About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Supreme Court of Appeal
SAFLII
>>
Databases
>>
South Africa: Supreme Court of Appeal
>>
2016
>>
[2016] ZASCA 162
|
|
Ndaba v Ndaba (600/2015) [2016] ZASCA 162; [2017] 1 All SA 33 (SCA); 2017 (1) SA 342 (SCA) (4 November 2016)
Links to summary
THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Reportable
Case
No: 600/2015
In
the matter between:
GALEFELE
HILDA
NDABA
APPELLANT
and
JAMES
NDABA
RESPONDENT
Neutral
citation:
Ndaba v Ndaba
(600/2015)
[2016] ZASCA 162
(4 November 2016)
Coram:
Mpati
AP, Seriti, Petse and Swain JJA and Makgoka AJA
Heard:
23 August 2016
Delivered:
4 November 2016
Summary:
Marriage ─ Divorce ─ parties married in community of
property ─ pension interest ─ entitlement of
non-member
spouse under ss 7(7)
(a)
and 7(8)
(a)
of
Divorce Act 70
of 1979
─ pension interest of member spouse as at date of
divorce is by operation of law part of the joint estate for the
purpose
of determining the parties’ patrimonial benefits ─
no order required in terms of
s 7(7)
(a)
.
ORDER
On
appeal from:
Gauteng Division of the High Court, Pretoria (Kgomo
J sitting as court of first instance):
1
The appeal is upheld with costs.
2
The order of the court below is set aside and in its place the
following order is substituted:
‘
1
Mr Phillip Jordaan of Divorce Settlement Services, Pretoria is
appointed as Liquidator of the joint estate of the applicant and
the
respondent with the powers and obligations set out in annexure A to
this judgment.
2
It is declared that the applicant is entitled to an amount equal to
50 per cent of the respondent’s nett pension interest
in the
Government Employees Pension Fund Scheme calculated as at 25 May
2012.
3
It is declared that the respondent is entitled to an amount equal to
50 per cent of the applicant’s nett pension interest
in the
Government Employees Pension Fund Scheme calculated as at 25 May
2012.
4
The respondent shall pay the costs of the application.’
JUDGMENT
Petse
JA (
Mpati AP and Swain JA
concurring):
[1]
The primary issue in this appeal concerns the proper interpretation
of s 7(7) and (8) of the Divorce Act 70 of 1979 (the Act).
The
subsidiary issue concerns the legal effect of the terms of a clause
relating to the division of the joint estate contained
in the
settlement agreement concluded by the parties and incorporated in the
divorce order granted in the Regional Court for the
North West
Regional Division, Temba (the trial court) on 25 May 2012. These
issues arise against the following backdrop.
[2]
The appellant, Ms Galefele Hilda Ndaba, and the respondent, Mr James
Ndaba, were formerly married in community of property.
On 25 May 2012
their marriage was dissolved by the trial court at the suit of the
appellant. The divorce order granted by the trial
court incorporated
a provision that ‘... the deed of the settlement between the
parties ... [annexed thereto] is made an
order of the court.’
The parties’ deed of settlement in turn provided, inter alia,
that their joint estate would be
divided equally between them. The
appellant asserted that they incorporated this clause into their
settlement agreement because
at that stage they could not agree on
the method of the division of the joint estate.
[3]
On 15 April 2013 the appellant’s attorneys wrote a letter to
the respondent inviting him to make proposals in relation
to the
division of the joint estate. They indicated that if no proposals
were forthcoming the appellant would institute legal proceedings
in
which a determination of that dispute would be sought. In the event,
no response was received from the respondent. Consequently,
on 26
June 2013 the appellant, as applicant, instituted legal proceedings
on notice of motion against the respondent in the Gauteng
Division of
the High Court, Pretoria in which, in essence, she sought an order
for, inter alia, the appointment of a liquidator.
She also sought a
declarator that she and the respondent were entitled to an amount
equal to 50 per cent of each other’s
pension interest. In
addition, she sought an order directing each pension fund to make an
endorsement in its records that a portion
of the pension interest of
the member spouse, as at the date of divorce, shall be payable to the
non-member spouse when the pension
benefits accrued.
[4]
Whilst the respondent did not oppose the appointment of the
liquidator, he, however, resisted the remainder of the relief sought.
In his answering affidavit, the respondent, inter alia, said the
following:
‘
I
deny that either my or the applicant’s pension interest form
part of the assets to be divided between the parties. Our respective
pension interests did not form part of the applicant’s claim
when she instituted divorce proceedings, it did not form part
of the
settlement agreement, and no order was granted in terms of which it
was deemed to be part of the assets in the joint estate
in accordance
with
section 7(7)
and
7
(8) of the
Divorce Act 70 of 1979
.
...
These
policies include my retirement annuity fund, which also falls within
the definition of “pension interest” and
is similarly
excluded from the joint estate, because of the fact that our
respective pension interests did not form part of the
applicant’s
claim when she instituted divorce proceedings, it did not form part
of the settlement agreement, and no order
was granted in terms of
which it was deemed to be part of the assets in the joint estate in
accordance with
section 7(7)
and
7
(8) of the
Divorce Act 70 of 1979
.’
[5]
Thus, the respondent’s answer to the appellant’s claim
was, in substance, threefold. First, he asserted that the
appellant
had unequivocally renounced her claim in relation to the pension
interest in her prayers in the divorce action. Second,
that the
pension interest nowhere featured in their settlement agreement.
Third, that the divorce court which granted the decree
of divorce had
not made an order deeming the pension interest as part of the joint
estate, as contemplated in s 7(7)
(a)
and (8) of the Act.
However, it was not contested that the joint estate had still not
been divided between them.
[6]
The application came before Kgomo J who, after considering the
provisions of the Act and reviewing certain judgments dealing
with
the interpretation of s 7(7)
(a)
and (8) of the Act,
dismissed it with costs. The dismissal of the application in relation
to the appointment of a liquidator appears
to have occurred per
incuriam
as the court a quo had itself noted that that aspect
was uncontentious. In essence, the court a quo approached the matter
on the
following basis:
·
It first asked itself two questions; namely: (i) whether it could
grant an order declaring the parties’ respective
pension
interests to be part of the joint estate long after the dissolution
of the marriage when no such order was made by the
court granting the
decree of divorce; and (ii) whether it was open to it to vary the
divorce order by supplementing the blanket
order relating to the
division of the joint estate by inclusion of the parties’
respective pension interest.
·
After
reviewing several cases
[1]
of
various Divisions of the High Court, it held that the Act
contemplates that any order in terms of s 7(7)
(a)
and (8) can be granted only by the court granting the decree of
divorce. Thus, s 7(7)
(a)
and (8) do not avail a party who seeks to invoke them after the
dissolution of the marriage.
·
It concluded that absent a court order by the divorce court declaring
the pension interest of the member spouse as part
of the joint
estate, such pension interest did not form part of the joint estate.
·
That, in any event, the parties’ settlement agreement in the
divorce court was silent in relation to their respective
pension
interests.
[7]
Aggrieved by the dismissal of her application, the appellant now
appeals to this court with the leave of the court a quo.
[8]
Section 7(7) and (8) in their material parts read:
‘
(7)
(a)
In the determination of the patrimonial benefits to which the parties
to any divorce action may be entitled, the pension interest
of a
party shall, subject to paragraphs
(b)
and
(c)
,
be deemed to be part of his assets.
(b)
The amount so deemed to be part of a party's
assets, shall be reduced by any amount of his pension interest which,
by virtue of
paragraph
(a)
,
in a previous divorce ─
(i)
was paid over or awarded to another party; or
(ii) for the purposes of
an agreement contemplated in subsection (1), was accounted in favour
of another party.
(c)
. . .
(8) Notwithstanding the
provisions of any other law or of the rules of any pension fund ─
(a)
the
court granting a decree of divorce in respect of a member of such a
fund, may make an order that ─
(i) any part of the
pension interest of that member which, by virtue of subsection (7),
is due or assigned to the other party
to the divorce action
concerned, shall be paid by that fund to that other party when any
pension benefits accrue in respect of
that member;
(ii) the registrar of the
court in question forthwith notify the fund concerned that an
endorsement be made in the records of that
fund that that part of the
pension interest concerned is so payable to that other party and that
the administrator of the pension
fund furnish proof of such
endorsement to the registrar, in writing, within one month of receipt
of such notification;
(b)
. . . .
’
[9]
The concept of ‘pension interest’ which is central to s
7(7) and (8) is, in turn, defined in s 1(1) of the Act as
follows:
‘
Pension
interest’, in relation to a party to a divorce action who-
(a)
is a member of a pension fund
(excluding a retirement annuity fund), means the benefits to which
that party as such a member would
have been entitled in terms of the
rules of that fund if his membership of the fund would have been
terminated on the date of the
divorce on account of his resignation
from his office;
(b)
. . . .’
[10]
As to the nature of the pension interest, this court in
Old Mutual
Life Assurance Co (SA) Ltd & another v Swemmer
2004 (5) SA
373
(SCA) said the following (para 18):
‘
[A]s
indicated above,
s 7(7)
(a)
of the
Divorce Act 'deems
' a member spouse's “pension interest”
to be an asset in his or her estate for purposes of the determination
of the
patrimonial benefits to which the parties to a divorce action
may be entitled. “Pension interest” is narrowly defined
and simply establishes a method of ascertaining the value of the
“interest” of the member of the pension or retirement
annuity fund concerned as accumulated up to the date of the divorce.
In the words of the South African Law
Commission:
“
A
pension interest is not a real asset that is open to division. It is
the value that, on the date of divorce, is placed on the
interest
that a party to those proceedings has in the pension benefits that
will accrue to him or her as a member of a pension
fund or retirement
annuity fund at a certain future date or event in accordance with the
rules of the particular fund. The value
of the interest is calculated
according to a fixed formula and the amount determined in this manner
is
deemed
to be an asset of the party concerned. What we are dealing with here
is a notional asset that is added to all the other assets
of the
party concerned in order to determine the extent of the other party's
claim to a part of the first-mentioned party's assets.”’
(Footnotes omitted.)
[11]
As indicated, the real issue on appeal is therefore whether a
non-member spouse in a marriage in community of property, is
entitled
to the pension interest of a member spouse in circumstances where the
court granting the decree of divorce did not make
an order declaring
such pension interest to be part of the joint estate. As to a pension
fund’s statutory competence to make
deductions from a member’s
pension benefits, this court in
Eskom Pension and Provident Fund v
Krugel & another
(689/2010)
[2011] ZASCA 96
[2011] 4 All SA 1
(SCA) said the following (para 8):
‘
A
pension fund’s right to make deductions from a pension benefit
is highly circumscribed and may be exercised only as expressly
provided by sections 37D and 37A of the Pension Fund Act. Relevant
for present purposes is section 37D which, in subsection (1)
(d)
(i),
allows a fund to:
“
deduct
from a member’s benefit or minimum individual reserve, as the
case may be . . . any amount assigned from such benefit
or individual
reserve to a non-member spouse in terms of a decree granted under
section 7(8)
(a)
of the
Divorce Act, 1979
”.
According
to the provisions of subsection (4)
(a)
:
“
the
portion of the pension interest assigned to the non-member spouse in
terms of a decree of divorce or decree for the dissolution
of a
customary marriage is deemed to accrue to the member on the date on
which the decree of divorce or decree for the dissolution
of a
customary marriage is granted.”’ (Footnotes omitted.)
[12]
In the context of a divorce action, it is
s 37D(1)
(d)
(i) of
the
Pension Funds Act 24 of 1956
which is of relevance. It authorises
a registered pension fund to:
‘
(d)
deduct from a member's or deferred pensioner's
benefit, member's interest or minimum individual reserve, or the
capital value of
a pensioner's pension after retirement, as the case
may be─
(i) any amount assigned
from such benefit or individual reserve to a non-member spouse in
terms of a decree granted under
section 7
(8) (
a
) of the
Divorce Act, 1979 (Act 70 of 1979) or in terms of any order made by a
court in respect of the division of assets of a marriage
under
Islamic law pursuant to its dissolution; and . . .’
[13]
Section 21(1) of the Government Employees Pension Law 1996 which came
into operation on 1 May 1996 is to the same effect. The
section
reads:
‘
Subject
to section 24A, no benefit or right in respect of a benefit payable
under this Act shall be capable of being assigned or
transferred or
otherwise ceded or of being pledged or hypothecated or, save as is
provided in . . . section 7(8) of the Divorce
Act, 1979 (Act 70 of
1979), be liable to be attached or subjected to any form of execution
under a judgment or order of a court
of law.’
[14]
There are several judgments
[2]
of the various Divisions of the High Court in which the import of the
provisions of s7(7)
(a)
and (8) of the Act has been considered. The interpretation placed on
these provisions in those judgments has been discordant. However,
I
do not propose to analyse and discuss each of those decisions so as
not to overburden this judgment.
[15]
In
Sempapalele
, the court dealt with a claim by a former
spouse for the payment of a portion of the pension interest of the
member spouse following
the dissolution of their marriage by divorce
years earlier. The parties had concluded a settlement agreement ─
made an order
of court ─ in terms of which their joint estate
was to be divided between them. The former wife asserted that she was
entitled
to a 50 per cent share of the former husband’s pension
benefits paid out to him, more than a year after their divorce and
to
that end she instituted an action claiming, inter alia, a share of
the former husband’s pension benefit. Although Musi
J
ultimately dismissed the action on the simple basis that the
plaintiff had failed to prove the value of her former husband’s
pension interest as at the date of divorce, the learned judge
observed that (at 312G-H):
‘
...
the applicant failed (for whatever reason) to obtain at the hearing
of the divorce matter a Court order awarding her a share
in the
respondent’s pension interest in terms of
s 7
of the
Divorce
Act. She
cannot now get such an order.’
[16]
In
YG v Executor, Estate Late CGM
(which pertained to a claim
for redistribution of assets in terms of s 7(3) of the Act), Gangen
AJ found the reasoning in
Sempapalele
instructive. He
expressed the view that there was a common thread running through s 7
of the Act, to the effect that any relief
in terms thereof can only
be granted by the court granting the decree of divorce. The learned
judge said (para 15):
‘
It
is also clear from a reading of the subsections of s 7 that they are
interrelated and cannot be treated in isolation of one another.’
Later
he continued (para 17):
‘
It
is accordingly evident that only a court granting a divorce order may
grant the ancillary relief.’
[17]
In
Maharaj
the court was faced with a situation similar to
that in
Sempapalele
but reached a contrary conclusion. In the
course of his consideration of s 7(7)
(a)
, Magid J said the
following (at 651C-E):
‘
That
section was presumably inserted in the Act in order to rectify what
may have been regarded as an injustice to the spouse who
did not have
the pension interest. It states quite unequivocally that a pension
interest is deemed to be part of the assets of
a party “in the
determination of the patrimonial benefits to which the parties to a
divorce action may be entitled”.
The phrase “patrimonial
benefits” is not qualified by reference to the other
subsections of s 7 of the Act. It
applies in my judgment, with
equal force to a marriage in community of property.
.
. .
In
my judgment, therefore, when the joint estate of spouses married in
community of property is to be divided it is proper to take
into
account, as an asset in the joint estate, the value of a pension
interest held by one of them as at the date of divorce.’
Later
he continued (652B):
‘
It
therefore seems to be common cause that the joint estate as
it existed at the date of the divorce has never actually been
divided . . .’
[18]
In
Fritz v Fundsatwork Umbrella Pension Fund
, a case where
similarly no order had been made pursuant to s 7(7) of the Act when
the decree of divorce was granted, Goosen J expressed
a preference
for
Maharaj
as opposed to
Sempapalele
. After examining
certain judgments in relation to court orders for division of a joint
estate, the learned judge said (para 23):
‘
This,
in my view, brings the process of giving effect to an order
of division of the joint estate, by way of a subsequent
appointment of a receiver or by way of the resolution of a dispute in
relation to the division by the court, squarely within
the ambit
of
s 7(7)
of the
Divorce Act, which
speaks of determining the
patrimonial benefits in a divorce action. The definition of “divorce
action” which refers
to an action by which a decree of divorce
or other relief in connection therewith
is applied for, is broad enough to cover proceedings whereby the
court exercises its supervisory jurisdiction in relation
to the
division of a joint estate in the absence of agreement between the
parties.’
[19]
But, as the joint estate had already been divided pursuant to the
decree of divorce, the court in
Fritz
concluded that ‘an
order the effect of which is to “deem” a pension interest
to be part of the joint estate’
would not be appropriate.
[20]
The import of s 7(7) and (8) of the Act also arose pertinently in
Kotze
, a judgment of the Full Court of the Western Cape High
Court. It bears mentioning that
Kotze
(like
Fritz
)
differs from the present case in one material respect, namely that
the division of the parties’ joint estate pursuant to
the order
granted by the court granting the divorce had already occurred.
There, the former wife had sought an order declaring
that she was
entitled to 50 per cent of the pension benefit paid to the former
husband several years after the divorce. Her claim
in the court of
first instance failed on the ground that there was an irresoluble
dispute of fact on the papers, which she ought
to have foreseen.
[21]
On appeal, the Full Court considered the issue to be one that fell
foursquare within the purview of s 7(7) and (8) of the Act.
Saldanha
J, writing for the Full Court, said the following (paras 30-31):
‘
[30]
As indicated, Mr
Studti
was
strongly of the view that if the divorce order is found as not having
excluded the pension benefit (and all the other movables)
it should
be regarded as ambiguous and in such event the principles of
interpretation applied thereto. Mr
Burger
however submitted that there was
nothing ambiguous about the court order as it was clear and inasmuch
as the issue of the pension
interest arose by virtue of section
7(7)(a) it did not impact on a interpretation of the divorce order.
Moreover, the first respondent
himself in his opposing papers in the
court
a quo
claimed
that the meaning of the court order was clear and so too did Louw J
in fact find that the order was clear and unambiguous.
I share that
view and it is therefore not necessary to apply the rules of
construction or interpretation with regard to the divorce
order
inasmuch as its meaning is clear and deals very specifically only
with the assets in the joint estate referred to therein.
[31]
It is apparent from the judgment of the court
a
quo
that Louw J did not consider the
relief that the appellant sought in paragraph 2 but rather dealt
substantively with whether the
appellant had made out a case for the
variation of the court order. Moreover, it does not appear that it
was argued before the
court
a quo
that
the appellant was entitled to the relief under Prayer 2 which, in my
view, she was entitled to, without the need for a variation
of the
divorce order.’
And
the learned judge concluded (para 32):
‘
[32]
I am of the view that where parties who were married to each other in
community of property in subsequent divorce proceedings
do not deal
with a pension or provident fund interest which either or both of
them may have had in separate pension or provident
funds either by
way of a settlement agreement or by an order of forfeiture, each of
them nonetheless remain entitled to a share
in the pension or
provident fund to which the other spouse belonged to and such share
is to be determined as at the date of divorce
by virtue of the
provisions of
section 7(7)(a)
of the
Divorce Act 70 of 1979
.’
[22]
It would appear that the only assets of real value comprising
the joint estate in
Kotze
were two immovable properties. The
parties had agreed that the wife would retain the one property whilst
the husband would retain
the other. The divorce court made an order
incorporating the parties’ settlement agreement. As indicated,
when the wife discovered
that the husband had received a substantial
amount from his pension fund, that had accrued to him long after the
division of the
joint estate (pursuant to the parties’
agreement) had occurred, she applied to the court of first instance,
for an order
in terms of
s 7(7)
and (8). As already mentioned, the
court of first instance dismissed the application on the grounds that
there was an irresoluble
dispute of fact on the papers, which should
have been foreseen. The Full Court, as pointed out above, found that
notwithstanding
the fact that the division of the joint estate had
already been completed, the wife was entitled to a share of the
pension benefit
which had accrued to the husband. This share fell to
be determined as at the date of divorce, in terms of s 7(7)
(a)
of the Act. To the extent that the Full Court in
Kotze
concluded that it was competent to grant an order in terms of
s 7(7)
(a)
of the Act after the parties’ joint
estate had already been divided in accordance with the order granting
the divorce, it
erred.
[23]
The judgment of the Full Court in
Kotze
has been criticised by
Mr Johan Davey in an article titled ‘K v K and Another ─
a critique’ published in
De Rebus
of September 2013 (at
26-28). The writer opines that even though a pension interest is
deemed to be part of the joint estate for
the purposes of determining
the patrimonial benefits of a marriage to which parties to a marriage
in community of property are
entitled, a non-member spouse becomes
entitled to such share only if the court granting the decree of
divorce makes such a declaration
in terms of s 7(8)
(a)
.
[24]
Relying on the authority of
Eskom Pension and Provident Fund
which is to the effect that a non-member spouse’s entitlement
to receive benefits from a pension fund of the member spouse
in terms
of
s 37D(1)
(d)
(i) of the
Pension Funds Act, 24 of 1956
,
derives from the provisions of
s 7(7)
and s 7(8) of the Act, Mr Johan
Davey then contends that even though a member spouse’s pension
interest is deemed to form
part of the joint estate for the purposes
of s 7(7)
(a)
, a non-member spouse becomes entitled to a share
thereof only when ‘it is assigned to him or her in terms of
s 7(8)’.
[25]
Accordingly, the writer notes that, absent a court order in terms of
s 7(8), the non-member spouse effectively forfeits his
or her
entitlement to a share in the pension interest of the member spouse.
I do not agree with these sentiments for the following
reasons.
First, s 7(7)
(a)
is self-contained and not made subject to s
7(8). It deems a pension interest to be part of the joint estate for
the limited purpose
of determining the patrimonial benefits to which
the parties are entitled as at the date of their divorce. The
entitlement of the
non-member spouse to a share of the member
spouse’s pension interest as defined in the Act is not
dependant on s 7(8). To
my mind, it would be inimical to the scheme
and purpose of s 7(7)
(a)
if it only applies if the court
granting a divorce makes a declaration that in the determination of
the patrimonial benefits to
which the parties to a divorce action may
be entitled, the pension interest of a party shall be deemed to be
part of his or her
assets. The grant of such a declaration would
amount to no more than simply echoing what s 7(7)
(a)
decrees.
For the same reasons it was not necessary for the parties in this
case, to mention in their settlement agreement what
was obvious,
namely that their respective pension interests were part of the joint
assets which they had agreed, would be shared
equally between them.
[26]
In
my judgment, by inserting s 7(7)
(a)
in the Act the legislature intended to enhance the patrimonial
benefits of the non-member spouse over that which, prior to its
insertion, had been available under the common law. The language of s
7(7)
(a)
is clear and unequivocal. It vests in the joint estate the pension
interest of the member spouse for the purposes of determining
the
patrimonial benefits, to which the parties are entitled as at the
date of their divorce.
[3]
Most
significantly, the legislature’s choice of the word ‘shall’
coupled with the word ‘deemed’ in
s 7(7)
(a)
is indicative of the peremptory nature of this provision. The section
creates a fiction that a pension interest of a party becomes
an
integral part of the joint estate upon divorce which is to be shared
between the parties. Van Niekerk puts it thus:
[4]
‘
[W]here
the parties are married in community of property, the value of the
pension interest is added to the value of the other assets
that fall
in the joint estate for purposes of the division of the estate.’
[27]
Section
7(8), on the other hand, creates a mechanism in terms of which the
Pension Fund of the member spouse is statutorily bound
to effect
payment of the portion of the pension interest (as at the date of
divorce) directly to the non-member spouse as provided
for in s
37D(1)
(d)(i)
of the
Pension Funds Act 24 of 1956
and
s 21(1)
of the
Government Pension Law, 1996. This is as far as
s 7(8)
goes and no
further.
[5]
The non-member
spouse is thereby relieved of the duty to look to the member spouse
for the payment of his or her share of the pension
interest with all
its attendant risks.
[6]
The
remarks by this court in relation to
s 7(8)
(a)
,
in
Old
Mutual Life Assurance Co (SA) Ltd & another v Swemmer
2004
(5) SA 373
(SCA) are instructive. It said the following (para 20):
‘
Once
a part of the pension interest of the member spouse becomes “due”
or “is assigned” to the non-member
spouse in the course
of the divorce proceedings, the Court may order that such part of the
pension interest must be paid by the
pension fund concerned to the
non-member spouse “when any pension benefits accrue in respect
of” the member spouse.
. . .’
[28]
The cases that espouse the proposition that for the pension interest
of a member’s spouse to form part of the joint estate
upon
divorce, it is necessary that it be claimed by the non-member spouse
in his or her summons or counter-claim, have been criticised.
[7]
For the reasons articulated above, those criticisms, in my view, are
justified.
[29]
In the respondent’s written heads of argument, it was contended
that only the court granting the divorce order may grant
relief under
s 7(7)
(a)
. And that in the absence of such an order the
non-member spouse could not at a later stage seek an order under
s
7(7)
(a)
or
s 7(8).
For this submission respondent’s
counsel placed much store in the decision of this court in
Schutte
v Schutte
1986 (1) SA 872
(A) at 882C-E. In relation to
maintenance in terms of s 7(1) of the Act, this court said it
was only the court granting a
divorce that could make an order with
regard to the payment of maintenance by the one party to the other.
That decision, however,
is distinguishable and did not deal with the
clear wording of s 7(7)
(a)
.
[30]
Appreciating the weakness inherent in the respondent’s
contention, before us counsel for the respondent adopted a different
approach accepting that the pension interest of either party in this
case formed part of their joint estate. It was nevertheless
contended
that a party seeking an order for the division of the pension
interest of the other party ─ which is what the appellant
sought in the court a quo ─ must still obtain an order in terms
of s 7(8) of the Act from the court granting the divorce.
For the
reasons set out above this submission is without foundation. A
further submission was made however, that the appellant’s
belated application in the court a quo was doomed to fail as no such
order can be granted post the grant of the divorce order,
even at the
instance of a liquidator. It is, in my view, not necessary to decide
this point as counsel for the appellant accepted
that it would not be
competent for this court to decide this issue for the first time on
appeal when no application had been made
in the court that granted
the decree of divorce for such relief.
[8]
[31]
In the result those decisions which held that if there is no
reference in the divorce order of parties married in community
of
property to a member spouse’s pension interest, the non-member
spouse is precluded in perpetuity from benefitting from
such pension
interest as part of his or her share of the joint estate, were
wrongly decided. It follows that the liquidator will
be justified in
regarding the pension interest of either party as part of the assets
of their joint estate which has yet to be
divided between them.
[32]
It remains to say that I have had the benefit of reading the judgment
of my colleague, Makgoka AJA. I have no quarrel with
the additional
facts set out in my colleague’s judgment. My colleague and I
agree on the basic premise that the fate of this
appeal in relation
to the parties’ pension interests hinges on the interpretation
of their settlement agreement. But we differ
fundamentally on the
direction to which the interpretation process should lead us. I
regret that I cannot subscribe to the process
of reasoning and the
conclusion reached by my colleague. I have difficulty with the
interpretation placed on the parties’
settlement agreement in
relation to the division of their joint estate. My colleague says
that because the relevant clause is headed
‘Immovables and
Movables’ this means that the body of the clause which reads:
‘The joint estate shall equally
be divided between the parties’
must be taken to mean that only immovables and movables are
encompassed thereby and nothing
else. And that the concept of
‘immovables and movables’ does not include the pension
interest of a member spouse. In
my view, there is a glaring
difficulty with this approach.
[33]
First, as already indicated (para 10), this court in
Old Mutual
Life Assurance
approved of the description of a pension interest
in the South African Law Commission’s Reports dealing with the
division
of pension benefits on divorce in Project 41 (March 1995)
and the sharing of pension benefits in Project 112 (June 1999),
namely,
that a ‘pension interest’ is a notional asset
which ‘simply establishes a method of ascertaining the value of
the “interest” of the member of the pension or retirement
annuity fund as accumulated up to the date of the divorce’.
This notional asset ‘is added to all the other assets of the
party concerned in order to determine the extent of the other
party’s
claim to a part of the first-mentioned party’s assets’.
Second, whilst it is correct that the heading
and the provisions of a
contract should be read together where the heading does not conflict
with the body of the contract, it
is trite that where there is
conflict between the heading and the body of the contract the latter
prevails. But here, as my colleague
points out, there is no conflict
between the heading and the body of the relevant clause. However,
sight must not be lost of the
fact that the parties in this case were
married in community of property. Consequently, one of the invariable
consequences of such
a marriage is that, subject to a few exceptions
not here relevant, the spouses became co-owners in undivided and
indivisible half-shares
of all the assets acquired during the
subsistence of their marriage. And, absent a forfeiture of benefits
under s 9(1) of the Act
or an express agreement between the parties
to the contrary, each spouse is entitled to a half-share of the joint
estate ─
whatever it entails.
[34]
The joint estate in this case must necessarily include the pension
interest of either party as contemplated in s 7(7)
(a)
of the Act. Hence the heading to the clause, such as it is, cannot be
taken to mean that the pension interest of each spouse is
excluded
from the assets which make up the joint estate. It is manifest from
the language of the clause, which must be ‘the
inevitable point
of departure, read in context and having regard to the purpose of the
provision and the background to the preparation
and production of the
document’
[9]
, that the
clause relating to the equal division of the joint estate constituted
the so-called blanket division. Indeed both the
heading and the
language of the body of the clause concerned, read together, do not
support the construction and hence the limitation
placed on it by my
colleague. And the settlement agreement is not susceptible to an
interpretation that the parties’ pension
interests were
excluded from its reach. Quite the contrary. As to the background to
the preparation and production of the settlement
agreement, great
store is placed in the assumption that the settlement agreement was
drafted by the respondent’s attorneys
without any input from
the appellant. From this, it is concluded that because the
respondent’s attorneys knew that the appellant
had renounced
her entitlement to the pension interest in her combined summons, the
respondent could not have been so benevolent
as to allow the
appellant to share in his pension interest. In my view, there is no
warrant for this conclusion. First, it is belied
by the averment in
the respondent’s answering affidavit that the parties’
pension interest ‘did not form part
of the settlement
negotiations’ which implies that the conclusion of the
settlement agreement was preceded by negotiations.
Second, it is
based on conjecture as there is no evidence on record as to what the
parties’ settlement negotiations entailed
prior to the grant of
the divorce order.
[35]
In
any event, there is a more fundamental reason why the pension
interests of the parties must, on the facts of this case, be an
integral part of their joint estate. Central to the reasoning in my
colleague’s judgment is, in my view, the notion that
a pension
interest is neither immovable nor movable. And that because the
clause under consideration provides that only immovables
and movables
shall be divided equally between the parties, anything else not
expressly mentioned is excluded. To my mind such a
notion is unsound
in law. By its very nature, movable property comprises both corporeal
and incorporeal things. According to the
learned authors of
Wille’s
Principles of South African Law
[10]
typical examples of incorporeal movables, inter alia, include real
rights such as a pledge, notarial bond, mortgage bond, or any
rights
in personam that are connected with the transfer of movable property
from one person to another or which can be satisfied
by a money
payment.
[11]
It therefore goes
without saying that the parties’ entitlement to each other’s
pension interests, which can be satisfied
by a money payment, falls
squarely within the rubric of movables. Seen in this light, the
maxim
expressio unius est exclusio alterius
is therefore unavailing. My conclusion above, in relation to s 7(7)
of the Act, renders it unnecessary to address the jurisdiction
question. It suffices to say that this point was neither raised on
the papers nor addressed in written or oral argument.
It
is trite that it is impermissible for judicial officers to rely for
their decisions on matters not put before them by litigants
either in
evidence or in oral or written submissions. (See in this regard:
Kauesa v
Minister of Home Affairs & others
1996
(4) SA 965
(NmS) at 973J-974A;
Welkom
Municipality v Masureik & Herman t/a Lotus Corporation &
another
[1997] ZASCA 14
;
1997
(3) SA 363
(SCA) at 371G-H.)
[36]
This leaves the question of costs. The relief to which the appellant
is entitled has a bearing not only on the costs of the appeal,
but
also those in the court a quo. Counsel for the appellant argued that
what was in contention between the parties was whether
the appellant
was entitled to a share of the respondent’s pension interest.
As the appellant has established such entitlement
in this court, she
has achieved substantial success entitling her to the costs of the
appeal and those in the court a quo. Counsel
for the respondent did
not contend otherwise. The appellant is accordingly entitled to a
costs order in her favour in both courts.
[37]
In the result the following order is made:
1
The appeal is upheld with costs.
2
The order of the court below is set aside and in its place the
following order is substituted:
‘
1
Mr Phillip Jordaan of Divorce Settlement Services, Pretoria is
appointed as Liquidator of the joint estate of the applicant and
the
respondent with the powers and obligations set out in annexure A to
this judgment.
2
It is declared that the applicant is entitled to an amount equal to
50 per cent of the respondent’s nett pension interest
in the
Government Employees Pension Fund Scheme calculated as at 25 May
2012.
3
It is declared that the respondent is entitled to an amount equal to
50 per cent of the applicant’s nett pension interest
in the
Government Employees Pension Fund Scheme calculated as at 25 May
2012.
4
The respondent shall pay the costs of the application.’
_________________
X
M PETSE
JUDGE
OF APPEAL
Makgoka
AJA (Seriti JA concurring)
[38]
I have read the erudite judgment of my colleague, Petse JA. I agree
that the appeal in respect of the appointment of a liquidator,
with
related powers, should succeed. With regard to the appeal in respect
of the pension interests of the parties, I agree, in
principle, with
my colleague’s scholarly exposition of the law. I differ,
however, with him on the application of the
law to the facts of this
case.
[39]
My interpretation of the settlement agreement signed by the parties,
and the circumstances in which it came into existence,
lead me to a
different conclusion, namely, that the parties had, on a proper
construction of the settlement agreement, agreed to
exclude their
respective pension interests from the division of their joint estate.
With that conclusion, it is unnecessary for
this court to consider
the effect of s 7(7) of the
Divorce Act. For
that reason,
I disagree with the declaratory orders made by my colleague in
respect of the parties’ pension interests in
terms of
s 7(7)
of
the
Divorce Act. I
therefore write separately to set out the reasons
for my disagreement.
[40]
The basic facts, which are simple and largely common cause, have been
set out in my colleague’s judgment. However, I
think that he
has not given sufficient attention to the circumstances which gave
rise to the settlement agreement. Also, I do not
agree with his
interpretation of the settlement agreement. I will therefore give
focused attention to those aspects.
[41]
The parties were married to each other in community of property on 14
January 2005. The appellant is employed as a supply chain
officer in
the Department of International Relations and Cooperation in
Pretoria. The respondent is a major in the employ of the
South
African National Defence Force, Air Force Headquarters, in Pretoria.
By virtue of their employment, they are both members
of, and
contribute to, the Government Employees Pension Fund (the GEPF).
[42]
During 2011, the appellant instituted divorce action against the
respondent in the North West Regional Court of Moretele (the
regional
court), in which she also sought ancillary relief, namely, custody of
the parties’ minor children, and their maintenance,
spousal
maintenance and division of the joint estate. With regard to the
pension interests, the appellant sought a prayer that
‘each
party [was] to retain his/her pension fund interest.’
[43]
The divorce action was eventually settled. The terms of the
settlement were recorded in a settlement agreement signed by the
parties on 25 May 2012. The settlement agreement comprises slightly
under 1½ pages. It has headings, making provision for
the
following aspects: action for divorce; custody of the minor children;
maintenance of the minor children; immovables and movables;
and
future expenses. The headings are all in upper case, and emboldened.
The specific clause which deals with the division of the
joint estate
reads:
‘
IMMOVABLES
AND MOVABLES.
The
joint estate shall equally be divided between the parties.’
[44]
A decree of divorce was granted on 25 May 2012, and the settlement
agreement concluded by the parties was made an order of
court by the
regional court. On 15 April 2013, the appellant’s attorneys
(who were not her attorneys during the divorce action),
wrote a
letter to the respondent and requested him to furnish them with his
proposals regarding the division of the joint estate.
[45]
When no response was forthcoming from the respondent, the appellant
launched motion proceedings in the Gauteng Division of
the High
Court, Pretoria (the high court) seeking the appointment of a
liquidator for the purposes of dividing the joint estate.
In prayers
2 and 3 of the notice of motion, the appellant sought orders that the
parties were entitled to payment of 50 per cent
of each other’s
pension interest as at the date of the divorce. It was common
cause between the parties that a liquidator
should be appointed. The
only dispute was on the appellant’s prayers in respect of the
pension interests. Clearly due
to inadvertence, the high court
dismissed the entire application with costs. The high court
erred in that regard. It should
have granted the order for the
appointment of a liquidator, as this had been agreed upon by the
parties.
[46]
In her founding affidavit, the appellant asserted that the assets
which comprised the joint estate included the parties’
respective pension interests. In his answering affidavit, the
respondent denied that assertion. The respondent stated that the
pension interests ‘did not form part of the [appellant’s]
claim when she instituted divorce proceedings, [and]
did not form
part of the settlement agreement’ and that no order was made in
respect thereof in terms of
s 7(8)
of the
Divorce Act.
[47
]
Confronted with the respondent’s version, the appellant sought,
in her replying affidavit, to explain the reason why the
prayers in
her combined summons expressly excluded the pension interests. She
explained that she was assisted by one Mr Sentsho,
whom she believed
to be an attorney (who later turned out not to be). According to the
appellant, she had indicated to Mr Sentsho
that she wished to share
in the respondent’s pension interest. Mr Sentsho informed to
her that if she included a prayer for
sharing in the respondent’s
pension interest, it would bring about a lot of administrative
difficulties. She also sought
to explain the background to the
signature of the settlement agreement, in respect of which she states
that on the day of the hearing
she was presented with the settlement
agreement, which she signed.
[48]
These, briefly are the facts. I should mention, right at the outset,
that
s 7(7)
is peremptory in its provisions. In other words, the
pension interests of spouses married in community of property are, by
default,
deemed to be part of the joint estate. In para 33 above, my
colleague emphasises this point, and correctly states one of the
invariable
consequences of a marriage in community of property: at
the dissolution of the marriage, each party is entitled to a
half-share
of the joint estate, including the pension interests,
where applicable, except where there is an order of forfeiture in
terms of
s 9(1) of the Act or an express agreement between the
parties to the contrary. As already stated, I take a view that the
parties
have adopted the latter option in the settlement agreement.
[49]
To my mind, the starting point, before considering the effect of
s
7(7)
of the
Divorce Act, should
be whether the settlement agreement
as framed, is to be interpreted so as to include the parties’
pension interests. Only
if that question is answered
positively, would it be necessary to consider the issue of principle
in terms of
s 7(7).
The question, in my view, should be
answered in the negative, for two reasons. First, the clear language
of the settlement
agreement militates against that. Second, the
circumstances in which the settlement agreement came into being do
not lend themselves
to that interpretation.
[50]
With regard to the language of the settlement agreement, I have in
para 43 above, referred to the clause of the settlement
agreement
which makes provision for the division of the joint estate.
I understand that clause to mean: ‘The
joint estate, as
identified above, being the immovables and the moveables, shall be
divided equally.’ Therefore, anything
which does not fall
within the identified category is not included in the division of the
joint estate.
[51]
Pension interests are neither immovable nor moveable property. In the
context of a divorce action and
s 7(7)
and (8) of the
Divorce Act,
any
suggestion that ‘immovable and moveable property’
includes pension interests is untenable. That is so because,
traditionally,
the pension interests did not form part of the assets
of the parties. Only by special legislative enactment in the form of
s 7(7)(a)
, were they deemed so. It is for that reason that a specific
order in terms of
s 7(8)
, distinct from the order of
division of the joint estate, should be made by the court to give
effect to the deeming provisions
of
s 7(7)(a).
This point is fully
discussed in paras 66-70 below. In the present case, the pension
interests are excluded by the maxim
expressio
unius est exclusio alterius,
[12]
as applied with the necessary caution. (See for example,
Administrator,
Transvaal, & others v Zenzile & others
1991 (1) SA 21
(A) at 37G-H.) In my view, the language
used in the settlement agreement concluded by the parties is plain
and unambiguous.
[52]
The situation would have been entirely different had there been no
heading. In that event, the clause providing for the equal
division
of the joint estate would have constituted a so-called blanket
division. That would have brought the pension interests
within the
purview and reach of the deeming provisions of
s 7(7)
of the
Divorce
Act. To
read the clause providing for equal division of the joint
estate as if the heading does not exist is, with respect, untenable.
The heading clearly delineates the assets of the joint estate to be
divided. By specifically mentioning the category of the assets
of the
joint estate to be divided, the parties clearly had the intention to
exclude any other category not mentioned. Effect should
therefore be
given to the clear and unambiguous provisions of the settlement
agreement.
[53]
In
Sentinel Mining Industry Retirement Fund and Another v Waz
Props (Pty) and Another
[2012] ZASCA 124
;
2013 (3) SA 132
(SCA)
para 10,
it was observed that when
interpreting a contract, headings can be taken into account. Where a
heading conflicts with the body of
contract, it must be the body of
the contract which prevails because the parties’ intention is
more likely to appear from
the provisions the parties have spelt out
than from an abbreviation they have chosen to identify the effect of
those provisions.
[54]
My colleague and I are agreed that there is no conflict between the
heading and the body of the relevant clause in the present
case. What
then was intended by the inclusion of the heading with the particular
words ‘
IMMOVABLES AND MOVABLES
’ in relation to the
division of the joint estate? Those words should be given
meaning. One cannot treat those words
as if they do not exist. It is
impermissible to do so, as it militates against a longstanding
precept of interpretation that every
word must be given a meaning,
and that no word should be ignored, or treated as tautologous or
superfluous. See
African Product (Pty) Ltd v AIG South African Ltd
2009 (3) SA 473
(SCA) para 13;
National Credit Regulator v
Opperman & others
2013 (2) SA 1
(CC) para 99;
Kilburn v
Tuning Fork (Pty) Ltd
[2015] ZASCA 53
;
2015 (6) SA 244
para 15.
[55]
When read together, the heading and the clause make perfect sense,
given the circumstances which gave rise to the settlement
agreement.
The settlement agreement, by its silence on pension interests, is
consistent with, and mirrors, the appellant’s
express exclusion
of pension interests in her combined summons.
[56]
I turn now to consider the circumstances under which the settlement
agreement came into existence. This court, in
Natal Joint
Municipality Fund v Emdumeni Municipality
[2012] ZASCA 13
;
[2012]
2 All SA 262
;
2012 (4) SA 593
(SCA) para 18, recognised that the
circumstances in which a document came into being, is one of the
factors to be considered when
interpreting a document. Wallis JA
said:
‘
[W]hatever
the nature of the document, consideration must be given to the
language used in the light of the ordinary rules of grammar
and
syntax; the context in which the provision appears; the apparent
purpose to which it is directed and the material known to
those
responsible for its production. Where more than one meaning is
possible each possibility must be weighed in the light of
all these
factors. The process is objective not subjective. A sensible meaning
is to be preferred to one that leads to insensible
or unbusinesslike
results or undermines the apparent purpose of the document. Judges
must be alert to, and guard against, the temptation
to substitute
what they regard as reasonable, sensible or businesslike for the
words actually used. To do so in regard to a statute
or statutory
instrument is to cross the divide between interpretation and
legislation. In a contractual context it is to make a
contract for
the parties other than the one they in fact made. The “inevitable
point of departure is the language of the
provision itself”,
read in context and having regard to the purpose of the provision and
the background to the preparation
and production of the document.’
(Footnotes omitted.)
See
also
Cloete Murray N.O. & another v Firstrand Bank Ltd
[2015] ZASCA 39
;
2015 (3) SA 438
(SCA) para 30.
[57]
My conclusion that the settlement agreement was not preceded by
negotiations, and that the appellant did not have any input
in its
production, is not speculative, nor is it based on conjecture. What
are the facts? The answer lies, first, in what the appellant
does not
say. She does not say that the settlement agreement was preceded by
any negotiations in which she made input with regard
to its terms. If
she did, it should not be difficult to say so. Part of the difficulty
in this regard, is the paucity of information
in both the appellant’s
founding and replying affidavits. It seems that she consciously set
out to be as sparse as possible.
As the applicant, she was expected
to place before the court, as much relevant information as possible.
If she elected to place
less, she should not expect the court to
speculate in her favour. If there is adverse speculation against her,
it is only because
the appellant’s papers are woefully lacking
on detail.
[58]
But what she says with regard to the production of the settlement
agreement, is also instructive. It is set out in paragraph
10.10 of
her replying affidavit: She says:
‘
At
the hearing of the divorce the respondent and his legal
representative presented me with the settlement agreement which was
later that specific day incorporated in the order of the court. No
mention was made of the pension fund and at the time of the signing
of the settlement agreement I never understood the pension fund
interest not to form part of the joint estate. I at all relevant
times the specific day understood the pension fund to be included in
the joint estate, especially in the light of the fact that
it was not
specifically excluded in the settlement agreement drafted by the
respondent and his legal team. I was never advised
differently prior
to date I have approached my current legal team who explained to me
the legal position.’
[59]
From the above, it is clear that the respondent’s attorneys
were the drafters of the settlement agreement. If the
appellant
had negotiated with them for the inclusion of the pension interests
in the settlement agreement, she would surely have
enquired about its
non-inclusion, on being presented with the settlement agreement. What
material was known to the respondent’s
attorneys when the
settlement agreement was produced? They knew that the appellant had
expressly excluded the pension interests
in her combined summons. It
is therefore difficult to see how, under those circumstances, they
would include the pension interests
in the agreement, such never
having been part of the
lis
between the parties on the
pleadings, because the appellant had expressly excluded them. The
drafters of the settlement agreement
were therefore entitled to draft
the settlement agreement on the basis of the pleadings, unless the
appellant had conveyed to them
a contrary attitude with regard to the
pension interests.
[60]
Human experience has shown that contracting parties seldom contract
to their disadvantage. I therefore do not see how the respondent’s
attorneys would have been so benevolent as to make the respondent’s
pension interest part of the settlement agreement, where
the
appellant had expressly disavowed her entitlement thereto. It must be
borne in mind that had the respondent not defended the
divorce
action, the regional court would in all likelihood, have granted an
order that each party was to retain their own pension
interest, as
requested by the appellant in her combined summons.
[61]
It is therefore quite ironic that by defending the matter and
concluding a settlement agreement in the manner it was worded,
the
respondent would suddenly be deemed to have bestowed a right on the
appellant, which she expressly had disavowed in her combined
summons.
Under the circumstances, the appellant could only be entitled to
share in the respondent’s pension interest if the
settlement
agreement was a product of negotiations, during which she insisted
that the pension interests be included as part of
the settlement
agreement. From the facts available to us, this was not the case. It
seems the settlement agreement was presented
to the appellant by the
respondent’s attorneys as a
fait accompli
on the day of
the hearing of the divorce action.
[62]
This brings me to the appellant’s statement (in paragraph 10.10
of her replying affidavit) that at the time of signature
of the
settlement agreement, she ‘never understood the pension fund
interest not to form part of the joint estate.’
This can simply
not be correct. Having expressly excluded the pension interests in
her combined summons, she could possibly not
have had such an
understanding. That could only be, if she had a change of heart on
that aspect, and conveyed that to the respondent’s
attorneys
before the settlement agreement was drafted. As stated already, this
does not appear to have happened. At least she does
not say so, and
there is nothing in the record to suggest otherwise.
[63]
But if there is any residual doubt about whether the
appellant considered the settlement agreement to incorporate
the
pension interests, paragraph 10.12 of her replying affidavit offers a
complete answer. There, the appellant essentially acknowledges
that
the settlement agreement falls short of including the pension
interests as part of the assets to be divided. She says:
‘
If
the legal position was explained to me I would never have instituted
the action in the manner I did, and in addition hereto I
never would
have signed the settlement [agreement] in the manner it was presented
to me.’
[64]
In my view, there can be no clearer indication of the appellant’s
mind-set (as to whether the pension interests formed
part of the
settlement agreement). It is plain that the appellant
recognizes that terms of the settlement agreement are insufficient
to
be read as to include the pension interests. For, if her case
is that the settlement agreement as drafted also incorporates
the
pension interests, why would she ‘never have signed’ it
in its present wording? The above statement seems to contradict
the
essence of the appellant’s case, which, as already stated, is
that the terms of the settlement agreement do incorporate
the
parties’ pension interests.
[65]
One has sympathy for the appellant because clearly she was assisted
by an unqualified person in drafting her papers in the
regional
court. She was apparently unrepresented when she signed the
settlement agreement, which she appears not to have had any
role in
negotiating its terms. One option open to her would have been to
approach the court for the rectification of the settlement
agreement
on the basis that it did not correctly reflect the intention of the
parties. But she, on advice I suppose, elected to
seek an order in
terms of
s 7(7)
and
7
(8)(
a
) of the
Divorce Act on
the basis of
a settlement agreement which, in my view, patently does not permit of
such an order. I would, very reluctantly, non-suit
her on this
portion of the appeal, for all of the reasons stated above.
[66]
Lastly, and for the sake of completeness, there is also the issue of
jurisdiction.
This issue, as
to which court is competent to grant an order in terms of
s 7(8)
of
the
Divorce Act, was
pertinently debated during the hearing with the
appellant’s counsel, during which counsel conceded, correctly
so, that this
court does not have jurisdiction to grant an order in
terms of
s 7(8)(a)
as had been requested by the appellant in the high
court. My colleague discusses this issue in para 30, and states that
‘[I]t
is ….not necessary to decide this point as counsel
for the appellant accepted that it would not be competent for this
court
to decide this issue for the first time on appeal…’
My colleague then concludes that it is not necessary to decide
the
point, but accepts, correctly so, in my respectful view, that ‘the
wording of
s 7(8)
…seem to restrict the grant of such an order
to the “court granting the decree of divorce”’
[67]
In my view, it is necessary to determine the issue. I do so.
Section 7(8)(
a
) of the
Divorce Act reads
:
‘
Notwithstanding
the provisions of any other law or of the rules of any pension fund ─
(a)
the court granting a decree of divorce in respect of a member of
such a fund, may make an order that –
(i)
any part of the pension interest of that member which, by virtue of
subsection (7), is due or assigned to the other party to
the divorce
action concerned, shall be paid by that fund to that other party when
any pension benefits accrue in respect of that
member;
(ii)
an endorsement be made in the records of that fund that that part of
the pension interest concerned is so payable to that other
party.’
[68]
The above sub-section makes plain that the court which may grant an
order directing a pension fund to pay a pension interest
to a
non-member spouse, is the court granting the decree of divorce. The
court with the requisite jurisdiction is the regional
court. This is
the court to which the appellant should have directed her
application. The upshot of this is that the high court
lacked
jurisdiction to determine prayers 2 and 3 of the appellant’s
notice of motion. It should have declined to hear that
portion of the
appellant’s application. It is trite that a decision taken
absent proper jurisdiction is void. As explained
by this court in
Tὃdt v Ipser
1993 (3) SA 577
(A);
[1993] 2 All SA 303
(A) at 589B-C:
‘
According
to our common-law authorities judgments are void in only three types
of cases – where there has been no proper service,
where there
is no proper mandate or where the court lacks jurisdiction. See
Minister of Agricultural Economics and
Marketing v Virginia Cheese and Food Co (1941) Pty Ltd
1961
(4) SA 415
(T) at 422E-424H;
S v Absalom
1989 (3) SA 154
(A) at 163C and 164E-G; and the earlier authorities
cited in these cases…’
[69]
By parity of reasoning, this court is similarly placed. It is for
that reason that this court is not making an order in terms
s
7(8)(
a
), and is restricting itself to a declaratory order in
terms of
s 7(7).
This does not help the appellant much, because,
absent an order in terms of
s 7(8)(
a
), the declaratory order
in terms of
s 7(7)
remains enforceable only between the parties. The
pension fund to which they both belong, the GEPF, is empowered by law
to give
effect only to an order made in terms of
s 7(8)(
a
).
[70]
Such an order must direct the pension fund to make payment of a
member’s pension interest to a non-member spouse, and
endorse
its records accordingly. A declaratory order such as the one made by
my colleague, is not sufficient. The upshot of this
is that, unless
and until one of the parties approaches the regional court for an
order in terms of
s 7(8)(
a
) of the
Divorce Act, the
appellant’s victory in this court would remain hollow and a
brutum fulmen
, as far as the GEPF is concerned.
[71]
In conclusion, it is appropriate to refer to the observations made by
this court in
Old Mutual Life Assurance Co (SA) Ltd & another
v Swemmer
2004 (5) 373 (SCA) para 26, in which the importance of
carefully formulating settlement agreements and divorce orders
relating
to pension interests, was emphasised. This is to ensure that
they fall within the ambit of
s 7(7)
and (8) of the
Divorce Act. The
dispute in the present case would have been avoided had this been
heeded.
[72]
Like my colleague, I would uphold the appeal to the extent that the
high court failed to grant a prayer for the appointment
of a
liquidator, despite it being common cause between the parties that
such a prayer should be granted. I would make no order
in respect of
the appeal relating to the pension interests. For the reason that the
appellant had sought an order in respect of
pension interests in a
wrong forum, I would accordingly order that each party should pay its
own costs, both in the high court
and in this court.
__________________
T
M Makgoka
Acting
Judge of Appeal
APPEARANCES:
For
the Appellant:
M Haskins SC
(with R M Molea)
Instructed by:
Shapiro & Haasbroek
Inc, Pretoria
Lovius Block,
Bloemfontein
For
the Respondent:
J L Basson
Instructed by:
Makokga Sebei Inc,
Kempton Park
Phatshoane Heney Inc,
Bloemfontein
Annexure
A
APPOINTMENT
OF LIQUIDATOR AND/OR RECEIVER OF THE JOINT ESTATE OF PLAINTIFF AND
DEFENDANT
1.
PHILLIP JORDAAN is hereby appointed as Liquidator in the joint estate
of the above PLAINTIFF and DEFENDANT to realise the whole
of the
joint estate assets, movable and immovable, and for that purpose to
sell them or any part of them, by public auction or
by private
agreement as may seem most beneficial with leave to both parties to
bid, to collect debts due to the joint estate unless
the same be
disposed of by sale, to pay the liabilities of the joint estate, to
prepare a final account between PLAINTIFF and DEFENDANT,
and to
divide the assets of the joint estate after payment of its
liabilities in accordance with the account.
2.
THE LIQUIDATOR SHALL HAVE THE FOLLOWING POWERS:
2.1
The right to make all investigations necessary and in particular to
obtain from the parties all information with regard to the
assets
comprising the joint estate;
2.2
the right to obtain information regarding their financial affairs
from bank managers, building societies, managers or any other
financial institutions where monies may have been invested.
2.3
the right to obtain information from auditors of private companies or
business and personal accountants with regard to personal
affairs and
tax matters and any other person who may have knowledge of the
affairs
2.4
the right to obtain and call for balance sheets in respect of all
companies or businesses in which the parties have interest;
2.5
the right to inspect books of account in respect of any company or
business where the parties may have an interest and also
the right to
inspect personal bank statements, paid cheques, deposit books and
personal statements of affairs and liabilities which
may have been
drawn for tax and other purposes;
2.6
the right to make physical inspection of assets and take inventories;
2.7
the right to question the parties and obtain all explanations deemed
necessary by them for the purpose of making the division;
2.8
without limitation to the aforegoing, the rights which are conferred
on a Trustee in terms of the provisions of the Insolvency
Act Number
24 of 1936 and in particular the rights to call meetings of creditors
to perform interrogatories to take charge of the
property of the
joint estate, to open bank accounts and to deal with investments as
provided for in terms of sections 64, 65, 66,
68, 70 and 72 of Act 24
of 1936;
2.9
in particular the Liquidator is empowered to distribute and allocate
the movable assets of the joint estate between PLAINTIFF
and
DEFENDANT and will not be obliged to realise/sell all the assets of
the joint estate;
2.10
the Liquidator is empowered to locate assets for the joint estate out
of the Republic of South Africa, to proceed overseas
to take evidence
in location of such assets on commission
de bene esse
if needs
be for the purpose of taking in possession assets of the joint
estate;
2.11
the Liquidator is authorised, with the concurrence of the affected
pension funds, to effect the necessary endorsement against
any
pension interest of the parties in terms of
section 7[8]
of the
Divorce Act No 70 of 1979
and the same shall apply to the insurance
policies of the parties.
3.
DUTIES OF THE LIQUIDATOR
The
Liquidator is obliged to collect all assets, discharge all
liabilities and pay to the parties after deduction of his fees and
the legal costs of the parties in the divorce action and
interlocutory applications in that action and any other amounts due,
the residue of the joint estate to each party in equal shares.
Included in the aforegoing will be the right to realise all assets
on
such terms as the Liquidator may deem fit, including by public
auction, private treaty or otherwise.
4.
SECURITY
The
Liquidator is not required to find security for his administration.
5.
RELEASE OF THE LIQUIDATOR:
The
Liquidator shall be relieved of his duties as follows:
5.1
Upon completion of his account, the Liquidator will forward a copy of
such account to the parties’ respective attorneys.
5.2
The liquidator will send his account by prepaid registered mail or
hand-delivery to the addresses as reflected above.
5.3
Both PLAINTIFF and DEFENDANT shall be entitled to raise objections to
the said account within 14 [FOURTEEN] DAYS from date that
such
accounts had been sent. Should the Liquidator not receive any
objections from either PLAINTIFF or DEFENDANT within the fourteen
day
period, the said account shall be deemed to have been confirmed by
PLAINTIFF and DEFENDANT and the Liquidator shall proceed
to finalise
the estate in accordance with the said account.
[1]
Sempapelele
v Sempapelele & another
2001 (2) SA 306
(O);
YG
v Executor, Estate Late
CGM
2013 (4) SA 387 (WCC);
Maharaj
v Maharaj & others
2002 (2) SA 648
(D);
Fritz
v Fundsatwork Umbrella Pension Fund & others
2013 (4) SA 492 (ECP).
[2]
Sempapelele
v Sempapelele & another
2001
(2) SA 306
(O);
YG
v Executor, Estate Late CGM
2013 (4) SA 387
(WCC);
Maharaj
v Maharaj & others
2002
(2) SA 648
(D);
Fritz
v Fundsatwork Umbrella Pension Fund & others
2013
(4) SA 492
(ECP);
Elesang
v PPC Lime Ltd & others
2007
(6) SA 328
(NC);
Kotze
v Kotze & another
[2013]
JOL 30037
(WCC);
Macallister
v Macallister
[2013]
JOL 30404
(KZD);
Motsetse
v Motsetse
[2015]
2 All SA 475
(FB);
M
v M
(LPD) unreported case no 18/15 of June 2016.
[3]
See further in this regard: Jacqueline Heaton ed (2014),
The
Law of Divorce and Dissolution of Life Partnerships in South Africa
at 74.
[4]
P A van Niekerk,
A
Practical Guide to Patrimonial Litigation in Divorce Actions
,
issue 17 September 2015 at 7.2.4.1.
[5]
See further the discussion by P A van Niekerk op cit para 7.2.4.1.
[6]
Jacqueline Heaton op cit at 77.
[7]
See, for example, Merike Pienaar Does a non-member spouse have a
claim on pension interest (December 2015)
De
Rebus
at 38-39; M C Marumoagae A non-member spouse’s entitlement to
the member’s pension interest (2014) 17(6)
Potchefstroom
Electronics Law Journal
2488 at 2509.
[8]
See in this regard s 168(3)
(b)
(i)
and (ii) of the Constitution which provides that the Supreme Court
of Appeal may decide only appeals or issues connected with
appeals.
The wording of s 7(8)
(a)
would, however, seem to restrict the grant of such an order to the
‘court granting a decree of divorce’. But for
the
present purposes it is unnecessary to express a definite conclusion
on this question.
[9]
Natal
Joint Municipality Fund v Endumeni Municipality
[2012]
ZASCA 13
;
2012 (4) SA 593
SCA para 18.
[10]
Francois du Bois et al
Wille’s
Principles of South African Law
9 ed (2007) at 421-424.
[11]
Ibid at 424. In footnote 167 the learned authors cite Voet 1.8.21
and
MV
Snow Delta: Serva Ship Ltd v Discount Tonnage Ltd
2000 (4) 746 (SCA) paras 9-10 in support of what they say.
[12]
A maxim of interpretation meaning that the express mention of one
thing is the exclusion of the other.