Ensuring a fair sharing of growth
South African couples married out of community of property with accrual retain separate estates during the marriage but share in the net growth of both estates on divorce. The intention is to achieve fairness by compensating the spouse whose estate grew less.
In practice, however, two common complications often arise in high-value divorces.
1. Unilateral Contributions toward Shared Assets
In many matters, one spouse (typically the wife) pays bond instalments, maintenance, or property costs on assets registered in the name of the other spouse. Unless properly accounted for, these contributions may inflate the paying spouse’s estate and trigger an accrual payout in favour of the non-contributing party.
This is particularly problematic where the assets are used jointly (e.g., family homes or vacation properties).
2. No Written Reimbursement Agreement
Absent a written agreement on reimbursement, courts must determine whether such payments were:
- • Gifts,
- • Payments linked to shared-use assets may be recognised:
- • Loans, or
- • Contributions meriting adjustment.
- • Payments linked to shared-use assets may be recognised:
- • As a personal claim against the other spouse’s estate; or
- • As a reduction in the value of that spouse’s estate for accrual purposes.
Evidentiary Requirements
- • Success depends on documentation:
- • Bank statements showing transfers or bond instalments;
- • Bond schedules;
- • Property valuations;
- • Invoices and ledgers reflecting the nature and timing of each contribution.
Strategic use in Divorce
The accrual system provides a mechanism for fair distribution of post-marital wealth, but its effectiveness depends on accurate financial disclosures and clearly documented contributions. Where one spouse’s contributions significantly outweigh the other’s, accrual can be recalculated to reflect this imbalance.
