Questions which are frequently asked with reference to family law issues
According to recent jurisdiction of the Federal German High Court of Justice marriage contracts can be invalid if they give rise to a grossly unilateral and imbalanced distribution of burdens which appears to be no longer compatible with the essence of the marriage. This applies all the more when the once agreed-upon provisions relate to or interfere with those key issues and principles which are subject to the laws which govern the statutory consequences of a divorce.
The jurisdiction of the Federal High Court of Justice provides for graduations which stipulate different levels of specific protection for the parties, for instance in the case of one spouse’s right to alimony and support while this spouse is raising a child or children, or, in case of a divorce, the right to a mutual compensation of retirement benefit expectancies, while provisions concerning the spouses’ conjugal property regime can in most respects be agreed-upon at the parties’ discretion without any restrictions.
An aspect where particular risks are involved is that a violation of accepted moral standards by one specific provision in a marriage contract can entail the invalidity of the entire contract. In most of such cases the Courts will, however, by way of a mere implementation check arrive at the solution that one of the spouses may, for a transitory period of time, not invoke acertain- provision in the marriage contract.
In these cases it is necessary to carefully study and evaluate the parties’ individual situation and the intentions and the personal plans which the spouses had for their lives at the time when they signed their marriage contract.
As a matter of principle a spouse is not liable for the other spouse’s liabilities. This is so both in the case of a matrimonial regime of a separation of property which was contractually agreed upon by way of a marriage contract and also in the case of the German statutory matrimonial regime of ‚community of the surplus’ („Zugewinngemeinschaft“).
This means to say that it is not specifically necessary to contract a separation of property in order to avoid a joint liability for the other spouse’s liabilities.
The situation is, however, different, if the other spouse has him- or herself entered into an obligation in relation to the grantor of a credit, for example by co-signing a credit agreement or a promise of surety or surety bond.
As a matter of principle the situation is such that the divorce of a marriage does not affect an obligation which was entered into in relation to the grantor of a credit, that is to say that both spouses continue to be liable for instance in relation to a banking institution.
The situation may, however, be different if a borrower’s commitment under a loan was undertaken exclusively in the interest of one of the spouses, for instance for his or her business enterprise or for a house of which only one of the spouses is the sole owner.
In cases like these the separation and divorce of the spouses may constitute a fundamental change of the circumstances which are underlying the contract for one spouse’s joint liability for the outstanding debt of the other spouse.
In situations like these jurisprudence provides for a right of exemption from liability, which is directed against the other spouse. As a result this other spouse then has to alone reduce the outstanding debt at any rate for the time following the divorce.
According to an opinion which is gaining ground but not yet prevailing in jurisprudence it is the „prohibition of double deduction which has to be taken into account.
This problem is frequently overlooked by both lawyers and family courts.
According thereto it is not permitted that debts will be taken into account for one spouse when implementing the equalization of the community surplus with the consequence that this spouse’s community surplus is reduced, and that at the same time payments for the loan debt are once again taken into account in determining the income of the spouse who is obliged to pay alimony or support, with the consequence that this results in that the other spouse’s claims to alimony or support will be lowered.
A recognition of loans payable is to be permissible only with respect to either the equalization of the community surplus or the alimony or support which is to be paid to the spouse.
It is therefore as a rule recommended to clarify the issues of equalization of the community surplus on the one hand and post-marital spouse’s alimony on the other hand in the course of the judicial divorce proceedings by way of the so-called composite or consolidated divorce proceedings in order to be able to appropriately take account of both of these aspects.