Journal for Notary Law 2011, pp. 179-192, 2011
8 Pages Posted: 16 Jun 2011
Date Written: April 9, 2011
In this article I analyse how undivided assets may be compatible with a marital contract of separation of property. The argument goes that one should approach the problem not from marital property law, but from the framework of general property law.
There is a doctrinal discussion in general property law on the application of article 815 of the Belgian Civil Code to undivided property that has been established on a voluntary basis. Article 815 concerns the fundamental right for every co-owner not to be forced to stay in a situation of undivided ownership, and hence be entitled to exit. Traditionally this is limited to the coincidental situations of undivided ownership (eg inheritance) but excluded for people who deliberately entered into the undivided ownership. Here the argument goes that as long as the reason for their undivided situation stands, it cannot be ended unilaterally.
The latter vision was heavily criticized more recently on grounds of creditor protection. Debtors should not be allowed to organize a situation of undivided ownership and thereby limit the personal creditor's collateral since he would not be able to seize the debtor's share in the undivided property as long as it stands.
My thesis is that the latter vision is correct but only in the external relationship towards third parties such as creditors. Yet not in the internal relationship between the undivided owners. It is therefore perfectly possible to create a situation of undivided ownership connected to some common idea or project, prohibiting the owners to exit unilaterally (no application of 815 BCC), yet always allowing third parties such as creditors to claim the ending of the situation of undivided ownership (application of 815 BCC).
Hence, also in marital property systems, also of separation of property, it is perfectly valid and possible for spouses to create an undivided ownership that is internally and externally open (the normal undivided property with full application of 815 BCC) or one that is internally closed (linked to the marriage, excluding 815 BCC) but always remains externally open for creditors. This is what I have introduced already in 1995 as an internal community added to the separation of property.
The third type of undivided ownership between spouses, the community in a systems of community property, is the bizar model, since it does not fit into general property law. It is only possible because of the legal basis in the Civil Code regulating community property systems. Here the community is both internally and externally closed. Personal creditors cannot claim their share in the community as long as the marriage stands. This is an exception to the normal rules of property law. I have argued already ten years ago that this is exception is not justified. Marital property law should only have an internal impact and should create benefits nor disadvantages for third parties.
Notes: Downloadable document is in Dutch
Keywords: Marital Property Law, Separation of Property, Marital Contract, Undivided property, Internal Community, article 815 Civil Code
JEL Classification: K11, K12
Suggested Citation: Suggested Citation
Verbeke, Alain Laurent P. G., Scheiding van goederen en onverdeeldheden: Over de rechtsgeldigheid van een TIGV (Dutch) (Separation of Property and Undivided Property: On the Validity of an Internal Community Added to the Contract of Separation) (April 9, 2011). Journal for Notary Law 2011, pp. 179-192, 2011. Available at SSRN: https://ssrn.com/abstract=1860960