Civil Code on the division of property

Civil Code on the division of property

Civil Code on the division of property. According to the law, the division of property is carried out in order to secure the rights of ownership of certain property or a share in the property. The rules applied in the division of property are regulated by the norms of the Civil Code of Ukraine (CC of Ukraine). The main rules applied in the distribution of property rights consist of the following articles:

• This article explains what is common property, and in what cases common property arises;
• The article defines the rights and rules of ownership, use, and disposal of the property that is in common ownership;
• This norm regulates the procedure for dividing property that is in common ownership, as well as the rules for allocating a part;
• The article establishes the procedure for foreclosure on a share in the common property of spouses;
• The article defines the property that is the common property of spouses.

The listed norms are not exhaustive. The division of property may include many accompanying nuances and key points, in the solution of which it may not be enough to be guided only by the Civil Code of Ukraine. 

Family lawyer

Skryabina Darya Sergeevna

Candidate of Law

Hello! In this article I will tell you about the civil code on the division of property, ownership, use, and disposal of common property according to the Civil Code of Ukraine, division of common property according to the Civil Code of Ukraine, grounds for recognizing an agreement on the division of property as invalid according to the Civil Code.

Ownership, use, and disposal of common property according to the Civil Code of Ukraine

Legislative norms are used not only to protect people’s interests when dividing common property, but also to secure people’s rights to own and use such property. The basic rules are regulated by the Civil Code of Ukraine and contain the following:

1. citizens who are participants in common property own and use such property jointly (except in cases where there are other agreements between such citizens, formalized in accordance with the law);
2. citizens who are participants in common property may dispose of such property only with the consent of other citizens who are participants in this property;
3. in the event of a violation of the requirements of the legislation on the ownership, use, and disposal of common property, each of the owners whose rights and interests are violated by another owner of the common property has the right to appeal illegal actions in court.

Participants in common property have equal rights in the ownership, use and disposal of such property. Therefore, prohibition or restriction of such rights by other participants in common property is not permitted.

Division of common property according to the Civil Code of Ukraine

The division of property that is the common property of citizens should be done according to the rules established by the Civil Code of Ukraine. The same rule regulates the allocation of a share from the common property. According to the Civil Code of Ukraine, the following rules apply during division:

• divide common property between the owners, as well as allocate a share from the common property by one of the owners, carried out only after the share of each participant in the common property has been determined;
• division of common property, as well as allocation of a share in such property, presupposes the equality of the shares of each owner of such property (except in cases where there are other agreements between the owners, formalized in accordance with the law).

The division of property is carried out on the grounds and rules established by a similar norm of civil legislation — the Civil Code of Ukraine.

Form of agreement on division of property and the Civil Code

Property may be divided by agreement. Spouses may enter into such an agreement both while married and after its dissolution. Since agreements are agreements, there are norms of the Civil Code of Ukraine, established by the chapter, applied when concluding agreements.

According to the Civil Code of Ukraine, agreements are drawn up according to the following basic rules:

• transactions are concluded both in oral and written form (written form implies simple and notarial);
• oral transactions can be executed only voluntarily, by the persons who have concluded such an agreement.

When dividing property, the law recommends concluding written agreements. Since only in this case, the transaction will have legal force and is a document establishing the procedure for dividing marital property.

An agreement drawn up in writing must contain all the requirements applicable to this type of document (Civil Code of Ukraine). It is not necessary to certify such a document in a notary public. An agreement on the division of spouses can be concluded:

1. on all property acquired during marriage;
2. on a certain part of the property acquired during marriage.

In the division document, it is important to indicate the name and characteristics of each item or thing, as well as its value and who or in what shares will own this property after the divorce. Also, the document can reflect monetary compensation for the property that will go to one of the spouses.

Grounds for recognizing a property division agreement as invalid under the Civil Code

When there are various types of agreements between citizens, such agreements can be changed, terminated, appealed in court and declared invalid by the court. An agreement on the division of property can be declared invalid on the grounds provided for in a paragraph of the Civil Code of Ukraine:

• if the transaction is disputable in its basis;
• if the transaction is concluded with the purpose of concealing another transaction;
• if the transaction is concluded by an incapacitated citizen;
• if the transaction is concluded by a minor citizen;
• if the transaction is concluded by a citizen with limited legal capacity;
• if the transaction is concluded by a citizen who is not capable of understanding the meaning of his actions;
• if the transaction is concluded by a citizen under the influence of a significant error;
• if the transaction is concluded by a citizen under the influence of deception, pressure, threats, other circumstances that are unfavorable for the citizen concluding the transaction;
• in other cases, established by law and applied to specific situations.

Judicial practice of division of property under the Civil Code

However, the existing grounds for recognizing the agreement as invalid must be supported by appropriate evidence.

Example

Citizen “T” filed a lawsuit against his wife to invalidate the property division agreement. In support of his claims, he stated that he and his wife had entered into a property division agreement during their marriage, according to which all property was transferred to the wife. The plaintiff claims that this agreement was concluded so that the debt could not be collected from the plaintiff. Therefore, the plaintiff asks the court to recognize the agreement as a sham agreement.

The court, having reviewed the case materials, concludes to deny the plaintiff’s claims to invalidate the transaction on the following grounds:

• the plaintiff did not provide evidence that the agreement was fictitious;
• in addition, when concluding the property division agreement, the wife was not aware of the obligation of citizen “T”, which is confirmed by the plaintiff himself.

According to the rules of the law, a sham agreement is made by both parties, without the intention of fulfilling it. However, the property transferred to the wife according to the agreement was registered in the State Register (and the applications for registration were submitted by the spouses jointly). Consequently, the court finds no grounds for recognizing the agreement as invalid.

The limitation period for the division of property under the Civil Code

The limitation period for division of property is calculated in accordance with the Civil Code of Ukraine. The limitation period for filing claims against property is three calendar years. The moment of expiration of the limitation period is the moment when the citizen learned or should have learned about the violation of his property rights and interests.

The following situations may be considered a violation of the property rights of citizens in relation to common property:

• obstruction by one of the owners to another in the use of the property;
• in the case when one of the owners has alienated the property (sold, donated, provided as collateral, etc.);
• in the event of a dispute over the use of the property;
• in other situations provided for by law.

If the deadlines for filing a claim in court are missed, citizens have the opportunity, provided by the Civil Code of Ukraine, to restore such deadlines. This opportunity is exceptional and can only be provided when the citizen missed the deadlines for valid reasons.

Joint and several obligations in the division of property under the Civil Code

When a marriage is dissolved between spouses and the common property is divided, the spouses’ debt obligations are taken into account. It is important that the funds that were purchased by the spouses or one of them on credit were spent on family needs.

However, not only spouses, but also creditors can initiate the division of property in the event that there is a debt on debt obligations. Based on the content of the Civil Code of Ukraine:

1. a creditor, a citizen who is a participant in shared or common property, in the event that the debtor does not have enough of his own property, has the right to demand the allocation of such debtor’s share in the common property in order to collect on this share;
2. when the allocation of a share in kind is impossible, or there is a denial by other owners, the creditor may demand the sale of his share in the property to other owners (at market value), and the funds received as a result of alienation to be collected from the debtor.

Moreover, not only legal entities (banks, credit and financial institutions, pawnshops, etc.), but also individuals — that is, citizens who provided money as a loan to spouses — can act as a creditor initiating the division of property between spouses.

How is property divided during a divorce according to the Civil Code?

Example

Citizen “O” filed a claim with the court against her neighbors: spouses – citizen “S” and citizen “G” on the division of common property at the request of the creditor. The plaintiff motivated her claims by the fact that, according to a previously issued decision on the collection of funds on a loan, funds in the amount of UAH 70,000 were collected in her favor from citizen “G”. To date, the court’s decision has not been executed due to the defendant’s lack of income.

During the court hearing, it was established that citizen “G” (the defendant) spent the funds on purchasing a vacation package, entertainment, etc.

The court, guided by the norms of legislation, having heard the parties, checked the evidence, made the following decision. Based on the fact that the amount of the debt is significant, and the funds received as a loan were used by the defendant for personal use, decides to satisfy the claims of citizen “O” and divide the property between the spouses.

Civil Code on the division of property of spouses during divorce

Civil legislation is intended to protect interests and rights arising from various civil-legal relations, including property relations. Citizens must comply with the requirements established by such legislation. Violation of the norms of civil legislation (the Civil Code of Ukraine) entails certain legal consequences.

Citizens whose rights have been violated have the right to protection in court. The division of property can occur both peacefully — with the conclusion of an agreement on distribution, and in court. Also, the division of property can be initiated by creditors, in the case of debt on bank loans and other borrowed or collateral funds, both of the spouses and of them.

Family lawyer

Alexey Nikolaevich Skryabin

Doctor of Law

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