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[2008] ZAWCHC 165
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Silva v Silva (318/2008) [2008] ZAWCHC 165 (13 March 2008)
IN
THE HIGH COURT OF SOUTH
(CAPE
OF GOOD HOPE PROVINCIAL DIVISION)
CASE
NUMBER
318/2008
DATE 13
MARCH 2008
In
the case between
ANTONIO
MANUEL DA COSTA SILVA PLAINTIFF
and
CHARLISE
SILVA DEFENDANT
JUDGMENT
FOURIE
J:
The
parties in this matter are embroiled in an opposed divorce. The main
disputes between them centre on the proprietary consequences
of the
divorce and include Defendant's claim in terms of the accrual
sharing system, as well as her claim for the implementation
of
certain provisions of the Antenuptial Contract.
At
the commencement of the hearing, it appeared to be convenient to
have two issues decided separately and at the request of
the
parties, I accordingly ordered, in terms of Rule 33(4), that the
following issues be heard separately: Firstly, whether Plaintiff's
interest in the following legal entities should be taken into
account for the determination of the accrual ol his estate, namely
(a) Nichols Investments CC; (b) 92 Malgrove (Pty) Ltd and (c) Euro
Blitz 1154 CC. Secondly, whether Defendant is entitled to
occupation
of erf 4301, alternatively erf 12300, Knysna
r
from date of divorce, to the date that the minor child born of the
marriage, is emancipated.
I
also ordered that the remaining issues between the parties are to
stand over for later determination, if necessary. As this
judgment
is given during the penultimate week of the civil circuit and other
matters require my attention, I do not intend furnishing
detailed
reasons, but merely to provide a summary of my findings on the
issues presently before the Court.
Clause
3.4.6 of the parties
Antenuptial Contract, reads as follows:
"Notwithstanding
anything to the contrary herein contained, in determining the
accrual of each party's estate, any and all
shares and/or members'
interest and/or claims on loan account against any company, close
corporation or other business by which
a party is employed at any
time during the 12 month period preceding the date of dissolution of
the intended marriage, shall
be excluded from the accruaf of the
estate of the party entitled thereto."
If
Clause 3.4.6 of the Antenuptial Contract is read in the context of
the document as a whole, it is clear that what the parties
intended,
is that a party's interest in any legal persona should be taken into
account in determining the accrual of his/her
estate, except if
he/she is employed by the legal person in which he/she holds such
interest during a 12 month period preceding
the divorce.
The
question to be answered is accordingly whether, as averred by
Plaintiff, he is employed by the three entities concerned. In
terms
of the golden rule of interpretation, the ordinary grammatica]
meaning of the word 'employed
3
should be determined.
As
pointed out by Miss Wasserman, for plaintiff, the Collins English
Dictionary defines the word 'employ' as meaning:
"To
engage or make use of the services of a person in return for money
or the state of being employed, especially in the
phrase 'in
someone's employ
1
".
In
the South African cases dealing with employment law, the so-called
control test was traditionally used to determine whether
an
employment relationship, i.e. that of master and servant, exists
between two persons. However, as stated by Van Heerden J,
as she
then was, in
Stein
v Rising Tide Productions CC
2002(5) (SA) 199 (C) at 206D, the problems experienced by our Courts
in the application of the control test for determining a
master/servant relationship, ultimately resulted in the Courts
acknowledging that, although the control test is an important
factor
in the enquiry, the crucial test, particularly in marginal cases, is
whether or not the dominant impression of the relationship
is that
of a contract of employment. See also
Smit
v Workmen's Compensation Commissioner
1979MHSA) 51 (A) at 62 D to 63 B.
In
the
Stein
case at 206 H to 207 8, Van Heerden J, listed the most important
indicia in the application of the dominant impression test,
thus:
"The
application of the dominant impression test thus requires a
typological approach according to which the right of control
is not
an indispensable requirement of the contract of service, but one of
a number of indicia, the combination of which may
be decisive. Other
indicia which have been identified in the South
African
case law are: the nature of the work; the existence or non-existence
of the right of supervision on the part of the employer;
the manner
of payment (for example whether the employee is paid a fixed rate or
by commission); the relative dependence of freedom
of action of the
employee in the performance of his/her duties; the employer's power
of dismissal; whether the employee is precluded
from working for
another; whether the employee is required to devote a particular
amount of time to his/her work; whether the
employee is obliged to
perform his/her duties personally; the ownership of the working
facilities and whether the employee provides
his/her own tools and
equipment; the place of work; the length of time of the employment;
the intention of the parties etc."
It
is common cause that Plaintiff is the sole shareholder and director,
or sole member, of the three legai entities, which are
utilized as
vehicles to acquire properties and to let same out to tenants. As
conceded by Plaintiff, the purpose of the acquisition
of the
properties and holding same by means of these entities, is to
make a profit and to minimize tax implications
All
the income earned by the letting of the different properties is paid
into one bank account and is used as and when Plaintiff
requires the
money. At the end of the financial year, his auditor allocates such
advances to remuneration earned by Plaintiff
or as draws against his
loan accounts in the said entities.
It
is common cause that Plaintiff has no formal employment contract
with any of the entities, nor has there been any form of agreement
concluded between him and the entities, regarding any remuneration
to be paid to Plaintiff by the entities. In fact, there is
not a
single document which Plaintiff produced, indicating the existence
of an agreement of employment between Plaintiff and
any of the three
entities.
Plaintiff
is also in sole control of the running of the day to day affairs of
the entities and, if necessary, he appoints subcontractors
to
perform certain work which may be required to be done. No other
people are employed by the entities.
When
the indicia referred to by Van Heerden J in the Stein judgment, are
applied to the facts of the present case, it is, in my
view,
abundantly clear that the dominant impression test
(or
even the traditional control test) yields onty one result, namely
that no relationship of employer/employee exists
between
Plaintiff and the three legal entities. In fact, all the indtcia
point the other way, i.e. that Plaintiff is in sole
control of the
entities and conducts the business of these entities for his own
financial benefit. It follows, in my view
r
that Plaintiff is not employed by any of the said entities. Clause
3.4.8 of the Antenuptial Contract reads as follows: "Notwithstanding
anything to the contrary herein contained in determining the accrual
of each party's estate, unless otherwise agreed by the parties
in
writing, if at the time of the dissolution of the
intended marriage there are minor children born of
such
marriage, the custodian parent shall be entitled to remain in
occupation of whatever residential property is registered
in the
name of either party until such time as the youngest of such minor
children is emancipated."
Plaintiff
testified that by including this clause in the Antenuptial Contract,
he, as the party who gave the instructions to the
attorney who
drafted same, intended it to provide his children to be born of the
marriage, with a roof over their heads until
their emancipation.
I
should mention that there is one minor child born of this marriage,
born on 26 March 2007. I should also mention that in terms
of the
minute of their pre-trial conference, the parties confirmed that it
would be in the best interests of the child for her
to be in the
primary care of Defendant.
The
question to be answered, is accordingly whether Defendant and the
minor child are entitled to remain in occupation of whatever
residential property is registered in Plaintiff's name. I should add
that it is common cause that the parties have not agreed
otherwise
in writing as envisaged in Clause 3.4.8.
The
grounds upon which Plaintiff relies in contending that Defendant is
not entitled to occupy a residential property owned by
him, are,
firstly, that in terms of the new
Children's Act, No. 38 of 2005
,
both parents are, in effect, custodian parents and neither is or
will become the custodian parent as envisaged by Clause 3.4.8
of the
Antenuptial Contract.
Secondly,
it is submitted that as Defendant is not in occupation of the
relevant properties, she cannot, in terms of Clause 3.4.8,
remain in
occupation so as to enable her to qualify for this benefit in terms
of the Antenuptial Contract.
I
am in agreement with the submission of Mr Jooste, for Defendant,
that interpreting this clause of the Antenuptial Contract,
the best
interests of the minor child of the parties, should be paramount.
Not only does Plaintiff confirm that the clause was
intended to
benefit their children, but
Section 28(2)
of our Constitution
provides that a child's best interests are of paramount importance
in every matter concerning the child.
That is also the theme to be
found in the new
Children's Act.
I
further agree with Mr Jooste that the correct approach in the
interpretation of Clause 3.4.8, is to accept that upon the divorce
of parties, the right to remain in occupation of a property
registered in the name of either party, vests in the child. In view
of her tender age, the child of this marriage has to be cared for on
a permanent basis and as I have already indicated, the parties
are
agreed that Defendant as the mother of the child, is and should
remain the primary caregiver.
This,
in my view, means that on a proper construction of Clause 3.4.8,
Defendant and the minor child should, as from the date
of the
divorce, be entitled to remain in occupation of a residential
property registered in Plaintiff's name, as there is no
residential
property registered in her name.
The
interpretation contended for by Plaintiff, is, in my view, not only
highly technical, but also does not pay any regard to
the best
interests of the child. In fact
r
on Plaintiff's interpretation of the relevant clause, neither party
would, on the wording of the
Children's Act, be
entitled to remain
in occupation of whatever residential property is registered in the
other's name.
This
would mean that neither party would, upon divorce, be entitled to
rely on Clause 3.4.8 to safeguard the interests of the
child.
Surely, this would not have been the intention of the parties in
instructing the attorney to draft Clause 3.4.8 in the
manner that It
appears in the Antenuptial Contract.
In
my view a purposive interpretation of the nature referred to
hereinbefore, is necessary to give effect to the object the parties
intended to achieve by incorporating Clause 3.4.8 in the Antenuptial
Contract.
Even
if a purposive construction of this nature is not followed, I am of
the opinion that, at the very least, the clause is ambiguous
and
should in any event be interpreted against the prevailing background
circumstances and in such a manner as to avoid an absurdity.
The
construction contended for by Plaintiff ignores the most important
background circumstance, namely, the intended protection
of the
child's rights upon divorce of the parties.
It
aEso leads to an absurdity, as already explained, namely that the
child may be left without a roof over her head, as neither
party wiN
be regarded as the custodian parent and accordingly not be entitled
to occupy the residential property of the other
after the divorce.
Finally,
as a last resort, to resolve the ambiguity, the clause should be
interpreted
contra
proferens,
i.e.
against Plaintiff.
It
follows, in my view, that from the date of the parties' divorce,
Defendant and the minor child is entitled to occupy either
of the
two residential properties registered in Plaintiff's name.
Mr
Pama, the attorney for Plaintiff, has today, with the consent of Mr
Pretorius, the Defendant's attorney, placed the following
information before me, namely, that Defendant does not intend
occupying either of the two residential properties owned by
Plaintiff.
Mr
Pretorius informed the Court that he agreed to this being divulged
to the Court, as it has no relevance to the issues now before
the
Court. In my view, this information, which I accept as part of the
body of evidence, does not assist Plaintiff. Firstly,
this
intimation by Defendant does not constitute a written agreement by
the parties as envisaged in Clause 3.4.8 of the Antenuptial
Contract
and does accordingly not constitute a waiver of Defendant's rights.
More
importantly, however, is my finding that the said clause creates a
right which vests in the child, which right cannot be
abandoned by
Defendant. Even if Defendant decides to reside elsewhere after the
divorce, it does not necessarily mean that she
has abandoned her
right, nor, as I have indicated, does she have the right to abandon
the rights created for the child by Clause
3.4.8.
During
the course of the evidence, it transpired that Plaintiff has in fact
sold the property known as erf 4301 Knysna, to a third
party and
that his attorneys were in the process of transferring same to the
third party. He estimated that the transfer would
probably be
registered within a period of approximately one month.
Defendant
accordingly sought a temporary order interdicting Plaintiff from
transferring this property, pending the final determination
of the
divorce action.
Plaintiff
opposed the application but I granted same for the following
reasons:
I
was satisfied that Defendant had established the necessary clear
right in the subject matter of this litigation. In particular,
she
has a clear right to a judgment on the issue of accrual sharing, at
least insofar as the right created in her and the child's
favour in
Clause 3.4.8 of the Antenuptial Contract, is concerned.
The
transfer of erf 4301 Knysna will result in her right to occupy this
property being rendered worthless, as the divorce herein
will in all
probability not be finalized before the transfer of the property is
concluded.
I
was also satisfied that the balance of convenience favoured the
granting of the order, as a refusal of the application would
leave
her and the child without a remedy to enforce her and the child's
rights in terms of Clause 3.4.8 of the Antenuptial Contract,
while
the granting of the order will not cause Plaintiff similar
irreparable harm.
I
also concluded that in these circumstances Defendant has no
satisfactory alternative remedy at her disposal.
Returning
to the relief sought in these proceedings, the following orders are
made:
1.
It
is declared that Plaintiffs interest in the following legal entities
is to be taken into account for the determination of the
accrual of
his estate,
(a)
Nichols Investments CC
(b)
92 Malgrove (Pty) Ltd
(c)
Euro Blitz 1154 CC.
It
is declared that Defendant and the minor child born of the parties'
marriage, are entitled to the occupation of erf 4301
Knysna,
alternatively erf 12300 Knysna, from date of divorce to the date
the minor child is emancipated.
Plaintiff
is to pay the costs occasioned by the adjudication of the two
issues decided in terms of
Rule 33(4)
, as well as the costs
occasioned by Defendant's application for an interim interdict.
FOURIE,
J