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Useful Information

GENERAL OUTLINE OF THE COMMUNITY PROPERTY REGIME IN URUGUAY

In our country, the general regime of property between spouses is the community property of marital partnership which revolves around the community nature of the property acquired during marriage.

That is, if before getting married or during marriage the spouses do not choose to set or establish a special regime for property, the legal regime of marital partnership governs. Such regime establishes that, in principle, all the property acquired by spouses during marriage is equally owned by both spouses (community property); while property acquired before marriage is solely owned by the spouse who acquired it.

However, there are exceptions which are expressly set forth in the Civil Code in connection with property which, although it is acquired during marriage, it is solely owned by the spouse who receives or acquires it; for instance, property received during marriage by succession or donation is solely owned by the spouse who receives it; in the same way, property acquired with the money from the sale of a property solely owned by a spouse (subrogation) is his/her own property, as long as certain conditions are met.

Nevertheless, without prejudice to the foregoing, spouses may choose a regime different from that of marital partnership, such as separate ownership of property during marriage, so that even being married, the property will be solely owned by the spouse acquiring it. The separate ownership of property during marriage may be attained as follows:

a) Prenuptial agreement: before the spouses get married, they may execute a prenuptial agreement establishing beforehand how assets and financial responsibilities will be handled, such as a total or partial separate ownership of property. The prenuptial agreement must be executed on a Public Deed and registered with the corresponding Registry.

b) Settlement of Community Property: during marriage and at any time, any of the spouses unilaterally or both spouses may decide or seek settlement of community property by the court; it is a legal procedure made at request of the parties (the other spouse may not object), through which the Judge adjudges the settlement of the community property but not the dissolution of the marriage between them which remains in force and valid; from that time, a regime of absolute separation of property will govern (property will be owned only by the person who acquired it). And, in relation to the property acquired before the settlement of the community property, it will be jointly owned by the spouses in equal parts. The settlement of community property by the court shall also be registered with the corresponding Public Registry, so that such information is available for any interested party.

Once the community property has been settled, the property acquired before the settlement may be jointly owned by the spouses or may be distributed by means of a Partition which may be in or out of court.

It is important to note that spouses may, at any time, change the separate ownership of property regime and go back to the marital partnership regime.

We believe it is quite useful that the reader knows how far can creditors go in relation to community property. Please note as follows:

a) Marital partnership regime: During the existence of the marital partnership regime, whereby community property exists, the creditors of a spouse may only go after the assets owned by that spouse or after the community property acquired by such spouse (the spouse is the administrator of the asset); whereas the creditor may not go after the assets owned by the other spouse or by the community property acquired by the other spouse.

b) Separate ownership of property regime: In the event that a marital partnership had not existed or that the same had been dissolved, the creditors of a spouse may go after the assets owned by that spouse, or after the spouse's half of the property jointly owned by the spouses after the dissolution of marital partnership; the creditor may not go after the assets owned by the other spouse or after the half belonging to the other spouse after the dissolution of marital partnership.

Finally, it is important to know that in our country, and under certain circumstances, Consensual Unions which didn't turn into marriage have a special treatment which in some cases resembles marriage.