We bough a house in Hua Hin on the name of my wife (Thai national). I have heard some rumours that I (foreigner) am not protected with a usufruct and that my wife is allowed to cancel it again if she likes. Is this true or not. I am talking about the usufruct as a protection for a large chunk of my savings invested in this house.
When the usufruct is registered with the land office it is in essence not a contract that can be terminated by your wife. Usufruct is a real right and as a real property right governed by the civil and commercial code book IV PROPERTY and not book III CONTRACTS. This means that once the right of usufruct is registered it is more or less guaranteed by law and to terminate the usufruct your wife would need 1 your consent or 2 a court order to have it removed from the title deed.
Section 1469 (laws governing property between husband and wife) does apply and when you would divorce the usufruct could be simply terminated by a court as part of the division of assets. After your marriage in Thailand, under Thai matrimonial law, personal and jointly owned marital property between husband and wife is governed by the statutory system of sections 1465 to 1493 Civil and Commercial Code, therefore any agreements between husband and wife made during the marriage affecting their assets (in conflict with the statutory system) could be set aside by the spouses themselves or a court.
Your wife is not able to cancel it when she likes, because usufruct is a registered real property right, but the usufruct can be terminated as the creation is in conflict with the statutory system of property of husband and wife. Buying real estate in Thailand as a foreigner married to a Thai often means signing away your rights to the land, therefore it is important to obtain legal advice BEFORE you buy land on the name of your Thai spouse. Land (or other immovable property) registered as a personal property of the Thai spouse (a non-marital property) is not automatically subject to an equitably division between husband and wife upon termination of marriage.
Mainly because of the special relationship of husband and wife the law gives in section 1469 of the Civil and Commercial Code both spouses the right to void any agreement concluded between them during marriage (without grounds). This means for example that a right of usufruct given by one spouse to the other during the marriage can be voided and cancelled. It will not be very easy to void a registered property right but the usufruct could in any case be terminated by a court as part of the division of assets. This also means that any payments used for the acquisition of the property made by the foreign spouse from his separate personal property or payments originating from the marital assets (not from separate personal assets of the owner) must be returned pursuant Thai marriage and divorce laws and sections 1469 (property of husband and wife) and the sections on 'undue enrichment'.
Source of the funds
Therefore: keep a record of all payments made and the source (if the property is purchased with personal assets of the usufructuary). Usufruct gives protection in different situations, but in addition, keep track of all payments you made from your personal assets or accounts or marital account used for the acquisition of the property and calculate regularly marital assets or property of the marriage through a system of accounting. In a possible divorce or termination of the marriage it all comes down on what you can proof what is separate personal or jointly owned marital assets. In case of doubt all properties acquired during the course of the marriage is considered marital and jointly owned and subject to an equal division between husband and wife.