ALL IS FAIR IN LOVE AND WAR?
During divorce proceedings, it comes as no surprise that the division of marital assets is usually one of the main disputes between spouses following the breakdown of a marriage. In Malaysia, the Court will consider each spouse’s contribution before dividing the marital assets.
What constitutes matrimonial assets?
Although the Law Reform (Marriage and Divorce) Act 1976 (“LRA”) does not define matrimonial assets, guidance can be sought from judicial precedent. The Court has held the following to be matrimonial assets:-
- the matrimonial home and everything which is put into it by either spouse
- movable and immovable properties acquired during the marriage
- intangible assets such as shares, stocks and monies in bank accounts
- the Employees’ Provident Fund/pension received during the marriage
It is a common misconception that assets acquired by one party before the marriage are excluded from division. Marital assets would also include assets owned by one party before the marriage which have been substantially improved during the marriage by the other party or by their joint efforts. An example of this would be a property acquired by one spouse before marriage in which the other spouse had made significant improvements on it such as renovations or paying for the household expenditures.
Division of matrimonial assets
Section 76 of the LRA empowers the Court to order the division of assets acquired during the marriage when granting a decree of divorce or judicial separation. Previously, Section 76 of the LRA was centred on a distinction between the joint efforts of both spouses and the sole effort of a spouse in acquiring the asset. If an asset is acquired by the sole effort of one of the spouses, he or she will receive a greater proportion of the asset. Meanwhile, the Court would lean towards an equality of division of assets if acquired by the joint efforts of both spouses.
The Law Reform (Marriage and Divorce) (Amendment) Act 2017 has recently amended section 76, in which the distinction between jointly acquired assets and assets acquired by the sole effort of a party has been removed. The Court no longer needs to take into consideration whether the asset was jointly or solely acquired and would be inclined towards an equality of division of assets but prior to that, the Court must take into account the following statutory considerations: –
- the extent of the contributions made by each party in money, property or work towards the acquiring of the assets or payment of expenses for the benefit of the family;
- the extent of the contributions made by the other party who did not acquire the assets; to the welfare of the family by looking after the home or caring for the family;
- any debts owing by either party which were contracted for their joint benefit;
- the needs of the parties’ minor children; and
- the duration of the marriage.
The objective of the amendment to Section 76 of the LRA was to give due recognition to the non-financial contributions of spouses, namely in taking care of the home and the family. The new statutory provision would now protect the class of stay at home moms and dads, who had contributed in taking care of the home and the family but yet, deprived of any entitlement to the assets due to the fact that they were unable to prove the requirement of “joint effort” under the previous section 76 of the LRA.
Applicability of the amended Section 76 of the LRA
Although there are currently not many reported cases on how the Court would interpret the newly amended Section 76 of the LRA, the case of Theynarasi Selambaram v. Periasamy Chinnappan & Anor  1 LNS 818 has given an insight on the Court’s approach in the application of the amended section 76 of the LRA.
The High Court in the case observed that under the amended section 76 of the LRA, there are now only two categories of properties – matrimonial assets which fall under section 76(1) and non-matrimonial assets which fall under section 76(5). If the assets are non-matrimonial properties, the division is not permissible as of right whereas, for matrimonial assets, the division is as of right.
Relying on the provisions of the amended Section 76 of the LRA, the Court had ordered the matrimonial home as well as the other 3 properties that were registered under the husband’s name to be divided equally between the parties. In exercising its discretion, the Court took into account the statutory considerations i.e. the fact that the parties had been married for 26 years and the extent of the contributions made by the wife in looking after the home and caring for the family.
Meanwhile, in respect of the properties that were owned by the husband before the marriage, the Court held that the wife failed to prove that she has substantially improved these properties during the marriage and therefore, they were not considered matrimonial assets under section 76(5) of the LRA to be divided between the spouses.
As seen in the above case, the Court is now apt to order an equal division of matrimonial assets between divorcing spouses in accordance with the new provision, regardless of whether the asset was solely or jointly acquired.
Does conduct affect the division of assets?
The conduct of the parties such as adultery or unreasonable behaviour does not bear a relevance in the determination of division of matrimonial assets. As held by the High Court in the case of Lim Bee Cheng v Christopher Lee Joo Peng  2 CLJ 697, the power of the Court to order division of matrimonial assets under Section 76 is subject only to those considerations prescribed therein and conduct of the parties is and has always been irrelevant.
The drafting of section 76 of the LRA does not provide for any precise apportionment of a spouse’s share in the matrimonial assets based on their contributions. As Faiza Tamby Chik J held in the case of Choy Yoke Ying v Yong Yook Seng  8 CLJ 105, the discretion vested in a judge of the family court is to do “rough justice” between the parties, as there is no measure which can fit all marriages. That being said, the Court endeavours to reach a fair and equitable division in each case and the apportionment would depend on the nature and extent of the contribution, as well as all the circumstances of the case.
By: Jaclyn Chang
DISCLAIMER: This article is for general information only and should not be relied upon as legal advice and/or legal opinion. Messrs Yeoh & Joanne accepts no liability for any loss which may arise from reliance on the information contained in this article.
虽然目前关于法院将如何解释新修订的《1976年法律改革(婚姻和离婚)法》第76条的案例不多，但Theynarasi Selambaram v. Periasamy Chinnappan & Anor  1 LNS 818一案中使人们对法院如何应用经修订的《1976年法律改革(婚姻和离婚)法》第76条的有了深入的了解。
双方的行为，如通奸或不合理行为，与婚姻财产分割的决定无关。正如高等法院在Lim Bee Cheng v Christopher Lee Joo Peng  2 CLJ 697一案中所认定的那样，法院根据第76条命令分割婚姻财产的权力只受其中规定的考虑因素的制约，而当事方的行为现在和过去都是不相关的。
《1976年法律改革(婚姻和离婚)法》第76条的起草并没有规定根据配偶的贡献对其在婚姻财产中的份额进行任何精确的分配。正如法官Faiza Tamby Chik J在 Choy Yoke Ying v Yong Yook Seng  8 CLJ 105一案中所认为的那样，家庭法院法官的酌处权是在双方之间进行“大致公平合理的处置”，因为没有任何措施可以适用于所有的婚姻。尽管如此，法院努力在每个案件中实现公平和公正的分配，分配将取决于贡献的性质和程度以及案件的所有情况。
文章来自于：张美琪律师 (Jaclyn Chang Mei Qi)
文章翻译：李淑婷律师 (Lee Su Ting)
免责声明:本文仅供参考，不应作为法律建议和/或法律意见。Yeoh & Joanne律师事务所不会承担因依赖本文所含信息而产生的任何损失的责任。