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[2018] ZAGPJHC 608
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P S v T S (A3122/2017) [2018] ZAGPJHC 608 (29 October 2018)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
and
SAFLII
Policy
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO: A3122/2017
In
the matter between:
S:
P APPELLANT
AND
S:
T RESPONDENT
JUDGMENT
TWALA
J
[1]
This appeal concerns the order varying the divorce settlement
agreement entered into by the parties which was made an order
of
court by the Regional Court Magistrate sitting in Johannesburg on the
12
th
of May 2016. The magistrate varied the order on the 9
th
of June 2017.
[2]
The application to vary the settlement agreement between the parties
which had been made an order of court could not be decided
on the
papers because there was a dispute of fact – hence the
magistrate called for oral testimony.
[3]
It is common cause that the parties were divorced on the 12
th
of May 2016 when they concluded a settlement agreement which was made
an order of court. It is not in dispute that with regard
to the
parties’ proprietary rights to the pension fund interests, the
appellant presented an actuarial calculation by Gerald
Jacobson
Consulting Actuaries (Jacobson). It is settled between the parties
that the actuarial calculation presented two pension
fund benefit
schemes of the appellant, (a) the Johannesburg Municipal Pension
Fund, and (b) the City of Johannesburg Pension Fund.
It is further
not in dispute that in terms of the settlement agreement the
respondent was to receive 40% as her share of the pension
fund
interest of the appellant.
[4]
It is apparent from the record that the parties were married to each
other in community of property on the 19
th
of November
1987. The respondent instituted divorce proceedings against the
appellant in November 2011. On the 28
th
of January 2014
the appellant made discovery and included the City of Johannesburg
Pension Fund and the title deed of Erf […]
Zone 4 Pimville
Soweto as his assets in its discovery affidavit.
[5]
In a nutshell the testimony of the respondent was that she knew that
the appellant was a member of a pension fund but did not
know that he
was a member of two pension fund schemes. She saw the report by
Jacobson for the first time when she was appearing
in court on the
12
th
of May 2016. She was shown the document which had an amount written
in manuscript as the amount she was to receive from the pension
fund
interest of the appellant.
[6]
On the 12
th
of May 2016, as testified by Ms Rizzotto who was the attorney for the
respondent when the matter was set down for hearing, the
parties held
settlement discussions and the appellant produced the actuarial
report by Jacobson. She did not notice that the actuarial
report
referred to two pension fund benefit schemes but negotiated
settlement on behalf of her client at 40% based on the
figure
that represented the total amount on the Jacobson’s report
which was then hand written on the report amounting to
R1 012 836.40. She then prepared and or amended the
settlement agreement and she advised her client to sign it
on the
basis that she (client) was to receive a pension fund interest in the
sum of R1m and the house in Soweto. She only became
aware of the
second pension fund of the appellant when she lodged a claim for her
client and the correspondents reflected a sum
of R214 023.50 as
an amount due to her client instead of the expected R1m. She was
given the pension number by the attorney
for the appellant who did
not disclose to her that there are two pension fund interests. At all
times she was concentrating on
the total figure on Jacobson’s
report but never noticed that it related to two pension fund schemes.
She then advised her
client to institute the proceeding to vary the
settlement agreement. She denied that there was an issue whether the
division of
the joint estate between the parties was fair or not.
[7]
The appellant testified that the agreement that the respondent will
be entitled to 40% of the City of Johannesburg Pension Fund
was based
on the premise that she was also entitled to the property in Soweto
which has more value than the property in Polokwane
which is tribal
land. He insisted that there was more than one meeting held at the
respondent’s attorney’s offices
where all these
discussions took place and were agreed upon. It was agreed in these
meetings that the Johannesburg Municipal Pension
Fund be excluded. He
conceded that they did not know the value of the City of Johannesburg
Pension Fund at the time but it was
agreed on his estimate that the
respondent will receive 40% as her share in that pension fund.
[8]
It is trite law that in interpreting any document, the court must
consider all the facts and the circumstances under which such
document or contract was concluded. The starting point remains the
words in the document, the background facts and the intention
of the
parties.
[9]
It is apposite at this stage to refer to the relevant provision of
the settlement agreement which reads as follows:
“
7.3
Pension
7.3.1
That 40% (Forty percent) of the Defendant’s pension interest as
defined in
Section 1
of the
Divorce Act 70 of 1979
, in the City of
Johannesburg Pension Fund, membership and employee number being 300
14913, be paid to the Plaintiff.
7.3.2
The City of Johannesburg Pension Fund is ordered to endorse its
records accordingly and make payment directly to Plaintiff
of the
amount due to her within 60 (sixty) days of her request, on
presentation of this court order.”
[10]
In
Novartis
v Maphil
[2015]
ZASCA 111
,
2016
(1) SA
the Supreme Court of Appeal per Lewis JA alluded to the following:
“
[27]
I do not understand these judgments to mean that interpretation is a
process that takes into account only the objective meaning
of the
words (if that is ascertainable), and does not have regard to the
contract as a whole or the circumstances in which it was
entered
into. This court has consistently held, for many decades, that the
interpretative process is one of ascertaining the intention
of the
parties – what they meant to achieve. And in doing that, the
court must consider all the circumstances surrounding
the contract to
determine what their intention was in concluding it. KPMG, in the
passage cited, explains that parol evidence is
inadmissible to
modify, vary or add to the written terms of the agreement, and that
it is the role of the court, and not witnesses,
to interpret a
document. It adds, importantly, that there is no real distinction
between background circumstances, and surrounding
circumstances, and
that a court should always consider the factual matrix in which the
contract is concluded – the context
– to determine the
parties’ intention.
[28]
The passage cited from the judgment of Wallis JA in Endumeni
summarizes the state of the law as it was in 2012. This court
did not
change the law, and it certainly did not introduce an objective
approach in the sense argued by Norvatis, which was to
have regard
only to the words on the paper. That much was made clear in a
subsequent judgment of Wallis JA in Bothma-Botha Transport
(Edms) Bpk
v S Bothma & Seun Transport (Edms) Bpk
[2013] ZASCA 176
;
2014 (2)
SA 494
(SCA), paragraphs 10 to 12 and in North East Finance (Pty )
Ltd v Standard Bank of South Africa Ltd [2013]ZASCA 76;
2013 (5) SA 1
(SCA) paragraphs 24 and 25. A court must examine all the facts –
the context – in order to determine what the parties
intended.
And it must do that whether or not the words of the contract are
ambiguous or lack clarity. Words without context mean
nothing.
[29] Referring to
the earlier approach to interpretation adopted by this court in
Coopers & Lybrand & others v Bryant
[1995] ZASCA 64
;
1995 (3)
SA 761
(A) at 768A-E, where Joubert JA had drawn a distinction
between background and surrounding circumstances, and held that only
where
there is an ambiguity in the language, should a court look at
surrounding circumstances, Wallis JA said (para 12 of Bothma-Botha):
‘
That
summary is no longer consistent with the approach to interpretation
now adopted by South African courts in relation to contracts
or other
documents, such as statutory instruments or patents. While the
starting point remains the words of the document, which
are the only
relevant medium through which the parties have expressed their
contractual intentions, the process of interpretation
does not stop
at a perceived literal meaning of those words, but considers them in
the light of all relevant and admissible context,
including the
circumstances in which the document came into being. The former
distinction between permissible background and surrounding
circumstances, never very clear, has fallen away. Interpretation is
no longer a process that occurs in stages but is “essentially
one unitary exercise” [a reference to a statement of Lord
Clarke SCJ in Rainy Sky SA v Kookmin Bank
[2011] UKSC 50
, [2012]
Lloyd’s Rep 34 (SC) para 21].
[30] Lord Clarke
in Rainy Sky in turn referred to a passage in Society of Lloyd’s
v Robinson [1999] 1 All ER (Comm) at 545,
551 which I consider
useful.
‘
Loyalty
to the text of a commercial contract, instrument, or document read in
its contextual setting is the paramount principle
of interpretation.
But in the process of interpreting the meaning of the language of a
commercial document the court ought generally
to favour a
commercially sensible construction. The reason for this approach is
that a commercial construction is likely to give
effect to the
intention of the parties. Words ought therefore to be interpreted in
the way in which the reasonable person would
construe them. And the
reasonable commercial person can safely be assumed to be unimpressed
with technical interpretations and
undue emphasis on niceties of
language.’
[31] This was
also the approach of this court in Ekurhuleni Metropolitan
Municipality v Germiston Municipal Retirement Fund
[2009] ZASCA 154
;
2010 (2) SA 498
(SCA) para 13. A further principle to be applied in a
case such as this is that a commercial document executed by the
parties with
the intention that it should have commercial operation
should not lightly be held unenforceable because the parties have not
expressed
themselves as clearly as they might have done. In this
regard see Murray & Roberts Construction Ltd v Finat Properties
(Pty)
Ltd
[1991] ZASCA 130
;
1991 (1) SA 508
(A) at 514B-F, where
Hoexter JA repeated the dictum of Lord Wright in Hillas & Co Ltd
v Arcos Ltd
[1932] UKHL 2
;
147 LTR 503
at 514:
‘
Business
men often record the most important agreements in crude and summary
fashion; modes of expression sufficient and clear to
them in the
course of their business may appear to those unfamiliar with the
business far from complete or precise. It is accordingly
the duty of
the court to construe such documents fairly and broadly, without
being too astute or subtle in finding defects.’
[11]
I find myself in disagreement with counsel for the applicant in that
it was agreed between the parties that the respondent
will receive
40% of the City of Johannesburg Pension Fund interest because she was
getting the house in Soweto. It is clear from
the conspectus of the
matter that the respondent was not aware that there were two pension
fund schemes in which the appellant
was a member. The appellant
deliberately withheld that information to the respondent –
hence he discovered only the City
of Johannesburg Pension Fund and
provided the respondent with the number for that pension fund only.
[12]
I am unable to disagree with counsel for the appellant that the
attorney for the respondent was negligent in not reading the
Jacobson’s report properly and effect the necessary amendments
to include the figure of R1m as the 40% share due to her client
as
reflected in Jacobson’s report in manuscript. However, that
imputation on the attorney, coupled with the conspectus of
the facts
of the matter, does not take away the duty of the court to construe
the document fairly and broadly. It is not in the
interest of justice
for this court to be astute and subtle in finding defects in the
agreement between the parties.
[13]
Ms Rizzotto in her unchallenged testimony confirmed that, although
she did not insert the figure of R1m on the settlement agreement,
it
was on the basis of the figure that is reflected on the Jacobson’s
report in manuscript that the matter was settled between
the parties.
I am of the view therefore that the appellant’s attorney
produced the Jacobson’s report on the date of
trial to
facilitate settlement of the matter and the agreement was concluded
that the respond will receive 40% of the pension fund
interest of the
appellant based on the figure on Jacobson’s report.
[14]
I agree with counsel for the respondent that it was not necessary to
insert the figure of R1m on the settlement agreement for
the figure
would change when worked out by the pension fund when payment is made
some time after the order. Common sense suggests
that, although the
figure would not drastically change, but it is prudent to leave it in
the hands of the pension fund to do the
calculation. It is my
respectful view therefore that there is no merit in the submission
that the figure of R1m should have been
reflected in the settlement
agreement if it was the figure that was agreed upon on the 12
th
of May 2016.
[15]
I agree with counsel for the appellant that the respondent signed an
agreement for 40% in the City of Johannesburg Pension
Fund interest
of the appellant. However, she did so under the belief, and that of
her attorney, that her 40% share in City of Johannesburg
Pension Fund
amounts to R1m as was presented to her during the settlement
negotiations on the day of trial of her matter. It is
my considered
view therefore that, there was no agreement between the parties to
exclude the Johannesburg Municipal Pension Fund
from settlement
agreement and therefore the appeal falls to be dismissed.
[16]
In the circumstances, I make the following order:
The
appeal is dismissed with costs.
________________
TWALA
J
JUDGE
OF THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION
I
agree
_______________
MATSEMELA
AJ
ACTING
JUDGE OF THE HIGH COURT OF
SOUTH
AFRICA, GAUTENG LOCAL DIVISION
Date
of hearing: 09 October 2018
Date
of Judgment: 29 October 2018
For
the Appellant: Adv MJ Mojela
Instructed
by: TF Mathebula Attorneys
Tel:
011 333 7298
For
the Defendant: Adv. C Snoyman
Instructed
by: Ratshivhombela Attorneys
Tel:
011 4920042