Pen-contractsAntenuptial Contract – What exactly is it?

An Antenuptial Contract, also referred to as a Prenuptial Contract or Prenup, is a legal contract entered into by a couple previous to their marriage, to stipulate the terms and conditions regarding the exclusion of community of property between them. The stipulations may not be illegal, immoral or contrary to public policy. Each spouse usually retains his / her separate property and has complete freedom to handle that property as he or she chooses. If one spouse was declared insolvent, their spouse’s property is protected against the insolvent spouse’s creditors, subject to Section 21 of the Insolvency Act.

Why would I consider registering an Antenuptial Contract?

There are numerous reasons why many couples may want to enter into an Antenuptial Contract with a view to be married out of community of property. The most typical reasons are that: They don’t want to be held responsible for any debts that the opposite spouse could have incurred prior to marriage; They need to guard assets say for example a house from creditors, especially when one of the spouses has a company of their own, and they might therefore want to have the ability to register the home in the name of their spouse; One or both spouses have assets at the time of the marriage that they don’t want to become a part of a joint estate; They want to have the ability to enter into transactions without the need to obtain the consent of their spouse; During the marriage each spouse retains control over his / her own property, builds up his / her own estate and each is liable for their own debts.

There are 2 options regarding an Antenuptial Contract

An Antenuptial Contract excludes community of property. This can only be accomplished by entering into an Antenuptial Contract before you get married. There really are two options:
  • Marriage out of community of property with application of the accrual system
  • Marriage out of community of property without application of the accrual system
Should you conclude an Antenuptial Contract previous to your marriage, the accrual system will automatically apply under the Matrimonial Property Act of 1984, unless it’s expressly excluded within the contract. ‘Accrual’ means increase. The accrual system is a form of sharing of assets that are built up throughout the marriage. The philosophy in respect of the accrual system is both parties are eligible to get the asset value that she or he brought into the marriage, after which they share what they’ve accrued together. Under both options (with or without the accrual system), one spouse’s property can’t be sold to repay the spouse’s creditors if the opposite becomes insolvent – as opposed to the case in which the parties are married in community of property.