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Prenuptial Agreement in Indonesia

Discover How a Prenuptial Agreement Redefines Your Marriage

Property Division in the Course of Marriage

13 October 2017 Asep Wijaya 1001 times
Marriage is a step that will surely be passed by every human being, male and female. The nature of marriage under applicable Indonesia’s 1974 Marriage Law stated that Marriage is the inner and outer bond between one man and one women as the husband and wife with the intention of forming a happy and eternal family (household). Morevoer, in accordance to Article 2 of Compilation of Islamic Law, marriage is a very strong contract to obey God’s commands and execute its worship. Marriage sparked quite much legal implications, one of which appears as properties, which arise separation or joint marital property. According to The Great Dictionary of the Indonesian Language of the Language Center (Kamus Besar Bahasa Indonesia Pusat Bahasa), joint marital property is defined as the goods in the form of money and so that becomes property used or utilized together. The terms of joint marital property in our Indonesian community is also popularly known as Gono Gini which derives from Gana-Gini describes by the Great Dictionary of the Indonesian Laanguage as treasures collected over the rights to settle down so that it becomes the the rights of both the husband and wife. The brief explanation of Basic laws and regulations concerning joint marital property would refer to the laws and regulations will be elaborate on next paragraph as follows.
 
Indonesia’s 1974 Marriage Law
  1. Innate Treasures (personal property). Article 35 paragraph 2 of Law No. 1 1974 on Marriage stipulates that property brought into the marriage by the husband and the wife respectively and property acquired by either of them as a gif or inheritance shall remain under their respective control, unless otherwise decided between the parties. That means, if each party obtaining their own goods and are brought into the marriage, remains under the authority of each party.
  2. Joint marital property. In Article 35 paragraph 1 of Indonesia’s 1974 Marriage Law stipulates that Property acquired during marriage shall become joint marital property. the joint marital property here is property acquired by each and every spouse in matrimony for the interest of family. Each party can use the property along with the consent of his or her spouse.
  3. Gift or Inheritance. Let us see again the Article 35 paragraph 1 of Indonesia’s 1974 Marriage Law. It stipulates that common property acquired by each of the spouse as a gift or inheritance shall remain under their respective control. Property acquired during the matrimony becomes joint marital property, and an innate property of each spouse or property obtained by each party as a gift or inheritence is under the authority of each party so long as the parties don’t establish other conditions.
Marital Property in Terms of Islamic Law Compilation
 
In Islamic law, both marriage and divorce are contingent upon the fulfilment of transfers of property, usually from husband to wife. However, Islamic law does not acknowledge the concept of joint martial property, instead vesting rights for any property brought to or produced in marriage with the individual. As Islamic law does not recognize joint marital property, men and women are deemed to have equal rights to own and dispose of their porperty, without requiring the permission of the other spouse. Nonetheless, Islamic law acknowledges partnerships (syirkah) so it considered possible to conceptualize marital property produced through joint effort as partnership property. There is also an obligations from muslim husbands concerning on properties to their wifes. The husband has the right to take care of his wife’s assets and obliged to maintain and preserve the assets.
  1. Inheritence. Islam gives equal rights to men and women. Both were created by God and are of equal spiritual worth. And so in terms of marital property, men and womeh have equal rights. Islamic legal materials generally support women’s right to acquire, hold, use, administer and dispose of property. However, based on teaching of Islam, men have responsibilites that are heavier than women. In terms of Inheritence, men  get a larger share than women as stipulated in the surah An-Nisa verse 11: .”Allah commands you as regards your children’s (inheritance); to the male, a portion equal to that of two females; if (there are) only daughters, two or more, their share is two thirds of the inheritance; if only one, her share is half.”
  2. Mahar (dowry). For the marriage, grooms must provide a gift to the bride (mahar). The provisions of Article 30 of Compilation of Islamic Law states that the prospective groomis required to pay a dowry (mahar) to the bride that number, shape, and type agreed upon by both parties. Furthermore, it stipulates that dowry determination is based on the principles of ease and simplicity advocated by Islam. While dowry is given directly to the prospective bride and it become her personal rights ever since. It can be concluded that the mandatory provision of a dowry is given and expressed by a husband to his future wife in a marriage ceremony which is a sign of their approval and willingness to live as husband and wife. The form can be anything as long as it has value.
  3. Grants, or  (hibah) or gifts are given goods that have a social function in people’s lives either it is given by individuals or institutions. The grant is given by  a person to the other when he / she still alive. The implementation of division of grants is usually done at the time the testator still alive. This means that the person granted posesses full rights to the property, but it could also be acquired into a joint marital property with the consent of both parties.
  4. Properties acquired as the results of own’s effort. Marital property can usually be separated into four groups as follows. Merely: goods acquired by spouses from inheritence or bequesst of relatives of each party and were brought into the marriage, goods acquired during marriage belongs to the husband and wife as the joint marital property, goods obtained by each party for each seles before or during marriage, and  items awarded to the husband and wife at the time of marriage. In terms of joint marital property, the husband and wife can commingle their properties. In islam, it is known as Syirkah or mixing assets acquired by each spouses during marriage, or their joing efforts. This also applies to the assets derived from inheritance, gifts, and grants. All of which may remain as the property either acquired before marriage or after marriage with the consent of each spouses.
Martial Property in Private International Law
 
Private International Law contains three important streams of the marital property, namely:
  1. The establishment who sees marriage property law, for example, an immovable goods belongs to the status reel. There is a distinction between movable and immovable. The principle of lex rei sitae applied to the immovable  objects, while the movable object is placed under their place of domicile.
  2. the establishment that a marrital property law belongs to the field of personal status.
  3. Marital property law is a contract between husband and wife, thus the will of both parties will determined what kind of law to be used. The parties can make a prenuptial agreement and in this case, they will used the law that they have chosen.
Arrest 1929 which is a decision of Hooge Raad in Netherlands in 1929 is considered as the basis of marital property law in Private International Law. This Arrest stipulates that marital properties including personal status, ia s unity, and the law of marital property can not be changed.
 
Divsion of marital property under Indonesia’s 1974 Marriage Law
 
Article 37 of Indonesia’s 1974 Marriage Law which contains provisions concerning joint property does not explicitly stipulates the division of property for each spouses if the marriage is ended whether it is by divorce or ended because one person dies. The article however stipulates, if the marriage is ended because of divorce, the joint marital property will be governed by the law applicable to each divorce parties. It is not described about provisions on the arrangement regarding the division of joint martial property if it is associated with filing a divorce petition. The arrangements regarding on the division of marital joint property will be governed by the law applicable to the parties, for example, the Moslems will surely apply to the Religious couort. In this case, the applicable law would certainly be Compilation of Islamic Law.
 
The division of marital property according to Compilation of Islamic Law
 
In the Compilation of Islamic Law, the division of joint marital property governed by Article 96 and 97. Those articles stipulates about the division of joint martial property for the spouses if the marriage ends, whether by divorce or the death of another party. Each will get half of the joint property.  It is said that:
(1) If the marriage is ended because one person dies, then the property that constitutes common property (Shared Property) falls to the party that lives longer.
( 2 ) the division of joint property for a husband or wife or husband who lost should be deferred until there is certainty that the ultimate death or die in the law on the basis of religious court decisions
whereas Article 97 stipulates that widow or widower who divorced entitled to one-half of the joint property to the extent so long as the parties don’t establish other conditions. It can be concluded that the division of joint marital property because of divorce can be done directly between the former husband and wife, with each spouse entitled to one-half. But this provision does not apply when there is prenuptial agreement held by both parties.
 
Prenuptial Agreement
 
For many of us there is a gap between the marriage we have and the marriage we thought we would have. Disputes around property division in the course of marriage could be prevent by making a prenuptial agreement. It could brings altogehter a positive impact on relationship breakdown. As we have discussed earlier, Indonesia’s 1974 Marriage Law has given the opprotunity for those who want to set it up. Prenuptial agreement is one way to minimize the divorce because of the provisions in it are burdened with obligations that will create one of the parties to reconsider filing for divorce. Prenuptial agreements can also be used as a means to provide legal protection to the property of the spouses. The parties could determine whether a prenuptial agreement would regulates the separation of property in marriage or sets a joint marital property or whatever they want. The prenuptial agreement is faciliaed in Indnesia and can be upheld in court. The laws governing prenuptial agreements (prenup) stipulate that the agreement should be made prior to marriage. The legal grounds for the prenup come from severalapplicable Indonesian laws, including: Civil Code, 1974 Marriage Law, and Compilation of Islamic Law, as follows:
  1. Article 47 (1) of Compilation of Islamic Law Article stipulates similar provision with the Marriage Law: “At the time of or before the marriage took place, the bride and groom may enter into an agreement approved by the Registrar of Marriage regarding the management of community property.”
  2. The 1974 Marriage Law in Article 29(1) stipulates that: “At the time of or before the marriage took place, with the mutual consent of both parties, they may enter into an agreement approved by the Civil Registrar of marriage, after which it shall also apply to third parties as long as it involves them as well.” Another provision stipulated in the marriage law is that the agreement cannot be amended during marriage, except upon approval of both parties and cannot cause disadvantage to any third party. This stipulation comes from Article 29(4) in the Marriage Law.
  3. Article 199 of the Civil Code stipulates that: “From the commencing of a marriage, there shall exist by law, community property between the spouses to the extent that no other stipulations have been made in the prenuptial agreement.”
The Law in Indonesia does not provide a ready-made framework for a prenuptial agreement. One has to find a lawyer to help them define their particular needs of the husband and wife. Naturally, both parties are free to determine the provisions of the prenuptial agreements as long as it does not abide the law and morality of public.
 

I am Asep Wijaya, Managing Director of Wijaya & Co. Thank you for visiting my blogs and reading my posts.

 

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