Legal Ground: Property split in divorce gets complicated

Everybody knows that when one divorces there is a division of property.

dr  haim katz 88224 (photo credit: )
dr haim katz 88224
(photo credit: )
Everybody knows that when one divorces there is a division of property. It is conventional wisdom that the law [Spouses (Property Relations) Law of 1973] is clear with regards to who takes what out of the matrimonial assets - they are divided equally between the adverse parties. And isn't it clear that according to the explicit wording of the law, assets belonging to any one of the spouses from before the marriage, or assets one of the couple has received as a gift or as an inheritance, are excluded from the shared matrimonial property? Well, it was clear. The law, until recently, had formed a protective bastion around the individual's inalienable right to the property he owned before meeting her and in turn, her right to property she possessed before meeting him. The social policy was to divide equally assets produced by the parties starting from the date of their marriage. However, a recent ruling by a leading judge in the family law court in Ramat Gan has substantially undermined this, and those protective legal walls may be tumbling down like the walls surrounding biblical Jericho. In a case brought before Judge Tova Sivan, the husband had received the property prior to his marriage as a gift from his parents and had registered the deed solely in his name. Reacting to his divorcing wife's demand for half the apartment, the husband argued before the family court that the apartment was bought for him with the intention that it would remain exclusively his. His wife argued that there was a presumption that he wanted to give her a half-share in the apartment, but the man denied this vigorously. There was never an intention to share this asset with his new bride, he told the Judge, and he had made this clear to her from the outset of their marriage. Various documents were presented to the court to support his claim. For example, a will that he had made years before the divorce action was presented in which he clearly stated that he had no intention of leaving any of his assets at all to his wife. In particular, the will spelled out that, after his death, the wife was not to inherit the apartment. "Surely," the husband argued, "it is clear that I had no intention to ever share my private property with my wife as is evidenced by the unambiguous registration of the property being solely in my name; and by the terms of my last will and testament." He also pointed out to the court that their marital life was "no bed of roses." That, in itself, indicated he had no motive, to give away a valuable asset to his spouse. The wife painted a different picture. "We have lived together in this apartment for 17 years," she told the court. "We raised three children there and it is, in fact, our only significant asset. Of course the intention was to share the property from the outset." As to why the apartment remained registered in the husband's sole name, the wife claimed she hadn't even an inkling that the property remained in the husband's name throughout the years of marriage. This only became known to her when she sought advice from a lawyer regarding the imminent divorce. The court decided that there are times when a judge will read into the relationship a presumed intent to share assets that are normally excluded. The fact that the marriage wasn't a particularly successful one becomes irrelevant in light of the length of the family's residence in the property and the fact that they raised three children in it, stated the judge. The fact that the law specifically excludes assets that were acquired by gift, inheritance or prior to the marriage is overridden when such a presumed intent is determined by the court. After this landmark decision, how may one protect an asset from becoming part of the shared matrimonial property? It's quite simple, really: write a pre-nuptial agreement explicitly excluding any such asset from the shareable matrimonial property. This can be signed before a notary; if you're already married you would need to sign this agreement before a judge. What advice can be given to a third party who is innocently purchasing an apartment that is registered in the sole name of a person who is married and whose spouse's name does not appear on the deed? Is there not a risk that the spouse whose name is not in the land registry will attack the sale and even sue the purchaser? The answer to that is plain as well: whenever buying a property from a married person, do not be satisfied with the signature of the registered owner alone. Always insist that the spouse, whether registered or not on the deed, sign a clear letter of consent to the transaction. [email protected] The author is a senior partner with the Abraham Neeman Law Offices, one of the largest real estate law firms in Israel.