Different Types of Matrimonial Regimes in Malta
The Maltese Civil code establishes three matrimonial regimes applicable to the spouses' property in marriage, namely:
- Community of Acquests
- Separation of Estates
- Community of Residue under separate administration (CORSA)
When a couple gets married, the Community of Acquests regime applies automatically to their property, unless the parties enter into a marriage contract before or after the marriage. If the couple follows such procedure after the marriage, an authorization from the Court of Malta needs to be acquired before the couple can proceed with the marriage contract.
The Community of Acquests
Under this matrimonial regime, all the assets and liabilities of both spouses are joined into one fund, and both spouses equally own and administer such assets and liabilities together.
The general rule which applies to this matrimonial regime is that both spouses are obliged to regulate and administer their matrimonial property jointly, and thus acts performed in relation to such property, need the consent of both spouses.
Acts of ordinary administration and Acts of extraordinary administration
Maltese law distinguishes between acts of ordinary administration and acts of extraordinary administration. Acts of ordinary administration may be carried out by either one of the spouses individually, while acts of extraordinary administration require that the spouses act jointly. The law only specifies the acts of extraordinary administration, and thus, by exclusion, whatever does not fall within the list mentioned by the law, falls under acts of ordinary administration and may thus be carried out by either one of the spouses on his/her own.
Acts of Extraordinary Administration: What does it Include?
The acts of extraordinary administration mentioned by the law include the following:
a )Acts whereby real rights over immovable property are acquired, constituted, or alienated, for example the sale or purchase of immovable property.
b) The creation of hypothecs and/or privileges and the partitioning of immovable property.
c) Acts granting the right of use and enjoyment over immovable property.
d) The Borrowing or lending of money – this shall not include the deposit of money in a bank account.
e) Donations – this shall not include donations of manual gifts of money or of other movable corporeal things, or of documents to bearer, when the sum or value thereof is moderate.
f) Contracting of suretyship.
g) Giving of a pledge.
h) Entering into an unlimited liability partnership or acquiring shares in a limited liability company, which shares are not fully paid up.
i) The acquisition of movable property or of any right over movable or immovable property, where the consideration for which, is not paid on or prior to delivery – this does not apply to any debts which are incurred for the needs of the family and to the hiring of movables or immovables when the consideration is moderate in relation to the condition of the family and the duration of the lease is for a short period.
j) Transfer of a business concern and share in a commercial partnership (except a public company)
k) Any act which serves to rescind the constitution of a real right over immovable property or the partition of an immovable property.
l) Settlement in trust of property forming part of the community of acquests and the variation or revocation of the terms of any trust in which any such property has been settled.
Exceptions to the Community of Acquests
The Maltese Civil Code specifies the property which shall form part of the community of acquests, namely being:
a) All that is acquired by the spouses through their work or profession;
b) All earnings (fruits) from property owned by spouses;
c) All earnings (fruits) made from property owned by the children;
d) Any property which is acquired with money or other property which is already in the community of acquests, even if the property is in the name of only one spouse;
e) Property acquired after marriage by the personal property of the spouses; and
f) Any fortuitous winnings by either of the spouses.
What does not constitute community property under Maltese law?
Any property which belongs to either of the spouses, not by virtue of any of the above-mentioned acts, does not constitute community property under Maltese law. This means that a property which was transferred to either one of the spouses by means of a donation or by means of a transfer causa mortis does not constitute community property. However, the fruits and earnings of such property form part of the community of acquests. This provision does not apply if in the deed of donation and/or inheritance, an express condition has been included to the effect that proceeds of the property shall not form part of the community of acquests.
Separation of Estates
Under this matrimonial regime, the spouses continue to act as they did prior to contracting marriage. Therefore, notwithstanding the marriage, all and any property which is acquired by the spouses throughout their marriage, remains paraphernal. Therefore, any property acquired during the marriage would belong to the spouse acquiring such, and no authorization from the other spouse shall be required irrespective of the nature of the act.
Community of Residue Under Separate Administration (Corsa)
This matrimonial regime is the least common matrimonial regime in Malta. Under this matrimonial regime, during marriage, each of the spouses’ property remains separate, however if the spouses decide to terminate their marriage, the residue left is deemed to belong equally to both spouses. This means that if one of the spouses ends up with a lesser amount of assets than the other spouse, the spouse having a greater amount shall assign an amount from his/her residue, so that both spouses end up with equal shares.
Upon a married couple establishing itself in Malta, the default matrimonial regime applicable to regulate their marriage is the community of acquests. Therefore, it is important that a couple who wishes to marry or establish itself in Malta, consults a lawyer before marrying or before establishing itself in Malta, in order to avoid unwanted consequences which arise from a matrimonial regime point of view.
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