Blue Chip Issue 90

BLUE
CHIP
FINANCIAL PLANNING | Legislation
SOME IMPORTANT CHANGES IN
THE WORLD OF DIVORCE LAW
The family law fraternity (divorce lawyers in particular)
are all a-buzz with the Constitutional Court’s recent
judgement in the case of EB v ER and Others; KG v
Minister of Home Affairs and Others.
For any aspiring law geeks among you, the full judgement
penned by Justice Rogers is well worth a read, but as it stretches
to a lengthy 72 pages, I thought you may appreciate something
a little punchier.
The liberal view is that the
judgement is a triumph for our
constitutional democracy.
What’s it all about?
The nub of the issue is essentially this:
In the past, wealthy people getting married would often
try to safeguard their assets against divorce by insisting on an
antenuptial contract (or prenup) stipulating that the marriage
would be out of community of property and would exclude
the accrual system. For the sake of simplicity let’s call this a
“No Share ANC”.
Effectively a No Share ANC stipulates “what’s mine is mine,
what’s yours is yours (‘til death or divorce do us part) and the
fact that we’re getting married for a bit in between isn’t going
to change that”.
Typically, with a No Share ANC, the wealthier spouse (let’s
call them No Share Sherlock) slept comfortably at night secure
in the knowledge that when the marriage ends (and let’s face
it, all marriages come to an end at some point, even if only
because eventually somebody dies) they won’t have to hand
over any assets to their former spouse (or their spouse’s heirs,
for that matter).
Since the EB v ER and KG judgement things have changed
– and No Share Sherlock should now be aware that there is a
possibility that some assets will be “redistributed”. Effectively,
the recent Constitutional Court judgement has resulted in a
change in the law – such that a court is now empowered to
order No Share Sherlock to transfer a portion of his/her assets
to his/her former spouse, even though they both signed a No
Share ANC.
The rands and cents
How much might No Share Sherlock have to pay? you ask.
The amount that the court deems “just and equitable” in the
circumstances, is the answer. While this may seem a bit vague
and unsatisfactory, one should take (some) comfort from the fact
that, at least in principle, it shouldn’t be a totally arbitrary award.
The various factors a court will take into consideration are dealt
with extensively in the full judgement (so you might have to read
it after all, sorry!).
Among other things, the court will need to be satisfied that No
Share Sherlock’s soon-to-be ex-spouse has made a contribution
(monetary or otherwise) towards the accumulated assets they now
want to share.
Bottom line
In a nutshell, what the EB v ER and KG judgement does, is to sound
the warning for those who are married or getting married: they are
in for a financial partnership of sorts, whether they like it or not.
72 www.bluechipdigital.co.za