Divorce is no easy matter, either legally or emotionally. The term “marital gain” often comes up in this context. This raises numerous questions: What is meant by marital gain? How is it calculated in a divorce? How and when is a marital gain settlement carried out?
In the following article, we’ve summarized key information about the legal concept of marital gain.
What Is Marital Gains?
The term originates from German family law and, within the context of the marital property regime known as “community of accrued gains,” refers to the increase in assets that occurred during the marriage.
Such marital gains form the basis for calculating the mutual equalization of marital gains, which must be carried out in the event of a divorce. The spouse with the lower increase in assets may be entitled to demand financial compensation from the other spouse.
This is because the legislature assumes that the spouse who has achieved less increase in assets during the marriage has provided other services equivalent to professional work. This includes, for example, raising the couple’s children.
What is a community of accrued gains?
If no marital agreement has been entered into, the community of accrued gains serves as the legal framework ensuring that, by law, the matrimonial property regime during the marriage is one of separation of property with equalization of accrued gains.
Under this system, each spouse or registered domestic partner remains the sole owner of the assets acquired by him or her during the marriage or brought into the marriage. Consequently, no joint property is created in a community of accrued gains.
If the marriage ends through divorce or the death of a spouse, assets acquired during the marriage must be divided between both spouses (or their heirs) as part of the equalization of accrued gains. The equalization of accrued gains must be carried out as provided even if the spouse entitled to the equalization is at fault for the breakdown of the marriage.
How are accrued gains determined through the equalization of marital gains?
In the equalization of marital gains, the assets of both spouses at the beginning of the marriage (initial assets) are compared with the assets available at the time of divorce (final assets).
The difference between the initial assets and the final assets represents the increase in assets for each spouse—that is, his or her marital gain. The spouse with the higher marital gain is obligated to provide compensation, so that both spouses each receive half of the other’s marital gain. If disputes over assets are likely to arise due to legal uncertainties regarding assets acquired during the marriage, legal counsel should be sought immediately.
How is the claim to marital gains regulated in the case of jointly owned real estate?
If an existing community of accrued gains comes to an end due to divorce and there is a jointly acquired property, each spouse is entitled to half of the property. In the event of the death of a spouse, this applies mutatis mutandis to the heir(s).
Since, on the one hand, the equalization of accrued gains must always take the form of a monetary payment and, on the other hand, real estate is among the assets that are not easily converted into cash, the spouses must consider what should happen to the property in the course of the divorce.
If one spouse is financially able to pay out the other, the property can be transferred to him or her by a notarized contract, provided the other spouse gives his or her consent. It is also possible to sell the property jointly. The proceeds from the sale are then allocated equally to both spouses in accordance with the equalization of accrued gains.
If an amicable solution cannot be reached, the final option is a partition auction. This is often very time- consuming, and the proceeds to be realized are uncertain.
The valuation and division of business shares can also be complicated and time-consuming in the context of the equalization of accrued gains.
In such cases, it is advisable to seek expert advice from certified specialist lawyers in family law as early as the time of separation.
more here:
Related articles
