How are our matrimonial assets divided in a divorce?

First, it is important to determine which of your assets are part of the matrimonial asset pool for division. Essentially, there are three categories where a contested property can fall under:

1. Property acquired during the marriage;

2. Property acquired before the marriage; and

3. Property acquired by one party by gift or inheritance

For the first category, all properties acquired during the marriage by either party, whether individually or jointly, will form part of the pool of matrimonial assets.

For the second category, such properties are known as pre-martial assets. In general, pre-marital assets are excluded from the pool. However, if it is shown that this property was ordinarily used or enjoyed by both parties or their children, it will form part of the matrimonial asset pool. Also, if a pre-martial asset had been substantially improved during the marriage by the other non-acquiring party or by both parties, it will also form part of the pool of matrimonial assets.

For the third category, if the property was acquired as a gift/ inheritance, it will be excluded from the pool of matrimonial assets regardless of when it was acquired. However, there are two exceptions to this rule:
(1) Where the gift/ inheritance was used as the matrimonial home; and
(2) Where the gift/ inheritance was intended for and/or used by both parties.

Important considerations for division

The Court’s main objective is to ensure an equitable division of matrimonial assets for parties. The court has a wide discretion and will consider all circumstances in order to ascribe a ratio that would be fair and just. Some important considerations include:

• The direct and indirect contributions of parties;

• The extent of the financial and non-financial contributions made by each party;

• The needs of the children (if any) of the marriage;

• The extent of the contributions made by each party to the welfare of the family; and

• The financial independence of each party after divorce

Typically, these considerations will serve as a guide for the court to ascribe a ratio to each parties’ direct and indirect contributions respectively. The court then takes an average of the two ratios.

However, it is not always the case that an equal weightage is given to the direct and indirect contributions. In certain circumstances, the Court will give due attention to the following and adjust the average ratio in one party’s favour:

• The nature of indirect contributions (e.g. if you were an exceptional homemaker, more emphasis would be given to indirect contributions);

• The length of the marriage (i.e. longer marriage point towards greater emphasis on indirect contributions); and

• The size of the pool of matrimonial assets (i.e. If there is a large pool of accumulated matrimonial assets, direct contributions may be given more weight where assets were mainly accumulated by one party).

Ultimately, the division of matrimonial assets is done on a case-by-case basis. When the court exercises its power to divide matrimonial property, the court is not undertaking an exercise based on arithmetic but a judgmental exercised based on the circumstances of the marriage.