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[2016] ZAGPPHC 652
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V v M (19398/2014) [2016] ZAGPPHC 652 (25 July 2016)
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REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
25/7/16
CASE
NO:
19398/2014
Reportable:
No
Of
interest to other judges: No
Revised.
In
the matter between:
P
T
V
PLAINTIFF
and
M
J
M
DEFENDANT
JUDGMENT
MALI
J
[1]
The plaintiff a 50 year old unemployed lady and the mother of two
children seeks an order for a declaration of universal partnership.
The order sought is against the defendant, a 48 year old male
financial manager who has no children of his own. The parties were
never married to each other. The defendant denies the existence of a
universal partnership.
[2]
The parties have agreed that the only issues for decision are (a)
whether a universal partnership came into existence; (b) if
so,
whether the parties had equal shares in the partnership; (c) if so,
whether a liquidator ought to be appointed on terms and
conditions to
make an award in writing.
[3]
The basis of the plaintiff's claim is that the parties had lived
together as husband and wife for a period of approximately
18 years.
It has been always the plaintiff's understanding that the parties
came into a relationship on the basis that the they
would give each
other their respective possessions or properties.
[4]
The following facts are common cause; that the parties commenced
their relationship in 1992 in Witbank, Mpumalanga. They started
living together in 1996. The plaintiff was working for BHP Billiton
Gold Mine.("BHP"). The defendant worked for a bank
when the
parties met. The defendant commenced with his Bachelor of Commerce
studies at the University of Pretoria before his cohabitation
with
the plaintiff. He completed his studies after he had moved in with
her. The defendant also completed a Masters degree in Business
Leadership ("MBL") during the course of the relationship.
The defendant because of his qualifications enjoyed career
growth in
the Accounting and Financial Industry. The parties jointly purchased
an immovable property, a house situated at […]
V. St, Beun
Fleur, Witbank. The property is commonly referred to as […] V.
St. The parties agreed to share living expenses
such as buying
groceries, and home maintenance. In October 2013 their relationship
was terminated on the instance of the defendant.
[5]
In
PEZZUTO
v DREYER AND OTHERS
[1]
it was held that a universal partnership will exist if the following
essentials are present:
(a) That each of
the parties bring something into the partnership, whether it be
money, labour or skill,
(b) That the
partnership should be carried on for the joint benefit of the
parties;
(c) That the object
should be to make a profit;
(d)
That the
contract should be a legitimate one. This element has been discounted
by our courts for being common to all contracts,
as held in
BESTER
v VAN NIEKERK
[2]
.
[6]
In
BUTTERS
v
MNCORA
[3]
at paragraph 17 -18 the following is stated;
"The requirements
for
a
partnership
as
formulated by Pothier had become
a
well-established part of our law. Those requirements have
served us well. They have been applied by our courts to universal
partnerships in general and universal partnerships between cohabitees
in particular. I therefore cannot see the necessity for the
formulation of special requirements for the latter category. This is
also borne out by the fact that Pothier himself did not find his
formulation of the requirements incompatible with the concept
of
universal partnerships of all property which he discussed in some
detail.
In this light our
courts appear to be supported by good authority when they held,
either expressly or by clear implication that:
(a)
Universal
partnerships of all property which extend beyond commercial
undertakings were part of Roman Dutch law and still form part
of our
law.
(b)
A universal
partnership of all property does not require an express agreement.
Like any other contract it can also come into existence
by tacit
agreement, that is by an agreement derived from the conduct of the
parties.
(c)
The
requirements for
a
universal partnership of all property,
including universal partnerships between cohabitees, are the same
as
those formulated by Pothier for partnerships in general.
(d)
Where the
conduct of the parties is capable of more than one inference, the
test for when
a
tacit universal partnership can be held to
exist is whether it is more probable than not that
a
tacit
agreement had been reached.
(See eg Ally v Dinath
1984 (2) SA 451
(T) at 453F-455A; Miihlmann v Miihlmann
1981 (4) SA
632
(W) at 634A-B; Miihlmann v Miihlmann
1984 (3) SA 102
(A)
at 109C-E; Kritzinger v Kritzinger
1989 (1) SA 67
(A) at 77A;
Sepheri v Scanlan
2008 (1) SA 322
(C) at 338A-F; Vo/ks NO v Robinson
2005 (5) BCLR 44
(CC) para 125; Pone/at v Schrepfer
2012 (1) SA 206
(SCA) paras 19-22; J J Henning Law of Partnership (2010) 20-29; 19
Lawsa 2 ed para 257.)
Once it is accepted
that
a
partnership enterprise may extend beyond commercial
undertakings, logic dictates, in my view, that the contribution of
both parties
need not be confined to
a
profit making entity.
The point is well illustrated, I think, by the very facts of this
case. It can be accepted that the plaintiff's
contribution to the
commercial undertaking conducted by the defendant was insignificant.
Yet she spent all her time, effort and
energy in promoting the
interests of both parties in their communal enterprise by maintaining
their common home and raising their
children. On the premise that the
partnership enterprise between them could notionally include both the
commercial undertaking
and the non-profit making part of their family
life, for which the plaintiff took responsibility, her contribution
to that notional
partnership enterprise can hardly be denied".
[7]
In
BUTTERS
v
MNCORA
above it is further
stated that:
"a
universal
partnership of all property does not require an express agreement.
Like any other contract it can also come into existence
by tacit
agreement, that is by an agreement derived from the conduct of the
parties.
"
[8]
The only witnesses were the parties themselves.
[9]
It transpired from the evidence that when the parties first moved
together they stayed in the mine house. The mine house belonged
to
the plaintiff's then employer, BHP. The stayed with the plaintiff's
two minor children from her previous marriage. The plaintiff
was
earning more income than the defendant and she was receiving
maintenance from the father of her children. The parties contributed
towards household expenses and food together without following strict
rules regulating their respective contributions. As the time
went by
the defendant contributed two thirds and the plaintiff contributed a
third of the household expenses including food.
[10]
The plaintiff further stated that in 1997 the defendant got employed
by BHP on her instance. The defendant has disputed that
the plaintiff
assisted him to get employment at BHP. What is not in dispute is that
at the time the defendant earned more than
the plaintiff and as a
result they jointly purchased [...] V. St. The defendant paid two
thirds towards the bond instalment and
the plaintiff paid a third. In
the beginning, at [...] V. Street the parties used the plaintiff's
furniture and they later decided
to buy new furniture. The defendant
would buy more expensive furniture as he had means to do so.
[11]
The plaintiff further stated that the defendant paid for the
maintenance and renovations of [...] V. Street and the plaintiff
assisted by contributing physical labour and skill. The defendant
personally carried out the repairs, a fact not disputed by the
defendant. The plaintiff also took the responsibility for interior of
the house by contributing her money, time and labour.
[12]
Under cross examination it was put to the plaintiff that the reason
for her participation in the renovations was because she
was a half
owner of the property and was duty bound to do so. It was also put to
her that she was carrying ordinary duties of a
wife. I cannot accept
this contention because although they were joint holders the
defendant paid more than what was required of
him. He never followed
the 50% principle in the daily practice.
[13]
The plaintiff further stated that she believed that as they bought
their first joint property they were going to grow old together
and
were working together towards the same goal. Both parties agree that
[...] V. Street was purchased jointly because neither
of them then
could afford to obtain housing finance individually. The plaintiff is
adamant that the purchase of the property furthered
their tacit
intention of universal partnership.
[14]
The plaintiff further gave evidence that the parties used to talk
about growing old together in a large estate and were looking
forward
to sit in a
"stoep"
to watch the sun. The defendant
even joked with the plaintiff that he would buy her a house with a
"stoep"
somewhere in the Free State Province. This
is not disputed by the defendant. Although this has an element of
jest it is normal for
parties who are committed to each other to make
these kinds of jokes. If it was undesirable for the defendant to grow
old with
the plaintiff, it was his opportune moment to express his
disapproval.
[15]
It is evidence of both parties that when the parties moved in
together the defendant continued with his studies and the plaintiff
would assist by cooking , washing and ironing for the defendant and
in making the household comfortable and conducive for studying.
According to the plaintiff, she had contributed to the defendant's
success.
[16]
The defendant further testified that when they moved together he had
a television set, a bed, his own vehicle, a pension investment
and
immovable property which he rented out. The defendant testified that
he bought the property before he met the plaintiff. When
he sold the
property in October 1997 he did not share any proceeds with the
plaintiff because he made it clear to the plaintiff
that it was his
investment.
[17]
Both parties testified that the defendant later purchased another
immovable property, a vacant land which is commonly known
as Reyno
Heights. The plaintiffs evidence is that they bought Reyno Heights in
order to build a bigger house to occupy in the future.
The plaintiff
had no problem that the property was in defendant's name because from
the actions of both parties it was clear that
it was their dream
home, in fact the plaintiff trusted the defendant. According to the
plaintiff they verbally agreed to sell [...]
V. St and other
properties with the aim to use the proceeds to build their home on
Reyno Heights.
[18]
Under cross examination the plaintiff was questioned about the
improbability of contributing proceeds from her only property
into
the property not registered in her name. She persuasively stated that
she was operating under trust relationship and never
wanted to upset
the system that was working well by questioning things.
[19]
The plaintiff further stated that the only reason that the building
of the house was delayed was because of the constant change
of plans
as they were designing their dream house. Unfortunately whilst they
were busy with the plans the defendant got involved
with another lady
and the building of the property stalled. The defendant does not deny
that the plaintiff made inputs into the
plans and design of the
property, however he proffers a different reason. His reason is that
he only requested the plaintiff's
input on how to design a best
investment house, as there was no agreement between them that the
plaintiff was part of the property.
[20]
In the event that the defendant's contention above is accepted, the
defendant on his own admission continued to source plaintiff's
skills. It matters not whether the house was intended for investment.
What is important is that both parties contributed something
towards
the property for the shared purpose of growing their joint estate
with their retirement in mind. According to the plaintiff
the
partnership was carried on for the joint benefit of both parties.
[21]
It also transpired from the evidence that the defendant later
purchased another house on his name. As earlier testified by
the
plaintiff she never bothered about her not being the registered owner
of the properties as she trusted the defendant. The defendant
further
purchased another immovable property referred to as Santica. When he
bought the house it was no longer comfortable for
the parties to live
together. According to the plaintiff she was supposed to move to
Santica, but because of the laser grass cutting
machine which could
not be accommodated at Santica the plaintiff did not move.
[22]
The inferred conduct of a universal partnership, is further
corroborated by the plaintiff's evidence that the defendant nominated
her as a sole beneficiary for his death benefits. The defendant
bequethed almost his entire estate to the plaintiff and some of
his
estate to the plaintiff's children. At the time of the hearing of the
matter the defendant had retained the plaintiff on his
medical aid.
The defendant's evidence is that the will is not enforceable as it
is. The policy was in terms of the oral agreement
as well as that the
conferment of benefits does not imply element of universal
partnership. There is no evidence that the defendant
ever amended the
will, and nominated a new beneficiary for his death benefits.
[23]
According to the defendant he is stingy and very money wise when it
comes to savings and investment. One of his reasons is
that he comes
from a lacking and deprived background. I find it implausible that a
stingy and a financial sound person of defendant's
stature would
throw away his estate to anyone and everyone who means or meant
nothing to him. My view is that in the least he would
have bequethed
a part of his estate to his parents and sister who were not doing
well financially. This is because that according
to his testimony the
defendant has a close bond and or good relationship with his family.
[24]
According to the plaintiff the defendant bought her a gift, a laser
grass cutting machine mentioned above to start her own
business. The
defendant later insisted that the plaintiff pay him for the machine
after the termination of their relationship.
The plaintiff testified
that she had all the reasons to believe that the machine was the
present from the defendant as he used
to buy her expensive gifts
including a wristwatch valued at R12000.00. The wrist watch was
purchased 15 years ago; the defendant
further took her on expensive
holiday destinations and bought her a Ducatti motorcycle. Under cross
examination the plaintiff admitted
that on two separate occasions
paid the flight tickets both for he and the defendant to Las Vegas
and Amsterdam, the majority of
the expenses for the overseas holidays
were paid for by the defendant.
[25]
The plaintiff further testified that she is currently unemployed as
she took a package in 2013 because she was being forced
to transfer
to Johannesburg. She was not prepared to move to Johannesburg as she
was still in love with the defendant. The plaintiff
currently earns
her living from what she calls a salary, a substantial monthly amount
of R16000.00 from the defendant. She also
earns income from the
business of grass cutting. She further stated that the defendant
stopped paying the said "salary"
on the advice of his own
lawyers. The defendant informed her that according to his lawyers,
continuation of the said "salary"
payment could be seen as
an admission of guilt.
[26]
The defendant did not challenge the plaintiffs evidence that in 2011
when they encountered problems with their relationship
the defendant
offered to purchase the plaintiff a property. The above clearly shows
how the parties were both committed to each
other despite that in the
end the defendant changed his minds about the relationship.
[27]
Under cross examination the defendant admitted that if the
relationship lasted longer the plaintiff would have benefited. From
this it appears that the defendant accepts the existence of universal
partnership but the issue is the duration of the relationship.
Is
there any period more than 18 years of a relationship to qualify
someone for the benefits of a universal partnership? By anyone's
standards, 18 years is way more than reasonable to accept the
existence of universal partnership although this is not a
requirement.
However when taking into account the totality of the
circumstances nothing more is required to prove universal partnership
particularly
when the defendant's own admission is considered.
ASSESSMENT
OF THE EVIDENCE
[28]
The plaintiff testified in a coherent, lucid and credible manner. She
would express her emotions by crying and confusing some
of the facts.
This is the expected behaviour from someone grieving the loss of an
intimate relationship, and above all she is a
layperson. Despite the
above conduct the plaintiff managed to compose herself and adduced
her evidence well.
[29]
My observation is that she was deeply hurt because of the breakdown
of the relationship on the instance of someone whom she
considered
her soul mate and her life partner. This is not farfetched because
the defendant on his own admission under cross examination
agreed
that he regarded her as his wife. The defendant went to the extent of
referring to his relationships with other people as
extra marital
affairs, and that after the first extra marital affair the defendant
went for counselling to solve their problems.
[30]
The credibility of the plaintiff was challenged when she was cross
examined about the fact that defendant had more assets when
they met.
Taking into account that they started cohabiting in 1992 it is
expected of the plaintiff not to remember everything.
[31]
To the plaintitrs credit she could not remember the defendant's
immovable property, the one he rented out and sold whilst taking
shelter with the plaintiff in the mine house. The mine house was the
plaintiff's benefit. At that stage the defendant was earning
less
than the plaintiff even though it was for a short while. This shows
that the plaintiff is not driven by greed, she wants what
is lawfully
and rightfully hers. Under cross examination the plaintiff went as
far as admitting that her property including the
movable property and
other capital investment falls within the universal partnership.
[32]
The defendant was coherent, logical and composed. There are few
incidents when I found his credibility questionably. For example
when
he testified about selling his first house he said that he "thought"
he told her about her career plans and that
he was not prepared to
share the proceeds of the sale of the house with her. Secondly
regarding the issue of the laser cutting
machine he was not
convincing at all when he testified that he bought the plaintiff the
machine based on the loan agreement. The
defendant tried hard and
painfully to ward off any facts and or evidence proving the existence
of universal partnership.
[33]
I fully agree with the counsel for the plaintiff that the most
important concession made by the defendant was that if the
relationship had not terminated because of his infidelity the
plaintiff would have benefited from the assets he accumulated over
time. According to the counsel for the defendant , the defendant's
concession is irrelevant because it is not one of the elements
required to prove the plaintiff's case. Even though it is accepted
that indeed it is not one of the elements, however taking together
everything into account it is more probable than not that a tacit
agreement had been reached.
[34]
In conclusion, the plaintiff has succeeded in establishing on the
balance of probabilities the existence of a universal partnership
between her and the defendant.
[35]
The remaining question is whether the parties had equal shares in the
partnership. The counsel for the defendant submitted
that in the
event that a universal partnership is found the plaintiff's share
should not exceed 10%. There is no basis for this
submission.
[36]
The counsel for the plaintiff correctly submitted in my view that
since the defendant earned larger salary and contributed
a larger
share the plaintiff could not share equally with the defendant. In my
view it is fair and appropriate for the plaintiff
to share 33% of the
defendant's assets.
[37]
I therefore make the following order:
1. It is declared that a
universal partnership came into existence between the plaintiff and
the defendant which partnership was
dissolved on 30 October 2013;
2. It is declared that
the parties should share in the joint combined assets of the parties
as at 30 October 2013 as to 33% in favour
of the plaintiff and 67% in
favour of the defendant;
3. The parties are to
appoint a liquidator or receiver with authority to release the
universal partnership assets, to liquidate
same, if necessary, to
prepare a final account and to pay to the plaintiff 33% of the net
proceeds thereof, the remainder to be
paid to the defendant;
4. In the event that the
parties are unable to reach consensus on the appointment of a
liquidator or receiver the parties are directed
to approach the court
which shall, after hearing the parties, appoint or receiver;
5. Interest on the sum so
determined shall be calculated at the legal rate as from 30 October
2013 to date of payment thereof;
6. The defendant is
ordered to pay the plaintiff's costs of suit including the costs of
two counsel.
________________________
N
P MALI
JUDGE
OF THE HIGH COURT
Counsel
for the Plaintiff:
Adv. T.P. Kruger
(SC)
Instructed
by:
MARAIS SASSON INC
Counsel
for the Defendant:
Adv. K. Foulkes - Jones (SC).
Instructed
by:
KYRAICOU INC
Date
of Hearing:
3rd and 4th of March 2016
Date
reserved:
6 April 2016
Date
of Judgment:
25 July 2016
[1]
1992 (3) SA 379 (A)
[2]
1960 (2) SA 779
[3]
[20121 ZASCA 29 at page 9 -10