The role of antenuptial contracts (prenups) in South Africa

Are you in favour of the ANC? No, I don’t mean the political party. I’m referring to the antenuptial contract. Hi. I’m Simon Dippenaar and I’m a family lawyer. Antenuptial contracts, or ANCs, have been around for a long time. In the US they are often called prenuptial contracts, or prenups, but they are all the same thing.
The recent announcement that Bill and Melinda Gates are to divorce - amicably if we believe the news reports - has shone a spotlight on the ANC. Bill and Melinda didn’t have one. So what exactly is an antenuptial contract and how can it benefit a couple?
Before we can unpack the ANC, we need to understand the different marriage rules - or matrimonial property regimes - here in South Africa.
There are three types of marriage. Historically the most common was “in community of property”. This is still the default regime. In this type of marriage both parties are the owners of the joint estate, and when they divorce, they split the marital property 50/50. In a marriage in community of property there is no ANC.
The other types of marriage are “out of community of property” - either with or without accrual. In both of these cases an ANC is required. Very briefly, out of community of property means that all assets owned by each party before the marriage remain the property of the individual. They do not become part of a joint marital estate. “With accrual” means that everything acquired after the marriage is considered part of the joint estate, and is divided equally in the event of divorce. This includes any increase in the net value of each individual’s estate. “Without accrual” is the simplest marital arrangement, but it may not always be the fairest. In this case, all property owned prior to the marriage and all property acquired during the marriage belongs to the person who acquired it.
So what role does the ANC play? It sets out the rules and conditions that govern the division of assets, both during the marriage and on divorce. The contract is straightforward, and declares:
The net values of the estates of the parties at the commencement of their intended marriage
Any exclusions (as per the Matrimonial Property Act)
The accrual calculation, for marriages with accrual
Any other conditions that may impact the accrual, such as insolvency
Then both parties declare their intention to solemnise the marriage and promise each other the full force of their legal obligations with respect to the marriage and property
You may feel it is awkward to discuss an antenuptial contract as part of your wedding plans. You may think it suggests the marriage won’t last. But the reality is…this document can prevent a lot of heartache later on. Some couples even find an ANC makes the marriage more harmonious, as financial disputes are pre-empted by the terms of the contract.
If you’re embarking on marriage, I hope your ANC will never be needed. but if it is, it can make life a lot easier for everyone involved. Give me a call on 086 099 5146 if you’d like to discuss an ANC.