Universal Partnership

Today, about 60 percent of couples live together before a marriage. There is no common-law marriage in South African law and therefore the period of time that a couple spends living together does not translate into a default marriage. The principle of a universal partnership assists cohabitees by affording them a right to a share in the property acquired during the relationship.

What is a “universal partnership”?
A universal partnership is an express or tacit agreement between two people, including same sex couples, who choose to live together in a permanent relationship without entering into marriage, or married persons who enter into an express or tacit agreement relating to a particular asset, such as a business.

Requirements of a universal partnership
A universal partnership will exist if the following essentials are present:

(a) each of the partners must bring something into the partnership, whether it be money, labour or skill;
(b) the partnership should be carried on for the joint benefit of the parties;
(c) the object should be to make a profit;
(d) the contract should be a legitimate one.

Assets of a universal partnership
The assets of a universal partnership are those assets brought into the partnership at inception and those acquired during the existence of the partnership. A partner may not alienate or use partnership assets as personal security without the other partner’s prior consent and may not entirely exclude a partner from controlling the partnership property or assets. Partners cannot share in the pension assets of their partners on termination of the relationship, even those who are able to prove the existence of a universal partnership. The reason for this is that the Pension Fund Act makes reference to a “divorce” and a universal partnership is not a marriage and can therefore not be terminated by divorce.

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