Marital Property and Personal Property

Disputes over marital property between husbands and wives are often contentious because the law tends to “presume” certain assets as “marital property.” This means they must be divided between both parties, even if one spouse did not contribute to earning or acquiring those assets. Today, I will be discussing this topic in depth, covering the meaning, distinctions, and the consequences of dividing assets upon divorce.

Table of Contents

• The Difference Between Marital Property and Personal Property

• Methods for Distinguishing Marital Property from Personal Property

• The Impact of Marital and Personal Property in Divorce Cases

• How to Protect Against Disputes Over Marital and Personal Property

• Legal Management of Marital and Personal Property

The Difference Between Marital Property and Personal Property

The most significant difference lies in ownership. Marital property, regardless of its value or who acquired it, must be split 50-50 if the law designates it as such. On the other hand, personal property, even if it is of substantial value, remains solely yours and does not need to be shared with your spouse.

Management of these types of property also differs. If it’s personal property, the other party cannot interfere with how you handle it. You have full control over how to manage or use it. In contrast, with marital property, the law grants joint ownership, meaning both spouses must manage it together, especially for significant matters like selling real estate or obtaining loans.

How to Distinguish Marital Property from Personal Property

Thai law makes this distinction fairly straightforward once you understand the definitions.

“Marital property” refers to assets that the law recognizes as jointly owned by both the husband and wife, even if one party did not directly acquire or contribute to these assets.

As mentioned, this is something determined by law. So, what does Thai law consider as marital property?

•  Assets Acquired “During” Marriage – This is straightforward under Thai law. From the moment the marriage is registered, any assets acquired by either spouse, regardless of whether they are from personal work or business, are considered marital property. Every cent or asset obtained after that moment is treated as marital property.

• Fruits of Personal Property – This point is slightly more complex but still manageable. Before marriage, any assets you owned are personal property. However, any benefits or profits that arise from those assets after marriage, such as rental income from a house you owned before marriage or calves from cattle you previously owned, are considered marital property. In other words, the original property remains personal, but the income or benefits generated from it are marital property.

• Assets Received by Will, Gift, or Deed Stipulating as Marital Property – This is another simple rule. For any asset received through a will, as a gift, or other legal transfer, it must explicitly state that it is given as “marital property” for the couple. If this condition is met, the asset is classified as marital property.

Personal Property can be easily understood in two parts

• First, assets owned before the marriage registration = These are entirely separate from your spouse and are not subject to division.

• Second, assets acquired after marriage but exempted by law = These include personal items, tools or equipment necessary for one’s profession, and assets received as a gift or inheritance that were explicitly given as personal property.

The Impact of Marital and Personal Property in Divorce Cases

Personal Property – There is no impact in divorce cases regarding personal property, so you can rest easy. When divorcing, it’s essential to first distinguish which assets are personal property to avoid mistakenly sharing them with your spouse when it’s unnecessary.

Marital Property – This has a direct impact, as divorce typically leads to disputes over assets. The status of marital property is that it’s “jointly owned” or split 50-50. This ownership remains in place until the assets are either sold and the money is divided, or an agreement is reached.

You may have seen foreign news stories where a couple sawed a car in half—this is taking things too far! Selling the assets and splitting the money is always a better option.

How to Prevent Disputes Over Marital and Personal Property

1. Understanding marital property before marriage registration is crucial to avoid misunderstandings or unrealistic expectations, especially for foreigners, as in many countries, personal property acquired before marriage is included in marital property. Start by understanding the laws.
2. If you disagree with how the law defines marital property, you can draft a prenuptial agreement (insert link to the article). This allows you to set conditions that suit each couple.
3. Try to transfer assets under both names as much as possible, making ownership clear. This ensures that anyone conducting business with the couple knows to deal with both parties and reduces the chances of disputes.
4. By addressing the root of the issue, the likelihood of future disputes over marital property decreases significantly.

Managing Marital and Personal Property According to Law

Personal property can be managed freely, but marital property has some restrictions.

สMarital Property – While either spouse can manage marital property, the law imposes certain restrictions on significant transactions. The following 8 major actions require joint agreement or consent from both spouses

•  Selling, exchanging, mortgaging, or leasing real estate or mortgageable personal property
• Establishing or terminating servitudes, usufructs, or other real rights over real estate
• Leasing real estate for over three years
•  Lending money
• Making gifts, except for charitable or family-appropriate gifts
• Settling disputes through compromise
• Submitting disputes to arbitration
• Pledging property as security or collateral with authorities or the court

You see, the law restricts certain actions to require both parties because it aims to prevent one person from making decisions that could significantly harm the other.

Summary

Before getting married, it’s crucial to understand the concepts of “marital property” and “personal property.” When in love, these matters often seem unimportant, but when it comes to divorce, every penny can be scrutinized. Disputes can linger for years, even after the divorce.

If anyone wishes to consult about marital property, personal property, or asset division between spouses, feel free to contact our lawyer for assistance.

Contents by Champ lawyer