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[2015] ZASCA 9
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WT and Others v KT (933/2013) [2015] ZASCA 9; 2015 (3) SA 574 (SCA) (13 March 2015)
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THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Case
No: 933/2013
Reportable
In
the matter between:
WT
.......................................................................................................................
FIRST
APPELLANT
WT
NO
...........................................................................................................
SECOND
APPELLANT
GT
NO
...............................................................................................................
THIRD
APPELLANT
and
KT
.................................................................................................................................
RESPONDENT
Neutral citation:
WT & others v KT
(933/2013)
[2015] ZASCA 9
(13 March 2015)
Coram:
Lewis,
Bosielo, Pillay, Mbha JJA and Mayat AJA
Heard: 18
February 2015
Delivered: 13
March 2015
Summary:
Discretionary Family Trust– whether trust assets form part
of the joint estate of parties married in community of property.
ORDER
On
appeal from
Gauteng Local Division, Johannesburg (Lamont J
sitting as court of first instance):
(a)
The appeal is upheld with costs, save for costs attendant upon the
preparation of the record for the purposes of the appeal.
(b)
The order of the court a quo is set aside and substituted with the
following order:
‘
(i)
It is declared that the assets of the [W T] trust with Master’s
reference number IT11246/1999, established in October
1999 do not
form part of the joint estate of the parties.
(ii)
The action in this matter is postponed sine die to enable the value
of the joint estate of the parties to be determined.
(iii) The defendant
is directed to pay the plaintiff’s costs as well as the costs
of the trust.’
JUDGMENT
Mayat
AJA (Lewis, Bosielo, Pillay, Mbha JJA concurring)
[1]
The crisp issue in the present appeal, brought with the leave of the
court a quo
,
is whether or not assets of a discretionary
family trust can be regarded as part of the assets of the joint
estate of parties married
in community of property.
Pertinent
background to proceedings
[2]
W T (the plaintiff in the court below and the first appellant), who
was married to K T (the defendant in the court below and
the
respondent) in community of property on 6 October 2001, instituted an
action in the Gauteng Local Division of the High Court
against K T in
January 2010, claiming a decree of divorce as well as ancillary
relief. Whilst K T did not oppose the decree of
divorce sought by her
husband, she filed a counterclaim relating to the extent of the
assets of their joint estate. Both W T and
his brother (the third
appellant), each cited
nomine officio
in their capacities as
duly appointed trustees of a trust, were joined as parties to the
counterclaim as the second and third defendants
in reconvention
respectively in the court below.
[3]
K T’s amended counterclaim was premised upon the contention
that assets of a trust with Master’s reference IT11246/1999
established in 1999 (the trust) formed part of her joint estate with
W T. Specifically, the following averments were made in this
regard
in the counterclaim:
‘
5.5
The plaintiff [W T] deceived and made false representations to the
defendant [K T], inter alia the plaintiff falsely represented
to the
defendant that the purchase of a dwelling . . . [for] the plaintiff
and the defendant, would be registered in terms of a
Trust to protect
it from the plaintiff’s business/es debtors and in terms of
which both the plaintiff and the defendant would
be beneficiaries,
but proceeded to exclude the defendant from the Trust as a
beneficiary and, from her 50% (“per centum”)
entitlement
thereto in the joint estate in the event of a divorce.’
It
was further averred in the amended counterclaim that:
‘
8.
The defendant pleads that for the purposes of determining the assets
in the joint estate the assets of the Trust
alternatively
the
prior matrimonial home . . . registered in the name of the Trust fall
to be included in the joint estate as:
8.1
The Trust was established as the alter ego of the plaintiff [W T] in
that:
8.1.2
Plaintiff had no true intention to establish the Trust as an entity
separate from him and the joint estate;
8.1.3
Plaintiff effectively
de facto
controlled the . . . Trust,
having regard to the terms of the Trust Deed and the manner in which
the affairs of the Trust were conducted;
8.1.4
Plaintiff regarded the Trust as a financial vehicle whereby he and
the joint estate could amass his own wealth and obtain
a financial
advantage for himself and the joint estate;
8.1.5
Plaintiff, but for the Trust would have acquired and owned the assets
of the Trust in the joint estates’ name;
8.1.6
Plaintiff regarded the Trust as a financial vehicle for his and the
joint estates’ benefit.
8.2
Plaintiff is and always has controlled the Trust, having regard to
the terms and the manner in which Trustees conducted themselves
and
affairs of the Trust.
9.
In the premises, the Trust was and is in reality no Trust at all, the
assets forming part of the Plaintiff’s estate and
thereby the
joint estate.’
[4]
The court below (Lamont J) determined the counterclaim as a separated
issue in the context of the divorce action. More
specifically,
the court a quo granted an order in the following terms in relation
to the separated issue on 19 of September 2013:
‘
1.
The joint estate includes the assets of the [W T] Trust.
2.
The action is postponed sine die to enable the value of the joint
estate to be determined.
3.
Any party requiring the Order in 2 to be reconsidered should within 7
days of the date hereof deliver a notice declaring such
hearing on a
date to be arranged.
4.
The Plaintiff is to pay the Defendant’s costs including the
costs of the claim against the [W T] Trust.’
Paragraph
1 of this order constitutes the subject matter of the present appeal.
Relevant
evidentiary framework
[5]
On the basis of the evidence of both W T and K T, the circumstances
surrounding the development of their relationship and the
establishment of the trust by W T were largely common cause. During
March 1996 W T met K T, a mother of two daughters from
a previous
marriage. He was a bachelor at the time and she was in the
process of getting divorced from her previous husband.
W T was
employed by RPP Developments (Pty) Ltd (RPP) as a project manager,
whilst K T was employed as a store manager by the Foschini
Group.
[6]
In the middle of 1997, K T and W T moved in together in a house he
was caretaking for RPP. W T subsequently identified an immovable
property in Ormonde Street, Bryanston (the property) as a good
investment. The trust purchased the property in October 1999 and
the
property was subsequently registered in the name of the trust in
February 2000. W T and K T (who were still not married at
that stage)
then took occupation of the property in February 2000 and lived
together on the property for almost ten years until
October 2009.
There was no formal agreement between them and the trust relating to
their occupation of the property, but it appeared
from the evidence
that they lived on the property, free of any consideration.
[7]
W T had created the trust in terms of a written trust deed dated 4
October 1999, apparently on the advice of his father. A trust
deed
concluded at the time reflected W T’s father as the founder of
the trust. It was also stipulated in the preamble to
the trust deed
that W T’s father had created the trust by way of a donation to
the trustees of the trust for the benefit
of income and capital
beneficiaries (as defined) subject to the terms and conditions laid
down by the founder which were incorporated
in the trust deed. In
terms of letters of authority issued by the Master of the High Court
in November 1999, W T and his brother
were both appointed as the
trustees of the trust. They remained the only trustees of the trust
since inception.
[8]
The capital beneficiaries of the trust were defined in terms of
clause 1.2 (b) of the initial trust deed as beneficiaries selected
by
the trustees from the ranks of the children of W T; the legal
descendants of such children; any trust created for any such
beneficiaries; and the testate or intestate heirs of W T if none of
the said beneficiaries were alive at the vesting date of the
trust.
[9]
In due course, after W T instituted a divorce action against K T, he
also procured the amendment of the trust deed in February
2010 in
relation to the defined beneficiaries of the trust. On the basis of
such amendment, W T and his brother remained as trustees
of the
trust.
[10]
The purchase consideration of the property by the trust was R500 000.
The acquisition was financed by a loan in the sum of
R400 000 from
Standard Bank of South Africa Limited (Standard Bank) to the trust.
The balance of the purchase price in the sum
of R100 000 as well as
transfer costs in a sum of approximately R50 000, were lent to the
trust by W T. Whilst K T testified that
she had contributed to the
deposit for the property during 1999, she also confirmed in her
evidence that she had only contributed
the limited amount of about R7
900 in the preceding year (1998) to W T for their joint living
expenses at the time. Be that as
it may, the loan from Standard Bank
to the trust was secured with a mortgage bond registered against the
property. W T, who was
still unmarried at the time, also bound
himself as surety for the obligations of the trust to Standard Bank.
The further loan from
W T to the trust was interest free, unsecured
and with no fixed repayment dates.
[11]
W T commenced business for his own account during 1998. For this
purpose, he initially established a company named Blue Lake
Developments (Pty) Ltd (BLD), which was involved in project
management for property developments. He subsequently
established
two affiliated companies. The shares in all these
companies were held by the trust.
[12]
After W T’s father died in September 2000, W T and his brother
inherited a sum of approximately R1 million each from
their father’s
estate in early 2001. W T, who was still not married to K T at
the time, used approximately R350 000
of his inheritance to settle
the loan from Standard Bank to the trust. He placed the balance of
his inheritance in an interest
bearing market-linked account in the
name of BLD. Even though the indebtedness of the trust to Standard
Bank was settled in full
in early 2001 by W T, he indicated in his
testimony that he did not cancel the mortgage bond registered against
the property. It
was accordingly on record that after the institution
of divorce proceedings by W T against K T, the bond from Standard
Bank was
increased to some R2,4 million, apparently on the basis of W
T’s loan account with the trust.
[13]
K T indicated in her testimony that she was given to understand that
the property was registered in the name of the trust solely
with a
view to protecting the property from W T’s business creditors.
She accordingly repeatedly referred to the property
in her evidence
as ‘our house’. Whilst she admitted that she always knew
that there was a trust, she suggested at one
stage that she did not
know that the property was registered in the name of the trust. At
another stage in her evidence, she confirmed
that W T had explained
to her that the property would be owned by the trust. Be that as it
may, she appeared not to dispute in
cross-examination that the
agreement of sale for the property was signed on behalf of the trust
on 14 of October 1999. She further
confirmed that she did not sign
any documentation in relation to such sale.
[14]
K T also asserted that she did not understand the notion of a trust.
She indicated at one stage in her testimony that she had
canvassed
with W T at an unspecified date, her averred right to the property in
the event that he predeceased her. At another stage
in her testimony
she indicated that she had simply assumed (apparently in the absence
of any discussions with W T) that half the
property was hers.
[15]
Some five years after meeting and approximately two years after the
property was acquired by the trust, W T and K T married
each other on
6
October 2001 in community of property. No children were
born of the marriage. From 1999 onwards they prospered, as W T
procured
lucrative contracts from various sources through the
companies affiliated to him. He indicated in his testimony that he
made ‘an
enormous amount of money’ and did ‘exceptionally
well’ from the very first year of his business until
approximately
2013.
[16]
After leaving the Foschini Group, K T was employed by Queenspark
during 1997. She then worked for a company named Edufin (Pty)
Ltd
(Edufin) from 1999 until 2004, when she was retrenched. Apart
from working for a very brief period as an estate agent
in 2005, she
was not employed from April 2004 until she separated from W T in
2009.
[17]
W T controlled the joint estate during the course of the marriage.
Over a period of some ten years until 2009, K T authorised
W T
to transfer funds from a banking account in her name to banking
accounts controlled by him including accounts of BLD and the
trust.
Such funds from the account in her name included her salary on a
monthly basis, bonuses, pension fund payments, as
well as the
proceeds of a retrenchment package from Edufin and the proceeds of
certain insurance policies.
[18]
By all accounts, the joint estate controlled by W T, enabled both K T
and W T to live a comfortable life. To the extent that
W T drew on
moneys from the trust for their use, the joint estate received
benefits from the trust during the course of their marriage.
Moreover, as already indicated, they lived in the property, without
paying any rental to the trust. They also travelled to countries
all
over the world and took a ‘gap year’ travelling around
South Africa when K T was not working. K T accordingly admitted
in
her testimony that W T looked after her well financially. In
addition, she did not dispute that he had purchased various items
for
her use, including a motor vehicle during the course of their
marriage.
[19]
The affairs of the trust, W T, BLD and the other companies affiliated
to W T were inextricably linked at all relevant times.
W T described
himself as the ‘main breadwinner’ of the trust. At one
stage in his testimony, he explained the connection
between himself,
the trust and the companies affiliated to him thus:
‘
.
. . because I was working as a project manager . . . and I earned a
high salary which paid the moneys into the trust account when
it was
needed and after I had a loan from the trust account, I paid the
money back personally into the trust account. Therefore
the trust
gained, the beneficiaries gained, everybody gained.'
[20]
Even though the documents on record reflected numerous transactions
relating to the trust, including loans between W T and
the trust, it
appears that apart from some four resolutions, all dated 22 July 2012
(after divorce proceedings were instituted),
W T and his brother did
not pass any resolutions relating to the transactions on record. All
the evidence also indicated
that for all intents and purposes, W T’s
brother was supine in relation to the affairs of the trust. It
appeared in these
circumstances that the trust was managed
exclusively by W T at all relevant times.
[21]
K T calculated that she had ‘contributed’ the cumulative
amount approximating R1 million to W T for their joint
expenses over
the course of their relationship. It was common cause that K T had
transferred most of such funds after their marriage,
and accordingly
long after the property was acquired by the trust. K T conceded
during cross-examination that the aggregate amount
spent by her
during the course of their marriage, exceeded the aggregate sum
transferred by her husband out of the account in her
name for the
same period.
[22]
The marriage between K T and W T has irretrievably broken down and
they separated in October 2009. There is no reasonable prospect
of
any reconciliation.
The
judgment of the court a quo
[23]
Against this background, the court a quo accepted that as a
consequence of representations made by W T to K T, she believed
that
their assets formed a unit, which they shared equally. As regards
ownership of the property, on the basis of criteria taken
into
account by this court in
Standard
Bank of South Africa Ltd & another v Ocean Commodities Inc &
others
,
[1]
the trial court found that even though the trust was the registered
owner of the property, it was effectively agreed between W
T and K T
that they would own the property equally as beneficial owners.
[24]
In these circumstances, the court below found that the subsequent
marriage in community of property constituted a continuation
of an
‘existing situation’ between the parties. Moreover, the
court took the view that the emotional and financial
arrangement
between the parties rendered K T’s actual nomination as a
beneficiary of the trust irrelevant in the circumstances.
The court
below accordingly held that K T and W T were considered to be
beneficial owners of the property, even though they were
not
reflected as beneficiaries of the trust. Furthermore, as regards the
averment that W T had managed the trust as his alter ego,
the learned
judge found that W T had obviously structured his affairs through the
trust (controlled exclusively by him) with a
view to amassing wealth
for no other person apart from himself.
[25]
On the basis of the discretion exercised by this court in
Badenhorst
v Badenhorst,
[2]
the
trial court further held that even though the parties were married in
community of property, it had a discretion as to whether
or not
assets belonged to a particular party, and hence also formed part of
the assets of the joint estate. For all the reasons
given, as already
stated, the trial court found that the assets of the trust were in
fact W T’ s personal assets and accordingly
formed part of the
joint estate between W T and K T.
General
legal framework
[26]
The proprietary consequences of a marriage in community of property
are trite: assets acquired by either spouse - irrespective
of who
acquired, purchased or earned the said assets - form part of the
joint estate of the parties. It is also accepted in our
law that the
concept of a trust is strictly speaking
sui
generis
.
[3]
Even though a trust is not a legal person in the same way as juristic
entities such as companies are, beneficiaries of assets of
trusts
have notionally separate interests to trustees who control such
trusts. On this basis, the statutory definition of a trust
in terms
of section 1 of the Trust Property Control Act 57 of 1988 (the Act)
specifically contemplates the transfer of interest
(or ownership) in
property or assets to a designated person or class of persons as well
as control of such property or assets by
a trustee or trustees in
accordance with the provisions of the governing trust instrument.
Section 12 of the Act further provides
that trust property does not
form part of the personal property of a trustee, except to the extent
that a trustee is entitled to
such trust property as a beneficiary in
terms of the applicable trust instrument.
Legal
issues on appeal
[27]
In so far as the issues on appeal are concerned, the allegations made
by K T in her counterclaim pertaining respectively to
W T not having
any true intention to establish the trust and the trust not being in
reality a trust at all, were not pursued. Argument
before this court
was accordingly limited to the trial court’s assessment of the
factual basis for the following primary
averments in the
counterclaim:
(a)
W T had deceived K T and had falsely represented to her that the
property was to be registered in the name of the trust, purely
with a
view to protecting it from his business creditors; and
(b)
The trust was established as the alter ego of W T inter alia by
virtue of the fact that W T controlled the trust for his personal
benefit with a view to amassing wealth only for himself.
Deceit
and misrepresentation
[28]
As I understand the averments in the counterclaim pertaining to
deceit and misrepresentation on the part of W T at an unspecified
date, it was contended that such deceit and misrepresentation
effectively resulted in K T being excluded as a beneficiary from
the
trust. It was also suggested that W T had deceived her into believing
that he would implement the consensus between the parties
relating to
beneficiaries of the trust. The difficulty with the case of K T
in this respect is that there was no evidence
whatsoever relating to
the averred deceit or misrepresentation by W T in this regard, nor
was there any evidence suggesting consensus
between the parties
relating to K T being a beneficiary of the trust. Therefore, it
appears to me that there was no evidence of
any representations
relating to K T being a beneficial owner of the property prior to her
marriage. It is also significant that,
unlike the two brothers, who
held shares through nominees in
Ocean
Commodities
,
[4]
K T did not provide the necessary capital for the acquisition of the
property. To the contrary, she benefitted from use of the
property
before she married W T, and the joint estate subsequently benefitted
from the joint use of the property after the marriage,
free of any
consideration at both stages.
[29]
Similarly, there was no factual basis for the further averment that W
T deceitfully took steps to preclude K T from her entitlement
to 50
per cent of the joint estate in the event of a divorce. This is
particularly so as W T was not married to K T when the trust
was
created and his conduct could hardly have been motivated by the
implications of a future divorce, as suggested. A further difficulty
from K T’s perspective is that she testified both that she
understood that she would be a 50 per cent owner of the property
upon
divorce and also that W T misrepresented to her that she would get 50
per cent of the value of the property upon divorce.
These averments
are not consistent and K T did not present evidence to corroborate
either.
[30]
It is also significant that notwithstanding K T’s evidence that
she assumed that she and W T were equal owners of the
property and
her further evidence that she was led to believe that she was an
equal owner in the property, the de facto ownership
of the property
by the trust was not really in dispute before the court below.
Moreover, the further suggestion that W T represented
to K T that she
would be a beneficiary of the trust is not corroborated by any of the
trust documentation on record. This
suggestion is also rendered
improbable given the undisputed evidence of W T pertaining to the
establishment of the trust on the
advice of his father prior to the
marriage.
Looking
behind the veneer of the trust
[31]
As regards averments pertaining to ‘looking behind’
the veneer of the trust as the alter ego of W T, the
legal principles
in this respect have in essence been transplanted from the arena of
‘piercing the corporate veil’.
[5]
In the latter context, courts are empowered to disregard the legal
fiction of separate corporate personality in suitable or appropriate
circumstances. Similarly, as Cameron JA noted in this court in
Land
and Agricultural Bank of South Africa v Parker & others
,
[6]
if the trust form is ‘debased’, justice would dictate
that the veneer of the trust be pierced in the interests of
creditors. By analogous reasoning, unconscionable abuse of the trust
form through fraud, dishonesty or an improper purpose will
justify
looking behind the trust form.
[32]
Even if one accepts in the present case that the trust form cannot be
separated from the personal affairs of W T, and even
if one accepts
further that W T did not act jointly with his brother in relation to
affairs of the trust,
[7]
as
contemplated in the trust deed, there is no legal basis for
contending that either W T or his brother, as trustees of the trust,
owed any fiduciary responsibility to W T. This is simply so as W T
did not qualify as a defined beneficiary of the trust at any
stage,
nor was there any evidence that she had transacted with the trust as
a third party at any stage before or after her marriage
to W T.
[33]
Significantly, the dicta of Cameron JA in
Parker
pertaining to the importance of maintaining the functional separation
between control (by trustees) and enjoyment (by beneficiaries)
in
family trusts, are premised upon the interests of third parties, who
transacted with the trust.
[8]
K
T is neither such a third party nor does she qualify as a beneficiary
of the trust. To the extent that it is relevant in this
context, I
also agree with Cameron JA that the frequent absence of the suggested
dichotomy of control and enjoyment in family trusts
may require
legislative attention prescribing oversight by an independent
outsider, with a view to ensuring adequate separation
of control from
enjoyment of trust affairs in every case. However, even if one
accepts that courts can invoke the suggested
supervisory powers to
ensure that trusts function ‘in accordance with the principles
of business efficacy, sound commercial
accountability and the
reasonable expectation of outsiders who deal with them’,
[9]
for the reasons given, K T has no standing to challenge the
management of the trust by her husband in the circumstances of the
present case, either as a beneficiary of the trust or as a third
party, who transacted with the trust.
[10]
[34]
In these circumstances, there was no factual or legal basis for the
further finding by the court a quo that the trust was simply
a
continuation of the previous situation between the parties. W T and K
T never owned the property in equal shares prior to the
marriage, nor
was it established on the probabilities that they ever concluded any
agreement relating to the purchase of the property.
Moreover,
notwithstanding suggestions to the contrary, it was common cause that
W T had procured the establishment of the trust
as well as the
purchase of the property prior to his marriage to K T, without the
participation of K T and without any significant
financial
contribution from K T.
[35]
The trial court’s reliance upon
Badenhorst
to suggest
that the court’s discretion played a role in determining
whether assets belonged to a particular party is also
misdirected.
This is primarily so as a significant distinguishing factor between
the present matter and
Badenhorst
is simply that the latter
case related to the determination of a redistribution of assets in
terms of s 7(3) of the Divorce Act
of 1979 (the
Divorce Act) for
a
marriage out of community of property. Therefore, whilst both cases
related to discretionary family trusts, it is pertinent in
relation
to
Badenhorst
that
s 7(3)
of the
Divorce Act vests
a wide
discretion in courts making a redistribution order in relation to a
marriage out of community of property
.
In contrast, when
assessing the proprietary consequences of a divorce following a
marriage in community of property, as in the present
case, the court
is generally confined merely to directing that the assets of the
joint estate be divided in equal shares. The court
concerned with a
marriage in community of property accordingly has no comparable
discretion as envisaged in
s 7(3)
of the
Divorce Act to
include the
assets of a third party in the joint estate. In any event, s 12 of
the Act specifically recognizes in this context
that trust assets
held by a trustee in trust, do not form part of the personal property
of such trustee as a matter of law.
[36]
In effect, what the court below did amounted to a transfer of the
trust’s assets to the joint estate. It did so without
considering the legal implications of a court order in this respect
on creditors of the trust such as Standard Bank. Indeed,
it is
arguable in this context whether even the wide discretion of the
court envisaged in
s 7(3)
of the
Divorce Act, incorporates
the
discretion simply to ‘transfer’ ownership of trust
assets, rather than merely including the value of trust assets
as
part of the personal estate of a trustee on the basis of piercing the
corporate veil.
[11]
[37]
Finally, it is my view in this context that the court below erred in
giving any weight to evidence relating to ‘contributions’
made by K T from time to time to banking accounts controlled by W T
during the course of their marriage. The fundamental misdirection
in
this regard is simply that W T and K T had one joint estate pursuant
to their marriage in community of property. Thus, even
moneys in a
bank account in her name obviously formed part of the joint estate.
Therefore, her testimony pertaining to her monetary
contributions to
W T were as irrelevant as W T’s inconsistent evidence relating
to the manner in which he sought to allocate
her financial
‘contributions’ from time to time. In the final analysis,
any empathy for K T`s case must in my view
necessarily be coloured by
the legal consequences of the election she had made with respect to
her marital regime.
Conclusion
[38]
For all the reasons given, the appeal against the declaratory order
made by the court a quo relating to assets of the trust
must be
upheld.
Costs
[39]
As regards costs, counsel for the appellants conceded at the hearing
of the appeal that the appellants’ attorneys had
not properly
complied with the rules of this court, inter alia by failing to
cross-reference the record of the appeal. As such,
even though the
appellants in this matter have been successful, it is appropriate to
limit the costs order, which follows in favour
of the appellants.
Order
[40]
Based on the aforegoing, the following order is made:
(a)
The appeal is upheld with costs, save for costs attendant upon the
preparation of the record for the purposes of the appeal.
(b)
The order of the court a quo is set aside and substituted with the
following order:
‘
(i)
It is declared that the assets of the [W T] Trust with Master’s
reference number IT11246/1999, established in October
1999 do not
form part of the joint estate of the parties.
(ii)
The action in this matter is postponed sine die to enable the value
of the joint estate of the parties to be determined.
(iii)
The defendant is directed to pay the plaintiff’s costs as well
as the costs of the trust.’
_________________________
H
Mayat
Acting
Judge of Appeal
Appearances
For
the Appellants: T Strydom SC
Instructed
by:
Louis
Benn Attorney, Johannesburg
Wessels
& Smith, Bloemfontein
For the Respondent:
A P Allison
Instructed by:
RMB Wands Attorneys
& Conveyancers, Johannesburg
Bezuidenhouts
Attorneys, Bloemfontein
[1]
Standard
Bank of South Africa Ltd & another v Ocean Commodities Inc &
others
1983 (1) SA 276
(A) at 289E-H where Corbett JA found that two
brothers who were not registered debenture-holders in a company, but
held such
debentures through nominees, were effectively beneficial
owners of such debentures inter alia because they had provided the
necessary
capital for the acquisition of the shares and dividends
declared on such shares were remitted to them.
[2]
Badenhorst
v Badenhorst
2006 (2) SA 255; [2006] 2 All SA 363 (SCA).
[3]
See
Commissioner
for Inland Revenue v MacNeillie’s Estate
1961
(3) SA 833
(A) at 840G-H.
[4]
Standard
Bank of South Africa Ltd v Ocean Commodities Inc
fn
1 above.
[5]
To the extent that it is relevant in this context, Binns-Ward J
correctly noted in
Van
Zyl NNO & another v Kaye NO
2014
(4) SA 452
WCC para 16, that there is often a conflation of the
notion of proving that a trust is a sham (in the sense that it does
not
really exist) and ‘going behind’ the trust form,
where there is a valid trust. The notion of a trust being a sham is
premised upon not recognizing the trust, whilst the ‘looking
behind’ a trust veil, implicitly recognizes the validity
of a
trust in the legal sense, but challenges the control of the trust
concerned.
[6]
Land
and Agricultural Bank of South Africa v Parker & others
2005 (2) SA 77, [2004] 4 All SA 261 (SCA).
[7]
As envisaged in
Niewoudt
and Another NNO v Vrystaat Mielies (Edms) Bpk
2004
(3) SA 486
(SCA) para 16 quoted by Cameron JA in
Parker
para
15.
[8]
Para 37.1.
[9]
As stated by Cameron JA in
Parker
para
37, where the learned judge refers to comments by Coppenhagen J in
Vrystaat
Mielies
.
[10]
In para 37.1 of
Parker
,
Cameron JA specifically premised his suggestions pertaining to
trusts on the basis of safeguarding the interests of third parties,
who transact with trusts.
[11]
See the comments in this respect in the recent decision of Alkema J
in
RP
v DP & others
2014
(6) SA 243
ECP para 35.