Matrimonial Property – What Falls Under It and How to Divide It

Article chapters:

• How spouses are created
• What’s a SJM?
• What’s not included in SJM?
• Beware of debts within the joint property of the spouses
• If we don’t want to share (all) assets and liabilities
• When does the joint property expire and how is it settled?
• How are assets valued in SJM settlement?

How matrimonial property is acquired

Matrimonial property, also known as community property or marital property, refers to any property acquired after the wedding. For example, if you buy a car after you get married, it will count as matrimonial property. So will the first salary transferred to your account after the wedding. According to Czech law, the switch from acquiring separate property to obtaining community property upon marriage is by default. However, you may enter into a prenuptial agreement with your spouse, in which you can agree not to have any marital property. In other words, you may choose to keep both your assets and debts separate after the wedding.

In a similar fashion, you may choose to remove certain items from the matrimonial property or even to eliminate and divide it during your marriage. That said, marital property is most frequently divided during a divorce or upon the death of a spouse. If you’re married and haven’t signed an agreement eliminating matrimonial property and it hasn’t been eliminated by the court, then you do have community property.

What counts as matrimonial property

The Czech civil code states that anything of value belonging to a married couple comprises their community property. This includes assets as well as debts. As far as assets are concerned, anything obtained by a spouse after the marriage falls under matrimonial property, with certain exceptions. For instance, both of the couple’s salaries received after the wedding fall under matrimonial property.

What doesn’t count as matrimonial property

• satisfies the personal needs of a spouse, e.g., clothes or hygiene accessories,
• one of the couple inherited or was given (unless the gift or inheritance is explicitly said to belong to marital property),
• a wife or husband obtained as a reimbursement for suffering a wrong to their ius naturale, such as compensation for injuries after a car accident,
• a spouse acquired via their separate property (for instance, a husband sells a motorbike belonging to his separate property and uses the money to buy a new one – the new motorbike will be a part of his separate property as well),
• one of the couple obtained as damages to their separate property.

Any profits from separate property count as matrimonial property. To illustrate, if your spouse separately owns a flat (for instance, because they inherited it or had had it in their possession before the wedding), any profits from the flat fall under community property. In certain cases, a share in a company may count as matrimonial property as well.

Debts are a part of matrimonial property

Matrimonial property includes not only assets, but debts as well. When a couple takes a loan or mortgage, this liability falls into community property. Keep in mind that even a single spouse may create a joint debt if they buy products regularly consumed by the family. In other words, when a wife goes shopping for groceries, the eventual debt counts as marital property; on the other hand, if she takes a large loan to buy a new car without her husband’s consent, it’s her own liability to be paid by her separately owned money.

If you don’t wish to share (all) your assets and liabilities

Couples who don’t want to conform to the previously described rules are free to agree otherwise. If they enter into a prenuptial agreement, their matrimonial property may be eliminated or reduced (i.e., may exclude certain items). In contrast to this, they may also wish to extend their marital property to, e.g., real estate that would otherwise be owned separately.

When is matrimonial property eliminated and how is it divided?

• By divorce – it’s usually best to reach an agreement on how to divide marital property. The agreement comes into force on the day of elimination of the matrimonial property. In other words, it doesn’t matter whether you sign it before or after your marriage is divorced. And even if you find yourselves unable to come to an agreement, 3 more options remain:
• You may agree at a later time;
• you may file a property settlement proposal at the court within 3 years of the divorce, allowing the court to determine to whom particular assets or debts will be apportioned. The marital property is allotted to one of the ex-spouses, who must then buy off the other, divide the property or sell it and share the profits.

If you neither reach an agreement nor file the proposal, the matrimonial property will be divided automatically. It will remain in the possession of the ex-spouse who exclusively uses it to satisfy their needs or the needs of their family or family household. The rest of the marital property including debts will continue to be shared.

Your Attorneys Online advise: The last of the above options can prove treacherous. Let’s elaborate using a model situation: Your ex-husband takes the car after the divorce and drives it regularly. You didn’t want the car, because you haven’t got a driver’s licence. If you propose the property settlement in time, your ex-husband should buy you off. However, if you neither come to an agreement nor file the proposal within 3 years, you’ll be deprived of the money.

How is the matrimonial property appraised when settling?

• In most cases, it will be supposed that each of the ex-spouses is entitled to an equal share of     the marital property.
• Under certain circumstances, the court can decide that one of the ex-spouses is to receive less – for instance, when they leave the household, cease to look after the children and don’t pay alimony.

During the property adjustment itself, the property (and debts) needs to be appraised. The appraisal is based on any and all items falling under the matrimonial property at the time of the divorce; however, these are valued according to current prices. The court also examines whether one of the couple invested money from their separate property in the community property (or vice versa) and strives to make the adjustment accordingly.

• The death of a spouse – the property is divided by a notary during the probate. First, the     matrimonial property (assets and debts) is divided and then it is decided what falls under the     inheritance. The probate must respect the eventual will of the deceased or the married  couple’s agreement regarding their property.

In any case, property settlement is often marked by strong emotions. An experienced solicitor will help you make sure that you don’t get tricked by legal chicanery and get the maximum to which you’re entitled. If you’re divorcing, we’ll draft any required legal documents for you – online and for a fixed price. On the other hand, if you aren’t sure about where you stand (for example, during the inheritance process), you might find our Attorney’s Reply useful.