Distribution of the property of the spouses
...when the marriage is dissolved due to the death of a spouse
When a marriage is dissolved through the death of a spouse and the deceased spouse has left direct heirs (children or their descendants), the widow(er) and the heirs of the deceased can request a distribution of matrimonial property.
In this distribution of matrimonial property, the main rule is to divide all property equally. The surviving spouse obtains half of the property and the heirs together the other half. After the distribution of the matrimonial property, each heir may further demand the distribution of the inheritance between the heirs.
However, the property is distributed equally like this only when surviving spouse has less property than the deceased spouse. If, on the other hand, the surviving spouse has more property than the deceased spouse, the surviving spouse always has the right to right himself/herself to keep all of his/her property.
Example 1: Matti and Maija are married and their marriage is dissolved through Matti’s death. Matti’s heirs are the children A and B of the spouses. Matti’s property is worth 200,000 euros and Maija’s 100,000 euros. In this case the distribution of the matrimonial property is carried out so that Maija obtains half of the aggregate property (300,000 euros), i.e., 150,000 euros, and the children A and B together likewise 150,000 euros. In other words: because in this case the surviving spouse, Maija, has less property than the deceased spouse, Matti, the property of the spouses is divided equally between Maija and the children A and B.
Example 2: If, in the previous example, the marriage had dissolved through Maija’s and not Matti’s death, Matti may keep all of his property (200,000 euros) and the children A and B only get the property that belonged to their mother Maija (100,000 euros). In other words: because the surviving spouse, Matti, had more property than Maija, Matti may keep all of his property himself and he does not have to give any of his property to the children A and B.
In addition to that above, the surviving spouse is ensured the right to keep the joint home of the family and the household goods in his/her possession if the surviving spouse does not own another residence suitable as a home.
If a marriage is dissolved through the death of a spouse, but the deceased spouse left no direct heirs (children or their descendants), the surviving spouse inherits all the assets of the deceased spouse unless the deceased spouse has ordered otherwise in a will. After the death of both spouses, the property left by the spouse last deceased shall, under the main rule, be divided equally between the heirs of both spouses.
...and in a divorce
When a divorce case has become pending in the District Court, each spouse may demand the distribution of the matrimonial assets. The spouses need not wait until the end of the six-month reconsideration period or until the final divorce order, but the distribution can be carried out as soon as the matter has become pending. In a distribution of property on the basis of a divorce, the main rule is to divide all the property of the spouses equally between them.
Example 3: Matti and Maija make a joint application for divorce. The distribution of matrimonial property may be carried out after the application has been filed with the court. Matti’s property is worth 200,000 euros and Maija’s 100,000 euros. In this case the distribution of the matrimonial property is, under the main rule, carried out so that each obtains half of the property of the spouses (300,000 euros), i.e., 150,000 euros.
However, one must remember that the equal distribution of property is only the main rule, which can be derogated from. Derogation from this main rule may especially be based on the spouses having concluded a marriage settlement or on the fact that a spouse demands that the distribution of matrimonial assets be adjusted to obtain a reasonable result.
Marriage settlement and the distribution of matrimonial assets
A marriage settlement affects the distribution of matrimonial assets. A marriage settlement relates to the distribution both when the marriage is dissolved trough the death of a spouse and when the distribution is carried out on the basis of a divorce.
In practice the most common is a marriage settlement ordering that neither spouse has a matrimonial right to the property of the other. This means that upon the dissolution of the marriage, the property of the spouses is not divided equally but each spouse keeps his/her property himself/herself.
The marriage settlement can also stipulate that a spouse has no matrimonial right to certain property belonging to the other spouse, such a farm obtained as inheritance. This order means that all other property except the farm referred to in the marriage settlement is divided equally between the spouses.
However, a marriage settlement is not necessarily binding. Its stipulations may be derogated from or it may be set aside altogether in the adjustment of the distribution of matrimonial property if compliance with the marriage settlement would result in an unreasonable result.
Adjustment of the distribution of matrimonial property
The adjustment of the distribution of matrimonial assets means that in an individual case, on the basis of consideration, the rules otherwise applicable to the distribution of matrimonial property may be derogated from.
The distribution of matrimonial assets can be adjusted if the distribution would lead to:
- an unreasonable end result; or
- to the other spouse receiving unjust financial benefit.
When considering the adjustment of the distribution of matrimonial assets, special attention shall be paid to:
- the duration of the marriage;
- the activities of the spouses for their common household or for the accumulation and preservation of the property; and to
- other comparable facts regarding the finances of the spouses.
The adjustment of the distribution of matrimonial assets thus takes place paying attention to perspectives of reasonableness and justice separately in each individual case. Therefore no general rules can be set in advance as to when the adjustment of the distribution of matrimonial assets is possible, how the adjustment is carried out or how often the adjustment is applied.
The most common examples where the adjustment is to be considered can, nevertheless, be described by means of the following two examples:
Example 1: Short marriage without children, no marriage settlement. Matti and Maija conclude marriage. After the marriage has lasted two years, the spouses are granted a divorce. Matti has property worth 600,000 euros and Maija has a flat worth 200,000 euros. Both are gainfully employed and there are no children. Under the main rules applicable to the distribution of matrimonial property, the property of the spouses (800,000 euros) would be divided equally so that Matti would have to give 200,000 euros of his assets to Maija.
Under the rules on the adjustment of the distribution of matrimonial assets, it can, however, be decided that each shall keep his/her own property, because otherwise Maija would receive an unjust financial benefit after a short marriage.
Example 2: Long marriage – marriage settlement: Antti and Raija are granted a divorce after a marriage of 16 years. The spouses have children aged 14 and 12 from the marriage. Antti’s monthly income is 4,000 euros and Raija’s 2,000 euros. Raija has been at home for ten years taking care of the home and the children. The only property of the spouses is a flat worth 400,000 euros in Antti’s name; the spouses have no debts.
Under the marriage settlement concluded by Antti and Raija, neither has a matrimonial right to the property of the other, which means that upon the distribution of property, Antti would keep the flat in his name and Raija would obtain no property at all.
Under the rules on the adjustment of the distribution of matrimonial assets, the stipulations of the marriage settlement may be disregarded and the property (400,000 euros) can be divided equally between the spouses, because compliance with the marriage settlement would lead to an unreasonable end result taking into consideration the duration of the marriage, the financial position of the spouses and Raija’s activities for the common household. In this case each will obtain property worth 200,000 euros.
How is the distribution of matrimonial assets carried out?
The distribution of the matrimonial assets can be carried out either so that
- the parties carry out the distribution themselves in accordance with a mutual agreement (distribution by agreement); or
- the distribution is carried out by an estate distributor appointed by the court, usually an attorney (official distribution).
When the distribution is carried out by agreement, the distribution shall be reduced to a document, which must be dated and signed and attested by two non-disqualified persons. If an estate distributor carries out the distribution, he drafts it in the form of a document, which he signs.
When clarifying the property relations of the spouses and when planning the distribution of the matrimonial assets, there is always reason to turn to an attorney, the State Legal Aid Office or another skilled lawyer. At that point it is appropriate also to inquire whether compensation for the litigation costs is obtainable from a legal security insurance (home insurance) or legal aid paid from State funds.