How are Matrimonial Assets divided in Singapore during a Divorce?

 

Introduction

The division of matrimonial assets are one of the ancillary matters considered in a Singapore divorce. Essentially, ancillary matters comprise of the division of matrimonial assets (including the matrimonial property), care and custody of the children, as well as the providence of maintenance and legal costs.

In an uncontested divorce, where the parties have agreed on the division of the matrimonial assets, the Courts will abide by the parties’ wishes. However, in the case where there are disputes as to the division of matrimonial assets, the Courts have the power to divide it in a manner they deem fit, and the Court also has the power to order a transfer of property, sale of property to facilitate division.

What are Matrimonial Assets?

Matrimonial assets are defined in the Women’s Charter in Section 112(10).

Therefore, what constitutes a matrimonial asset depends on the time and mode of acquisition, rather than the type of asset. Matrimonial assets can include property, shares, businesses, money, vehicles, insurance policies, and jewellery.

Are Gifts Matrimonial Assets?

Gifts from Husband to Wife or Vice Versa (Inter-Spousal gifts):

It is not unusual for spouses to give gifts to each other especially as a form of security or to show appreciation. However, the fact that the asset stays within the family means that it is still possible for it to form part of the pool matrimonial assets, due to the power conferred to the Courts by Section 112 of the Women’s Charter.

The Courts can choose to either pool it together with the matrimonial asset, or choose to exclude it from the division if the value of the gift is insubstantial compared to the total value of the matrimonial assets.

In Wong Ser Wan v Ng Cheong Ling, the husband had signed an agreement gifting his wife certain assets, but sought to subject the gifts to division in divorce proceedings. The Court held that because the husband had been legally represented when he signed the agreement, and he had the ability to adhere to the terms, he could not seek to retrieve the assets. Consequently, the High Court excluded it from the pool of matrimonial assets.

However, in Tan Cheng Guan v Tan Hwee Lee, the wife sought to rely on the promise that the property transferred to her from her husband, in the hopes of salvaging the marriage should not form part of the pool of matrimonial assets.

The High Court rejected the argument that the promise automatically justifies exclusion. Rather, it held the consideration of whether an inter-spousal gift ought to be irrevocable will be considered during the division of matrimonial assets, which will be explained below.

Therefore, is no hard and fast rule as to whether inter-spousal gifts matrimonial assets. The ethos of the family justice system in Singapore is to decide on a just and equitable division of matrimonial assets, and Courts are consequently awarded a broad discretion to enforce this. To err on the side of caution, inter-spousal gifts should form part of the pool of matrimonial assets.

Gifts that are Acquired from Third Parties to only One Party (by Inheritance or other Means):

The Women’s Charter states that the asset will only be satisfied as matrimonial asset if at least one of the two conditions are met:

• it becomes their matrimonial home, or;
• If the other party, or the parties together have substantially improved the property

According to TNC v TND, ‘ordinarily used or enjoyed’ would not be satisfied if the stay at the property was ‘occasional or casual’. It would depend on the facts of each case for the Courts to decide if it forms part of the matrimonial assets.

Are Property and Assets located Overseas Matrimonial Assets?

Yes, as long as it fulfils the definition of matrimonial asset as described above, since the definition highlights that it includes ‘assets of any nature’.

However, there may be complications regarding the enforcement of any court orders, since they may not be recognized in a foreign jurisdiction. As such, the Court may exercise their discretion and decline to make an order as to the foreign assets.

How do the Courts in Singapore divide Matrimonial Assets?

Ultimately, the Court has a duty to reach an outcome that is just and equitable, considering the circumstances as a whole. Therefore, the ‘broad-brush approach’ is usually taken where the Court assesses the situation as a whole to attain the goal of a just decision.

While the Court possesses a large discretion, there are methods which are frequently employed to reach the decision.

The most common method of division is the ‘global assessment methodology’ which comprises of four main stages:

---

First stage: Identification.

The Court will identify what the matrimonial assets are and pool them together.

Second stage: Assessment.

The Court will assess the net value of the pool of matrimonial assets.

Third stage: Division.

The Court will determine a just and equitable division in light of all the circumstances of the case.

Fourth stage: Apportionment.

The Court will decide on the most convenient way to achieve these proportions of division (i.e. how the order of division should be satisfied from the assets).

---

At the stage of division, the Court possesses a statutory duty to consider all the circumstances of the case, and in particular the following factors in Section 112(2) of the Women’s Charter:

• Extent of the contributions made by each party in money, property, or work towards acquiring, improving or maintaining the matrimonial assets (direct contributions)
• Debt of the household
• Needs of the children (if any)
• Extent of contributions made by each party to the welfare of the family, including looking after the home or caring for the family or any aged or infirm relative or dependent of either party (indirect contributions)
• Any agreement between the parties with respect to the ownership and division of the matrimonial assets made in contemplation of divorce
• Any period of rent-free occupation or other benefit enjoyed by one party in the matrimonial home to the exclusion of the other party
• The giving of assistance or support by one party to the other party, including support in the other party’s business or occupation

Other factors the Court will also look at factors such as the length of the marriage, the value of the matrimonial assets as well as the extent and nature of the indirect contributions.

As the Singapore Courts view marriage as a joint enterprise, financial contributions (direct contributions) to matrimonial assets are equally as important indirect contributions in the realm of homemaking. Therefore, the Courts will consider both direct and indirect contributions of both the husband and the wife to the marriage.

At the stage of apportionment, the Courts will decide what is the best method to divide the property. For example, if the matrimonial home is an important aspect to the children’s lives, and the wife has custody of the children, the Court may give the wife an option to buy out her husband’s share, depending on the facts of the situation, such as her financial ability and the size of the other assets.

The Courts also have the power to postpone any order of sale of the matrimonial home to a date where the children perhaps finished education, to prevent disturbance to the children. However, such orders are always dependent on the factual matrix of the case.

---