21 July 2011
As per 1 January 2012, legislative proposal on general community of property regime takes effect, as announced in my previous weblog.
What does this mean for divorcing couples?
In order to shed some light on the practicalities, I am listing some of the changes that will affect couples filing for divorce under the new provisions.
Couples married under the matrimonial regime of community of property and goods must divide their assets by definition, if they decide to terminate their marriage. However, it is worth exploring the circumstances under which the reference date for the valuation of the overall assets will be set, as such valuation takes into consideration the value at the moment of valuation, as well. How and when does the value of the matrimonial home, the balance of the bank accounts, the extent of life insurances etc, get established?
At present, the reference date for the extent of the community of property and goods is the date on which the divorce is registered, and the reference date for the valuation itself takes place on the date the assets are meant to be divided. In the case of real estate, this will be the date of the deed being signed in front of a notary. Parties may make different arrangements; however, practice shows that the reference date for the valuation is often disputed.
Quite a lot of time can pass between the moment when one of the parties moves out of the matrimonial home and the moment when the divorce is completed and registered. As things are now, the spouses have no insight into each other’s dealings and financial manipulations of their joined assets and property, before the divorce is finalised. It often happens that one of the spouses strips significant amounts from the jointly owned account, or that the value of jointly owned assets rises or falls. Since the division of assets and property is meant to conclude the divorce proceedings, it is not clear under the present legislation what may happen with the jointly owned property right up until the divorce is final.
As per 1 January 2012, the reference date for the division of assets and property will be the date when the petition for divorce is filed with the court. This is a considerable advancement, compared to the “old “situation, meaning that after filing for divorce, the couple will no longer be able to manipulate their assets. Arranging a different date of reference is still an option, if the spouses can agree; however, this matter remains a difficult one.
Part 3 of this special blog series is now available
