Divorcing a Poorer Spouse
It is always a cause for concern when divorcing a spouse who is to put it simply – poorer than you. The concern of the richer spouse is what percentage of their assets or income will go towards any distribution of matrimonial property and spousal maintenance/alimony. The tips below can help both women and men who are richer than their spouses to avoid the dreaded ‘gold-digger divorce.’
It is open to parties to negotiate a divorce settlement and where they fail to do so, the Marriage Act and Matrimonial Property Act govern these issues of alimony and division of assets. One can plan for these eventualities even from the time of the marriage and through to the point a decision is made to divorce your spouse and the following tips are helpful towards obtaining a good outcome to secure your financial security after a divorce and avoid what you would consider an ‘unfair divorce settlement.’
Parties may enter into an agreement to determine their property rights prior to marriage. This is of great relevance in mixed-income unions because this prenuptial agreement clarifies what is solely owned property; what will be matrimonial property and any basis for division subsequent to divorce. You can include clauses on year based divorce settlement such that a spouse will be entitled to specific assets/alimony after certain number of years. Read here for tips on a prenuptial agreement that protects your interests.
Clear Outlining of Matrimonial Property and Sole Property
During the course of your marriage, it is good to keep clear inventory of assets held jointly and solely as well as outline contribution made by spouses to the acquisition. This can be as simple as a spreadsheet accessible at all times by both parties.
Good Faith Negotiations and Reduced Hostility during Divorce Proceedings
While Kenya does not provide for no-fault divorces and a divorcing spouse must show the marital offence committed by the other spouse, it is no reason not to conduct an amicable divorce. This is also tied to avoiding an expensive and overly acrimonious divorce. It is encouraged to conduct either direct negotiations with your spouse or engage in family mediation to come to a divorce settlement and avoid hostile litigation on these matrimonial property matters during a suit in court. Any divorce agreement on division of property can be put forth to the court to be adopted.
Formalising any Agreements if your Spouse Works in your Business
While you may have set up a business before entering marriage which would reasonably be deemed solely owned property at the time of marriage; circumstances after the marriage may render the said business as matrimonial property where your spouse comes to work in the business and helps build it and/or run it. This may then be deemed a family business and in such a case, the court may find that your spouse is entitled to a portion of your business due to making a non-financial contribution to the growth of the said business. By formalising the status of your spouse in the business, through written agreements etc., your goal is to delineate that the business remained a solely owned business despite said involvement of spouse and that it falls outside of a family business as stipulated in S 2 of the Matrimonial Property Act.
Avoid commingling Assets, Incomes which you Wish to Retain as Separate Assets or Separate Income
During the course of marriage, it is a good idea not to commingle assets which you desire to remain your solely owned assets, for instance putting up a matrimonial asset as security in a loan to get cash for a solely owned asset or vice versa; if you desire your business not to be deemed matrimonial property, monitor the extent of contribution of your spouse to the performance and operations of your sole business; note that improvements by your spouse to a solely owned asset may sometimes make it to be deemed as matrimonial property etc. Additionally, while the general provision of law is that liabilities over separately owned assets remain the liabilities of the separate owner, once liabilities are incurred to the benefit of the marriage, then the spouse who presumed they did not incur joint liability may be shocked to know that the law can attribute joint liability despite the fact you did not personally incur said liability.
Monitor Liabilities Incurred by a poorer spouse in the course of Marriage
Be careful to know the liabilities that your poorer spouse incurs in the course of marriage. What you may think is a separate liability incurred by your spouse may be deemed a joint liability between spouses where your spouse can reasonably show that the liability was incurred for the benefit of the marriage. If the court deems it so, you will be liable to jointly pay for liabilities which you may not have signed for or agreed to.