Beware the sneaky spouse who sails around consent

If all is fair in love and war, then spousal consent in the transfer of a property must fall firmly in the same category? As it turns out, the division of property when a marriage dissolves depends on how you were married, and in certain cases consent is the only key that the transfer of property hinges on.

It is common knowledge that spouses who are married in community of property are required to co-sign agreements due to their limited contractual capacity. The question that arises is, what if a spouse manages to transfer the property without consent? To avoid losing sales, a thorough investigation into the marital status of both the purchaser and seller must be conducted.

Marriage basics

Section 15(2) and (3) of the Matrimonial Property Act states that a spouse married in community of property, shall not without the written consent of the other spouse “alienate, mortgage, burden with a servitude or confer any other real right in any immovable property forming part of the joint estate”.

In practicality, being married in community of property means that spouses have a single joint estate with each partner owning an indivisible 50 percent share in an asset such as a property.

A civil marriage or union is automatically registered as in community of property in South Africa - this is unless spouses have entered into a prenuptial agreement before the wedding.

How this works is that a marriage must be registered at the Department of Home Affairs and should be updated accordingly on their database. Interestingly though, the prenuptial agreement is not registered at the Department of Home Affairs but at one of the Deeds Offices.

Vukeya v Ntshane and Others

A recent case that dealt with consenting spouses in the transfer of a property provides frightening clarity on the requirement of consent in that a non-consenting spouse is deemed to have consented to the sale if the purchaser was unaware, and could not have reasonably been aware that the surviving spouse’s consent was required.

In this matter, the wife of the deceased discovered only after his death that her husband had sold their property without her consent. She immediately approached the High Court to have the transfer cancelled. Although the High Court found in her favour, the decision was overturned by the Supreme Court of Appeal.

This outcome does not mean that the purchaser is always protected, however. Adequate enquiry must be done at all times, which is usually performed by the conveyancer before transfer.

Worryingly, adequate enquiry might not actually be possible! The Department of Home Affairs may not have updated their records, leaving a married person registered as unmarried. As a direct result, the Deeds Office would only register the property in one of the parties’ names, leading to the title deed not reflecting the non-consenting spouse’s details.

Turn an enquiry into and intensive investigation

As the Vukeya case illustrates, estate agents and conveyancers need to act with caution and be mindful that a client could negligently or maliciously portray their status incorrectly. Ensuring that the correct declarations are signed, specific clauses relating to warranties are included in the agreement, and a thorough investigation into the status of all the parties is a must. Requesting both the marriage certificate and prenuptial agreement to be kept on file is a way to check that the correct processes are followed.

Added to that, you can turn an adequate enquiry into an intensive investigation by using the TPN SalesPack documentation and the full suite of credit and fraud prevention checks available through TPN Credit Bureau.

For more information, please visit: https://www.tpn.co.za/Group