Impact of South Africa's divorce law changes on property ownership

South Africa’s family law is set for a significant shift, with proposed amendments that could impact how your property - and other assets - are divided in the event of divorce or death, even if there’s an antenuptial agreement in place.

This is one of the most substantial adjustments we’ve seen in matrimonial property law in some time. The goal is to promote fairer outcomes, particularly for spouses who’ve made meaningful non-financial contributions to the marriage.

Statistics South Africa shows that 130,806 civil marriages were registered in 2023, while in decline, marriage remains a commonplace institution in South Africa with significant legal implications for property ownership. 

Unpacking proposed legal reforms

Justice Minister Mmamoloko Kubayi plans to table the General Laws (Family Matters) Amendment Bill in Parliament this year.

This Bill follows the 2023 Constitutional Court ruling that called for greater equity in divorce and estate matters. The amendment aims to protect spouses who could be left financially vulnerable after death or divorce by granting courts broader discretion in terms of fair asset redistribution.

The proposed amendments will affect the Divorce Act, Matrimonial Property Act, and Mediation in Certain Divorce Matters Act, with the most notable proposed reforms including:

1. Pre-1984 marriages (before the accrual system): Courts may now redistribute assets upon death or divorce.
2. Post-1984 marriages without accrual: Even with an antenuptial contract excluding accrual, courts may intervene to redistribute assets if deemed just.

This departs from the current norm, where a spouse typically walks away only with what’s legally theirs, regardless of their broader contributions to the marriage. Couples who are married or planning to marry should take note of how these legal updates could affect property ownership and estate planning.

What the Bill means for property owners

Under this amendment, courts will consider non-financial contributions, such as homemaking, raising children, or supporting a spouse’s career or business, when it comes time to divide assets.

Interestingly, this isn’t about defaulting to a 50/50 split; it’s about assessing whether one spouse enabled the other to grow wealth or acquire property before deciding what a fair outcome looks like.

The reforms mean that spouses in no-accrual marriages will be able to apply to the divorce court for a redistribution of assets. The court can then decide to transfer a portion of the spouse’s assets to the applicant if it finds that the applicant contributed towards the increase of the spouse’s estate, directly or indirectly.

Factors that will determine asset distribution include the duration of the marriage, the couple’s arrangements, and the extent of the applicant’s contribution.

Based on this, assets that may be subject to redistribution include:

• Primary or investment properties
• Real estate-linked business interests
• Property within a deceased spouse’s estate

Under the current law, surviving spouses in non-accrual marriages often have no claim to property unless specified in a will. The proposed changes would allow for court-ordered redistribution from the deceased’s estate, offering greater financial protection for the surviving spouse.

This aims to prevent situations where an individual is left with nothing when a spouse dies, despite years of matrimonial support.

Practical tips for married and engaged couples

Married or engaged couples, especially those with shared property or long-term investments, should seek legal advice regarding the upcoming adjustments to the marital law.

Top tips to follow:

1. Review or update your antenuptial contract: Antenuptial contracts remain valid, but courts may override them if they result in an unfair outcome. Here, we strongly suggest drafting contracts with contingency clauses to account for future contributions and asset division scenarios, and it’s strongly advised that you work with a legal team to make these adjustments.
2. Explore postnuptial adjustments: Married couples can apply for a change in their matrimonial property regime under Section 21 of the Matrimonial Property Act. This helps to align existing agreements to the new legal framework - particularly when it comes to property investments.
3. Consider detailed contract planning: If you’re going into a marriage and there are significant property assets involved, more consideration will need to be applied to ensure an equitable distribution. Couples should consider the following:

·       Clearly defining asset exclusions.

·       Assessing whether the chosen regime still suits their needs.

·       Ensuring estate plans and wills reflect the potential for court-ordered redistribution.

·       Accounting for dependents to avoid unintended asset shifts.

Smee believes these changes reflect a more modern understanding of marriage dynamics: It’s important to remember that contributions aren’t always financial. The law takes cognisance of the reality that sacrifices, including non-financial sacrifices, made for the household deserve recognition. These reforms aim to create a more balanced approach to property and asset distribution.

* Smee is the CEO of Only Realty Property Group.

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