Matrimonial Property Law
1. General introduction
Continental European legal systems generally regulate the proprietary consequences of marriage in matrimonial property and maintenance law rather than leaving them to be governed by rules of general property law. Most legal systems contain provisions relating to certain aspects of property in the general law on marriage (régime primaire, allgemeine Ehewirkungen) (marriage); this may include, for example, rules governing the family home and liability for household debts. Such rules are independent from the matrimonial property regime (régime sécondaire) which lies at the core of these legal systems. Spouses are typically granted a large degree of autonomy insofar as they may choose a matrimonial property regime in a prenuptial agreement (marital agreements), the default matrimonial property regime being a default rule.
The common law does not have matrimonial property law in the continental sense and, therefore, also does not have a default matrimonial property regime. Since the Married Women’s Property Act 1882, marriage has no effect upon the proprietary rights of the parties in England and Wales. As a result, the spouses’ properties remain separate at common law. This is comparable to the legal situation in Ireland and Scotland.
2. The default matrimonial property regimes
A division runs through the various European default matrimonial property regimes. Legal systems in the Romanic legal family and the middle and eastern European legal traditions are more familiar with the community of acquests (see a) below) whereas the Nordic and Germanic legal families have a separation of property in combination with a deferred community or a compensation clause (see b) below). A few Spanish fueros, ie the law of certain autonomous provinces, even prescribe separation of property as the default matrimonial property regime (see c) below). Finally, the common law systems take an alternative approach, whereby judicial discretion leads to a form of deferred community in practice, rather than adopting any formal matrimonial property law (see d) below). Beyond that, the Netherlands stands as the only European country offering universal community of property as the default matrimonial property regime (Art 93 Burgerlijk Wetboek (BW)).
a) The community of acquests
The legal systems in the Romanic legal tradition remain faithful to the Napoleonic model and have a limited community, which can be considered a community of acquests, as their default matrimonial property regime. The fundamental characteristic of the community of acquests is the creation of a community which encompasses all property acquired non-gratuitously throughout the duration of the marriage.
The community of acquests is the default matrimonial property regime in Belgium, France, Italy, Luxembourg and Portugal. Spain also has a community of acquests regime in the form of the sociedad de gananciales (Art 1344 Código civil), although the Código civil is only applicable insofar as the fueros do not make alternative provisions which, by virtue of the constitution, take priority (Art 13.2 Código civil in conjunction with Art 149.1.8 Constitución Española). Where this is the case, Spanish law is deemed to be derecho supletorio, applicable only where there are gaps in the fueros. Aragon, the Basque region, Galicia and Navarre have a community of acquests which differs from Spanish law in only a few areas.
The community of acquests model also constitutes the default matrimonial regime in most middle and eastern European legal systems, including those systems in Bosnia-Herzegovina, Bulgaria, Croatia, the Czech Republic, Hungary, Latvia, Lithuania, Poland, Russia, Slovakia, Slovenia and Ukraine.
The same substantive principles governing the combination of the three proprietary masses (each spouse’s respective personal property and the community) are applicable in all the aforementioned legal systems, albeit with some subtle variations.
In the Belgian, French, Portuguese and Spanish legal systems the personal property of each spouse comprises assets acquired prior to marriage and those acquired gratuitously during marriage (eg through gifts or inheritance), as well as assets and rights which are closely connected to the person—such as clothing, personal effects, compensation for personal injury and immaterial damage, assets acquired through subrogation or reinvestment and professional assets. The community encompasses all income; this includes income from employment inclusive of subsidiary income, income from personal property and all assets acquired with such income. Personal and community property is divided along the same lines in most middle and eastern European legal systems. Some legal systems make further distinctions and differentiate between income derived from employment and income derived from personal property. Croatian, Serbian and Slovenian law provide that only income arising from employment forms part of the community whereas income arising from personal property is personal.
All community systems draw a distinction between internal and external relationships in relation to liability for debts. The liability is characterized by detailed provisions which are linked to the rules governing the assets. The general marriage laws or default regimes tend to include provisions regulating liability for debts arising from childcare and household expenses. These debts will be joint and several insofar as they correspond to the standard of living of the spouses.
Personal property is subject to personal administration. Most legal systems, however, have exceptions to this rule, mainly with regard to the family home and household goods. The community is subject to individual administration, but for significant legal transactions the consent of both spouses is required.
In the community of acquests, a division of assets is only possible upon dissolution of the community. Dissolution requires a balance sheet to be drawn up, in which the issue of compensation will be of great significance. Wherever the personal property of one spouse has gained an advantage from the community, or vice versa, the latter property mass is entitled to compensation by the former in order to avoid unjust enrichment. Where, for example, the community has invested in a house belonging to the personal property of the wife, the personal property of the wife must reimburse the community. The same rule applies where the community was used to discharge a personal debt of the husband. The compensation will usually be a nominal calculation, although many legal systems make an exception for investments made in order to acquire, improve or maintain an asset. In these latter situations the property entitled to compensation obtains a share in the increased value of the asset in question.
The community of acquests distributes the community in two equal parts and gives the spouses a proprietary claim to their portion. Personal property remains intact. An increase in the value of personal assets accrues to the personal property alone. The courts generally have neither discretion to diverge from the division of assets into two equal parts nor discretion to redistribute personal property of one of the spouses, albeit some legal systems, such as that in Poland, differ in this area. However, in many legal systems there is the possibility of giving one spouse preferential treatment in the allocation of particular assets found in the common property, in particular the family home. This spouse, in turn, must allow that asset to be set off against his or her portion of the property and, if necessary, pay any additional charge where the value of the asset exceeds the value of his portion of the community.
b) Participation systems
The default matrimonial property regimes of the Nordic and Germanic legal families are based upon a participation system. The assets of the spouses remain separate during the marriage. In principle, all debts are attributed to the personal properties of the spouses, except where the spouses incurred them jointly or severally on the basis of the general law of obligations. Debts incurred by bringing up the children or by running the household are also incurred severally. Each spouse administers his own property although legal acts involving the family home and household goods are subject to restrictions.
Upon dissolution of the marriage, however, each partner partakes in the assets of the other. It is necessary to distinguish between two models; under the first model the spouses partake by way of a deferred community whereas under the second model they partake by way of a default compensation clause.
The first type, which can be found in the Nordic legal systems, distinguishes between reserved property and common property. Gifts and legacies, received upon the condition that they pass into the reserved property, as well as a number of personal assets and rights belong to the reserved property. All other assets are part of the common property. The latter materializes as a deferred community after dissolution and comprises the net assets of each spouse’s personal property. In case the liabilities exceed the assets, then the property is evaluated as breaking even. In view of the restrictive composition of the reserved property, this deferred community has to be qualified as a universal community. Generally, this deferred community has to be split into two equal parts. That means that each spouse participates not only in those assets the other spouse acquired with his earnings, but also in those assets the other spouse owned before the marriage or acquired during the marriage by donation or inheritance.
All Nordic legal systems provide the courts with powers to refrain from an equal division for equitable reasons. In Norway, each spouse has an option to exclude property acquired before marriage and such obtained by donation or inheritance from the equal division (§ 59 Ekteskapslov). Generally, the court may deviate from an equal split, eg in the case of a marriage of short duration. Conversely, the court also has powers to grant the economically weaker spouse a part of the reserved property of the other spouse for reasons of equity.
Regarding the second type of participation system, no deferred community is created, but a compensation claim is provided. Representatives of this type are the community of accrued gains in Germany and Greece and the Swiss participation in acquests.
In the German Zugewinngemeinschaft (§§ 1363 ff Bürgerliches Gesetzbuch (BGB)), compensation for the accrued gains has to be provided when the matrimonial property regime is liquidated. In cases where the regime is dissolved by death, the surviving spouse’s share in the inheritance is increased by a fourth of the inheritance (§ 1371 BGB) (fixed-rate equalization of the accrued gains (pauschaler Zugewinnausgleich)). In cases of divorce, the surplus is calculated mathematically. If the surplus of one spouse exceeds the other’s, the latter has a claim for half the balance (§ 1378(1) BGB). Since the surplus is calculated on the basis of the spouses’ entire property, participation is not limited to the assets acquired during the marriage, but also encompasses changes in value of assets acquired before the marriage (both positive and negative) and interest accrued on assets acquired before the marriage. This expresses a rather extreme understanding of marital solidarity.
The Swiss participation in acquests does not grant such far-reaching solidarity as only gains have to be compensated and the accrued value on personal property remains unconsidered.
c) Separation of property
The Balearic Islands, Catalonia and Valencia, have a separation of property as their default matrimonial property regime. In case of divorce, neither is a deferred community established nor are compensations granted. In Catalonia, compensation may be awarded to the housekeeping spouse or to the spouse who worked in the business of the other. Valencian law has comparable provisions which are not enshrined in the matrimonial property law but in the general laws on marriage.
d) Towards a deferred community in common law?
The Matrimonial Causes Act 1973 gave English judges wide powers to reallocate assets of the spouses by means of property adjustment orders in divorce cases. It must be noted that, in common law systems, a substantive distinction between division of assets and maintenance is, to a large extent, unknown. In accordance with the clean break principle, the common law operates by way of global package solutions which merge and combine division of assets and maintenance payments. In case the marriage is dissolved by death, the application of the family provisions leads to similar results (succession law).
Under the Matrimonial Causes Act the courts are under an obligation to take into account the interests of any children in their proprietary reallocation, to aim for a clean break and to consider all the relevant elements of the case, especially actual and potential income, financial need, duties and responsibilities of the spouses, as well as their contribution to the well-being of the family in the past and future.
In the past, the application of the Matrimonial Causes Act resulted in guaranteeing that no more than the claimant’s reasonable requirements would be met. This meant that the more affluent spouse was not under a duty to share his or her entire fortune with the needy spouse. The redistribution was only conducted to the extent that the spouse in need of maintenance was put in a position which enabled him or her to continue his or her matrimonial standard of living. This line of case law was changed by the House of Lords in White v White [2001] AC 596 (HL). The guideline is no longer a guarantee of equivalent matrimonial standards of living, but rather a guarantee of equal treatment between the spouses. If both have contributed to the family’s well-being in equal shares, it is of no significance that one particular spouse built up the family’s wealth. Consequently, an equal division is appropriate and only good reasons can justify an uneven split. An uneven distribution is permissible where the origin of wealth lies outside the marriage, eg in cases of gifts or inheritance. But all assets which can be regarded as income from employment are to be distributed equally as a matter of principle (Miller v Miller; McFarlane v McFarlane [2006] UKHL 24 (HL)).
e) Evaluation from a comparative law perspective
Upon making a functional comparison between common law and continental law, it is readily apparent that there are great similarities between English law and the continental participation systems. There are several indications that, in practice, English law, even without a formal matrimonial property regime, is increasingly tending towards a type of deferred community where the courts retain wide judicial discretion.
Both the community and the participation systems emphasize the importance of spousal autonomy during the marriage, which is evident not only in the composition of the properties, but also in the rules governing their administration. However, while they express it in different forms, both systems also attach great importance to the solidarity of spouses towards each other. Matrimonial solidarity in community systems is realized during the marriage by the creation of a community, which is administered by both spouses. In this way, a spouse already has access to the other’s wealth during the marriage and this differs greatly from the participation systems. Given that participation systems are based upon separation of property, there is accordingly no participation during marriage, the limited matrimonial solidarity which does exist is, in most cases, only given effect via the general law of marriage.
Solidarity upon marital dissolution is also expressed differently in each system. In the community systems solidarity finds its expression through the equal division of the community, although this is of course limited to the acquests. Each spouse has a right in rem to half of the community. Although personal property of each spouse is not taken into account, there is some solidarity in this respect because income from personal property is often a component of the community. With the exception of the possibility for preferential assignments, in most community systems the courts enjoy no discretion and can therefore not effect a reallocation. Participation systems lead to deferred communities or to compensation. The extent of the property to be distributed or compensated varies according to the legal system at issue. Most legal systems which broadly define this property grant the judge discretion to limit the property to be distributed on equitable grounds.
3. European perspectives
With regard to the harmonization of the European matrimonial property law regimes, one must observe that the legal systems remain very different. In light of the rules on property composition, it is apparent that community systems give spouses less autonomy than participation systems. However, they do enable the spouse who has limited or no income to exercise a certain amount of autonomy as he directly acquires community property and partakes in the administration of that property. Participation systems grant the spouses a greater degree of autonomy which is usually only curtailed by the law on marriage. The spouse who neither has nor accumulates wealth of his own cannot however enjoy this autonomy as he does not acquire rights to the property during the marriage and is, therefore, also not party to its administration. Rather, he is only empowered to make everyday dispositions with money which the other spouse has put at his disposal by virtue of the duty to contribute to the costs of the marriage. Consequently, participation systems better suit spouses who are financially independent whereas community systems better suit spouses who are not independent. Accordingly, the major differences in composition and administration of property impair the creation of a European default regime based on a ius commune.
However, in respect of participation upon marital dissolution the preponderance of unifying features in the two legal models are such that it is possible to ascertain a common core. Through their equal distribution, community systems ensure that each spouse can participate in the wealth that the other spouse acquired during marriage. The same goal is accomplished in participation systems, either by division of the deferred community, by reallocation or by compensation. In both systems, judicial discretion and exceptions to the general rules commonly lead to participation which is limited to assets acquired during marriage by the spouses in ways other than by gift or inheritance. The basic principle in both systems is that each spouse should be able to partake in the wealth acquired by the other during marriage independent of the distribution of duties between the spouses as these gains are in fact products of both spouses’ labours.
At present, the Commission on European Family Law is attempting to elaborate Principles of European Family Law in the field of matrimonial property law which represent the common core within the correlating European legal systems. Where such a common core does not exist, the Commission instead derives a solution by applying a better law approach.
Additionally, a German-French treaty has established a common optional matrimonial regime on the basis of the German community of accrued gains (Zugewinngemeinschaft) and the French participation in acquests (participation aux acquêts). In both countries ratification procedures have been started. This optional regime is to be integrated into the civil law codes of both states and should be available to persons regardless of their nationality or habitual residence. The treaty exclusively concerns substantive norms and is neutral in respect of international private law.
The vast differences among the legal systems massively impair the creation of a European matrimonial property regime based on the ius commune. Yet even if it is impossible to completely bridge the gap between community and participation systems, it will be possible to offer a harmonized model of both regimes, and this is already an important step forward.
Literature
Alexander Bergmann, Murad Ferid and Dieter Henrich (eds), Internationales Ehe- und Kindschaftsrecht mit Staatsangehörigkeitsrecht, vols I–XX (6th edn, since 1983); Walter Pintens (ed), International Encyclopedia of Laws: Family and Succession Law, vols I–VI (1997 ff); Dieter Henrich and Dieter Schwab (eds), Eheliche Gemeinschaft, Partnerschaft und Vermögen im europäischen Vergleich (1999); Katharina Boele-Woelki and others, ‘Huwelijksvermogensrecht in rechtsvergelijkend perspectief’ (2000) Ars notarius CIII; Bente Braat, Indépendance et interdépendance patrimoniales des époux dans le régime matrimonial légal des droits français, néerlandais et suisse (2004); Sibylle Hofer, Dieter Schwab and Dieter Henrich (eds), From Status to Contract? Die Bedeutung des Vertrags im europäischen Familienrecht (2005); Andrea Bonomi and Marco Steiner (eds), Les régimes matrimoniaux en droit comparé et en droit international privé (2006); Rembert Süß and Gerhard Ring (eds), Eherecht in Europa (2006); Volker Lipp and others (eds), Die Zugewinngemeinschaft—ein europäisches Modell? (2009); Walter Pintens, ‘Matrimonial property law in Europe’ in Katharina Boele-Woelki, Jo Miles and Jens M Scherpe (eds), The Future of Family Property in Europe (2011) 19; Dieter Martiny, ‘Der neue deutsch-französiche Wahlgüterstand—Ein Beispiel optionaler bilateraler Familienrechtsvereinheitlichung’ (2011) 19 ZEuP 577.
