Lesson 4 - FL PDF

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LESSON 4: PROPERTY RELATIONS BETWEEN SPOUSES (I): REGIMES OF SEPARATION OF PROPERTY AND PARTICIPATION IN ACQUISITIONS: 1. PRELIMINARY REMARKS: Sec. gives us general rules on economical relationships among spouses. There are some things that we already know about this: Spouses are free to choose thei...

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LESSON&4:&PROPERTY&RELATIONS&BETWEEN&SPOUSES&(I):®IMES&OF&SEPARATION& OF&PROPERTY&AND&PARTICIPATION&IN&ACQUISITIONS:& & 1.&PRELIMINARY&REMARKS:&& Sec.&231-10&CCC!gives!us!general!rules!on!economical!relationships!among!spouses.!There!are!some! things!that!we!already!know!about!this:! • Spouses! are! free! to! choose! their! MPR1! in! MC2:! in! these! marriage! contracts! they! can! choose! their!property!regime,!make!inheritance!decisions,!recognize!children,!etc.!! • In! absence! of! agreement! (if! they! only! define! what! to! do! in! case! of! marital! breakdown! for! example),!or!in!case!that!the!marriage!contract!becomes!void!(for!the!lack!of!public!deed,!for! example),!the!legal!MPR!in!Catalonia!is!separation&of&property.!The!system!gives!us!a!series!of! default!rules,!and!in!our!case!the!solution!provided!by!the!law,!the!matrimonial!property!regime! is! the! separation! of! property.! The! rule! is! opposite! in! other! legal! systems,! such! as! the! one! established!in!the!Spanish!Civil!code:!Sociedad(de(gananciales!(community!of!property!regime)! à! sec.! 1315-1316! CC.! This! explains! why! more! marriage! contracts! are! celebrated! outside! Catalonia.!! However,!we!have!more!property!regimes!a!part!from!these!two.!! 1) Community!property!regimes! 2) Community!of!accrued!gains! 3) Separation!property!regimes!! ! 1.1&Community&property®imes:&& In!this!group,!we!have!3!different!groups!of!assets:! • (Personal)!Assets!belonging!to!spouse!1! • (Personal)!Assets!belonging!to!spouse!2! • Common!assets!which!belong!to!both!of!them!50%! However,! we! find! different! subgroups! inside! these! property! regimes! depending! on! which! are! the! goods!that!form!the!third!group.!We!find!systems!of!community!properties:! • Universal& community:! all! property! of! the! spouses,! once! they! are! married! becomes! common! property! and! it! is! split! 50%! after! the! end! of! marriage! à! all!property! becomes! joint& property& upon!marriage!and!is!to!be!divided!at!divorce.!à!e.g.,!Netherlands.!! • Deferred&community:!spouses!keep!their!own!properties!during!marriage!but!after!the!end!of! the!regime!all!goods!become!common! à! upon! divorce,!all!property!(separate!property!of!the! husband!+!separate!property!of!the!wife)!becomes!joint!propertyà!e.g.,!Nordic!countries! • Community& Of& acquest:! property! earned! by! means! of! consideration! by! every! spouse! during! marriage!becomes!common!property!and!it!is!split!50%!after!the!end!of!the!regime.!During!the! marriage!they!are!autonomous!and!they!don’t!have!to!ask!for!permission!to!the!other!party!to! decide! about! their! goods,! but! at! the! end! of! the! regime! we! have! the! same! problem! that! we! explained! in! the! first! group.! à! property! acquired! after! marriage! (except! e.g.! gifts! and! inheritances)!becomes!joint!property!and!is!to!be!divided!equally!at!divorce.!Separate!property! of!the!husband!/!separate!property!of!the!wife.!à!e.g.,!Spain,!France!or!Italy.!! & 1.2&Community&of&accrued&gains&(Germany):&& During!the!marriage!the!regime!works!as!a!separation!property!regime!but!it!turns!into!a!community! property!regime!after!the!end!of!the!regime!(participation!credit).!The!difference!with!the!deferred! com.!is!that!the!%!of!calculation!is!different:!the!weakest!party!does!not!have!a!right!to!participate!in!

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 1 2 !Matrimonial!property!regime! !Marriage!contracts!

the!50%.!The!credit!of!participation!in!the!common!property!won’t!be!50%.!Instead,!we’ll!look!at!the! gains!made!by!each!of!the!spouses!and!we’ll!give!a!right!to!participate!in!the!gains!of!the!other!party! to!the!party!that!had!less!gains.! à!If!at!the!time!of!divorce,!the!accrued!gain!of!one!spouse!is!greater!than!the!accrued!gain!of!the! other!spouse,!the!latter!can!bring!a!claim!against!the!former!as!the!accrued!gain!of!the!spouses!Is!to! be!divided!equally.!! & 1.3&Separation&property®imes&(Catalonia,&Balearic&Islands,&Valencia)& 2!groups!of!assets!à!Personal!assets!from!spouse!1!/!Personal!assets!from!spouse!2! à!MPR!consistent!with!spousal!agreements!aimed!at!turning!some!goods!into!common!goods!and! with!some!legal!corrective!tools!such!as!the!compensation!of!inequalities!for!household!work.!! In! this! case,! thus,! we! don’t! have! the! third! group! that! we! considered! in! the! other! cases! (common! property).!We!only!have!personal!properties!belonging!to!one!of!the!parties.!In!order!to!avoid!unfair! results!the!system!gives!us!mechanisms!to!compensate!the!weakest!party:! • Buying! some! goods! as! common! goods:! spouses! buy! important! goods! as! common! goods,! registering! the! good! in! the! name! of! both! of! the! spouses.! They! will! be! co-owners! of! these! registered!goods! • Compensation!of!inequalities!for!household!work.!! ! 1.4&Systems&with&no&MPR&(no®ime,&like&cohabitants):&UK& People! who! are! not! married! do! not! get! the! benefits! from! marriage! property! goods,! so! they! have! separate!goods!(similar!to!separation!property!regimes).!! ! 2.®IMES&OF&SEPARATION&OF&PROPERTY:&& The!main&idea!is!that!spouses!have!financial&and&administrative&autonomy,!since!they!are!owners!of! their!personal!items.!They!do!not!need!authorization!by!the!other!party.!! If! they! receive! any! inheritance! or! salary,! they! have! exclusive& appropriation! of! them.! à! exclusive& appropriation&of!earning!and!other!acquisitions.!! They!can!also!buy!goods!together,!as!previously!explained,!but!if!they!don’t!do!that,!the!family!home! would!be!property!of!the!formal!buyer:!!sharing&effectuated&on&a&voluntary&basis! There!are!many!legal&challenges!that!we!find!in!the!separation!of!property!regime:! 1. Contribution&to&common&household&expenses:!the!contribution!must!be!the!same,!not!taking! into!account!the!regime!in!the!couple.!These!rules!are,!thus,!applicable!to!separation!property! regimes! couples,!according! to! the!basis!of!common! household! expenses! seen! in!the!previous! topic.! 2. Ascertainment& of& assets&ownership:! since!every! spouse! is!the! owner!of! their!goods!and! they! just!share!on!a!voluntary!basis,!when!the!regime!finishes!we!can!have!an!additional!problem:! who!is!the!owner!of!a!good,!which!is!not!properly!assigned!to!an!owner?!We!need!specific!rules! to!solve!these!problems,!or!presumptions!! 3. Compensation&for&non-financial&contributions&to&family:!when!the!regime!finishes!we!can!have! situations!of!unfairness!(one!of!them!buys!everything!but!the!other!party!helped!him!with!his! work):! we’ll! need! systems! to! compensate! this! à! (household! work;! children! upbringing;! contribution!to!the!other!spouse!business/job).! ! 2.1&Regimes&of&separation&of&property:&The&principles:&& Sec.& 232-1& CCC& Content:! “In( the( regime( of( separation( of( property,( each( spouse( has( the( property,( enjoyment,(administration(and(free/disposal(of(all(his(assets(within(the(limits(set(by(law.”!

Sec.&232-2&CCC& Separate&property:!“In!the!regime!of!separation!of!property,!the!separate&property! of! each! spouse! is! property& owned& by& the& spouse& prior& to& marriage& and& property& acquired& subsequently!by!the!spouse!in!any!manner!(not!only!by!means!of!consideration)”.! The!legal!limits!to!each!spouse’s!autonomy!and!to!the!exclusive!appropriation!of!surpluses:!! • The!liability!regime!for!household!debts!(sec.!231-8)!à!lesson!3!! • The!protection!of!the!family!dwelling!(sec.!231-9)!à!lesson!3!! • The! compensation! for! household! work! (sec.! 232-5)! à! my! properties! are! mine! and! yours! are! yours!but!maybe!there!might!be!a!compensation!if!there!is!a!weaker!part!after!the!end!of!the! regime!(only!if!there!is!a!big!imbalance)! ! 2.2&Ascertainment&of&entitlements:&& Sometimes!we!don’t!know!the!owner!of!a!good.!Which!rule!does!the!judge!follow!to!attribute!the! good!to!one!spouse!or!the!other?! In& case&of&doubt&about&asset&ownership&(232-4):! In!these!cases! where!ownership!cannot!be!proven!it!will!be!split!50%.!!The!other!party!has!to!prove!that!it!is!not! 50%! split!but! that! he! is! the! real!owner! (à! allocation! to! both! spouses! in! undivided! equal! shares).! Despite!that,!there!are!exceptions!in!the!form!of!presumptions:! • Movables! for! personal! use! of! ordinary! value:! a! laptop! with! your! password! and! that! you! personally!use;! • Movables!directly!linked!to!the!professional!activity!of!one!of!the!spouses! • In!cases!of!real!property,!we!have!the!register!to!tell!us!the!real!owner.!! ! 2.2.1&Assets&acquired&for&consideration&during&marriage&(232-3)& These! goods! are! not! received! by! inheritance! but! received! for! consideration! during! marriage.! The! rule!here!is!that!it&prevails&the&formal&entitlement,!reinforced&by&a&presumption.!The!owner!is!the! spouse! that! appears! in! the! formal! tittle! (bill! or! register,! for! example).! If! we! have! a! spouse! that! bought!a!house!for!the!family!and!it!was!registered!at!his!name,!the!formal!entitlement!prevails,!so! the! other! party! won’t! be! proprietary! of! the! good.! Formal! entitlement! is! basic! in! the! catalan! legal! system.!This!formal!entitlement!is!reinforced!by!a!presumption:!! • If!there!is!evidence!that!the!consideration!comes!from!the!other!spouse,!the!law!presumes!that! it! was! donated! (this! spouse! has! the! burden! of! proof! of! onerosity).! The! owner! will! be! formal! owner,!not!the!one!who!gave!the!money!to!buy!the!good.!This!is!a!presumption,!so!if!you!can! prove!that!it!was!not!a!donation,!this!presumption!can!be!rebutted.!! The!formal!entitlement!prevails!because!it’s!easier!to!prove!and!we’ll!have!more!legal!certainty.!We! have!this!presumption!also!because!of!these!two!rationales:! • Compensation!for!contributions!to!the!family:!to!compensate!an!invisible!work!inside!the!family! itself! • Mutual!affection!and!spousal!solidarity:!spouses!made!these!kind!of!donations!and!they!did!not! appear!in!the!register!because!divorce!was!not!usual.!! Example:!spouse!2!contributes!to!the!mortgage!rents!over!the!apartment!purchased!by!spouse!1.!! • Owner:!spouse!1.!Because!formal!entitlement!prevails.! • Spouse!2:!has!just!a!right!to!be!reimbursed!if!he!can!prove!that!the!contribution!was!not!made! on!altruistic!bases!(that!it!wasn’t!a!donation).!! If& you& put& the& money& it& is& important& to& register& the& asset& in& your& name& due& to& the& formal& entitlement&prevalence.&& & & & & &

2.2.2!Exceptions&to&the&prevalence&of&the&formal&entitlement:&! It!can!be!rebutted!if!the!party!can!prove!that!it!was:! • A!simulation! • A!fiduciary&agreement:!a!pact!to!get!a!bank!benefit;!a!warranty…!but!not!as!a!donation.!! • A! different&consideration:!rebut!the!presumption!of!donation! if! we! prove!that! there!is! a! loan! signed!before!a!notary!where!you!stated!that!this!money!had!to!be!given!back.!! There!are!also!certain!fields&where&formal&entitlement&is&irrelevant.!If!we!are!in!front!of!important! assents!(such!as!buildings!or!cars),!we’ll!consider!the!formal!owner!taking!into! account!the!register.! The!point!is!that!the&formal&entitlement&is&irrelevant&in&these&cases:! • Movables!of!ordinary!value!for!family!use! • Assets!acquired!acting! as! an!(implicit)!agent! of!the! other! spouse!or! for! the!benefit!of!both! spouses!! & 2.3!Compensation&of&inequalities&for&household&work:&& Sec.& 232-5.1& CCC:! “In( the( regime( of( separation/ of/ property,( if( either( spouse( has/ worked/ for/ the/ household/substantially/ more(than(the(other,(such(spouse(is(entitled(to(financial(compensation( for( this( involvement( if,( at( the( time( of( termination( of( the( regime( by( separation,( divorce,( annulment( or( death(of(either(spouse(or,(as(the(case(may(be,(of(effective(end(of(cohabitation,(the(other(spouse(has( accrued(more(assets(in(accordance(with(the(provisions(of(this(section”.! This!regulation!is!really!wide:!this!compensation!is!applicable!to!all!marriages!celebrated!under!the! separation!property! regime!if!it!can! be!proved!that!“either& spouse& has& worked& for& the& household& substantially& more! than! the! other”! and! the! regime! finishes! because! of! separation,! divorce,! annulment,!or!death,!or!end!of!cohabitation!(even!if!they!are!not!married!).!! We&need&to&prove&that:&SPR/cohabitation& • Work&by&spouse&1&(the&one&claiming&for&compensation):&& o For! the! other! party! (job/company! of! the! other! spouse):! without! receiving! a! fair! compensation! according! to! market! criteria! (paying! minimum! salary! for! someone! taking! important!decisions!might!be!not!a!fair!compensation).*& o For!the!family:!household.!He!has!to!prove!that!he!has!worked!substantially!more!than!the! other!part!& • That&the®ime&finished&due&to:&& o Separation& o Death& o Divorce& o End!of!cohabitation& • That&the&other&party&(spouse&2)&got&more&assets.!We’ll!look!how!many!$!did!they!have!before! the!regime!and!after!the!regime,!as!what!it’s!interesting!to!us!is!the!changes!made!during!the! existence!of!the!regime.!& • *The&compensation&criteria&–&the&compensation&rationale:& o Payment!of!the!work!price?! o Redress!for!losses!and!other!damages!incurred?!! o Profit!sharing!with!the!spouse?!! REQUIREMENTS:&& 1. Performance!of!household!work!(sec.!232-5.1)!/!work!for!the!other!spouse!(sec.!232-5.2).! 2. Household! work! is!substantially!higher! /! work! for!the! other!spouse! is! not! compensated! or! compensated!in!an!insufficient!way.! 3. Higher!wealth!increase!by!the!spouse!who!has!benefited!from!this!work.!!

All!of!this!is!not!applicable!in!the!Spanish!system,!because!it!gives!me!the!50%!of!the!assets.!In!2011! the!legislator!introduced! more! details! to!calculate!the!compensation!because! this!section!was!too! wide.!! Example:! the! Fotoprix( Case! was! quite! famous! in! the! press! because! the! TSJ! gave! the! wife! a! compensation! of! 600.000€.! The! woman! never! worked! for! the! house,! they! did! not! have! common! children!and!the!marriage!only!lasted!9!years.!The!wife!was!also!received!a!high!salary!for!attending! some!customers!in!the!shops!and!she!also!received!benefits!from!the!company.!This!woman!claimed! a!compensation!and!she!got!it.!This!is!an!example!of!how!this!case!was!decided!in!2002,!where!all! these!requirements!that!we!have!just!exposed!were!not!necessary!to!give!a!compensation.!In!2011! this! was! deeply! regulated! and! the! calculation! for! household! work! was! also! more! accurate.! The! legislator!said!that!the!weak!party!claiming!for!compensation!will!receive!a!limit!compensation!(2326!CCC):!we’ll!compare!the!increases!of!fortune!during!the!regime!and!we’ll!give!the!weaker!party!a! right!to!participate!in!the!increase!of!patrimony!with!the!maximum!of!25%.!! • 1!à!100! • 2!à!25! • 100! –! 25!=!75!=!75/4!(25%).! The!25%!is!a!presumption! and!she!can!claim!more!than!25%!but! never!more!than!50%.!This!calculation!is!very!similar!to!the!calculation!of!credit!of!participation! (in!a!regime!of!participation),!but!the!maximum!percentages!are!different.!! ! 2.3.1&Compensation&of&inequalities&for&household&work:&defining&features:& 1)!It!applies!to!broken-down& couples& (separation,!divorce,!nullity)!and!couples&ended&by&death.&à! ALSO&APPLICABLE&TO&COHABITANTS.&Sec.&234-9&CCC:&COMPENSATION&BY&REASON&OF&WORK:&& 1.!When!either!partner!has!worked!for!the!household!substantially!more!than!the!other!or!has! worked!for!the! other! partner!without!any!or!sufficient!remuneration,!such!partner!is!entitled!to!financial!compensation!for!this!involvement! if,!at!the!end!of!cohabitation,!the!other!partner!has!accrued!more!assets,!according!to!the!provisions!of!Article!232-6.! 2.!The!provisions!of!Articles!232-5!to!232-10!apply!to!financial!compensation!by!reason!of!work.!

2)!It!is!quantified!by!applying!the!rules!of!a!regime&of&participation&in!acquests.! 3)!It!has!an!upper&limit&(25%)&which!can!be!exceeded!if!proved!that!the!contribution!was!higher!à! less!legal!uncertainty.! 4)!The!law!provides!some!criteria&to!set!the!amount:!“duration(and(intensity(of(such(involvement”.! Sec.&232-5.3&CCC:! 3.(To(determine(the(amount(of(financial(compensation(by(reason(of(work,(account(must(be(taken(of( the(duration(and(intensity(of(such(involvement,(of(the(length(of(the(cohabitation,(and,(specifically,(in(case(of(housework,(of( the(fact(that(such(work(may(have(included(the(upbringing(of(children(or(personal(care(for(other(family(members(living(with( the(spouses.!

5)!Possibility!of! agreeing!to! an! increase,& a!reduction& or! a! waiver& of! the! compensation! (sec.! 232-7! CCC:!according!to!the!criteria!of!the!sec.!231-20):! Article&232-7&CCC.&AGREEMENTS&ON&COMPENSATION:&& In(anticipation(of(a(marriage(breakdown(or(a(dissolution(of(marriage(by(death,(it(can(be(agreed(to(increase,(reduce(or( exclude(financial(compensation(by(reason(of(work(in(accordance(with(the(provisions(of(Article(231-20.( ARTICLE&231-20.&AGREEMENTS&IN&ANTICIPATION&OF&A&MARRIAGE&BREAKDOWN& 1.(Agreements( in( anticipation(of(a( marriage( breakdown(may( be( entered(into( in(the( marriage( contracts(or( in(a( public( deed.(Ante-(nuptial(agreements(are(only(valid(if(executed(thirty(days(at(least(prior(to(the(date(of(marriage.( 2.(The(notary,(prior(to(performing(the(deed(referred(to(in(paragraph(1,(must(inform(separately(each(of(the(contracting( parties(on(the(scope(of(the(changes(which(the(agreements(are(intended(to(introduce(with(respect(to(the(supplementary( legal(regime(and(he(must(warn(them(of(their(reciprocal(obligation(to(provide(the(information(referred(to(in(paragr.(4.( 3.(Agreements(waiving(or(limiting(rights(must(be(reciprocal(and(they(must(clearly(specify(the(rights(limited(or(waived.( 4.( The( spouse( claiming( enforcement( of( an( agreement( in( anticipation( of( a( marriage( breakdown( has( the( burden( of( proving( that( the( other( party( had,( at( the( time( of( its( execution,( sufficient( information( about( his( assets,( incomes( and( financial(perspectives,(if(such(information(was(relevant(in(relation(to(the(content(of(the(agreement.( 5.(Agreements(in(anticipation(of( a(breakdown(which( pose(a(serious(harm( to(any(spouse( at(the(time(of( their(intended( performance(are(null(and(void(if(such(spouse(proves(that(important(changes(of(circumstances(have(arisen(which(were( unforeseen(or(could(not(be(reasonably(foreseen(at(the(time(of(execution(of(the(agreement.(

6)!Payment&in& cash,&but!the!judge!may!authorize!the!debtor!to! pay!in!kind!and! pay!in!installments! (sec.!232-8).!! ARTICLE&232-8.&PAYMENT&OF&COMPENSATION:&& 1.(Compensation(must(be(paid(in(money,(unless(the(parties(agree(otherwise.(However,(for(just(cause(and(at(the(request( of( either( party( or( of( the( heirs( of( the( debtor( spouse,( the( judicial( authority( may( order( payment( to( be( made( fully( or( partially(in(assets.( 2.(At(the(request(of(the(debtor(spouse(or(his(heirs,(the(judicial(authority(may(defer(payment(of(compensation(or(order(it( to(be(made(in( installments,(with(a(maximum( maturity(of(three(years(and( accrual(of(legal(interest(from(the(date(of(its( admission.( The( judicial( authority( may,( in( this( case,( order( the( creation,( if( necessary,( of( a( mortgage,( according( to( the( provisions(of(Article(569-36,(or(of(other(securities(in(favor(of(the(creditor(spouse.(

7)&Possibility!of!reducing!or!suppressing!certain!donations&(sec.!232-6):!! ARTICLE&232-6.&CALCULATION&RULES&& 1.(The(accrual(of(assets(of(the(spouses(is(calculated(according(to(the(following(rules:( a)(The(property(of(each(spouse(consist(of(the(assets(held(upon(termination(of(the(regime(or,(as(the(case(may(be,(of( effective(end(of(cohabitation,(after(deduction(of(liabilities(and(charges(over(the(assets.( b)(The( value( of( the(property( of( each(spouse( must( be( accrued(by( the( value(of( the( assets(disposed( of(gratuitously,( calculated(at(the(time(of(its(transfer,(excluding(gifts(made(to(common(children(and(usual(gifts(as(well(as(the(value(of( the(damage(caused(by(acts(intentionally(done(to(harm(the(other(spouse.( c)(The(value(of(the(property(of(each(spouse(must(be(decreased(by(the(value(of(the(assets(that(each(spouse(owned(at( the(beginning( of(the(regime( and(that( he(still(holds(upon( termination(thereof,(after(deduction( of(the( charges(over( these( assets,( and( also( the( value( of( the( assets( acquired( gratuitously( while( the( regime( was( in( force( and( the( compensation(for(personal(damage,(exclud...