property regime when it is just and equitable to do so, it is typically the women who are unfairly disadvantaged.
A very important point that Bonthuys and Coetzee made is the fact that s 7(3) simultaneously discriminate on several grounds and affected different groups of people differently. They referred to the Constitutional Court's decision in a matter where the court held that customary marriages concluded before the RCA came into operation would effectively be marriages in community of property. In their view, the judicial discretion created in that case was broader than the discretion created in section 7(3)(a) and did not limit the discretion to marriages concluded before or after a specific date.
The Court’s Reasoning
Judge Van Der Schyf held the view that the legislature, in an effort to address the obvious disadvantage suffered by economically disadvantaged parties in marriages out of community of property concluded before the commencement of the MPA, introduced s 7(3)(a) and reasoned that an entirely novel concept was brought into this branch of our law, namely that the Court was given the power under certain circumstances to order the transfer of assets of the one spouse to the other and that the power that was created enabling a court to make such a redistribution order was a reforming and remedial measure.
The judge referred inter alia to the case of Beira v Beira 1987 (1) SA 967 (A) 987G where the court clarified that section 7(3) was enacted to redress a deficiency, namely, to enable both spouses to enjoy their rightful shares in the accumulated wealth residing in the one which their joint endeavours during the subsistence of the marriage had brought them.
The judge referred to the authors Robinson and Horsten: The Quantification of “Labour of Love”: reflections on the Constitutionality of the Discretion of a Court to Redistribute Capital Assets in terms of Section 7(3) -(6) of the South African Divorce Act. (2010) Speculum Iuris 96-117, 115 where they emphasized that section 7(3) did not grant the court a judicial discretion to create a system of accrual that the parties themselves did not create or to redistribute the spouses' assets in a way that seems fair. In the Beira case, Leveson J expressly stated that it was not the aim of the legislature for a s 7(3) order to put the parties in equal financial positions. The aim of s 7(3) was to redress the unfair financial imbalance flowing from the very nature of a marriage being out of community of property in circumstances where one party contributed to the other's maintenance or the increase of the other's estate during the existence of the marriage.
The judge mentioned that a spouse does not qualify as having made a contribution as a matter of course by virtue of being married. The jurisdictional requirements of s 7(3) read with ss 7(4), (5) and (6) still had to be met. The practical effect of a s 7(3) order according to the judge is that the party who contributed to the other's gain is compensated for their contribution to the extent that a court finds just and equitable and that the court has a wide discretion, taking into account an infinite variety of factors.
When the MPA was enacted, the legislature prescribed a number of prerequisites that had to be met before an order could be granted in terms of s 7(3)(a). The first requirement was that the marriage must have been entered into before the coming into operation of the MPA. It was, however, not open to all parties married out of community of property before the commencement of the MPA to approach the court for a redistribution in the nature as provided for by s7(3)(a). The remaining requirements act as the proverbial gatekeepers, in that the remedy is only available in (i) the absence of any agreement between the parties regarding the division of their estates, where an applicant (ii) contributed directly or indirectly to the maintenance or increase of the estate of his or her spouse during the subsistence of the marriage, either by the rendering of services or the saving of expenses which would otherwise have been incurred.
The judge rightfully took the view that the Bill of Rights, and thus section 9 of the Constitution, applies to matrimonial property law since marriage is a matter of choice and so too are the proprietary consequences of marriage. The legislature crafted a reforming and remedial measure but limited its application to marriages out of community of property concluded before the MPA commenced. The judge reasoned that since the possibility of granting a redistribution order was created concomitantly with the introduction of the system of accrual sharing, it can arguably be assumed that s 7(3) was intended to be a transitional measure. According to the judge the legislature arguably did not extend the relief to marriages out of community of property excluding the accrual system because the MPA provided the option of choosing between a system that includes accrual sharing and a system that excludes accrual sharing. Parties seemingly exercise a deliberate choice when they exclude the accrual system and incorporate that choice in a written antenuptial agreement executed before a notary. The question is whether in this context it can be said that legislative innovation that brought into force s 7(3) of the Divorce Act to address the plight of economically disadvantaged parties who did not have the opportunity to choose a more beneficial marital regime in the form of the accrual system, is irrational. By restricting the operation of s 7(3) to marriages concluded before 1 November 1984 the legislature honoured the principle of freedom of contract and pacta sunt servanda, and that is not without merit.
The judge went further and found that it cannot be gainsaid that s 7(3)(a) of the Divorce Act differentiates between spouses married out of community of property who were married before the MPA commenced, and spouses married out of community of property with the exclusion of the accrual system after the MPA commenced. The obvious disparity and inequity that ensues when parties who are married out of community of property and where one party contributed to the maintenance or increase of the estate of the other party, file for divorce, moved the legislature to enact s 7(3)(a) of the Divorce Act. By incorporating a cut-off date for the application of s 7(3), economically disadvantaged parties who were married after 1 November 1984 cannot approach a court to make an order that is just and equitable if they meet the remaining jurisdictional requirements of s7(3). Thus, the inequity which is caused because the economically disadvantaged spouse nevertheless made a direct or indirect contribution towards the other spouse's estate, persists.
According to the judge the constitutional validity of s 7(3)(a) should not solely be considered from the perspective of the parties' position as it was when an antenuptial agreement was concluded, because there could well be a plethora of legitimate reasons as to why parties would agree to conclude a marriage out of community of property with the exclusion of the accrual system, e.g., a proud less affluent party who is intending to marry the love of their life who happens to be wealthy, may wish to demonstrate that the marriage is concluded solely for the reason of love, and not to gain any future patrimonial benefits.
The judge reasoned further that the inequality is caused when, after the conclusion of the marriage, a distortion is caused by the fact that one spouse contributes directly or indirectly to the other's maintenance or the increase of the other's estate without any quid pro quo. In ideal circumstances where parties commit 'for better and worse, until death do us part' the economic inequality that follows when one spouse contributes to the other's maintenance or estate growth while their own estate decreases or remains stagnant, may not even be noticed. The unity of marriage conceals economic disparity because it is, for the most part, during the subsistence of the marriage of no consequence. However, where it becomes apparent on divorce that one spouse's estate increased because of the other spouse's contribution while the latter spouse's estate decreased, the party who received maintenance from the other or whose estate increased because of a direct or indirect contribution by the other, have received what can be described as an unfair economic advantage on the basis of the marriage. This is the inequality that can be addressed by an order in terms of s7(3)(a), irrespective of the race or gender of the economically disadvantaged party, a remedy that is to date only available to spouses who married prior to 1 November 1984.
The judge was of the view that section 7(3)(a) differentiates between parties solely based on the date of commencement of the MPA in circumstances where parties could either (i) apply to incorporate the accrual system into their existing marriage property regime and for one or other reason, failed, or refrained from doing so, and (ii) where parties decided to exclude the accrual system. The only difference between these groups according to the judge was speculative in that it could be argued that there might be members in the first group who did not know that they could incorporate the accrual system post the commencement of the MPA, while a deliberate choice underpinned the position of the second group. Speculation aside the judge remarked, “these groups are par excellence in a similar situation, and yet the one group is denied the benefit of s 7(3)(a) only on the basis of the date on which their marriage was concluded. The differentiation amounts to discrimination based on the date on which a marriage was concluded because economically disadvantaged parties’ human dignity is impaired if they cannot approach the court to exercise the discretion provided for in s 7(3) of the Divorce Act. Unlike their counterparts whose marriages were concluded before 1 November 1984, economically disadvantaged parties who contributed to their spouses’ maintenance or the growth of their estates, are vulnerable parties whose only recourse is to approach the court for maintenance. The unequal power relationship implicit to any maintenance claim, and the extent to which it renders an economically disadvantaged party vulnerable, in these circumstances speaks for itself”.
The court further reasoned that Section 7(3) is subject to subsections (4), (5) and (6). According to the judge it was evident from a reading of those provisions that any party approaching the court for the relief provided for in s7(3) must make out a case that it contributed directly or indirectly to the maintenance or increase of the estate of the other party during the subsistence of the marriage. The court was of the view that it would be patently unfair that an economically disadvantaged party who can make out a case for relief in terms of s 7(3), whose contribution is not recognised and adequately compensated by the spouse who benefitted from such contribution, is metaphorically left out in the cold at the mercy of the spouse whose estate increased, without any recourse to the court to address the injustice.
The judge went further and stated: “the judicial power provided by section 7(3) of the Divorce Act was aimed at avoiding grossly inequitable discrepancies in the financial position of spouses on divorce. Irrespective of whether the section was initially intended as a transitional provision, the innate restriction in s 7(3)(a) based solely on the date on which a marriage was concluded, does not in 2022, muster constitutional scrutiny. The limitation of the relief provided for in s 7(3)(a) of the Divorce Act to marriages concluded prior to the commencement of the MPA violates s 9(3) of the Constitution. The cut-off date contained in s 7(3)(a) unfairly discriminates against people married according to a system of complete separation of property on the ground of the date of their marriage.”
The judge also referred to the learned author Sinclair Family Rights’ in Van Wyk, D., et al (eds) Rights and Constitutionalism – The New South Africa Legal Order 1994 JUTA 502-572, 548 who stated:
'The discrimination takes the form of denying to those people a remedy to relieve injustice that is granted to persons married with an identical system, but earlier.'
and:
“For couples who live on their salaries and do not have the opportunity to amass property the matrimonial property system that governs their marriage turns out to be the panacea for the poverty that will be experienced most acutely by the divorced women [or any economically disadvantaged party]. For the poor, matrimonial property law is as important as an elaborate estate planning exercise. But for many thousands of people the matrimonial home and a share in pension and other retirement benefits accumulated during marriage make the difference between forced reliance on exiguous welfare and some form of financial security. To these people the sharing of property acquired by joint efforts is crucial. To be denied an equitable remedy on the ground of the date of one's marriage is unacceptable”.
The judge ultimately took the view that s 7(3)(a) allows a court to interfere in a private relationship to avoid injustice and that it would be axiomatic that no injustice could be done if that power was also available to courts relating to marriages out of community of property with the exclusion of the accrual system. The court's s 7(3)- discretion is therefore wide in the sense that it is to be exercised in a manner that will bring about a just and equitable outcome in the factual context concerned, but the power to exercise the discretion is circumscribed and limited to the two scenarios prescribed in s 7(4) namely that the party in whose favour the order is granted must have contributed directly or indirectly to the (i) maintenance, or (ii) increase of the estate of the other party, during the subsistence of the marriage. The unfair discrimination that is caused by the exclusionary time-bar in s 7(3)(a) can be corrected by removing the time-bar.
Order
In the result, the following order was granted:
Criticism
Written by Bertus Preller, Family Law and Divorce Law Attorney at Maurice Phillips Wisenberg, Cape Town South Africa
As Family and Divorce Law attorneys we have had countless cases wherein the woman got an unfair deal simply because she married out of community of property, without the accrual. Many women who have been homemakers are stuck in unhappy or abusive marriages simply because they realise that they will walk away with nothing when they divorce. In these kinds of divorces women are not properly compensated, and they are usually deprived from any "return" for investing in and raising the children and allowing the husband to amass a lucrative estate. To put it bluntly, they get a raw deal.
Frequently, one party becomes economically inactive, or less active than the other after the conclusion of the marriage. Although it was traditionally the wife who forfeited her career and exited the labour market or took up employment with family-compatible hours at reduced compensation to run the joint household and take care of the children, incidences of men fulfilling the traditional role of homemaker whilst their professional wives follow their careers are growing. The main downside of a marriage out of community of property with the exclusion of the accrual system, is that no matter how long the marriage has survived and how much the economically disadvantaged party has contributed to the other party's economic and financial success, the economically disadvantaged party does not have a right to share in the latter's increases. The benefit of a system of complete separation for the economically active party, is that at the breakup of the marriage through divorce, he or she reaps the fruits of both spouses' contribution, since only one estate increased during the time of the marriage. Women are, still, predominantly found in the position of the economically disadvantaged party. This is an international phenomenon and not distinctive to the South African context.
In the Greyling case, the court found that Section 7(3)(a) of the Divorce Act was inconsistent with the Constitution of South Africa and invalid, suggesting it amounts to unfair discrimination in respect of marriages ‘out of community of property’, without the accrual.
Section 7(3) of the Divorce Act deals with the division of assets of spouses married out of community of property. Nevertheless, Section 7(3)(a) lays out different rules for marriages that took place after the Matrimonial Property Act came into effect on 1 November 1984. This distinction, according to the Judge, amounted to unfair discrimination especially for economically disadvantaged people and limits the operation of Section 7(3).
As a result of this case the Constitutional Court will now have to consider whether the court’s order should be confirmed or not. Should the order be confirmed, it will have a vital and compelling effect on many marriages that end in divorce in South Africa.
The Matrimonial Regimes
In South Africa the primary matrimonial property system has always been, and still is, in community of property. If the spouses fail to elect their matrimonial property system before they enter into a marriage, the default matrimonial property system applicable to their marriage is in community of property. Our current default property system derives from the Roman-Dutch concept of universal community of property.
Prior to 1984 there were only two regimes:
- In community of property - In this form of marriage, the spouses’ estates (what they own/assets and any debt/liabilities) are joined together, in a joint estate, and each had the right of disposal over the assets; they were equal concurrent managers of the joint estate. Each had an undivided or indivisible half share of the joint or communal estate. Upon divorce the net combined estate of the spouse were divided equally, unless one of the parties claimed a forfeiture.
- Out of community of property - This matrimonial property regime involved an antenuptial contract (ANC), (i.e., an agreement entered into before a Notary and signed before the marriage) where community of property and profit and loss were excluded. There was no joining of the spouses’ estates into one joint estate. Each spouse had his/her own separate estate, consisting of his/her premarital assets and debts, and all the assets and debts he/she acquired during the marriage. They each administered their own separate estates and had full and exclusive control over their own property. Upon divorce, the courts exercised a discretion on what a fair and reasonable distribution would be.
After 1984:
The Matrimonial Property Act, 88 of 1984 (MPA) was enacted on 1 November 1984 and introduced the so-called “accrual system” and spouses have a choice to either exclude or include the accrual system. Anyone entering into an ANC that excludes community of property and community of profit and loss is automatically married under the accrual system. Spouses as stated above may, however, exclude the accrual system in their ANC, but if they do not do so expressly, the accrual applies. When the accrual is included, a spouse will be entitled to share in the growth of the two estates at divorce. Therefore, since the commencement of the MPA intending spouses can now choose between three matrimonial property systems:
- in community of property;
- marriage out of community of property with the exclusion of the accrual system; and
- marriage out of community of property with the accrual system.
When Parliament enacted the MPA it also had to introduce a new judicial discretion to redistribute assets in marriages out of community of property entered into before 1 November 1984 at the same time as creating the accrual system as the default marriage out of community of property.
Section 7 (3)(a) of the Divorce Act 70 of 1979
A new section 7(3)(a) was introduced into the Divorce Act 70 of 1979 (the “Divorce Act”) to give judges in divorce cases a discretion to distribute the assets of the spouses in marriages out of community of property which had been concluded before 1 November 1984, when the accrual regime did not exist. Section 7(3)(a) of the Divorce Act reads:
“(3) A court granting a decree of divorce in respect of a marriage out of community of property--
(a) entered into before the commencement of the Matrimonial Property Act, 1984, in terms of an antenuptial contract by which community of property, community of profit and loss and accrual sharing in any form are excluded may… on application by one of the parties to that marriage, in the absence of any agreement between them regarding the division of their assets, order that such assets, or such part of the assets, of the other party as the court may deem just be transferred to the first-mentioned party”.
Thus, where spouses were married out of community of property before 1 November 1984 and divorce thereafter a judge applies his discretion to redistribute the assets by awarding each party a percentage of the assets, based on certain factors.
Parliament’s aim in introducing such a judicial discretion at the time was to make it possible for spouses who did not previously have the option of accrual to ease their position through the reallocation of assets by the court. The provision was only intended to be an outlet valve to ease the unfairness in current marriages that had been made subject to the rigid predetermined matrimonial property systems. The discretion was for that reason only available for those spouses married out of community of property prior to the commencement date of the legislation, on 1 November 1984.
Discretion Expanded
The judicial discretion was expanded to civil marriages out of community of property carried out in terms of the Transkei Marriage Act 21 of 1978, from commencement of the Recognition of Customary Marriages Act to 2000 when the Transkei Marriage Act was repealed. As a result of the case of Holomisa v Holomisa 2019 (2) BCLR 247 (CC) a further type of marriage was added in the discretion to redistribute assets under section 7(3)(c) of the Divorce Act. They are marriages “…entered into in terms of any law applicable in a former homeland, without entering into an antenuptial contract or agreement in terms of such law”. The discretion was exercised if it was equitable and just by reason of the fact that the party in whose favour the order was granted, contributed directly or indirectly to the maintenance, or increase of the estate of the other party during the subsistence of the marriage, either by the rendering of services, or the saving of expenses which would otherwise have been incurred, or in any other manner.
In the matter of Gumede v President of the Republic of South Africa 2009 (3) SA 152 (CC), the Constitutional Court introduced an additional judicial discretion which pertains to customary marriages regardless of the date on which they were concluded and regardless of the matrimonial property system in place: “…every divorce court granting a divorce decree relating to a customary marriage has the power to order how the assets of the customary marriage should be divided between the parties, regard being had to what is just and equitable in relation to the facts of each particular case”.
Finally in the matter of President, RSA v Women’s Legal Centre Trust 2021 (2) SA 381 (SCA), the Supreme Court of Appeal ordered that: “Section 7(3) of the Divorce Act is inconsistent with sections 9, 10 and 34 of the Constitution insofar as it fails to provide for the redistribution of assets, on the dissolution of a Muslim marriage, when such redistribution would be just”. Even though the declaration of unconstitutionality was suspended for a period of two years to allow Parliament to adopt legislation to cure the constitutional defect, this created yet another category of marriages to which the judicial discretion applied, regardless of the dates of the marriages.
Indeed, there are therefore numerous different dates which determine if the discretion in section 7(3) would be available to a marriage out of community of property and few bear any relation to the original purpose of the legislature. One may argue that these different rules pertaining to the availability of the discretion can be said to discriminate on the basis of marital status, race and religion.
The Greyling Case
The Greyling case seems to suggest that a redistribution discretion should be available in all marriages out of community of property without the accrual system irrespective of the dates on which these marriages were concluded.
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.
According to the MPA when married out of community of property with the inclusion of accrual, spouses will, at divorce, share equally in the growth of the spouses’ estates during the marriage. Spouses are also able to exclude certain assets in the ANC or include a commencement value on their respective estates. If a spouse’s estate grows larger than the other, at the time of divorce, the spouse with the smaller estate can make a claim against the larger estate for half of the difference in the accrual. Assets that were excluded in the ANC would not form part of the accrual. If a spouse included a commencement value in the ANC the amount so included plus inflation thereon, reckoned from the date of marriage until the divorce would also fall beyond the scope of an accrual calculation.
When married out of community of property without accrual, after 1 November 1984 there is no sharing of any assets at divorce, whether accumulated before or during the marriage. This current regime has left many people, mainly women, financially barren, even though they had contributed to the household, raised the children, and assisted their spouses to accumulate assets over the years.
In terms of the Divorce Act, a wife for example, would not be entitled to make any kind of claim from the husband, not a portion of what they owned, and nothing of what they accumulated during their years together, simply because she did not bring in an income.
The Facts of the Greyling Case
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, excluding the accrual, a few years after the commencement of the MPA. Mrs. Greyling (the “Applicant”) raised three children to adulthood during the marriage. The Applicant was 22 years of age 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 to be that no community of property and accrual would apply to the marriage and the applicant was presented with a one-page antenuptial contract by the family’s lawyer and she was 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. This meant that the Applicant was very involved in their schooling, transported the children on a consistent basis, was a very good wife and mother and was deeply involved in community work. Her husband, on the other hand, was a very successful farmer who won awards for farming, he 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. The Applicant 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.
What the Court had to decide
The court was not called upon to determine whether the Applicant would be granted a redistribution order in her divorce but to decide whether it was constitutional for spouses married out of community of property with the exclusion of the accrual system after 1 November 1984 to be deprived of the relief provided for in s 7(3) of the Divorce Act.
The Applicant’s (Wife’s) case
The applicant submitted that s 7(3)(a) arbitrarily and irrationally differentiated between people married before and after 1 November 1984, being the date on which the MPA commenced and contended that it was irrational that she would be protected by section 7(3) if she had married four years earlier. The Applicant relied on various expert reports. A psychologist who was called as an expert witness on the applicant’s behalf stated:
'Before the Matrimonial Property Act came into effect, the law entrenched a patriarchal system in which a man was legally entitled to control his wife and where women had a weak bargaining position. On the assumption that the husband's headship of the family was only removed in 1993 it means that the patriarchal system persisted for 9 years after the Matrimonial Property Act came into force, but a woman lost the ability to make an application under section 7(3) of the Divorce Act when the accrual system was introduced.'
The applicant further contended that no legitimate government purpose justified the differentiation that denied persons married out of community of property with the exclusion of the accrual system after 1 November 1984,the potential protection of a just and equitable remedial judicial order. Counsel for the applicant addressed the assumption that the purpose of limiting the benefit of s 7(3)(a) of the Divorce Act to marriages concluded before 1 November 1984, was to give effect to the choice of the parties to get married out of community of property without the accrual system, and that s 7(3)(a) held them to that choice. He submitted that the choice-argument was illusionary for the following reasons:
- It does not always mean that if a person is over 18-years old and legally able to get married, that such aperson is mature and competent enough to consider the consequences of an antenuptial contract logically.
- The question as to whether choice can realistically be exercised is to be differentiated from the question as to a party's capacity to contract.
- It is already accepted in our legislative scheme that courts can interfere with the choices expressed by spouses in their antenuptial contracts. Section 9 of the Divorce Act empowers a court to make an order that the patrimonial benefits of the marriage be forfeited by one party in favour of the other, having regard to the duration of the marriage, the circumstances that gave rise to the break-down of the marriage and any substantial misconduct on the part of either of the parties. Section 8(2) of the MPA empowers a court to replace the accrual system applicable to the marriage with a matrimonial property system in terms of which accrual sharing, as well as community of property and community of profit and loss, are excluded. Sections 9 and 10 of the MPA respectively empower a court to declare the right to share in the accrual forfeit or to order that satisfaction of an accrual claim be deferred on conditions that the court deems just. Section 16 of the MPA empowers a court to step in where a party married in community of property withholds his or her consent required in terms of ss 15 and 17 of the Act. The judicial discretion granted in the abovementioned instances allows courts to deviate from the strict application of the property regime chosen by the parties concerned in circumstances where it would be inequitable to hold the parties to their original antenuptial contract.
The applicant further contended that the cut-off date in section 7(3)(a) (1 November 1984) disproportionately impacted women and that the blanket deprivation of excluding spouses from the potential benefits of a just and equitable redistribution order constituted unfair discrimination based on sex, gender, marital status, culture, race, and religion. As a result, it was contended on her behalf that it operated to trap predominantly women in harmful and toxic relationships, when they lacked the financial means to survive outside of the marriage.
The applicant also relied on the views of two expert witnesses, namely Professor Elsje Bonthuys and Dr. Anzille Coetzee (the “Bonthuys & Coetzee report”). Bonthuys and Coetzee opined that even today, twenty-five years after the transition to democracy, the intersecting inequalities of gender, race, and class still render many women unable to access and realize their rights. They referred to a 2016 study wherein it was found that South African women and women-headed households were significantly more likely to be 'multidimensionally poor' than males or male-headed households. Black women remained the poorest group in South Africa. As a result of their disproportionate poverty, women depend economically on male family members, husbandsand intimate partners for their survival and that of their children. The cumulative effect of a number of inequalities, e.g., gender income gap, unequal access to land and education and women being disproportionately situated outside the formal economy, is that women often enter into marriage on a weaker footing than men, with high levels of economic precarity and financial dependence. They contended that:
“The decision to get married is there for one that many women make with less autonomy than men, and with less agency to insist on terms that would be advantageous to them.”
Bonthuys and Coetzee expressed that a women's ability to generate an income is reduced by marriage, and that this is statistically proven, that women bear more responsibility for housework and caring labour, and that a marriage out of community of property with the exclusion of the accrual system would generally favour men. The effects of gender equality are also exacerbated by high levels of physical, sexual, and other forms of violence which characterize intimate relationships. They also expressed the view that courts do not have the discretion to affect adjustments to a matrimonial property regime when it is just and equitable to do so, it is typically the women who are unfairly disadvantaged.
A very important point that Bonthuys and Coetzee made is the fact that s 7(3) simultaneously discriminate on several grounds and affected different groups of people differently. They referred to the Constitutional Court's decision in a matter where the court held that customary marriages concluded before the RCA came into operation would effectively be marriages in community of property. In their view, the judicial discretion created in that case was broader than the discretion created in section 7(3)(a) and did not limit the discretion to marriages concluded before or after a specific date.
The Court’s Reasoning
Judge Van Der Schyf held the view that the legislature, in an effort to address the obvious disadvantage suffered by economically disadvantaged parties in marriages out of community of property concluded before the commencement of the MPA, introduced s 7(3)(a) and reasoned that an entirely novel concept was brought into this branch of our law, namely that the Court was given the power under certain circumstances to order the transfer of assets of the one spouse to the other and that the power that was created enabling a court to make such a redistribution order was a reforming and remedial measure.
The judge referred inter alia to the case of Beira v Beira 1987 (1) SA 967 (A) 987G where the court clarified that section 7(3) was enacted to redress a deficiency, namely, to enable both spouses to enjoy their rightful shares in the accumulated wealth residing in the one which their joint endeavours during the subsistence of the marriage had brought them.
The judge referred to the authors Robinson and Horsten: The Quantification of “Labour of Love”: reflections on the Constitutionality of the Discretion of a Court to Redistribute Capital Assets in terms of Section 7(3) -(6) of the South African Divorce Act. (2010) Speculum Iuris 96-117, 115 where they emphasized that section 7(3) did not grant the court a judicial discretion to create a system of accrual that the parties themselves did not create or to redistribute the spouses' assets in a way that seems fair. In the Beira case, Leveson J expressly stated that it was not the aim of the legislature for a s 7(3) order to put the parties in equal financial positions. The aim of s 7(3) was to redress the unfair financial imbalance flowing from the very nature of a marriage being out of community of property in circumstances where one party contributed to the other's maintenance or the increase of the other's estate during the existence of the marriage.
The judge mentioned that a spouse does not qualify as having made a contribution as a matter of course by virtue of being married. The jurisdictional requirements of s 7(3) read with ss 7(4), (5) and (6) still had to be met. The practical effect of a s 7(3) order according to the judge is that the party who contributed to the other's gain is compensated for their contribution to the extent that a court finds just and equitable and that the court has a wide discretion, taking into account an infinite variety of factors.
When the MPA was enacted, the legislature prescribed a number of prerequisites that had to be met before an order could be granted in terms of s 7(3)(a). The first requirement was that the marriage must have been entered into before the coming into operation of the MPA. It was, however, not open to all parties married out of community of property before the commencement of the MPA to approach the court for a redistribution in the nature as provided for by s7(3)(a). The remaining requirements act as the proverbial gatekeepers, in that the remedy is only available in (i) the absence of any agreement between the parties regarding the division of their estates, where an applicant (ii) contributed directly or indirectly to the maintenance or increase of the estate of his or her spouse during the subsistence of the marriage, either by the rendering of services or the saving of expenses which would otherwise have been incurred.
The judge rightfully took the view that the Bill of Rights, and thus section 9 of the Constitution, applies to matrimonial property law since marriage is a matter of choice and so too are the proprietary consequences of marriage. The legislature crafted a reforming and remedial measure but limited its application to marriages out of community of property concluded before the MPA commenced. The judge reasoned that since the possibility of granting a redistribution order was created concomitantly with the introduction of the system of accrual sharing, it can arguably be assumed that s 7(3) was intended to be a transitional measure. According to the judge the legislature arguably did not extend the relief to marriages out of community of property excluding the accrual system because the MPA provided the option of choosing between a system that includes accrual sharing and a system that excludes accrual sharing. Parties seemingly exercise a deliberate choice when they exclude the accrual system and incorporate that choice in a written antenuptial agreement executed before a notary. The question is whether in this context it can be said that legislative innovation that brought into force s 7(3) of the Divorce Act to address the plight of economically disadvantaged parties who did not have the opportunity to choose a more beneficial marital regime in the form of the accrual system, is irrational. By restricting the operation of s 7(3) to marriages concluded before 1 November 1984 the legislature honoured the principle of freedom of contract and pacta sunt servanda, and that is not without merit.
The judge went further and found that it cannot be gainsaid that s 7(3)(a) of the Divorce Act differentiates between spouses married out of community of property who were married before the MPA commenced, and spouses married out of community of property with the exclusion of the accrual system after the MPA commenced. The obvious disparity and inequity that ensues when parties who are married out of community of property and where one party contributed to the maintenance or increase of the estate of the other party, file for divorce, moved the legislature to enact s 7(3)(a) of the Divorce Act. By incorporating a cut-off date for the application of s 7(3), economically disadvantaged parties who were married after 1 November 1984 cannot approach a court to make an order that is just and equitable if they meet the remaining jurisdictional requirements of s7(3). Thus, the inequity which is caused because the economically disadvantaged spouse nevertheless made a direct or indirect contribution towards the other spouse's estate, persists.
According to the judge the constitutional validity of s 7(3)(a) should not solely be considered from the perspective of the parties' position as it was when an antenuptial agreement was concluded, because there could well be a plethora of legitimate reasons as to why parties would agree to conclude a marriage out of community of property with the exclusion of the accrual system, e.g., a proud less affluent party who is intending to marry the love of their life who happens to be wealthy, may wish to demonstrate that the marriage is concluded solely for the reason of love, and not to gain any future patrimonial benefits.
The judge reasoned further that the inequality is caused when, after the conclusion of the marriage, a distortion is caused by the fact that one spouse contributes directly or indirectly to the other's maintenance or the increase of the other's estate without any quid pro quo. In ideal circumstances where parties commit 'for better and worse, until death do us part' the economic inequality that follows when one spouse contributes to the other's maintenance or estate growth while their own estate decreases or remains stagnant, may not even be noticed. The unity of marriage conceals economic disparity because it is, for the most part, during the subsistence of the marriage of no consequence. However, where it becomes apparent on divorce that one spouse's estate increased because of the other spouse's contribution while the latter spouse's estate decreased, the party who received maintenance from the other or whose estate increased because of a direct or indirect contribution by the other, have received what can be described as an unfair economic advantage on the basis of the marriage. This is the inequality that can be addressed by an order in terms of s7(3)(a), irrespective of the race or gender of the economically disadvantaged party, a remedy that is to date only available to spouses who married prior to 1 November 1984.
The judge was of the view that section 7(3)(a) differentiates between parties solely based on the date of commencement of the MPA in circumstances where parties could either (i) apply to incorporate the accrual system into their existing marriage property regime and for one or other reason, failed, or refrained from doing so, and (ii) where parties decided to exclude the accrual system. The only difference between these groups according to the judge was speculative in that it could be argued that there might be members in the first group who did not know that they could incorporate the accrual system post the commencement of the MPA, while a deliberate choice underpinned the position of the second group. Speculation aside the judge remarked, “these groups are par excellence in a similar situation, and yet the one group is denied the benefit of s 7(3)(a) only on the basis of the date on which their marriage was concluded. The differentiation amounts to discrimination based on the date on which a marriage was concluded because economically disadvantaged parties’ human dignity is impaired if they cannot approach the court to exercise the discretion provided for in s 7(3) of the Divorce Act. Unlike their counterparts whose marriages were concluded before 1 November 1984, economically disadvantaged parties who contributed to their spouses’ maintenance or the growth of their estates, are vulnerable parties whose only recourse is to approach the court for maintenance. The unequal power relationship implicit to any maintenance claim, and the extent to which it renders an economically disadvantaged party vulnerable, in these circumstances speaks for itself”.
The court further reasoned that Section 7(3) is subject to subsections (4), (5) and (6). According to the judge it was evident from a reading of those provisions that any party approaching the court for the relief provided for in s7(3) must make out a case that it contributed directly or indirectly to the maintenance or increase of the estate of the other party during the subsistence of the marriage. The court was of the view that it would be patently unfair that an economically disadvantaged party who can make out a case for relief in terms of s 7(3), whose contribution is not recognised and adequately compensated by the spouse who benefitted from such contribution, is metaphorically left out in the cold at the mercy of the spouse whose estate increased, without any recourse to the court to address the injustice.
The judge went further and stated: “the judicial power provided by section 7(3) of the Divorce Act was aimed at avoiding grossly inequitable discrepancies in the financial position of spouses on divorce. Irrespective of whether the section was initially intended as a transitional provision, the innate restriction in s 7(3)(a) based solely on the date on which a marriage was concluded, does not in 2022, muster constitutional scrutiny. The limitation of the relief provided for in s 7(3)(a) of the Divorce Act to marriages concluded prior to the commencement of the MPA violates s 9(3) of the Constitution. The cut-off date contained in s 7(3)(a) unfairly discriminates against people married according to a system of complete separation of property on the ground of the date of their marriage.”
The judge also referred to the learned author Sinclair Family Rights’ in Van Wyk, D., et al (eds) Rights and Constitutionalism – The New South Africa Legal Order 1994 JUTA 502-572, 548 who stated:
'The discrimination takes the form of denying to those people a remedy to relieve injustice that is granted to persons married with an identical system, but earlier.'
and:
“For couples who live on their salaries and do not have the opportunity to amass property the matrimonial property system that governs their marriage turns out to be the panacea for the poverty that will be experienced most acutely by the divorced women [or any economically disadvantaged party]. For the poor, matrimonial property law is as important as an elaborate estate planning exercise. But for many thousands of people the matrimonial home and a share in pension and other retirement benefits accumulated during marriage make the difference between forced reliance on exiguous welfare and some form of financial security. To these people the sharing of property acquired by joint efforts is crucial. To be denied an equitable remedy on the ground of the date of one's marriage is unacceptable”.
The judge ultimately took the view that s 7(3)(a) allows a court to interfere in a private relationship to avoid injustice and that it would be axiomatic that no injustice could be done if that power was also available to courts relating to marriages out of community of property with the exclusion of the accrual system. The court's s 7(3)- discretion is therefore wide in the sense that it is to be exercised in a manner that will bring about a just and equitable outcome in the factual context concerned, but the power to exercise the discretion is circumscribed and limited to the two scenarios prescribed in s 7(4) namely that the party in whose favour the order is granted must have contributed directly or indirectly to the (i) maintenance, or (ii) increase of the estate of the other party, during the subsistence of the marriage. The unfair discrimination that is caused by the exclusionary time-bar in s 7(3)(a) can be corrected by removing the time-bar.
Order
In the result, the following order was granted:
- Section 7(3)(a) of the Divorce Act, 70 of 1979, was declared inconsistent with the Constitution and invalid to the extent that the provision limited the operation of section 7(3) of the Divorce Act to marriages out of community of property entered into before the commencement of the Matrimonial Property Act, 88 of 1984;
- The inclusion of the words ‘entered into before the commencement of the Matrimonial Property Act, 1984’ in section 7(3)(a) of the Divorce Act, 70 of 1979, was declared inconsistent with the Constitution and invalid. These words were notionally severed from section 7(3)(a) of the Divorce Act, 70 of 1979, and section 7(3)(a) of the Divorce Act, 70 of 1979, was to be read as though the words ‘entered into before the commencement of the Matrimonial Property Act, 1984' do not appear in the section.
- In terms of section 172(1)(b) of the Constitution, the orders in paragraphs (1) and (2) of this order would not affect the legal consequences of any act done or omission or fact existing in relation to a marriage out of community of property with the exclusion of the accrual system concluded after 1 November 1984, before this order was made;
- The aforementioned orders, in so far as they declared provisions of an Act of Parliament invalid, were referred to the Constitutional Court for confirmation in terms of section 172(2)(a) of the Constitution, 1996, and the Registrar was directed to comply with Rule 16(1) of the Rules of the Constitutional Court in this regard.
- Each party had to pay their own costs.
Criticism
- The judgement raises several concerns:
- The judgment has omitted several serious problems in our law.
- The only remedy is to totally abolish the entire Accrual System.
- Since the Divorce Act was amended, bringing into force a redistribution system, the family system was in line with other westernised countries such as most of the states of the United States of America, England, Australia and New Zealand.
- The system was working well, and all that perhaps was needed were minor variations to the Divorce Act to prevent a spouse from putting assets out of reach of the other spouse where a court could not order redistribution of that asset.
- Instead of doing that, the legislator brought into being an Accrual System in respect of all marriages out of community of property, concluded after November 1984 and the legislator abolished a redistribution system for those marriages.
- This was in terms of the Matrimonial Property Act, and it allowed parties to contract with or without the Accrual System.
- Now suddenly, a spouse could contract without accrual and would not be entitled to any redistribution of assets.
- That was not the only problem, as appears below.
- The judgment concerned, has overlooked the other problem which is that spouses who contracted with the Accrual System, had an additional right, namely, to exclude assets and in practice the biggest problem faced by particularly women, is that even where the parties contracted with the Accrual System, the husband would often exclude important assets from the accrual, such as his company and his trusts or anything acquired from them. In this way, although the wife was entitled to apply the Accrual System, everything would be excluded and thus she would receive nothing.
- The judgment discriminates against women who have married out of community of property after 1984, with the inclusion of the Accrual System, and where the husband may have excluded various assets.
- In addition, the judgment has overlooked an essential issue, namely, the question of settlements which may be made in favour of one of the spouses in the Antenuptial Contract.
- The judgment has found that the redistribution section should apply only to marriages out of community of property concluded after 1984 where the accrual is excluded. Let us assume that in such a marriage the parties have settled on a benefit of R20 million to be paid the wifeat a particular time, she would be in a much better position than the wife who married with accrual where all the assets had been excluded and no settlement has been given in the Antenuptial contract.
- The judgment has called upon the Constitutional Court to amend the statute, but it seems likely that they will refuse to do so because it would leave certain spouses discriminated against.
- The solution is to abolish the Accrual System in its totality and return to the redistribution system for all marriages out of community of property.
Written by Bertus Preller, Family Law and Divorce Law Attorney at Maurice Phillips Wisenberg, Cape Town South Africa