Marriage and Matrimonial Property

 

 

Voluntary Surrender of Assets

Voluntary Surrender of Assets - A Path to Financial Fresh Start

Facing overwhelming debt can feel isolating. If you've reached a point where you can no longer meet your financial obligations, South African law offers a potential solution: Voluntary Surrender of your estate, also known as voluntary sequestration. This legal process allows you to proactively approach the court to declare your insolvency and seek relief.

At VDM Attorneys, we understand the stress and uncertainty that comes with financial difficulties. We can guide you through the complexities of voluntary surrender, ensuring you understand your rights and options every step of the way.

What is Voluntary Surrender?

Voluntary surrender is a formal application made to the High Court by an individual who is unable to pay their debts. Legally, you are considered insolvent when your liabilities (what you owe) exceed your assets (what you own). This process, governed by Section 6 of the Insolvency Act 24 of 1936, allows for a fair distribution of your remaining assets to your creditors.

When Might Voluntary Surrender Be the Right Option?

Voluntary surrender might be a viable option if:

  • You are Insolvent: Your debts are significantly greater than the value of your assets.
  • You Cannot Meet Your Financial Obligations: You are unable to make regular payments to your creditors.
  • There are Sufficient Realisable Assets: Your estate has assets that can be sold to provide a meaningful benefit to your creditors (currently, the requirement is typically a minimum return of around 20 cents in the Rand, after covering the costs of sequestration).

The Voluntary Surrender Process with VDM Attorneys

Navigating the legal procedures of voluntary surrender requires meticulous attention to detail. VDM Attorneys will assist you with every step, including:

  • Consultation and Assessment We will discuss your financial situation to determine if voluntary surrender is the most appropriate course of action for you.
  • Drafting the Affidavit We will expertly draft the necessary affidavit explaining your insolvency and the reasons for it.
  • Preparing Court Documents We will handle the preparation and issuing of all required legal documents at the High Court.
  • Notice to Creditors and Public We will ensure the publication of the Notice of Surrender in the Government Gazette and a local newspaper within the legally mandated timeframe (no more than 30 days and no less than 14 days before the application date). We will also send copies of the notice to all known creditors, SARS, and relevant trade unions within seven days of publication.
  • Statement of Affairs We will assist you in preparing a comprehensive Statement of Affairs (Form B), detailing your assets and liabilities, sworn under oath. This document will be available for creditor inspection at the Master's Office.
  • Court Representation You will not need to appear in court. Our experienced advocates will represent you throughout the application process.
  • Provisional and Final Orders We will guide you through the process of obtaining a provisional sequestration order, followed by the final sequestration order if no opposition is received from creditors.

Requirements for Voluntary Surrender

For the court to accept your voluntary surrender application, the following key requirements must be met:

  • Insolvency:Your liabilities must exceed your assets.
  • Advantage to Creditors The court must be satisfied that the sequestration will be to the advantage of your creditors, meaning they will receive a noticeable dividend from the sale of your assets.
  • Sufficient Realisable Assets You must possess enough assets that can be sold to cover the costs of the sequestration process and provide the required benefit to creditors.
  • Compliance with Formalities All statutory procedures and timelines outlined in the Insolvency Act must be strictly adhered to.

Consequences of Voluntary Surrender

Understanding the implications of voluntary surrender is crucial. Here are some key consequences:

Potential Benefits:

  • Debt Relief You can potentially become debt-free after the sequestration process and subsequent rehabilitation.
  • Protection from Creditors Once the provisional order is granted, creditors cannot take further legal action against you.
  • A Fresh Financial Start Voluntary surrender can offer an opportunity to rebuild your financial life without the burden of overwhelming debt.

Important Considerations

  • Loss of Assets You will lose control of your assets, which will be managed and sold by a court-appointed trustee to pay your creditors. Certain essential items like clothing, bedding, basic household furniture, and tools of trade may be exempt.
  • Impact on Credit Rating Your credit record will be negatively affected, and you will likely struggle to obtain credit in the future until you are rehabilitated.
  • Restrictions During the period of sequestration, you will face certain legal restrictions, such as limitations on holding certain positions (e.g., company director) and entering into credit agreements without the trustee's consent.
  • Impact on Spouse If you are married in community of property, both your estates will be jointly sequestrated. If married out of community of property, your spouse's assets may also be affected, requiring them to prove ownership.

Rehabilitation:

  • After a period of time or by applying to the court, you can become rehabilitated. Rehabilitation restores your legal standing, removes most of the restrictions of sequestration, and allows you to rebuild your financial life.

How VDM Attorneys Can Help You

Voluntary surrender is a significant legal decision with far-reaching consequences. It is essential to seek expert legal advice to fully understand the process and ensure all requirements are met. VDM Attorneys offers:

  • Expert Legal Guidance - Our experienced insolvency attorneys will provide you with clear and comprehensive advice tailored to your specific situation.
  • Professional Handling of Procedures - We will manage all the complex legal and administrative tasks involved in the voluntary surrender process, ensuring compliance with the Insolvency Act.
  • Dedicated Support - We are committed to providing you with ongoing support and guidance throughout the entire process.

If you are struggling with unmanageable debt and considering voluntary surrender, contact VDM Attorneys today for a confidential consultation. We are here to help you explore your options and navigate the path towards a financial fresh start.

Contact VDM Attorneys today to discuss your situation and explore how voluntary surrender might be the right solution for you.

Yes!!!! 
On 30 November 2006, South Africa made world headlines when it became the fifth country in the world (and the first in Africa) to legalise marriage between two people of the same sex under the Civil Union Act.
The Civil Union Act is the law that now provides for legal recognition of marriages and civil partnerships, collectively referred to as civil unions, between two persons regardless of their sexual orientation or gender identity.

Yes, it is possible to change your marital regime through a process known as a postnuptial agreement. However, this requires the consent of both spouses and a court application and it is beneficial to discuss this and work through an attorney to manage this process. 

A marriage ceremony can take place almost anywhere, as long as the legal part of the ceremony is conducted or repeated in a church or other building used for religious services or in a public office (i.e. a Government office) or in a private dwelling house.

Basically, as long as the signing of the register/marriage certificate is done indoors.

Absoloutely!

You need to have a frank discussion with a lawyer who can assist not only with the legal requirements but to give both parties some important and realistic advice and checks about how marraige will affect your future - Obtaining good legal advice before you get married can save you an enormous amount of stress and expense down the line, not only in the unfortunate case of a divorce. Remember that your marital status can affect future issues like your financial liability for debts incurred, or the division of assets in the case of a divorce.

1. Register your intent to marry at a Department of Home Affairs office. This should be done at least three months before the wedding date. 

2. Pay the required fee for the marriage certificate and other administrative costs. 

3. Choose a marriage officer, either from the Department of Home Affairs or a religious institution, to officiate the ceremony. 

4. Schedule a date for the ceremony and obtain a marriage license.

5. Invite witnesses to the ceremony; you need at least two and they must be over 16 years old and understand the language used during the ceremony. 

6. After the ceremony, your marriage officer will submit the marriage register to the Department of Home Affairs, and you’ll receive your marriage certificate. 

7. Consulting with legal professionals like VDM Attorneys or the relevant government authorities can help ensure that your wedding planning aligns with the legalities of marriage in South Africa.

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Marriage and Matrimonial Property

In South Africa, the Matrimonial Property Act 88 of 1984 regulates how assets and liabilities are managed within different matrimonial regimes. Understanding these marriage regimes is essential for couples planning their marriage or dealing with its dissolution, whether through divorce or the death of a spouse.

Marriage and Matrimonial Property Regimes

Types of Marriage in South Africa

South African law recognises three main matrimonial property regimes:

  • Marriage in Community of Property
  • Marriage Out of Community of Property without Accrual
  • Marriage Out of Community of Property with Accrual

Each of these regimes carries unique implications for ownership, debt liability, and asset division.

Marriage in Community of Property

This is the default regime when no antenuptial contract (ANC) is signed before marriage. The couple’s separate estates are combined into a single joint estate.

Key Features:

  • Shared Ownership – All assets and debts acquired before and during the marriage are pooled.
  • Joint Responsibility – Both partners are equally liable for debts, even if only one incurred them.
  • Consent Required – Major financial decisions, such as selling property or taking out a bond, must be made jointly.

Equal Division on Divorce or Death – Regardless of who earned or owned more, the estate is split equally if the marriage ends.

Risks:

If one spouse becomes insolvent or enters into reckless debt, the entire joint estate is exposed. This lack of financial separation can pose a significant risk.

Marriage Out of Community of Property

To avoid the automatic application of the joint estate, couples must sign an antenuptial contract before the wedding. This contract keeps estates separate, and allows couples to choose whether to include or exclude the accrual system.

Without Accrual

Each spouse remains fully independent in terms of assets and liabilities—during and after the marriage.

Key Points:

No Shared Growth – Each spouse retains ownership of their property and leaves the marriage with what they brought in or acquired individually.

Debt Protection – One spouse cannot be held responsible for the other’s debts.

Potential Downside: This arrangement offers no compensation to a spouse who may have contributed in non-financial ways (e.g. child-rearing or household support) but did not accumulate personal assets.

With Accrual

A more balanced approach, this option allows each spouse to grow their own estate—but also share in the difference if the marriage ends.

How It Works:

  • During the marriage, assets remain separate.
  • At divorce or death, the growth (accrual) in each estate is calculated.
  • The spouse with the smaller accrual may claim half the difference.

Example:

  • Spouse A starts with R100,000, ends with R400,000 → R300,000 growth.
  • Spouse B starts with R200,000, ends with R300,000 → R100,000 growth.
  • Difference in accrual: R200,000. Spouse B may claim R100,000.
  • Customisation: Assets like inheritances or donations can be excluded from accrual, but this must be clearly specified in the ANC.
  • Considerations: The spouse owing the accrual amount may face liquidity issues—particularly if wealth is tied up in immovable property or business assets.

Antenuptial Contracts and Legal Requirements

An antenuptial contract must be:

  • Signed before marriage; and
  • Registered with the Deeds Office within three months.

This document allows couples to:

  • Choose between the accrual or no-accrual system;
  • Exclude specific assets from accrual;
  • Tailor the legal and financial framework of their marriage.

Foreign Marriages and the Domicile Rule

For South Africans marrying abroad, the property regime is determined by the domicile of the husband at the time of the marriage (i.e. his permanent place of residence). For example, if a South African marries a UK resident in Mauritius, English law may apply. This can have far-reaching consequences—especially during divorce or inheritance—so legal advice is strongly recommended beforehand.

Choosing the Right Regime

Before deciding, consider:

  • Your individual financial positions
  • Whether you own or plan to own a business
  • How you want assets divided if the marriage ends
  • Whether one spouse plans to take on caregiving or unpaid roles
  • Future inheritances or family property

There’s no one-size-fits-all answer. What matters is choosing a regime that protects your interests and aligns with your life plans.

VDM Attorneys – Legal Advice for Every Stage of Marriage

Marriage isn’t only a personal commitment—it’s a legal framework with lasting financial consequences. Whether you’re planning your wedding or reviewing your options ahead of a divorce, it’s essential to understand your rights and obligations.

VDM Attorneys offers trusted legal guidance on:

  • Drafting and registering antenuptial contracts
  • Structuring matrimonial property regimes to suit your goals
  • Advising on estate division during divorce or death

With the right legal partner, you can enter marriage with clarity—and protect your interests at every stage.

Contact us.