Marital property contract – what are the benefits?

Surely everyone who gets married these days is aware that before they get married, they have to choose the type of property relationship – either joint property, separate property, or offsetting asset gains. Information on all these relationships can be found online to help couples make their choices. Formerly, the statutory default relationship was joint property, meaning that all property acquired by the spouses during the marriage is their joint property (except for gifts and inheritance).

To answer the question of why a marital property contract should be chosen in the first place, you should familiarise yourself with the general content of a marital property contract.

What is a marital property contract? What can be determined by it and how?

A marital property contract is an agreement between spouses in which both may: replace the selected property relationship with another property relationship provided by law; terminate the selected property relationship; grant the right to administer joint property to one of the spouses; and recognise individual items or item classes as joint or separate property.

Therefore, a marital property contract can be used to regulate property relations much more comprehensively according to the needs of the spouses.

A marital property contract can be concluded in a notary’s office in the presence of both spouses.

It is common to think that signing a marital property contract is a sign of distrust between the spouses. At the time of marriage, all couples are probably sure that their marriage will last “until death do us part”. In reality, however, it should be understood that a marital property contract is not just an instrument for divorce but helps spouses to regulate their property relationship during the marriage in exactly the way they need.

For example, if one of the spouses is a risk-taking entrepreneur, there may be a need to keep the assets of the spouses separate so that one spouse’s failed business decisions do not damage the life of the whole family. If the parties have signed a marital property contract and agreed that their assets and liabilities will be separate property, only their own assets will be at risk, and any claims against one party cannot be met from joint property.

As this example shows, a marital property contract is absolutely not an act of distrust, but, on the contrary, an act of mutual protection of each other’s property.

Of course, it cannot be denied that a marital property contract is useful in the event that the marriage ends if there is a need to divide the property accumulated during the marriage. Since a marital property contract already specifically defines which property is the joint property of the parties and which is not, disputes are less likely to arise on this ground. The spouses will divide the property according to the contract and will be saved from years of litigation.

It is natural that everyone marries with the expectation that marriage will last forever, and it could not be otherwise. However, it should be borne in mind that a marital property contract is not only useful for divorce and for division of property, but also for regulating the economic and property relationships of the parties during the marriage. There are many kinds of couples and as many lifestyles, so everyone can choose the property relationship that is right for them. If raising the issue of signing a marital property contract is still seen as a sign of mistrust, this attitude is unlikely to ever change.

Published in  Raamatupidamisuudised