During the marriage, parties generally do not tend to be calculative with each other. Our Divorce Lawyers often come across situations whereby during the course of the marriage, the Husband has greater financial capability and he decides to purchase a property in his sole name.
The Wife is agreeable to the same because “no one thinks about divorce and the legal ramifications such an arrangement will have on divorce proceedings”. Such circumstances have often been cited by clients.
The marriage has now broken down, divorce proceedings have commenced.
The Husband maintains that the Wife should not make any claims to the property because it was entirely his financial contribution towards the property in his sole ownership.
It is not uncommon for the Husband to argue that the property was acquired solely by him in his sole name during the marriage and should not be included in the pool of matrimonial assets.
However, it is worth noting that one’s ownership in a property is independent of whether a property constitutes a matrimonial asset.
This was noted in BPC v BPB and another appeal [2019] SGCA 3, a recent Court of Appeal case earlier this year in paragraph 49 “Section 112(10) of WC is to determine pool of matrimonial asset and therefore does not draw any distinction between it and any other asset in the pool on the basis of ownership.”
This was further highlighted in USA v USB [2019] SGHCF 5, a recent High Court case earlier this year in paragraph 19, the “presumptive position under s 112(10)(b) of WC is that any asset acquired during the marriage is a matrimonial asset liable to division.
The mere fact that one party solely paid for an asset is insufficient to exclude that asset from matrimonial pool.”
In determining whether a Wife has a claim in her Husband’s property during divorce proceedings in such a scenario, this article will consider some questions our Divorce Lawyers pose to our clientele.
When did the Husband acquire the property? Was the property used as a matrimonial home?
The first inquiry to determine whether the said property falls within the pool of matrimonial assets subject to division will depend on whether it satisfies the definition of Section 112(10) of the Women’s Charter (herein referred to as the ‘WC’).
Briefly, Section 112(10) of WC states that an asset falls within the definition of a matrimonial asset if: –
- It is acquired during the marriage; or
- If the asset was acquired before the marriage (ie. premarital asset), it has to satisfy either: –
- The asset must have been ordinarily used or enjoyed by both parties/ their children; or
- The asset must have been substantially improved by one or both parties during the marriage.
Thus, as long as the property falls within the definition of a matrimonial asset in Section 112(10) of WC as stated above, it is a matrimonial asset being subject to division.
However, if the said asset was a gift or inheritance to one party, and it has not been ordinarily used or substantially improved by the other party or by both parties during the marriage, it will not be deemed as a matrimonial property subject to division.
Although the property is in the Husband’s sole name, did the 3rd party assist the Wife in contributing financially to the property?
This can be a situation whereby the Wife’s parents gave the Wife a certain amount of money to contribute financially to the property, although the property is in the Husband’s sole name.
Further questions will be raised as to whether the sum contributed by the Wife’s parents is meant to be a gift or a loan. Such a situation is slightly more complex because principles within the realm of equity and resulting trusts will be applicable.
The High Court in UTQ v UTR [2019] SGHCF 13 succinctly explained the basic principles of equity and resulting trusts. They can be summarised as follows: –
- The presumption of resulting trust will arise in favour of the 3rd party who provided the financial contribution since equity presumes that when one party makes a voluntary payment towards a property, he/she did not intend to benefit the other through a gift. In other words, this means the 3rd party has a beneficial interest in the property.
- The presumption of resulting trust is displaced by the presumption of advancement that operates within a parent-child relationship. In other words, the 3rd party will not have a beneficial interest in the property and the sum of money contributed will be a gift in a parent-child relationship.
As such, based on the principles of resulting trusts, the Wife’s parents have a beneficial interest in the Husband’s property instead of the Wife herself.
The Wife’s parents can therefore take out a separate application under the principles of resulting trusts claiming their share of the property. Such matters will fall within the larger realm of civil law.
On the other hand, if the Wife’s parents do not make any attempt to claim their beneficial interest in the Husband’s property, the sum of monies contributed by them could be taken as the Wife’s direct contribution to the property.
The Wife therefore may be able to have a claim in the Husband’s property and her direct contribution may have an effect on the overall ratio in parties’ division of matrimonial assets.
It is best to seek advice from an experienced Divorce Lawyer in such a situation given the complex nature of resulting trust principles. The lawyer would be able to provide you with the best cause of action based on the evidence available on hand.
Ultimately, the Court has the discretion under Section 112(1) of the Women’s Charter to ensure that matrimonial assets and liabilities are divided ‘in such proportions as the Court thinks just and equitable.’
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Should you have any questions or would like more information on the Division of Matrimonial Assets, please contact Gloria James-Civetta & Co to speak to one of our lawyers.
