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What Happens to Spousal Gifts During Divorce?

Under the Women’s Charter, matrimonial assets do not include “any asset (not being a matrimonial home) that has been acquired by one party at any time by gift or inheritance and that has not been substantially improved during the marriage by the other party or by both parties to the marriage.”

What happens to spousal gifts during divorce?

Spousal gifts can be divided into 2 categories.


Inter-Spousal Re-Gifts

Spouse A receives an inheritance or a monetary gift from another party, and he/ she uses part of that money to buy a gift for spouse B. This is because the source of such gifts is directly traceable to the inheritance or monetary gift received by spouse A and spouse A did not put in any effort to acquire the gift for spouse B.

It is excluded as a matrimonial asset under the Women’s Charter. Spouse B would then be able to keep the gift from spouse A.


Pure Inter-Spousal Gifts

In another scenario, spouse C did not receive any inheritance or monetary gifts from another party. He/ she worked hard and made some money to purchase a gift for spouse D. Under Section 112 of the Women’s Charter, the definition of a matrimonial assets covers “any other asset of any nature acquired during the marriage by one party or both parties to the marriage”.

Given that spouse C spent a sum of money to acquire the gift, its original status as a matrimonial asset is not altered by way of spouse C gifting the gift to spouse D. In other words, the gift will fall under the definition of matrimonial asset and it will form part of the pool of matrimonial assets. The rationale of this is to recognize the effort of spouse C in acquiring the asset.


When will Pure Inter-Spousal Gifts be Excluded from the Pool of Matrimonial Assets?

Under the de minimis exception, a pure inter-spousal gift would not be treated as a matrimonial asset if it is considered de minimis. Items considered de minimis are usually of a small value as compared to the pool of matrimonial assets. There is no hard and fast rule adopted by the Court on which item should be considered de minimis. In fact, even certain gifts which are of a high monetary value may be considered de minimis if it is of relatively small value as compared to the total pool of matrimonial assets.

For instance, gifts such as clothing and household appliances which are of no substantial value may be excluded from the pool of matrimonial assets since their inclusion will not result in a substantial increase in the pool of matrimonial assets.

For instance, in the divorce case of Tay Ang Choo Nancy v Yeo Chong Lin, the husband’s gift of jewellery to the wife was excluded from the pool of matrimonial assets as the jewellery (even if worth between a quarter million to half a million dollars) is of relatively small value as compared to the total pool of matrimonial assets which amounted to S$116,560,000.00.


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