Until divorce do us part

The divorce process can be complicated by many factors, one of which is the ownership of immovable property.

August 29, 2016

There are, however, some clear guidelines based on the matrimonial regime selected at the time of the marriage.

In Community of Property

When two people are married in community of property, they form a joint estate of which they share equal, undivided shares of ownership.

As such, upon dissolution of a marriage, the property must either be “transferred” to one spouse or the property must be sold and the proceeds split between the two people.

If it is agreed by the parties, or it is stipulated in the divorce settlement, that one spouse will take ownership of the property, he or she will be required to compensate the other for the additional 50% share in the property. The Deeds Registries Act, 47 of 1937, makes provision for this type of transfer of ownership by way of an endorsement with an application being made to the Registrar of Deeds who then endorses the title deed with the relevant information of the new sole owner.

If the agreement of settlement requires the property to be sold, the proceeds will be split equally between the two people. In addition, as they are co-owners of the property, both parties will have to sign the offer to purchase with the new buyer in order for the contract of sale to be valid.

Out of Community of Property

For parties married out of community of property, where they are joint owners of a property, the property may be awarded to one party in terms of the settlement or by mutual agreement. In such a case, formal transfer of the half share of the property must take place from one spouse to the other.

However, for property that is owned by only one party, the divorce proceedings will not have any effect on the property ownership. Individually owned property will remain the property of that one spouse. Always subject to the terms of the settlement agreement.

Third party rights

Regardless of the marital regime and the process through which the property ownership is determined, any limited real rights which are held against that property (such as a registered bond) remain in force and must be dealt with. The party who receives full ownership of the property through the divorce will typically take full responsibility for this, and in the case of a registered bond, the other party will be “bought out” or asked to contribute in this respect.

Of course, there are many uncomfortable or problematic scenarios that can arise when it comes to the ownership of immovable property as a result of a divorce. While it is not always possible to avoid these, the best possible method of prevention is to stipulate the relevant details in an ante nuptial contract in the case of a marriage out of community of property to minimize any uncertainty that can lead to disagreement. For this, it is advisable to deal with a reputable attorney to manage this process and offer professional advice.

Written by Wessel de Kock

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