On Separate Possession Agreement Without Written Form And Its Legal Binding Force

According to Article 1065 of the Civil Code of the People's Republic of China,husband and wife may agree upon separate possession of the property acquired,which is the basic meaning of “separate possession agreement”.The separate possession agreement without written form means that husband and wife agree on adopting the regime of separate property orally or tacitly,rather than in writing,and that they separately possess,independently manage and dispose the property acquired during their marriage in a consistent and stable manner over a substantial period of time.The separate possession agreement without written form is a narrowly defined and absolute relationship of separate possession of property as agreed by husband and wife and agreed separate marital property system in deed but not in name.It has been found through interviews and case studies that most people in China agree on separate possession of property orally or tacitly.The denial of the parties' separate possession of property in all cases just because of the lack of written form is not only seriously inconsistent with the actual property relationship of the parties,but also against the free will of the parties to choose their own property relationships,even endangering the legitimate property rights of individuals.Worse still,the determination of separate possession agreement without written form as undivided co-ownership might lead to opportunistic behavior,which exacerbates marital conflicts and distorts people's values.Therefore,special attention should be paid to the legally binding force of agreement on separate possession without written form.The determination that separate possession agreement lacking written form has legally binding force is justified on the grounds of reality,values and legal norms.In terms of reality,the development of productivity has led to growth in the accumulated personal wealth;the elevated social status of women has contributed to increasing equality between men and women;pluralistic forms of marriage like DINK and remarriage have weakened the level of cooperation between husband and wife;and the one-child policy has impacted conjugal relations while strengthening intergenerational relationships.Consequently,regardless of the strength of their relationship,more and more parties are practicing separate possession of property.In terms of values,the core socialist values have offered a source of values and a yardstick for determining the legally binding force of separate possession agreement without written form.To confer legal validity upon such agreement conforms to the values of freedom,harmony,friendliness and justice.In terms of legal provisions,first,because of the gaps in relevant norms regarding separate possession agreement without written form,Article 464 of the Book of Contracts can be applied according to the nature of such agreement to search the law in the Book of Contracts in the Civil Code;second,concrete legal basis is provided for determining the legally binding force of such agreement by applying mutatis mutandis Article 490 of the Book of Contracts in the Civil Code.Regarding the determination of the legally binding force of separate possession agreement without written form,basic rules include general and special rules on how to determine that the two parties have agreed to separate possession of property.With respect to the general rules,that neither the husband nor the wife declares his or her will for undivided co-ownership is a prerequisite for the determination of separate possession agreement without written form;and the parties' objective act of property separation is an essential condition for the determination.With respect to the special rules,specific conditions for the determination and allocation of the burden of proof are required for the typical acts of property separation in cases of remarriage,insolvency of one spouse and special marital status.Based on the recognition of the legally binding force of separate possession agreement without written form,such agreement has internal validity in the following respects: personal property,and the identification of the scope of personal property according to the time when the property separation occurs.An individual's gratuitous transfer of large amounts of property should be subject to necessary restrictions.With respect to community property,usually the rules of the statutory matrimonial property regime are followed prior to the occurrence of property separation.If it is not necessary to partition the property,the partition may happen later to save judicial cost;if it is indeed necessary,the principle of equal division is followed with the exception for the rule of property division in a divorce,according to the Book of Marriage and Family in the Civil Code.After the occurrence of property separation,the two parties may agree on divided co-ownership.With respect to divorce compensation,a quantitative formula for calculating the compensation shall be developed for the specific compensation standards,and different scale factors shall be applied to different types of marriage to bring into play the signaling function of different matrimonial property regimes.Meanwhile,faults,betrothal gifts and economic capability shall be used as discretionary factors to prevent the rigid application of the formula.The external validity of separate possession agreement without written form mainly includes the determination and repayment of the community debt of husband and wife,and the order of payment of multiple debts incurred by one of the spouses.First,to respect the will of parties who choose the regime of separate property,the standards for determining the community debt of husband and wife shall exclude the application of the proviso in Article 1064 of the Civil Code and adopt the scope of daily household matters as the sole standard for statutory community debt.Second,where the spouses agree on separate possession,one spouse may incur multiple debts to the other spouse and a third party at the same time.Given that the order of debt settlement directly affects the balanced protection of transaction security and family stability,it is determined by applying the principles of the Bankruptcy Law and the Succession Law on the basis of the types of debts as sorted out,so as to achieve the objectives of prioritizing survival value,protecting spouses and third parties equally,preventing connected transactions etc.