Division of Assets of the Spouses re: Direct and Indirect Contributions iro Commercial Enterprises & Alter Ego Principle

HH128-12 : TENDAYI CHIKOMBA (NEE MANYERUKE) vs VITALIS CHIKOMBA
Ruled By: GUVAVA J

The plaintiff issued summons out of this court claiming a decree of divorce, distribution of the parties' matrimonial assets, and costs of suit.

The defendant, in turn, counter claimed for a decree of divorce and division of the matrimonial estate.

It was common cause that the parties married on 12 April 2001 in terms of the Marriage Act [Chapter 5:11]. During the subsistence of their marriage they acquired various movable property and an immovable property known as Stand 1822 Chadcombe Township of 1844 Chadcombe Township, Harare.

At a pre-trial conference held before a judge in chambers the parties agreed that their marriage had irretrievably broken down and agreed on the distribution of most of their movable assets. The following issues were however referred to trial:

1. Whether or not the deep freeze is matrimonial property and subject to be shared by the parties.

2. How should the matrimonial house, known as Stand number 1822 Chadcombe Township of 1844 Chadcombe Township be apportioned between the parties?

The plaintiff gave evidence in relation to the immovable property and the deep freezer.

She testified that..., in 2004, they established a phone shop. They set up a company to run the enterprise. She testified that the defendant suggested that he and his young brother should be the directors and shareholders of the company. His brother was a student at Midlands State University at the time.

The company was operating from Mabvuku. She would pass through there every weekday after work and would go with the defendant over the weekends. They decided to have a tuckshop in the same premises. They then took the deep freezer from the house and installed it in the tuck shop. The plaintiff stated that she would order goods for resale at the tuck-shop at Macro Wholesales. The money generated from these sales would be used to construct the house....,.

With regards to the deep freezer, she stated that they had purchased it at Greatermans Department Store. The defendant paid the 40% deposit which was required and she paid the monthly installments. She testified that since she had paid the bigger portion of the purchase price she should be awarded the deep freezer....,.

Turning to the issue of the deep freezer, the defendant stated that he and his brother were the sole shareholders and directors of a company known as Vittinach Enterprise. He stated that the plaintiff was never involved with the company at any stage as she worked out of town. His nephew, Lovemore, who was living with them, would collect money on a daily basis and he would go there on Sundays when the lady who operated the phone shop was off duty.

He denied that the plaintiff went to the shop on a daily basis as she was staying in Mutoko and would only come to Harare over the weekend. He stated that they would go together to the phone-shop with the plaintiff during this time so as to see the progress being made.

The defendant stated that when they started the tuck-shop business they decided to buy the deep freezer from Greatermans. He stated that the freezer was purchased on his personal account specifically for the shop and it was never part of the household goods. He denied that the plaintiff had paid the instalments although she did offer to make the repayments. He stated that he had declined her offer as he did not want to mix company with family business....,.

The deep freezer, which was a source of conflict in this case, in my view, was never matrimonial property.

From the evidence, the defendant purchased the deep freezer using his VIP credit card. Apart from the plaintiff's mere say so, there is no evidence that she contributed towards its purchase. There was no evidence that the deep freeze was ever used in the matrimonial home before it was taken to the tuckshop. The plaintiff was neither a shareholder nor a director in the company.

I take the view that the deep freeze belongs to the company and is not matrimonial property.

HH07-12 : IGNATIOUS GANYO vs MAULIDIA CHAONZA
Ruled By: CHITAKUNYE J

The plaintiff and defendant were married in terms of the Marriages Act [Chapter 5:11] on 14 January 2005 at Harare. Their marriage was blessed with one child born on 25 November 2008.

On 28 June 2010, the plaintiff sued for a decree of divorce on the ground that the marriage has irretrievably broken down to such an extent that restoration to a normal marriage relationship is impossible. He outlined the causes of the breakdown as including the following:-

(a) That the defendant has denied him love, respect, affection, and companionship ordinarily expected of a married couple;

(b) The defendant has demonstrated a quarrelsome and bellicose attitude towards the plaintiff whom she has physically and verbally abused. The plaintiff had to apply for a protection order in terms of the Domestic Violence Act [Chapter 5:16] on 12 February 2010;

(c) Despite the protection order, the defendant has continued to harass the plaintiff making life unbearable for him;

(d) The defendant is in the habit of forcibly taking money from the plaintiff;

(e) The defendant harasses and insults the plaintiff in front of school teachers and pupils at the school where he is the Headmaster;

(f) The parties have, throughout their marriage, exhibited all signs of incompatibility; and

(g) For a period of about 13 months, the defendant lived in an adulteress relationship with a truck driver in South Africa. Here in Zimbabwe, the defendant has a lover whom she has refused to cut ties with.

As a result of this, the plaintiff alleged, that, the marriage has irretrievably broken down.

He therefore prayed for a decree of divorce and that the defendant be awarded custody of the minor child and all the movable property they acquired during their marriage. He wished to retain the property he acquired before the marriage.

The defendant, in her plea, did not concede that the marriage had irretrievably broken down. She made a bald denial of the improper conduct alleged by the plaintiff against her. She, instead, contended, that, it is in fact the plaintiff who committed adultery.

She revealed, in her plea, that, the parties also acquired an immovable property in Domboshawa which is apparently registered in the defendant's name. She contended, that, that property/Stand should be awarded to their child.

The defendant made a counter claim in which she sought that the immovable property in Domboshawa be awarded to their child.

At a pre-trial conference held on 11 February 2011, the parties reached settlement on a number of issues. They agreed that:-

1....,.

2....,.

3....,.

4....,.

The issues referred to trial include the following:-

1....,.

2....,.

3. Whether the parties own a General Dealer's shop, and, if so, whether it is subject to distribution....,.

The aspect of the General Dealer's shop was based on the defendant's perception that the shop belonged to the plaintiff and that it was still operating.

When the plaintiff testified that he had been leasing the shop, and he had since ceased the operations, I did not hear the defendant to deny that.

All she said was she expected to get something from the operations without specifying what she now needed.

It is clear to me, that, the General Dealer shop is in effect no longer a sustainable issue.

HH68-10 : ALVIN CRISP vs STELLA MARY MASVIKENI
Ruled By: MUSAKWA J

Crovis Agencies (Private) Limited, at its inception, dealt in motor spares. It was the defendant's testimony that she contributed towards the establishment of the business. She used to negotiate sales with Nissan Clover Leaf where the plaintiff's late partner, Steven Madovi, was employed. In addition, it was the defendant's testimony that Crovis Agencies (Private) Limited was ...

HH124-09 : MAXWELL TAWODZERA AND MARGARET TAWODZERA vs DANNY MASUKUMA
Ruled By: MAKARAU JP

The plaintiffs are husband and wife. For the past fifteen years, they were resident in, and operating some business in, Mount Darwin. In September 2008, they decided to dispose of their business interests and properties in Mount Darwin and relocate to Harare. They advertised for sale their properties by word of mouth, and also inserted an advert ...

HB34-09 : NOKUKHANYA MOYO vs ROBERT MOYO
Ruled By: BERE J

On 3 April 1998 the parties had their marriage, which had already been blessed with three children, solemnized at Bulawayo. Prior to that, the parties had been living in an unregistered union dating back to 1989.On 14 January 2000 the plaintiff issued summons against the defendant claiming divorce and other ...

On 14 January 2000 the plaintiff issued summons against the defendant claiming divorce and other ancillary relief as outlined in her declaration. The grounds for divorce were given, inter alia, as alleged adultery on the part of the defendant. Allied to this were allegations of dishonest and irresponsible behaviour on the part of the defendant, whose cumulative effect was to render continuing of a normal marriage impossible.

The defendant countered the allegations against him by alleging irreconcilable differences with the plaintiff emphasizing it was the plaintiff's conduct which had brought about the sad end to the parties' marriage....,.

Distribution of Movables

These issues were curtailed at the pre-trial conference when the parties struck an agreement hence the court merely granted the order as agreed upon by the parties. The only outstanding issue on movables was the distribution and apportionment of the motor vehicles.

Distribution of Immovables

The parties could not come to a mutual agreement on the distribution and apportionment of two immovable properties, namely, Stand number 12713 Parklands, also known as 15 St Helens' Road, Parklands, Bulawayo as well as a Flat referred to as an undivided 1/36th share, being Share number 102 in and to Stand 585 Bulawayo Township.

I propose to deal with the issues in contention in the order in which the parties dealt with them.

The Evidence

It emerged from the largely uncontroverted evidence of the plaintiff that the bulk of the property, movables, and immovables that were acquired in contemplation of, or during the subsistence of the parties' marriage, was financed by the business venture of the parties.

The plaintiff's version was that at a time when the defendant was out of employment she embarked on trips to South Africa to buy goods for resale in Zimbabwe. According to her, the initial capital was sourced by her from her brothers based in the United Kingdom as well as her late mother. She said, initially, she was buying spices for resale back home before she eventually embarked on selling sausage casings which were to mark the turning point in her enterpreneurship. It was the plaintiff's evidence that to start with she was selling her items to a certain individual who, in turn, introduced her to Colcom for supply of big orders.

The plaintiff was clear that, initially, she was doing this business on her own as the defendant did not have a passport and was out of employment. It was only at a time the defendant had obtained a passport that he joined her in this trade.

The plaintiff went on to say that, with the passage of time, the buyers at Colcom indicated that they preferred dealing with a registered company as opposed to individuals and they encouraged her to register a company.

From the proceeds of their sales, a company called Ronoe Enterprises (Private) Limited was incorporated. The name 'RONOE' was formulated by taking the first two letters of the name of the defendant and “NOE” was reflective of the vernacular slang of the first letters of the plaintiff's first name. The two were recorded in the companies office as co-directors and shareholders with equal shareholding in that company.

The plaintiff's evidence about the formation of Ronoe Enterprises (Private) Limited went unchallenged in the record of proceedings. It was only when the defendant was giving his own testimony in court that he attempted to offer some feeble challenge to the plaintiff's evidence in chief. That did not portray the defendant in good light.

It is through cross-examination of a witness that one's evidence is put to the test. The defendant failed to do so and the plaintiff's version must therefore be regarded as eminently probable.

The court was left in no doubt that Ronoe Enterprises (Private) Limited bore its origins to the industry of the plaintiff. She indeed was the brains behind it.

Despite this, however, the plaintiff did not portray herself as a selfish character. She acknowledged that when the defendant joined her in cross-border trading he brought in additional capital which she could not vividly remember in detail but said was probably half of what she had injected into the business herself at the time of its inception. The plaintiff could have easily denied the contributions made by the defendant but she did not. Such was her credibility.

After failing to challenge the plaintiff's testimony through cross examination, the defendant went on a ruthless attack of the plaintiff when he gave his evidence-in-chief. The defendant portrayed the plaintiff as having started as a vegetable vendor before he eventually roped her as a co-director in Ronoe Enterprises (Private) Limited.

How ironic!

The court had difficulties accepting the version as told by the defendant. His tongue was filled with hate language and was determined to portray the plaintiff as someone who had contributed virtually nothing, or insignificantly, into the formation of Ronoe Enterprises (Pvt) Ltd. The defendant attributed the formation of this company to himself.

The difficulty with the defendant's evidence was that he had allowed the plaintiff to leave the witness box without challenging her version hence the plaintiff's explanation remained intact. Not only that but the defendant did not even want to acknowledge the immense contributions made by the plaintiff in the formation of Ronoe Enterprises (Pvt) Ltd.

It is with this background in mind that one must then look at the distribution and apportionment guided by the guidelines in the Matrimonial Causes Act [Chapter 5:13].

The approach to be followed is aptly summed up by HUNGWE J in the case of Isaac George Takawira v Evengeline Eveline Takawira HC924/97…, where the learned judge states:

“The practice has been for the courts to regard as matrimonial assets the net worth of both the business assets and the personal assets acquired by the parties during the duration of the marriage. In that regard, courts would then proceed to consider what order to make in respect of the division in terms of section 9(1) of the Matrimonial Causes Act [Chapter 5:13].”

The Motor Vehicle

In her declaration, the plaintiff contended that Ronoe Enterprises (Pvt) Ltd had acquired, among other items, a Toyota Corolla and a Mazda B2200DX which the defendant took to form, behind her back, a company called Josro Enterprises (Private) Limited; the directors whereof were himself and his uncle, Joseph Musekiwa, the latter only being a nominal director whose duties were, inter alia, cleaning cars within the company premises and working as a messenger. In the words of the plaintiff; “I do not think he is aware he is a director of that company.”…,.

The plaintiff's only desire was to be allocated a Toyota Corolla motor vehicle.

The defendant countered this by alleging that the motor vehicle claimed by the plaintiff had been “written off following a road accident during the month of February 2001.”…,.

The evidence which was led by the plaintiff, and which was canvassed at length both in her evidence-in-chief and under cross-examination, was to the effect that this vehicle was there and had been given to the defendant's mistress, Fiona Dick. The plaintiff checked with the City Council and confirmed that indeed this motor vehicle had been registered in the name of Fiona Dick.

The court accepts the evidence as told by the plaintiff. There is every indication that this vehicle was registered in a third party's name to ensure that the plaintiff would not be able to lay her hands on it. It was quite curious that having been served with the plaintiff's claim on the Toyota Corolla, the defendant would swiftly move to have the same motor vehicle registered in his mistress's name. It is only fair, in such circumstances, that the plaintiff be awarded the other vehicle that is there, that is, a Mazda B2200 bearing registration number 686-646D.

Immovable Properties

Through her declaration, the plaintiff expressed the desire to be awarded a 50% share of the value of the Parklands house and 25% share of the value of the Flat, namely, Stand number 585 Bulawayo Township (Share 102 thereof).

Whilst accepting the plaintiff's 50% share in the Parklands property, the defendant's position, as captured in his claim in reconvention, but not amplified by his evidence in court, was to the effect that the plaintiff be awarded her claimed 50% - but, after deducting the value of the bond registered on the property.

The evidence led and accepted by the court was that the bond in question was registered against the property without the plaintiff having been consulted and at a time divorce proceedings were in full swing. The directors of a company called Josro Enterprises (Private) Limited had, by their resolution of 23rd March 2000, initiated the registration of this deed of hypothecation against the matrimonial property.

To have a proper appreciation of the issues involved, one needs to understand the historical background of Josro Enterprises (Private) Limited.

The plaintiff gave a fairly detailed explanation about how this company came about. The plaintiff's unchallenged version was that when she started experiencing problems with the defendant she obtained a provisional order to freeze the operations of Ronoe Enterprises (Private) Limited and a liquidator was appointed in this regard. According to the plaintiff, financial indiscipline on the part of the defendant is what prompted her to initiate the liquidation of the company. The following questions and answers in cross-examination give a clear indication as to how Josro Enterprises (Pvt) Ltd was formed;

“Q. But you obtained a provisional order of this company?

A. Correct, but, after that defendant came and apologized to me. After that the Bank then gave us money after which we approached the customer who had been buying from us. After that defendant said he no longer wanted me to go to South Africa. Defendant took the money that we got from the Bank and deposited it into Josro account….,.

Q. What happened to the court order for provisional liquidation?

A. He approached me and apologized. He came thrice, and, on the fourth occasion, we agreed we would see our lawyers. We did that and he admitted before the lawyers that he was wrong and asked me to go back home…,.

Q. What happened to the provisional order?

A. When he apologized he said if I went back home we would continue working together in a transparent manner; that is why we agreed to have the provisional order put aside.

I was surprised, in 1999, that my name had been struck from the company and he had done this in 1998. This happened when we were still reconciling and behind my back he was forming another company….,. “

The record will show that the plaintiff continued to work with the defendant unaware that she had lost the co-directorship of the newly-formed company which was largely financed by the resources of the erstwhile family enterprise – Ronoe Enterprises (Private) Limited.

When challenged, under cross examination, the plaintiff referred the court to an Absa Bank Limited deposit slip which reflected that on 4 March 1999 she deposited a total amount of R165,000. The plaintiff's explanation was that this deposit was payment by Josro Enterprises (Private) Limited for goods supplied to it on credit and she made the deposit in Musina, South Africa….,. This document was produced to counter the defendant's denial that the plaintiff continued to work with him even in Josro Enterprises (Private) Limited.

Page 22 of the plaintiff's bundle of documents further demonstrates the deceitful conduct of the defendant. That document portrayed Joseph Musekiwa as co-director of this company.

Having assessed all the evidence led in this court, I was left in no doubt at all that Josro Enterprises (Pvt) Ltd was conveniently registered to ward off the plaintiff's interests in that company. Further, it became abundantly clear that this company was largely funded by the resources of Ronoe Enterprises (Private) Limited.

The bond registered against the Parklands house was unilaterally registered by the defendant at a time when the defendant knew the plaintiff had staked her claim against that property. Clearly, the motive by defendant was to compromise, if not defeat, the plaintiff's claim.

The assets of Ronoe Enterprises (Private) Limited were, in circumstances that were far less than honest, passed over to Josro Enterprises (Pvt) Ltd. In the court's view, what was raised through Josro Enterprises (Pvt) Ltd was but a continuation of what was raised by Ronoe Enterprises (Private) Limited.

It is clear to the court that the defendant barricaded himself behind the corporate veil to register the Flat in the name of Josro Enterprises (Pvt) Ltd and so were the motor vehicles.

It was particularly interesting to note that whereas the defendant tried to convince the court that his late mother was the source of the funds that purchased the flat, he was unable to tell how much was raised by his mother for the purposes of that purchase. He could hardly remember how much his mother had in the form of a retirement package.

Other than alleging it was a mistake, the defendant could not explain why, if the Flat was purchased by his mother, the Agreement of Sale reflected Josro Enterprises (Pvt) Ltd as the purchaser of the Flat.

There were other unconvincing aspects about the circumstances surrounding the acquisition of this Flat. The defendant was unable to explain, to the satisfaction of the court, why, six years after the death of his mother, the flat continued to be registered in her name.

It was also not made clear why it became necessary for Josro Enterprises (Pvt) Ltd to make a donation of the same flat to the defendant's mother after which the mother drew up a Will allocating the same flat to the defendant.

In the court's view, all these factors, taken cumulatively, demonstrated the defendant's stout effort to hide behind the corporate veil. All these efforts by the defendant were contrived to conceal the fact that all these assets are clearly matrimonial property.

It will be seen that whereas in her pleadings the plaintiff had claimed a 50% share in the value of the Parklands house, when she testified, she shifted from this position and sought to claim the whole house.

The court could not accept that position, for, by doing so, the plaintiff was demonstrating an element of greed or a desperate effort to claim what the disallowed amendment was designed to achieve.

In the final analysis, the court could not fail to see the corporate mischief of the defendant.

The law is clear on those who try to hide behind the corporate veil. The case of Cattle Breeders (Pvt) Ltd v Veldman 1974 (1) SA 169…, immediately comes to mind.

In that case, in an application by a company, of which the respondent's husband was the sole shareholder and the Managing Director, the company sought to eject the wife and children from the dwelling house on a farm leased by the company, which house had been regarded as the family's matrimonial house. The court a quo dismissed the application. On appeal, BEADLE CJ…, did not hesitate to lift the corporate veil to unmask what the husband was up to. It was held that the company was nothing more than the husband's alter ego.

See also the case of Wamambo v Wamambo HB03-92 and In re Budle Pres Ltd 1961 CH.D.270.

In casu, the unilateral and fraudulent de-registration of Ronoe Enterprises (Pvt) Ltd and the subsequent registration of Josro Enterprises (Pvt) Ltd was designed to hide the parties' matrimonial assets.

I hold the view that the Flat was part of the joint matrimonial property and require to be distributed and apportioned between the parties.

The court is also of the firm view that the plaintiff's entitlement to 50% share of the Parklands house cannot be diluted by the registration of a bond which was done behind her back and she is therefore entitled to her claimed share in the house....,.

1....,.

2. That the plaintiff be and is hereby awarded the following movable property:

(a) 1 x television set.

(b) 2 beds.

(c) 1 lounge suite.

(d) 1 x 2 sets of curtains in her possession.

(e) All cutlery and scullery in her possession.

(f) A Mazda B2200 bearing registration number 686-646D.

3. That the defendant be and is hereby awarded the following movable property:

(a) 1 x deep freezer.

(b) Garden chairs.

(c) 1 set of curtains (at Parklands house).

4. That the plaintiff be and is hereby awarded 50% of the value of Stand 12713 Parklands, also known as number 15 St Helens' Road, Parklands, Bulawayo.

5. That the plaintiff be and is hereby awarded 25% of the value of the Flat referred to as an undivided 136th share, being Share number 102 in and to Stand 585 Bulawayo Township with the defendant being granted the option to buy out the plaintiff not later than 31 March 2009.

6. That the defendant be and is hereby awarded 75% of the value of the Flat referred to as an undivided 136th share, being Share number 102 in and to Stand 585 Bulawayo Township.

7. That, in respect of Order 4 (supra) either party be and is hereby granted the option to buy out each other not later than 30th of March 2009 failing which the property shall be valuated by a mutually agreed estate agent in the City of Bulawayo and sold with the proceeds being shared in accordance with the ordered ratios.

HB36-09 : SABRINA MUDENDA vs ANDREW MUZUWANI MUDENDA
Ruled By: NDOU J

Although the parties agreed that their company, viz. Asmara (Pvt) Ltd should be sold, and the proceeds shared equally, the plaintiff has proposed that she be allowed to buy Asmara Clothing Factory. The defendant is adamant that both parties must be given the option to buy the other out of the entire company. In other words, ...

Although the parties agreed that their company, viz. Asmara (Pvt) Ltd should be sold, and the proceeds shared equally, the plaintiff has proposed that she be allowed to buy Asmara Clothing Factory.

The defendant is adamant that both parties must be given the option to buy the other out of the entire company. In other words, the defendant is opposed to the company being sold piecemeal....,.

Should the Asmara Clothing Factory be sold separately (to the plaintiff) from the other assets of Asmara (Pvt) Ltd?

The plaintiff passionately testified why she should be sold Asmara Clothing Factory separately. She said she was the hands-on director who also managed the factory. She has been in the clothing industry for about eighteen years. She was previously a factory manager at Sunjet Clothing. Her grandfather is a tailor. She was teaching “Fashion and Fabrics” at Ordinary Level when she was still a teacher. She said she is familiar with all production aspects in the clothing industry. She said she pioneered most of the school sports-wear used by private schools in this region. She has invested a lot of time and other resources in this factory.

She, however, conceded that she could still achieve her objective even if she bought the entire Asmara (Pvt) Ltd company....,.

I am in agreement with the defendant's position that it will be fair to both parties if the company is not sold piecemeal. An equitable and fair exercise of each party's right of first refusal would be achieved when the party is offered the entire company.

Accordingly, it is ordered as follows -

1. ...,.

2. ...,.

3. ...,.

4. ...,.

5. ...,.

6. ...,.

7. The plaintiff and the defendant shall, within fourteen days of this order agree on the inventory of the assets as well as the value of these assets, failing which the parties shall cause, within a further fourteen days, an instruction of the valuation of the inventory by a firm of Chartered Accountants to be nominated by the parties' legal practitioners.

8. On agreement, or valuation, pursuant to paragraph (7) above, the assets shall be sold to best advantage, and the proceeds thereof shared equally between the parties. The plaintiff is granted an option to buy out the defendant within sixty days of the agreement, or valuation, failing which, the defendant is granted the same option.

9. ...,.

HH35-10 : RUTH MUSONZA (nee MTANAUKWA) vs ESHMAEL MUSONZA
Ruled By: GUVAVA J

The plaintiff produced the Memorandum of Association for Mainland Business Merchants (Pvt) Ltd which showed that they were both directors of the company. The company's main business was commodity broking. They were dealing in business machines....,.With regards to the companies, the plaintiff stated that she did not know whether or ...

With regards to the companies, the plaintiff stated that she did not know whether or not they were still operating but she was claiming her 50% share in Mainland Business Merchants (Pvt) Ltd where she was a director and shareholder....,.

The defendant...,. denied that the plaintiff was employed by Mediocre (Pvt) Ltd in any capacity at all....,.

Turning to the company, the defendant stated that Mainland Business Merchants is a shelf company which has never operated since it was registered. The directors of the company are the defendant's children. He and the plaintiff were never directors of the company. He stated that the only company which ever operated was Mediocre Business Merchants (Pvt) Ltd. He also said that the plaintiff did not have any shareholding in that company.

The defendant also called Nicholas Musonza.

He confirmed that..., he was working at Mediocre Business Merchants (Pvt) Ltd at the time. He denied that the plaintiff ever worked at the company....,.

Whilst it was apparent, from the evidence, that the plaintiff was not employed as a secretary at Mediocre Business Merchants (Pvt) Ltd it was conceded that even if she had been so employed her contribution would not have been as high as that of the defendant who was also a director and shareholder in the company....,.

The plaintiff also claimed a share in the two companies which were in existence during the duration of the marriage.

The plaintiff stated that she did not know whether or not they were still operating. The defendant stated that in relation to Mediocre Business Merchants (Pvt) Ltd, he had been evicted from the premises where he had operated from for a long time and the company was doing very little business. He also stated that Mainland Business Merchants (Pvt) Ltd was a shelf company which had never operated at all.

No evidence was led as to the assets, if any, which are owned by the companies.

In my view, the plaintiff did not lead sufficient evidence for the court to make a finding on the issue. Even in the plaintiff's submissions no further claim was made on the companies. I will thus not make an order in relation to the companies as the plaintiff, being a director and shareholder in one of them, will be in a position to proceed in terms of the Companies Act [Chapter 24:03].

HH68-10 : ALVIN CRISP vs STELLA MARY MASVIKENI
Ruled By: MUSAKWA J

It is immaterial that the business was commenced after the parties had separated. In making this decision, I take into account that section 7(1) of the Matrimonial Causes Act [Chapter 5:13] provides that - “(1) Subject to this section, in granting a decree of divorce, judicial separation or nullity of marriage, or at any time thereafter, ...

Appealed
HH109-10 : MICHAEL PATRICK MORONEY vs VYVYAN JEAN MORONEY
Ruled By: MUSAKWA J

The parties moved to Darwendale in 1978. The defendant left employment then. Commercial fishing had commenced in 1977. V M Fisheries (Private) Limited was established and run as a family business in which the defendant has a fifty percent share. V M Fisheries (Private) Limited's fishing concession was cancelled in 2009. According to ...

HH115-10 : NASSAH MUKOMBERANWA vs VIVIAN MOKOMBERANWA
Ruled By: MUSAKWA J

The other issue was whether the defendant is entitled to a half share in Transelectrical (Private) Limited....,.The plaintiff testified that he qualified as an electrical engineer in 1987. He then worked for several companies before he ventured into private enterprise. This led to the incorporation of Transelectrical (Private) Limited in ...

HH240-10 : DOREEN SAGANDIRA vs PATRICK SAGANDIRA
Ruled By: MAVANGIRA J

The plaintiff said that she was also a Director of the company Multimillionaire Investments but she had been surprised to discover that her name had been removed from the directorship without her consent. She said that she has not been deriving any benefit from the businesses since 2006. The defendant said he started trading as a ...

HH61-11 : COLLIN SYDNEY DICKS vs AVERIL CAROL DICKS
Ruled By: CHITAKUNYE J

Another aspect pertains to whether the plaintiff should provide the defendant with a motor vehicle of the value of about 5,000= United States dollars. As with maintenance for long, I am of the view that this is not possible. The motor vehicles that the defendant pointed to, and even those she had used whilst in ...

HH365-13 : LYDIA MAURO (NEE) NYAMBO vs REGIS MAURO
Ruled By: UCHENA J

1. ….,. 2. …,. 3. …,. 4. …,. 5. …,. 6. Leerage Haulage (Private) Limited is awarded to the defendant whilst the plaintiff gets Leereg Fashions Boutique.

HB44-11 : JABULANI MANYATHELA vs THANDO MANYATHELA
Ruled By: MATHONSI J

The plaintiff's evidence is to the effect that he was employed by the National Railways of Zimbabwe (NRZ) in 1982 and after completing his probation period he applied for and was allocated rented company accommodation in 1985, being No.36 Troutbeck Road Greenhill, Bulawayo, where he moved in with his wife, Mellina, to whom he had been married in terms of the Customary Marriages Act [Chapter 5:07]. That marriage was blessed with two (2) children both of whom are currently University students, the first one being 25 years old while the second one is 21 years old. In 1995, he was involved in a headon train collision in Gwanda and sustained certain injuries.

He divorced the first wife in February 1996 and then applied for upgraded accommodation resulting in him being allocated House No.5 Ingram Road, North End Bulawayo (now No.6 Blasson Avenue, North End, Bulawayo) by the National Railways of Zimbabwe - again as rented accommodation. He moved into that house with the defendant on 4 June 1996. They got married on 21 September 1996. He said he married her because she was good in tailoring and also out of love. He accepted that the National Railways of Zimbabwe may have precipitated the marriage because they had written letters to him demanding that he vacates the North End house as it had been allocated to him in error. The house was for married employees and as he was then not married he had been requested to vacate the house or risk having commercial rentals levied against him with effect from 1 September 1996. He was then allowed to remain in the house courtesy of his marriage to the defendant. He stated that following successful negotiations between the National Railways of Zimbabwe and employees unions the National Railways of Zimbabwe offered its rented houses to sitting tenants at concessionary prices. He is one of those employees who participated in that scheme and signed a Memorandum of Understanding with the National Railways of Zimbabwe in July 1999 for the purchase of the house. In terms of that Agreement, deductions were being made from his salary towards the payment of the purchase price, a discounted rental and an administration fee.

According to him, the defendant did not contribute anything towards the acquisition of the house, as she was a mere housewife who had left employment in 1997 when she was pregnant. She gave birth to the only child of the marriage and continued looking after the child while he paid the purchase price of the house in instalments at the same time providing for the family without any input from the defendant.

He paid off the purchase price of the house and then signed a Sale Agreement on 15 August 2001. Instructions were given by the National Railways of Zimbabwe for the house to be transferred to his name. At that stage, he decided to register the house in the name of a company he had formed with his two (2) brothers called J. Manyathela Retailers (Pvt) Ltd which was incorporated in 2001. The house was transferred to this company on 4 July 2002 for the sole reason of facilitating access to loans for the business. He revealed that he and his brothers had intended to operate a retail business at their rural home area of Lupane in the name of that company. They tried to start the business but failed and only one of his brothers succeeded in starting a business in Lupane. He later tried to say that they did start operating as J. Manyathela Retailers (Pvt) Ltd in Lupane but this was contradictory.

Under cross examination, he conceded that when that company was formed he was a minority shareholder holding only 5,000 issued shares, the same as his brother Fortune, while his brother, Nkululeko, was the majority shareholder with 10,000 shares. He conceded that although the Share Certificate which signifies the 5,000 shares held by the defendant is dated 18 October 2001, at that time the defendant had nothing to do with the company. It was not until 27 March 2007 that the defendant was appointed Director of the company and issued with 5,000 shares.

He also accepted that he removed his brothers from the directorship of the company and took their shares without paying them anything for those shares. Currently he holds 75% while she holds 25% shares which were just donated to her. He insisted that the matrimonial house should be divided between them in that ratio. His main reason for saying so is that the house represents an estate he should share with his two (2) children who are at Universities and 24 years of hard work at NRZ. It represents his pension from the National Railways of Zimbabwe, the injuries he sustained in 1995 in a train accident, and, at the age of 52, he is unable to secure any loans from finance institutions to acquire another house, while, at 42, she still can secure loans.

Asked how he would pay off the 25% he is offering her, he insisted that he would get a loan from a finance house in clear contradiction with his earlier claims that he is unable to do so because of his age.

The defendant also gave evidence.

She started living with him at Emakhandeni Suburb where she was renting late in 1995. When he got the National Railways of Zimbabwe accommodation in Northend, they moved in together. The National Railways of Zimbabwe soon discovered it had issued the house to him in error because he was not married and started proceedings to evict him from the house. A former workmate of hers was married to a Marriage Officer and when this problem arose arrangements were made for him to marry them. She left formal employment in 1996 and commenced her tailoring business from TV Bazaars in Bulawayo. She had got those premises through her former workmate who knew the owner.

She called the owner, Anratbhai Vallbhai Desai, to confirm that story.

When she started that business he was still employed full time at the National Railways of Zimbabwe and would join her to run the front part of the business which was usually manned by her sibling, when he was on night duty. She made money from that business which was used to cover some of the family expenses like the utility bills. As his income was being wiped out by the payments for the house, she was the mainstay of the family covering all the other necessary expenses. He eventually took over that business from her. She was not consulted when the house was registered in the name of the company as she only discovered that when she saw bills coming in that name. When she queried, he told her that had been done to make it easy to secure loans for the business. She was never consulted when he took decisions and when she questioned that he would end up assaulting her as shown by the admission of guilt fines he paid at police stations. She produced proof of those fines. She stated that on one occasion, in March 2007, he had so severely assaulted her that she was forced to leave him returning to her parents' home. He asked for forgiveness, and as a sign of his good faith, he offered to register her as one of the Directors of the company. Her sister assisted in ensuring that her name was added and she was issued with shares. She was never involved in that company which had nothing to do with the business they were running until recently. In fact, their own business of selling buttons, zips and cotton was known as Dress Maker's Haven. As far as she is concerned, having been a working woman throughout the marriage, who contributed fully towards the building of the matrimonial estate, she is entitled to an equal share of the matrimonial house. This is particularly so considering that when they acquired the house it was a small 2 bedroomed house. Together they developed it by adding a third bedroom, ensuite bathroom, a garage and fitted wardrobes…,.

The provisions of section 7(2) of the Matrimonial Causes Act [Chapter 5:13] enjoin me to make an order that operates fairly between the parties. Section 7(4) of the Matrimonial Causes Act [Chapter 5:13] gives me a very wide discretion which must be exercised judicially having regard to all the factors mentioned therein: Takafuma v Takafuma 1994 (2) ZLR 103 (S)…,; Ncube v Ncube 1993 (1) ZLR 39 (S) and Dube v Dube HB149-10 (unreported)…,.

Counsel for the plaintiff has asked me to respect the legal persona principle and give effect to the shareholding of the parties in J. Manyathela Retailers (Pvt) Ltd and award them their shares as contained therein.

I do not agree.

In my view, that entity was the alter ego of the plaintiff. At the time that the house was registered in its name, it existed only on paper and for the sole reason of taking transfer of the house to the exclusion of the defendant.

It is for that reason that the plaintiff could dish out shares to his brothers and take them away as he pleased for no consideration at all. He tried to link it with a retail store run by his brother in Lupane but this could not work as it never traded there. He tried to link it to the business in Bulawayo but it was clear that it had nothing to do with it either. He may have started using that name now but that does not detract from the fact that the house was not bought for the business but the matrimony.

The plaintiff certainly did not deal with the court with candour as he tried to throw in the issue of his brothers and the company to cloud an otherwise straight forward matrimonial dispute. Mangwendeza v Mangwendeza 2007 (1) ZLR 216 (H)…,. In that case, NDOU J stated…, as follows:

''It is trite that a company duly incorporated is a distinct legal entity (endowed) with its own legal personality. Salomon v Salomon & Company Ltd [1897] AC 22. However, the veil of incorporation may be lifted, where necessary, in order to prove who determines or who is responsible for the activities, decision and control of a company.''

I am in agreement with the learned judge.

It has been accepted that the house was registered in the name of the company to provide a vehicle to access loans for the business of the parties. It had nothing to do with the running of that business, which, at the time, was not being conducted in the name of J. Manyathela Retailers (Pvt) Ltd but in the name of Dress Maker's Haven, a business started by the defendant herself. The plaintiff only joined later as confirmed by Mr Desai.

The house itself was the matrimonial home of the parties for 13 years. They acquired it and developed it together for their joint benefit: Sibanda v Sibanda 2005 (1) ZLR 97 (S)..,.

There is no doubt in my mind that she was not a mere housewife. She was a working woman throughout the marriage and generated income for the good of the family. Even the plaintiff unwittingly conceded her role by saying that he married her well-knowing she was good in tailoring.

I conclude that the parties worked together in acquiring House No.6 Blasson Avenue, North End Bulawayo. They moved in together as tenants and later acquired it during the subsistence of the marriage. They developed it together to what it is today. The defendant, therefore, had a direct and indirect contribution towards its acquisition.

I reject the assertion by the plaintiff that the house represents his pension from the National Railways of Zimbabwe and that because of his train accident injuries he should be treated differently from the defendant. That train accident occurred before the parties got married and acquired the house. He was to remain in employment for another 10 years before retiring. I tend to agree with the defendant that his retirement was influenced more by the economic situation prevailing then which reduced the value of his earnings.

All the circumstances of this case point to an equal sharing of the matrimonial home.

For the plaintiff to say that the defendant should take 25% of the value of the matrimonial house and use it to purchase a small house in the high density suburbs leaving him to enjoy the comfort of the house in the low density suburbs is an indication that he has never regarded the defendant as an equal in their relationship. For him to suggest that he should get 75% of the house because he wants to share it with his 25 year and 21 year old children from a previous marriage, who are now university students, is simply arrogant and selfish. It is unsustainable especially in a case as this where there is evidence that the marriage relationship broke down because the plaintiff repeatedly assaulted the defendant and it was her decision to protect herself by obtaining a peace order which forced the plaintiff to file for divorce - presumably not happy with being prevented from perpetuating further assaults on the defendant: Marimba v Marimba 1999 (1) ZLR 87 (H)…,.

In the result, I make the following order:

It is ordered that:

1. A decree of divorce be and is hereby granted.

2. The custody of the minor child, Adrien Andisa Manyathela, born on 14 July 1997, is awarded to the defendant with the plaintiff enjoying reasonable access.

3. The plaintiff shall pay maintenance for the minor child to the defendant in terms of the maintenance order registered at the Maintenance Court Bulawayo under Case number M29/2010.

4. The plaintiff is awarded the 4 plate stove, phone table, lounge suite, multichoice decorder, home theatre, black tv stand, Sansui tv, radio and the Nissan Hardbody Pick up Registration number ABF 7694 as his sole and absolute property.

5. The defendant is awarded the kitchen table with chairs, deep freezer, dinning room suite, panasonic tv, wiztech decorder corner stand, silver tv stand, bed and mattress in main bedroom, bedroom suite, DVD player, bed and mattress in son's bedroom, computer, computer stand, telefunken tv and Toyota Camry motor vehicle registration number ABD 7781 as her sole and absolute property.

6(a) The matrimonial home, being No.6 Blasson Avenue, Northend, Bulawayo, also known as Stand No.7184 Bulawayo Township of Bulawayo Township Lands shall be valued by estate agents agreed upon between the parties to determine its current market value after which the plaintiff shall pay to the defendant 50% of that value in settlement of the defendant's entitlement to that house within 3 months of the date of such valuation.

(b) In the event of the plaintiff's failure to pay the defendant in terms of paragraph 6(a) above, then the said house should be sold to best advantage and the proceeds shared equally between the parties.

HB60-11 : REZIMOSI DUBE vs SANDRA FARAI DUBE
Ruled By: KAMOCHA J

Companies The plaintiff gave a detailed account of the genesis of the companies owned by him. His evidence was that he had been working in casinos but quit in June 1997 after he had obtained a licence from the National Parks to conduct leisure cruises in the upper Zambezi River. With that licence, he approached ...

Companies

The plaintiff gave a detailed account of the genesis of the companies owned by him. His evidence was that he had been working in casinos but quit in June 1997 after he had obtained a licence from the National Parks to conduct leisure cruises in the upper Zambezi River. With that licence, he approached a friend of his known as Gail van Jaarveldts who had an interest in seeing him in business. He approached her so that she could connect him with a partner. The partner had to be a financier since he himself had no capital to start operating such a business. He held a couple of meetings with her culminating in her taking interest in going into a venture with him.

A meeting was held at J D Kennedy where Stanford Gwanzura was a partner whereat the Directors of Binga Wild Safaris agreed to offer him 40% in Binga Wild Safaris which was on loan account.

The first operation started in December 1997. Since his partners were not sure of his knowledge in the business of tourism they made him go into partnership with another company known as Africa Eagle Victoria Falls. But after trading for about a year it turned out that he was pulling in more business than the African Eagle partnership. Consequently, he convinced his partners that they pull out of the African Eagle partnership.

The assets then were a 56-seater boat cruiser, a kombi Toyota Haice, two Mazda trucks - a B1800 and B2200. The business was so successful that they were able to buy another 56 seater boat cruiser and a Toyota Coaster bus which was much bigger than what they had before. That business boom was shortlived as the tourism business hit a snag when tourist arrivals went down at the height of farm invasions. His partners, who were white, became insecure. Through the assistance of Stanford Gwanzura, their accountant in other companies, the plaintiff clinched a deal to secure the other 60% to make it 100%. That came to fruition in 2001 at a cost of six million Zimbabwe dollars which he had to pay over a period of time. He then ran the company on his own and acquired more buses and kombis.

Due to the good working relationship that he had with Gail van Jaarveldts and a Mr Konnot they offered him an opportunity to buy Delicacy Investment trading as Mama Africa. Payment for that business was as and when he got money as he operated it. That arrangement, however, did not work well due to low purchases. He ran short of money to purchase the business and even to run it. That state of affairs compelled him to call Mr Stanford Gwanzura to run the company and even to pay the plaintiff's domestic workers. Stanford Gwanzura did so from the year 2002 up to the year 2007 injecting in excess of 2.5 billion Zimbabwe dollars. The plaintiff did not know where Stanford Gwanzura got the funds from. On realizing that it was not possible for him to come out of the debt owed to Stanford Gwanzura he held a meeting with him whereat it was agreed that Vivstan (Pvt) Ltd, through the funds it had injected, could take 50% shareholding in Learmonth (Pvt) Ltd. A further reason for giving 50% equity to Vivstan (Pvt) Ltd was that the plaintiff felt it was only fair to do so due to the long period he had worked with Stanford Gwanzura.

Initially, Learmonth (Pvt) Ltd was a shelf company but later became a trust holding company for Binga Wild Safaris Trading as Dingani Tours, Delicacy Investments trading as Mama Africa; and Rain Forest Chickens. The Raz Dube Family Trust held a 100% shareholding in Learmonth (Pvt) Ltd.

Following the above, the current position is that The Raz Dube Family Trust and Vivstan (Pvt) Ltd have a 50% each shareholding in Learmonth Investments (Pvt) Ltd which is the holder of 100% shareholding in Delicacy Investments (Pvt) Ltd and Binga Wildlife Safaris (Pvt) Ltd. These two companies generated foreign currency.

The plaintiff stressed that the defendant was never involved in those companies. She never worked for them and was not a shareholder.

However, in the year 2004, the couple's marriage ran into problems as the wife felt that her husband did not involve her into his business activities. As a compromise, he listed her as a Director for both Binga WildLife Safaris trading as Dingani Tours and Delicacy Investment trading as Mama Africa. He further permitted her to use the Rain Forest facilities – the chicken project at the Victoria Falls Airport. The plaintiff told the court that he went further and bought his wife a RAV4 motor vehicle worth US$7,000= and registered it in her name. He also bought her a Nissan truck in 2007. All that was done in order to accommodate the defendant and save the marriage.

The plaintiff alleged that it was made clear to the defendant, as one of the Directors of the two companies, that the companies belonged to the Raz Dube Family Trust.

It was his testimony that they ran separate estates. While he ran the companies mentioned above, she, for instance, ran a company known as Mosi Flora Florist & Boutique (Pvt) Ltd whose Directors, appointed on 19 November 1998, were the defendant herself Sandra Farai Dube, the couple's children – the son, Raz Wilson Dube, and daughter, Tadiwanashe Rhoda Dube. The defendant was the principal Director. He contended that although the defendant had been made one of the Directors of Learmonth Investments (Private) Limited as far back as 18 March 1999 the company did not have anything then. It only became active after the Raz Dube Family Trust was formed as the Trust assets had to be loaded into it. Hence, Learmonth Investments (Pvt) Ltd is owned by the family Trust.

After the parties had separated in 2008 he discovered that the defendant had tempered with documents relating to Learmonth Investments (Private) Limited. The CR14 had been altered to reflect that he had resigned from Learmonth Investments (Private) Limited as a Director. It also reflected that S. G & Company had resigned as Secretary of the company and Sandra Dube, the defendant, had been appointed as Secretary. The couple's son, Raz Wilson Dube, was appointed Director replacing his father, the plaintiff.

The plaintiff reported the matter to the Criminal Investigation Department (CID) Bulawayo. The defendant and her accountant were facing criminal charges….,.

The plaintiff vehemently denied the suggestion that the couple ran a joint estate. Instead, he told the court the two invested separately as each of them ran his or her businesses. He asserted that through their actions it was clear that there was an element of wanting to be independent by each party and that they did not want to be accountable to each other. They never sat down as a couple to discuss how resources from their business empires were going to be utilized. They ran separate bank accounts with various banks.

He reiterated, under cross-examination, that the Trust was set up for the purposes of securing property for the family as a whole - especially for the children. Although the defendant was not consulted when it was being set up she was fully informed about what was going on. She was given documents relating to the setting up of the Trust. The documents were fully explained to her and she appended her signature without demur. Knowing her as he did she would not sign a document she did not understand and agree with…,.

When it was suggested to him that the defendant should continue running the chicken project at the airport after the divorce his response was that she could not benefit from the Trust after the divorce….,.

The sad picture that came out of cross-examination was that the plaintiff was never the head of his family. The defendant had a superiority complex because she was a holder of a Bachelor's Degree while the plaintiff was only 'O' levels. Right from the beginning of their marriage she made it known to him that he should realize that she was more educated than he was.

When he told her that he was not happy with her employment at United Touring Company the answer he got was that she had come to Victoria Falls to work not to be told what to do by a man. When she went into partnership with a Mr Chiwandire, he queried that but was told that he was jealous of her success. Further, her cross border activities date back early into their marriage. Despite the fact that he had indicated his displeasure of such activities due to the moral reputation attached to them, she insisted and continued to undertake the trips. His disapproval of the trips was of no consequence to her. He had no control over her during the subsistence of the marriage. She did her own thing while he did his. He concluded by saying that he stayed into the marriage for 18 years just for the sake of the couple's two children….,.

The Trust

The defendant complained bitterly about the Raz Dube Family Trust. In the first place, she alleged that she was not consulted when the family trust was initiated. Stanford Gwanzura did not explain the Trust to her in 1999 which she felt was no way in her favour. It is to benefit the settlor and the children. She had never received any income from the Trust as an income beneficiary of the Trust. Secondly, she said the plaintiff was a self-confessed externalizer of money by doctoring figures, hence her lack of faith in the figures coming from the company. Thirdly, Stanford Gwanzura, who is one of the Trustees, was involved in the formation of the Trust and is also a business partner with the plaintiff. Both have interests in the company and accordingly the Trust is biased against her. In the event of a divorce, the settlor can change the Trust Deed to whatever he wants. In that event, she would not get any benefit as an income beneficiary. She alleged that she would never be given the correct figures reflecting the company performance. Her expectation was a once off payment to avoid her going back to the plaintiff.

Companies

Rain Forest Chicken Project

The defendant's testimony was that she started running that project in 2003 and had made structural improvements to it. She built a kitchen and eating area for the workers. She furnished the servants quarters. She acknowledged the fact that it was the plaintiff who had started building it. When she started running the project, the plaintiff allegedly gave her certain documents and said the project was under Learmonth Investments (Pvt) Ltd as reflected in the lease agreement entered into with Hwange Rural District Council filed of record…,. She also filed a letter by the Chief Executive Officer of Hwange Rural District Council dated 19 June 2000 addressed to the Ministry of Local Government, Rural and Urban Development requesting the lease document for WILTI (Private) Limited to be amended to Learmonth Investments (Pvt) Ltd. She denied that Learmonth Investments (Pvt) Ltd was a holding company for other companies. As far as she was concerned, it was the company for her chicken project which she said was the only income generating and viable project at the moment and would like to continue running it. She offered to reimburse the US$600= paid by the plaintiff to Hwange Rural District Council.

Mosi Flora Florist & Boutique (Private) Limited was not operational. She alleged that she had lost a lot of equipment to thieves who had broken in twice. The rentals had also shot up. She felt insecure because of the burglaries to her business. She stopped running the kitchen known as Kwa Mai Raz because socially she could not live in Victoria Falls. A friend of hers was now running it.

Binga Wildlife Safaris and Delicacy Investments (Private) Limited

The defendant told the court that she was entitled to a share in each of the above companies because of the contribution she made. She allegedly helped him to set up the businesses. Her contribution was to ensure that food was available at the table and she clothed everybody in the family. Further, when she first met the Van Jaarsveldts on the boat cruise belonging to her employers, United Touring Company, she promised them that she would help her husband to run Binga Wild Life Safaris. It is on that basis that she felt she was entitled to a share in that business.

Under cross-examination, she told the court that she was an independent person who had been in business well before she was married to the plaintiff. Her business was cross border trading and a hair salon. She contended that cross border trading was a profitable business which she was still engaged in and alleged that the proceeds from there were ploughed into the construction of the matrimonial home…,. She denied that her husband did not approve of her cross border trips. She also denied that her husband did not like her to work for United Touring Company. It was her evidence, under cross-examination, that Mosi Flora Florist and Boutique and the cross border business had the same bank account while Kwa Mai Raz and the Rain Forest Chicken business had no bank accounts. The plaintiff was not a signatory to the bank account although she claimed the businesses belong to the joint estate. Her explanation for that was that the plaintiff did not make an issue of that as long as the money was accounted for. When asked to produce proof for payment towards the construction of the matrimonial home she merely said she gave money to her husband and went on to state that she was shocked to hear her husband telling the court that they ran separate estates. When it was put to her that it was not true that she was shocked because the husband said so from the onset, as reflected in paragraph 8 of his declaration, her response was that he was merely trying to run away from the idea that the couple acquired assets together. Moreover, when they got married they never discussed whether or not they were going to run businesses separately. That was never an issue. They did not have any assets before they got married. All assets were acquired during the 18 years of marriage.

Although she admitted that the plaintiff was not made a Director of any of her companies and was not a signatory of any of her accounts and neither did she sign on any of his accounts she still claimed that they ran joint estates and he was happy with that type of arrangement. It was, however, clear that she had no shares in the plaintiff's companies and neither did he hold shares in her companies. She was unable to furnish a satisfactory explanation why her companies did not use S. G. & Company (Pvt) Ltd as their accountant if they ran a joint estate because the companies ran by the plaintiff used that accounting firm. She admitted that Witli (Pvt) Ltd ceded all its rights, title and interest in lease number CL51492 at Lupinyu Township, Hwange District to Learmonth Investments (Private) Limited in which she held no shares. She contradicted herself on whether or not the Trust was explained to her. Initially she had said the Trust was only explained in 2004 but changed in cross-examination and denied that it was ever explained to her.

After her testimony, the defendant had no witnesses to call and closed her case….,.

Joint estate

What is common ground from the evidence adduced in this court is that the defendant ran four businesses during the course of the marriage, namely:

(a) The cross border trading;

(b) Kwa Mai Raz restaurant;

(d) Mosi Flora Florist and Boutique.

The plaintiff runs Binga Wildlife Safaris (Pvt) Ltd trading as Dingani Tours and Delicacy Investments trading as Mama Africa Restaurant. Learmonth Investments (Private) Limited was introduced into the picture and family for purposes of the Trust and both the plaintiff and the defendant appeared as Directors in 1999. It is common cause that the plaintiff assisted the defendant in setting up the chicken project at Victoria Falls Airport despite the fact that she was an independent, modern business woman. He supported all her businesses. He gave her foreign currency for her cross border purchases. He helped to equip her restaurant. He ordered one of his companies to buy chickens and chicken products from her chicken project. It is clear that the parties went into serious business simultaneously both leaving formal employment. They each ran their companies separately. Neither of the parties was a shareholder in the other's companies. The plaintiff was not a signatory to any of the company accounts of companies ran by the defendant and neither was she to those ran by the plaintiff. She did not even make him a Director to any of her companies. The plaintiff, however, in 2004 instructed his accountants to make her an honorary director to both his companies – Delicacy Investments and Binga Wildlife Safaris (Pvt) Ltd. The sole reason for doing so was to save their marriage. There was no other reason for so doing other than make the defendant feel secure.

The plaintiff's evidence was uncontroverted in that regard.

The parties' marriage seems to have had problems at an early stage because when the man attempted to assert his authority as the head of the family by telling her to stop some of her activities she told him in his face that she had gone to Victoria Falls to work and make money and not to be told what to do by a man. The plaintiff had suggested that she should give up her job at United Touring Company. The plaintiff did not approve of her cross border trading but had to accept it. She was at liberty to choose her own accountant for her businesses despite the fact that there was a family accountant. While the defendant would want the companies run by the plaintiff to be declared part of the joint estate she does not want the same to happen to those she runs. Apart from her honorary status as a Director in the companies of the plaintiff she had no direct involvement or participation in the decision making process. She had no idea of what the plaintiff was doing except what he told her. There would be no basis for treating the plaintiff's two companies as part of the joint estate of the parties in the light of the evidence before the court. What is just and equitable is for the plaintiff to keep what he worked for and for the defendant to do the same. The Rain Forest Chicken project belonged to the plaintiff although he had allowed the defendant to use it during the subsistence of the marriage. It must go back to the companies under the direct control of the plaintiff….,.

Having made a finding that the matrimonial house was jointly built by the parties and belongs to them jointly it follows that before it was transferred to the Trust both parties had to be in agreement to do so. The defendant told this court that she was not even consulted when that was being done let alone being in agreement. The plaintiff's attitude was that he did not need to consult her or seek her consent as he felt she had nothing to do with it.

He fell into error.

The court finds that the plaintiff transferred to the Trust an asset which was jointly built and jointly owned by both parties unilaterally. It ought to be transferred out of the Trust so that the parties can receive their respective 50% shares in it.

The Trust

In the light of the finding that the matrimonial home should be transferred out of the Trust, the assets remain in it are those previously owned by the plaintiff which the court has held that he can keep.

The defendant's testimony was that the Trust did not benefit her in any way. She even believed that it had been set up to disinherit her as she had not been consulted when the selection of trustees was being made. One of the trustees was Stanford Gwanzura, a business associate of the plaintiff and his accountant. She said she could not rely on the benevolence of such trustee to protect her interests, moreso when, as settlor, the plaintiff said he could dissolve the Trust as and when he pleased. She complained that in order to disentitle her of the matrimonial assets she was made an income beneficiary but had never received any income from the Trust since its formation in 1999 despite the fact that the companies had been generating externalized funds.

In the light of the foregoing, it seems to me that the plaintiff would be at liberty to continue with the Trust after transferring out of it the matrimonial home Number 499 Accacia Crescent, Victoria Falls or after paying her 50% share of the property.

In the result, the order of this court is as follows:-

1. The consent paper signed by both parties on 29 May 2009 becomes an order of this court, in its entirety;

2. The matrimonial home, House Number 499 Accacia Crescent, Victoria Falls shall be transferred out of the Trust and each party shall be awarded a 50% share in it with any of the parties being allowed to buy out the other within 3 months of the date of this order;

3. Each party shall keep its companies and businesses id est plaintiff shall keep Learmonth Investments, Binga Wildlife Safaris trading as Dingani Tours and Delicacy Investments trading as Mama Africa Restaurant and the Rain Forest Chicken project while the defendant shall keep Kwa Mai Raz Restaurant, Mosi Flora Florist and Boutique and her cross border trading;

4. The plaintiff shall keep the Trust after transferring out of it matrimonial House Number 499 Accacia Crescent, Victoria Falls for the parties to receive their 50% shares as stipulated in paragraph 2 supra;

5. …,.; and

6. Each party shall bear its own costs.

View Appeal
HB159-11 : HILDA SIBANDA vs TEEJAY SIBANDA
Ruled By: NDOU J

(d) Simpson Electrical (Pvt) Ltd and Muntomuhle Investments (Pvt) LtdThe plaintiff wants to be given twenty-five (25%) percent of the shares in Simpson Electrical (Private) Ltd and fifty percent (50%) of the value of the immovable property owned by Muntomuhle Investments (Pvt) Ltd.Simpson Electrical was incorporated in 1989 before the ...

(d) Simpson Electrical (Pvt) Ltd and Muntomuhle Investments (Pvt) Ltd

The plaintiff wants to be given twenty-five (25%) percent of the shares in Simpson Electrical (Private) Ltd and fifty percent (50%) of the value of the immovable property owned by Muntomuhle Investments (Pvt) Ltd.

Simpson Electrical was incorporated in 1989 before the defendant met the plaintiff. The defendant and his late brother were the only shareholders when it was incorporated. It is the defendant's case that he is no longer a shareholder of Simpson Electrical having donated his shares to his children from a previous marriage as per share certificates dated 3 December 1995 - that is almost a year before the parties were married.

The courts have accepted as trite the principle that a company duly incorporated is a distinct legal entity endowed with its own legal personality. It is equally trite that the veil of incorporation may be lifted where necessary in order to prove who determines or who is responsible for its activities, decisions, and control of the company; Sibanda & Anor v Sibanda 2005 (1) ZLR 97 (S)…, and Mangwendeza v Mangwendeza 2007 (1) ZLR 216 (H)…,.

In my view, this is a case that requires the lifting of the veil of incorporation because of the reasons that will be explained hereinunder.

According to the credible testimony of the plaintiff, when she got married to the defendant, Simpson Electrical was situated in Robert Mugabe Way between 14th and 15th Avenue. It was a small shop. They moved the shop into bigger premises in Pioneer House. The latter premises proved too big for the level of their trading. More stock was required. The defendant's resources proved inadequate for stocking a shop of that magnitude. They sold their cars to raise capital for the business. She also put in her funds. She was the one doing the buying of stock for the business. This involved her travelling up and down to South Africa.

She was told that the business was registered under the names of the defendant and his late brother.

The business grew in leaps and bounds. The family benefitted a lot from the growth of the business. They were able to carry out extensive extensions of the Woodlands property as alluded to above. Because the business was flourishing, they acquired the Hillcrest property and two Stands in Pumula South; built houses thereon.

These latter houses were registered in the names of the family members.

The business had some substantial disposable income - even after these investments. They decided to expand the business further. According to the plaintiff, they then approached her uncle (who was in the employ of the Bulawayo City Council). Through her said uncle, they were offered an industrial Stand in Donnington West. They used money from the business to pay for the industrial Stand.

When the defendant went to pay for the Stand he registered it in his name.

She said they toiled to build a factory i.e. double storey structure. They sent their children abroad. She also said that she sold her Paddonhurst house to the defendant's cousin and ploughed the proceeds thereof to Simpson Electrical by way of purchasing stock. This factory was massive. They rented it out to a company known as Setex. The tenants developed interest in the factory and offered to purchase it. The parties agreed to sell it. The proceeds of the sale of the factory were used to buy and reconstruct the building in 129-130 Robert Mugabe Way, which is the major asset of Muntomuhle Investments.

This fact is admitted by the defendant as evinced by his letter dated 5 March 2007 in the bundle of documents. In the same letter, drafted by his legal practitioners of record, the defendant concedes that the plaintiff is a shareholder of Simpson Electrical holding 25% shares.

After the acquisition of the Robert Mugabe Way property she fell ill. She was away for three months. She was first hospitalized and operated at Mater Dei Hospital, and, later, at St Annes Hospital, Harare where she was further operated. When she recovered, she approached the defendant for the title deeds of the property and he refused to show her. She said she was not amused and accused him of trying to make her “his slave”. They eventually decided to go separate ways.

The defendant offered her 25% of this property saying the other shares belonged to his children and himself (i.e. 25% and 50% respectively).

She said that she was later surprised to be told that the same building belongs to Muntomuhle Investments. It is her case that this company was incorporated to cheat her.

I am in agreement with this testimony.

The evidence points to a major contribution by the plaintiff in the growth of Simpson Electrical. After the plaintiff got involved in the running of Simpson Electrical there was fundamental expansion, thanks to the joint effort of both parties.

As far as Muntomuhle Investments (Pvt) Ltd is concerned it is a creature of the defendant for the dissipation of the assets of Simpson Electrical in order to defeat the plaintiff's just claims. Even the defendant's own witness, Nomalanga Sibanda, conceded that Muntomuhle Investments was a family project. More importantly, she evinced that -

(a) Muntomuhle Investments company never had an Annual General Meeting or directors' meeting;

(b) The shareholders had never been paid dividends;

(c) They were never (as shareholders) made aware of the donation of the shares or the company affairs; and

(d) That as far as she was aware Muntomuhle was the defendant's project and he could do as he wished or liked with the company or the shares.

The defendant was, therefore, the alter ego of Muntomuhle Investments (Pvt) Ltd. He was not only running the show at Muntomuhle Investments (Pvt) Ltd - he and Muntomuhle Investments (Pvt) Ltd have become one.

In light of the plaintiff's immense contribution towards the main asset of Muntomuhle Investments (Pvt) Ltd, as explained above, this court has no option but unmask Muntomuhle Investments (Pvt) Ltd and declare the plaintiff an owner of 50% of the market value of the building owned by Muntomuhle Investments (Pvt) Ltd known as Downings Buildings, Robert Mugabe Way, Bulawayo....,.

1....,.;

2....,.;

3....,.;

4....,.;

5....,.;

6....,.;

7....,.;

8....,.;

9....,.;

10....,.;

11....,.;

12. The plaintiff is awarded 25% of the shares of Simpson Electrical (Pvt) Ltd and the defendant the remainder of the shares;

13. The plaintiff is awarded 50% of the value of the immovable property known as Downings Building, Robert Mugabe Way, Bulawayo registered under the name of Muntomuhle Investments (Pvt) Ltd and the defendant the remainder;

Appealed
SC07-14 : TEEJAY SIBANDA vs HILDA M SIBANDA
Ruled By: GWAUNZA JA, GARWE JA and GOWORA JA

SIMPSON ELECTRICAL (PVT) LTD The court a quo awarded the respondent 25% of the shares in Simpson Electrical (Pvt) Ltd, while the appellant was awarded the rest. The appellant is disgruntled at this order and prays that the award of 25% to the respondent be set aside. It is not disputed that Simpson Electrical (Pvt) Ltd was ...

SIMPSON ELECTRICAL (PVT) LTD

The court a quo awarded the respondent 25% of the shares in Simpson Electrical (Pvt) Ltd, while the appellant was awarded the rest. The appellant is disgruntled at this order and prays that the award of 25% to the respondent be set aside.

It is not disputed that Simpson Electrical (Pvt) Ltd was incorporated in 1989 - before the parties' marriage. At the time, there were only two Directors of the company, that is, the appellant and his (now) late brother. The appellant, however, avers that following donation of his shares to his children from a previous marriage, he was no longer a shareholder in the company. This evidence, as indicated later in this judgment, was later contradicted by the appellant himself. The donation, according to share certificates dated 3 December 1995, was effected almost a year before the parties' marriage.

The court accepted as a trite principle of the law that a company duly incorporated has a distinct legal persona separate from its shareholders. The court also considered that the veil of incorporation of that company may be lifted, where necessary, in order to prove who determines or who is responsible for the company's activities. Based on what the court a quo referred to as the credible evidence of the respondent, the court was of the view that in this case, a lifting of the veil of incorporation of Simpson Electrical (Pvt) Ltd was justified. The 'credible' evidence was to the effect that:-

i) At the time of the parties' marriage, Simpson Electrical (Pvt) Ltd was in fact a small shop which the parties then moved into bigger premises in Pioneer House;

ii) The new premises having proved too big for the available stock, the parties sold their cars to raise capital to buy more stock for the shop;

iii) With both parties contributing to the running of the business, it grew in “leaps and bounds”;

iv) From the substantial income realised, the parties were able to carry out extensive renovations to their property in Woodlands;

v) From the same proceeds, they were able to buy the Hillcrest property as well as buy and develop two other Stands in Pumula South;

vi) From the still substantial disposable income, the parties bought an industrial Stand in Donnington West;

vii) The respondent also sold her house in Paddonhurst and ploughed the proceeds into Simpson Electrical (Pvt) Ltd by way of purchasing stock; and

viii) The appellant gave her (respondent) 25% shares in Simpson Electrical (Pvt) Ltd while the rest remained with the appellant and his children.

While it is accepted that there are no hard and fast rules on the circumstances that justify the lifting or piercing of the corporate veil, with each case generally having to depend on its own facts and merits, I find this dictum from the case of Mkombachoto v Commercial Bank of Zimbabwe & Anor 2002 (1) ZLR (4)…, to be apposite;

“In my view, the court has no general discretion to disregard the company's separate legal personality whenever it considers it just to do so. The court may 'lift the veil' only where otherwise as a result of its existence fraud would exist or manifest justice would be denied.” (my emphasis)

From the 'credible' evidence listed above, it is evident, as indicated below, that the appellant admitted he had given the respondent a 25% share in Simpson Electrical (Pvt) Ltd. Secondly, and flowing from this, the respondent, accepting that she owned the 25% shareholding, offered to hand the shares over in return for their fair market value. The appellant, in an about turn, then denied he ever gave the respondent the 25% shares. Further, in contradiction to what he had earlier stated, the appellant averred that the shares still belonged to him and his children. Overriding all this was the undisputed fact that the company had grown substantially from the time the parties got married, and that the respondent had made significant contribution to such growth. The contribution had resulted in the family earning so much income they were able to buy and develop several other properties.

The evidence of both the appellant and the respondent does not suggest that the other shareholders, to wit, the appellant's and one of the parties' children, made any contribution to the capital or other assets of the company, nor in any other manner. The relationships which lay behind the corporate veil are clearly revealed as between the appellant and the respondent. It is evident that the parties themselves were the administrators, controllers and contributors to the growth of Simpson Electrical (Pvt) Ltd.

Had the veil not been lifted, such a relationship would not have been revealed, to the ultimate detriment of the respondent.

The respondent was actively involved in moving the Simpson Electrical Shop to bigger premises and responsible for stocking the expanded shop, for which purpose she travelled back and forth between Zimbabwe and South Africa in order to source such stock. As a result, the shop, in other words, Simpson Electrical (Pvt) Ltd “grew in leaps and bounds.” Her contribution, as the court a quo found, was substantial. By arguing that no case has been made to pierce the corporate veil of Simpson Electrical (Pvt) Ltd, the appellant, in other words, is suggesting that all the assets, including the share acquired through the contribution of the respondent, should remain the property of Simpson Electrical (Pvt) Ltd. That effectively, the respondent must walk away without anything from Simpson Electrical (Pvt) Ltd. I do not doubt that denying the respondent any share of this company would result in manifest injustice.

I am satisfied, given the evidence on this matter, that the learned judge a quo properly lifted the veil of incorporation of Simpson Electrical (Pvt) Ltd….,.

MUNTOHUHLE INVESTMENTS (PVT) LIMITED

The court a quo lifted the veil of incorporation of Muntomuhle Investments (Pvt) Limited and awarded a 50% share to each of the parties, in the property known as Downings Building, Robert Mugabe Way, Bulawayo. This building was registered under the name of this company and constituted its main asset.

The appellant challenged both decisions, and charged, among other grounds, that the court erred in taking away the property of the shareholders of the company without giving them an opportunity to be heard. The shareholders referred to were his children, including one whose mother was the respondent.

Having considered the evidence placed before the court a quo as well as the judge's assessment thereof, I do not find that there is any merit in the appellant's arguments.

The learned judge a quo found that the appellant was not only running the show at Muntomuhle Investments (Pvt) Limited, he and the company had become one. Nomalanga, one of the alleged “shareholders,” in Muntomuhle Investments (Pvt) Limited, put the correctness of the conclusion of the court a quo that the appellant was its alter ego beyond doubt when, in her evidence, she indicated that:

i) The Muntomuhle Investments (Pvt) Limited company never had an Annual General Meeting or Director's meeting;

ii) The “shareholders” had never been paid dividends;

iii) They were never (as “shareholders”) made aware of the donation to them of shares or company affairs; and

iv) As far as she was aware, Muntomuhle Investments (Pvt) Limited was the appellant's project and he could do with it as he wished or liked.

The learned judge a quo further found that Muntomuhle Investments (Pvt) Limited was actually an invention of the appellant, created solely for the dissipation of the assets of Simpson Electrical (Pvt) Ltd in order to defeat the respondent's claim. The appellant, according to the evidence of the respondent, which was found to be more credible than that of the appellant, not only incorporated Muntomuhle Investments (Pvt) Limited without her knowledge, he proceeded, again without her knowledge, to register the building in question in the name of Muntomuhle Investments (Pvt) Limited.

Against this background, I find that the inference of an attempt by the appellant to deceive, if not defraud, the respondent, is difficult to escape. There is case authority to the effect that conduct of this nature justifies the piercing of the corporate veil. In Cape Pacific Ltd v Lubrier Controlling Investments (Pty) Ltd & Ors, the court had this to say:

“…, when the corporation is the mere alter ego or business conduit of a person, it may be disregarded. This rule has been adopted by the courts in those cases where the idea of the corporate entity has been used as a subterfuge and to observe it would work injustice.”

I find this dictum to be eminently apposite given the facts of this matter.

Having, in addition, considered the respondent's immense contribution towards the main asset of Muntomuhle Investments (Pvt) Limited, the learned judge a quo, in the result, concluded that he had no option but to unmask Muntomuhle Investments (Pvt) Limited and declare the plaintiff owner of 50% of the net value of the building in question.

I do not find fault with this decision.

As for the need to hear Muntomuhle Investments (Pvt) Limited's other shareholders, I am persuaded that the court's finding that the company was in fact the alter ego of the appellant, rendered it unnecessary to consider any other “shareholders” in the administration and control of the company. This, I find, is a consequence that is anticipated in the following passage by C NKALA and TJ NYAPADI in their book, ”Company Law in Zimbabwe”, 1995….,;

“…,. When the courts or legislature lift the veil of separate legal persona they disregard the corporate entity and look to the relationships which lie behind the corporate form…,.”

In any event, at no stage did the other shareholders take any action to protect their interest in the property, even though they were aware that the company was to be the subject of litigation in matrimonial proceedings.

I therefore find that the learned judge a quo correctly, and without reference to its other alleged shareholders, disregarded the corporate entity of Muntomuhle Investments (Pvt) Limited that the appellant and his daughter Nomalanga alleged existed.

The appellant challenges the court a quo's award of 50% of Downings Building to the respondent on another ground.

In his Heads of Argument, he concedes that the building in dispute was acquired through income originally drawn from Simpson Electrical (Pvt) Ltd. He, however, argues that, having awarded her only 25% shareholding in Simpson Electrical (Pvt) Ltd, the source of the funds, the court a quo should not have awarded the respondent a 50% share of Downings Building.

My understanding of this argument is that if the court was to award the respondent any share of the building, it should not have been more than 25%; a share that would reflect her shareholding in Simpson Electrical (Pvt) Ltd.

The evidence before the court suggests there was no direct link between the funds drawn from Simpson Electrical (Pvt) Ltd and those eventually used to purchase the building which is the main asset of Muntomuhle Investments (Pvt) Limited.

The judge a quo made this clear when he said the following regarding the acquisition of the main asset of this company, i.e. Downings Building;

“They used money from the business (Simpson Electrical) to pay for an industrial Stand. When the defendant (appellant) went to pay for the Stand, he registered it in his name…., they toiled to build a factory i.e. a double storey structure. The factory was massive. They rented it out to a company known as Stex. The tenants developed interest in the factory and offered to purchase it. The parties agreed to sell it. The proceeds of the sale of the factory were used to buy and re-construct the building in 129-130 Robert Mugabe Way, which is the major asset of Muntomuhle Investments. This fact is admitted by the defendant as evinced by his letter dated 5 March 2007 in the bundle of documents.”

In short, the funds from Simpson Electrical (Pvt) Ltd were used to purchase a commercial Stand on which a factory was then built. The factory was initially rented out and later sold to the sitting tenants. Funds realised from these latter endeavours were then used to buy the building in question. In all these developments, there was nothing to suggest that the parties' perception of the share of their entitlement in Simpson Electrical (Pvt) Ltd in any way determined or defined the extent of their contribution to the eventual acquisition of the building in question.

Instead of engaging in the type of mathematical calculations that the appellant argues for, the judge went on to use his discretion, as required by the law, in assessing the awards that he made. I do not find that such discretion was improperly exercised.

I would, therefore, dismiss this ground of appeal as having no merit.

In the result, I make the following order.

1. The appeal succeeds only in part.

2….,.

3. The appeal in relation to the assets and property referred to in paragraphs 6,7,12 and 13 of the order of the court a quo, is dismissed.

4. The appellant shall pay the costs of this appeal.

HB14-05 : SMART MALABA vs NOMATHEMBA FENNY MALABA
Ruled By: NDOU J

The plaintiff also testified that the parties jointly owned the dressmaking business. He outlined his contribution towards the setting up and subsequent life of the business.

View Appeal
HH18-06 : MASIYIWA CLEOPHAS GONYE vs STELLA MARIS GONYE (NEE MUCHENJE)
Ruled By: UCHENA J

In paragraph 12 of his declaration, the plaintiff sought to be awarded the sole ownership of all shares in the company controlling Wonder Valley Farm and that the defendant be awarded sole and exclusive ownership of the poultry project on the farm….,. In reconvention, the defendant seeks…,. (a)…,. (b)…,. (c) 50% of the value of Wonder Valley Farm….,. Counsel for the defendant also submitted ...

In reconvention, the defendant seeks…,.

(a)…,.

(b)…,.

Counsel for the defendant also submitted that since company money was used to acquire the assets they belong to the company and the defendant, being a shareholder, is entitled to a share of their value….,.

The plaintiff had sought to trade in the movables for the shares as he wanted all the shares of Wonder Valley (Pvt) Ltd. I refer to paragraph 12 of the plaintiff's declaration.

I must point out that the plaintiff's request in paragraph 12 cannot be granted. Only 50% of the shares can be dealt with. That which belongs to him and his wife. I cannot deal with their two sons' shares as that is not part of the matrimonial estate and the claim is against persons who are not parties to the case before me….,.

The Shares

As regards the shares, evidence led proves each party holds 25% of the company's shares. The plaintiff sort to be granted all the shares. I have already said that cannot be done as their two sons hold 50% of the issued shares. In my view, there is no need to temper with the percentages of the parties. The plaintiff gave his wife and children shares in the company. I see no reason why any of her shares should be taken from her and be given to him. However, I appreciate that the parties want a complete break from each other. She does not wish to remain a shareholder in the company and he does not wish to remain associated with her through the company. To achieve that he has to buy her out. He has to pay her 25% of the net value of the company as at the date of divorce….,.

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5. That the defendant is awarded 25% of the value of Wonder Valley (Pvt) Ltd.

6. That the value of the assets to be shared under 5 shall be obtained by adding the plaintiff's and defendant's valuations and dividing that figure by two.

7….,.

8. That the plaintiff is granted the option to buy out the defendant in respect of order 5 by not later than the 30^th July 2006.

HH457-14 : PHILIPPA ANN COUMBIS vs RONALD JOHN COUMBIS
Ruled By: MAWADZE J

Unlike what is stated in his plea and counterclaim, the defendant, in his evidence, revealed that there are other companies in which he has interests. This was prompted by the plaintiff's evidence. Let me list the companies and briefly state what the defendant said. (a) Northwood Accounting Services (Pvt) Ltd This is the only company in which the ...

(a) Northwood Accounting Services (Pvt) Ltd

This is the only company in which the defendant admits the plaintiff is a shareholder. The company has ceased operations. According to the defendant it now only owns a Mazda pick-up truck.

(b) Lighthouse Enterprises (Pvt) Ltd

The defendant admitted forming this company as a trading company but says it owns no assets as it never took off the ground. This could first be one of the companies formed by the defendant to cloud issues.

According to the defendant, Bret Lang has 60% shareholding, and, as usual, the defendant and his sister, Debra Banks, have 20% shareholding each. The only asset owned by the company, according to the defendant, is one motor vehicle.

(d) Natsburg Trading (Pvt) Ltd

According to the defendant, the trading company owns just one motor vehicle, a VW Caravan bus which is used as a family motor vehicle.

(e) Pollifax Traders (Pvt) Ltd

The defendant said this trading company has since folded and has no assets or stock.

(f) Ramis Traders (Pvt) Ltd

The defendant said this company was formed as a partnership between Stir-crazy Investments (Pvt) Ltd and another company in order to run a hardware shop in Graniteside, Harare on a 50% shareholding each. The defendant said this company has since been disposed of and proceeds of Stir-crazy Investments (Pvt) Ltd's shareholding was paid to Stircrazy Investments (Pvt) Ltd.

(g) Bywork Intermedia Investments

The defendant said this is an advertising company owned by his girlfriend, Tamara Forbes, Tendai Mutseyekwa, the defendant's eldest son, Murray, Farai, and one Sure Kamhunga. This company was set up after separation between the plaintiff and the defendant and divorce proceedings had commenced. The defendant denied that he set up the company using money raised from the sale of Ramis Traders (Pvt) Ltd. The defendant said he is only the Chairman and Director of this company. The defendant also admitted that Stircrazy Investments (Pvt) Ltd sold some assets to Bywork Intermedia but insisted that all the assets were paid for, for value.

The defendant was taken to task on how his eldest son, Murray, would find himself, soon after the separation of his parents, owning three viable companies, Incvat Enterprises, Big R Chain of hardware shops, and Bywork Intermedia when Stircrazy Investments (Pvt) Ltd was being liquidated.

The plaintiff's view is that the defendant registered these companies after separation in the names of nominees in order to hide such assets and defeat the plaintiff's claim.

(h) Incvat Enterprises

This is another company formed after the separation of the parties. The defendant, however, insists he has no interests to this company which is a trading company running hardware shops under the Mica franchise in Bulawayo and Harare at Boka, Belgravia, Newlands, and Mt Pleasant just like what Stircrazy Investments (Pvt) Ltd used to do. It cannot be disputed that this company was formed after Stir-crazy Investments (Pvt) Ltd was facing serious challenges and imminent collapse. The liquidator for Stircrazy Investments (Pvt) Ltd believed there is an incestuous relationship between Stircrazy Investments (Pvt) Ltd and Incvat Enterprises and the plaintiff also believed this is designed to frustrate her claim. A number of factors point to this, according to the liquidator;

(i) Incvat Enterprises paid US$900,000= to Stircrazy Investments (Pvt) Ltd.

(ii) Incvat Enterprises and Stircrazy Investments share the same resources from central store.

(iii) Bret Lang, a shareholder in Stir-crazy Investments, is alleged also to be a shareholder in Incvat Enterprises with the defendant's eldest son, Murray, whose ability to raise capital to buy shares in Incvat Enterprises is questionable when he is just a university student.

(iv) The liquidator was unable to tell which motor vehicles are owned by Incvat Enterprises and those by Stircrazy Investments as there was an admission that Stircrazy Investments sold motor vehicles to Incvat Enterprises after separation of the defendant and the plaintiff.

(v) Incvat Enterprises uses Belgravia House - the same premises Stircrazy Investments used.

No one was willing to disclose as to when Incvat Enterprises was formed, when it started to use Belgravia House or when it started to share assets with Stircrazy Investments (Pvt) Ltd.

The defendant denied that Incvat Enterprises is just Stircrazy Investments (Pvt) Ltd in another form despite all this being put to him….,.

While the plaintiff gave her evidence very well she has not, in my view, managed to answer the critical questions to deal with the shareholding structure of the various companies I have alluded to at length….,.

I have…, alluded to the various companies in which the plaintiff did not lay any claim but were alleged to be owned by the defendant and that I should consider that fact in the distribution of the assets of the parties. These include:-

(i) Telehec Investments (Pvt) Ltd.

(ii) Natsbury Trading (Pvt) Ltd.

(iii) Bywork Intermedia.

(iv) Incvat Enterprises.

(v) Stircrazy Investments (Pvt) Ltd.

In respect of all the above…, companies, I am inclined to grant absolution from the instance.

I have already alluded to the fact that neither the plaintiff nor the defendant have been able to place evidence before the court to show the shareholding of these companies. I have dealt, at length, with the evidence of the parties and explained why I believed the defendant is an untruthful and incredible witness. I, however, hold the view that the plaintiff has not been able to make out a case in respect of these assets. I am also persuaded to grant absolution from the instance because of the fact that as the trial commenced, but before its completion, Stir Crazy Investments (Pvt) Ltd was placed under provisional liquidation and is currently under liquidation.

The test to be applied in granting absolution from the instance is settled in our jurisdiction. See United Air Charters (Pvt) Ltd v Jarman 1994 (2) 341 (S)…,.; Walker v Industrial Equity Ltd 1995 (1) ZLR 87 (S)…,.

The test is simply whether there is evidence adduced upon which this court, directing its mind reasonably to such evidence, could find that the properties in issue are assets of the parties. It would be unjust, in my view, to dismiss the plaintiff's claim even at this stage. As I have said, I have no doubt that the defendant has interests in all these companies, whether trading companies or property-owning companies. It is the extent of his interests or shareholding which is unclear.

In making an order in respect of the distribution of the assets in terms of section 7(1)(a) of the Matrimonial Cause Act [Chapter 5:13], I am enjoined to take into account the factors outlined in section 7(4)(a) to (g) of the Matrimonial Cause Act.

I am unable to meaningfully apply these factors without establishing the full extent of the defendant's interests in these companies. While I have no difficulty in finding that the defendant has not been a useful and truthful witness and therefore dismiss his evidence, the plaintiff has not provided the court with proof of shareholding in these companies which could be the Memoranda and Articles of Association bearing the names of the subscribers and the designated shares they are taking up, Shareholders Agreements or share certificates (as proof of title). These are important facts which cannot be wished away by simply alleging that the defendant is an untruthful witness.

It is trite that a company duly incorporated is a distinct legal entity endowed with its own legal personality. See Salomon v Salomon & Co Ltd [1897] AC 22.

This means that both the property owning companies and the trading companies enjoy distinct legal persona from the plaintiff and the defendant. This court, in terms of section 7(1) of the Matrimonial Causes Act [Chapter 5:13] can only distribute or apportion each party's interests or shares in the said companies.

While there are instances in which the court may pierce or uplift the corporate veil, see Mangwendeza v Mangwendeza 2007 (1) ZLR 216 (H)…,.; Van Niekerk v Van Niekerk & Ors 1999 (1) ZLR 421 (S)…,; Deputy Sheriff v Trinpac Investments (Pvt) Ltd & Anor 2011 (1) ZLR 548 (H)…, I do not believe that a case has been made for such an approach.

As already said, it is a fact that Stir Crazy Investments (Pvt) Ltd has been placed in final liquidation. I am unable to ignore that fact which has a bearing on the value to be placed on this company. Absolution from the instance would enable the plaintiff, if she so desires, to deal with the defendant's interests in Stircrazy Investments, and other related companies, after a full public inquiry. The plaintiff would also be in position to cite properly on the relevant companies. The only viable and just option is to leave the door open for the plaintiff to approach the court, after a decree of divorce is granted, if she wishes, with sufficient evidence on the shareholding of both the trading and property owning companies in Zimbabwe and South Africa.

Section 7(1) of the Matrimonial Causes Act [Chapter 5:13] allows the court to consider such matters after divorce has been granted and other issues dealt with. Since evidence had been led in respect of these companies I cannot leave the matter hanging but to grant absolution from the instance….,.

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7….,.

8….,.

9….,.

10….,.

11….,.

12. Absolution from the instance be and is hereby granted in respect of the distribution of the following assets:-

(a) 94 Matumi Sands Lonehill (Pty) Ltd.

(b) 112 Matumi Sands Lonehill (Pty) Ltd.

(d) The Right Investments (Pvt) Ltd.

(e) Stir Crazy (Pvt) Ltd.

(f) Incvat Enterprises (Pvt) Ltd.

(g) Telehic Investments (Pvt) Ltd.

(h) Natsbury Trading (Pvt) Ltd.

SC25-09 : AIDAN BECKFORD vs ELIZABETH BECKFORD
Ruled By: SANDURA JA, ZIYAMBI JA and GWAUNZA JA

On 20 December 2006 the High Court granted a decree of divorce and other ancillary relief in a divorce action in which Mr Beckford was the plaintiff and Mrs Beckford the defendant. Aggrieved by part of the Order, Mr Beckford appealed to this Court. The Notice of Appeal, in relevant part, reads as follows:

“The appellant appeals against paragraphs 2, 3, 9, 10, 12 (only insofar as it relates to the respondent), 14, 15 (insofar as the time for payment by the appellant is required), 16, 17, 18, 19 (only insofar as it imposed upon the appellant the obligation to deliver such property to the respondent at his cost), 22 and 23 of the Order given by the High Court of Zimbabwe.”...,.

The parties were married to each other in Blackpool, Lancashire, England, on 26 November 1994. Two children were born of the marriage. These are Elsbeth Bridie Beckford, born on 7 August 1996, and Theodore Hugh Beckford, born on 9 February 1999. Both children were born in the United Kingdom.

At the pre-trial conference, the issues were identified as follows –

“1. Whether it is in the best interests of the minor children that custody be awarded to (the) plaintiff or (the) defendant, or that an award of joint custody be made.

2. Dependent upon the award of custody, the quantum of maintenance payable in respect of the children.

3. What order should be made in respect of the children's schooling?

4. The quantum of maintenance payable by (the) plaintiff to (the) defendant and the period thereof.

5. What assets constitute the matrimonial estate?

6. The apportionment thereof.

7. Costs.”

After a trial which lasted eight days the learned trial Judge prepared a long judgment in which he carefully considered the issues before him. I now wish to consider those paragraphs of the order of the court a quo which are challenged on appeal, and determine whether the learned trial Judge erred in any way....,.

PARAGRAPH 15

This paragraph reads as follows:

“Upon the permanent departure of the children and the defendant in terms of clause 3 of this order –

15.1 The house situated at 62A Steppes Road, Chisipite, Harare, or the shares in the company holding such property, shall be valued within thirty days of this order by an independent valuer to determine the likely market value of the shares or the property, and the plaintiff shall elect, within fourteen days of such a determination, whether to sell the shares or the property or to do neither.

15.1.1 If the shares (are) or the property is sold, the defendant shall receive 50% of the gross proceeds of the sale (less any assessed payment in respect of capital gains tax and the cost of the independent valuer).

15.1.2 If the plaintiff elects not to sell (the) shares or the property, he shall pay to the defendant 50% of the market value of the shares or the property within thirty days of such a determination by the valuator, whichever is the greater, as assessed by the independent valuer (less the costs of the independent valuer).

15.2 The defendant shall sell the contents of this property for their market value and the proceeds of the sale shall be divided equally between the parties.”

Mr Beckford's objection to paragraph 15 of the order was set out by his counsel…, in paragraphs 38 and 39 of his Heads of Argument, as follows:

“38. Although paragraph 15 of the order…, seems to deal with the disposal of the matrimonial property at 62A Steppes Road, Chisipite, Harare, as at the date of the permanent departure of Mrs Beckford and the children to the United Kingdom, the learned Judge directed the valuation to take place within thirty days of the order, and required Mr Beckford to make an election within fourteen days of the determination of the value as to whether to sell the shares or the property or do neither. He gave no reason for this direction, nor why (that) could not take place closer to the time of the departure of Mrs Beckford.

39. But, more importantly, the learned Judge directed, in paragraph 15.1.2…, that having made the election (in effect within forty-four days of the judgment) he then had to pay half the value of the shares or the property to Mrs Beckford within a further sixteen days if he elected then not to sell the shares or the property.

It is respectfully pointed out that this leads to the absurd position that within forty four days of the judgment, Mr Beckford must decide whether, upon the eventual departure of Mrs Beckford and the children to the United Kingdom, he is going to sell the shares or the property, and, if he made the decision at that point in time not to sell, then within a further sixteen days he must pay half the value to her, even though she continues to live in Zimbabwe and might never leave.”

In the circumstances, counsel for Mr Beckford, quite correctly in my view, submitted that in paragraph 15.1 the learned Judge should have directed that the valuation of the immovable property at 62A Steppes Road, Chisipite, Harare, or the shares in the company holding such property, was to be carried out, not within thirty days of the Order, but within thirty days of the permanent departure of Mrs Beckford and the minor children for the United Kingdom.

Counsel for Mrs Beckford, did not disagree with that submission. Paragraph 15.1 will, therefore, be amended accordingly....,.

1....,.

2. Paragraph 15.1 of the order of the court a quo is amended so that it reads as follows –

“The house situated at 62A Steppes Road, Chisipite, Harare, or the shares in the company holding such property, shall be valued within thirty days of such departure by an independent valuer to determine the likely market value of the shares or the property, and the plaintiff shall elect, within fourteen days of such a determination, whether to sell the shares or the property or to do neither.”

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Law Portal
Zimbabwe

Division of Assets of the Spouses re: Direct and Indirect Contributions iro Commercial Enterprises & Alter Ego Principle

HH128-12 : TENDAYI CHIKOMBA (NEE MANYERUKE) vs VITALIS CHIKOMBA
Ruled By: GUVAVA J

HH07-12 : IGNATIOUS GANYO vs MAULIDIA CHAONZA
Ruled By: CHITAKUNYE J

HH68-10 : ALVIN CRISP vs STELLA MARY MASVIKENI
Ruled By: MUSAKWA J

HH124-09 : MAXWELL TAWODZERA AND MARGARET TAWODZERA vs DANNY MASUKUMA
Ruled By: MAKARAU JP

HB34-09 : NOKUKHANYA MOYO vs ROBERT MOYO
Ruled By: BERE J

HB36-09 : SABRINA MUDENDA vs ANDREW MUZUWANI MUDENDA
Ruled By: NDOU J

HH35-10 : RUTH MUSONZA (nee MTANAUKWA) vs ESHMAEL MUSONZA
Ruled By: GUVAVA J

HH68-10 : ALVIN CRISP vs STELLA MARY MASVIKENI
Ruled By: MUSAKWA J

Appealed
HH109-10 : MICHAEL PATRICK MORONEY vs VYVYAN JEAN MORONEY
Ruled By: MUSAKWA J

HH115-10 : NASSAH MUKOMBERANWA vs VIVIAN MOKOMBERANWA
Ruled By: MUSAKWA J

HH240-10 : DOREEN SAGANDIRA vs PATRICK SAGANDIRA
Ruled By: MAVANGIRA J

HH61-11 : COLLIN SYDNEY DICKS vs AVERIL CAROL DICKS
Ruled By: CHITAKUNYE J

HH365-13 : LYDIA MAURO (NEE) NYAMBO vs REGIS MAURO
Ruled By: UCHENA J

HB44-11 : JABULANI MANYATHELA vs THANDO MANYATHELA
Ruled By: MATHONSI J

HB60-11 : REZIMOSI DUBE vs SANDRA FARAI DUBE
Ruled By: KAMOCHA J

View Appeal
HB159-11 : HILDA SIBANDA vs TEEJAY SIBANDA
Ruled By: NDOU J

Appealed
SC07-14 : TEEJAY SIBANDA vs HILDA M SIBANDA
Ruled By: GWAUNZA JA, GARWE JA and GOWORA JA

HB14-05 : SMART MALABA vs NOMATHEMBA FENNY MALABA
Ruled By: NDOU J

View Appeal
HH18-06 : MASIYIWA CLEOPHAS GONYE vs STELLA MARIS GONYE (NEE MUCHENJE)
Ruled By: UCHENA J

HH457-14 : PHILIPPA ANN COUMBIS vs RONALD JOHN COUMBIS
Ruled By: MAWADZE J

SC25-09 : AIDAN BECKFORD vs ELIZABETH BECKFORD
Ruled By: SANDURA JA, ZIYAMBI JA and GWAUNZA JA

Categories

Law Portal Zimbabwe

Division of Assets of the Spouses re: Direct and Indirect Contributions iro Commercial Enterprises & Alter Ego Principle

HH128-12 : TENDAYI CHIKOMBA (NEE MANYERUKE) vs VITALIS CHIKOMBA Ruled By: GUVAVA J

HH07-12 : IGNATIOUS GANYO vs MAULIDIA CHAONZA Ruled By: CHITAKUNYE J

HH68-10 : ALVIN CRISP vs STELLA MARY MASVIKENI Ruled By: MUSAKWA J

HH124-09 : MAXWELL TAWODZERA AND MARGARET TAWODZERA vs DANNY MASUKUMA Ruled By: MAKARAU JP

HB34-09 : NOKUKHANYA MOYO vs ROBERT MOYO Ruled By: BERE J

HB36-09 : SABRINA MUDENDA vs ANDREW MUZUWANI MUDENDA Ruled By: NDOU J

HH35-10 : RUTH MUSONZA (nee MTANAUKWA) vs ESHMAEL MUSONZA Ruled By: GUVAVA J

HH68-10 : ALVIN CRISP vs STELLA MARY MASVIKENI Ruled By: MUSAKWA J

Appealed HH109-10 : MICHAEL PATRICK MORONEY vs VYVYAN JEAN MORONEY Ruled By: MUSAKWA J

HH115-10 : NASSAH MUKOMBERANWA vs VIVIAN MOKOMBERANWA Ruled By: MUSAKWA J

HH240-10 : DOREEN SAGANDIRA vs PATRICK SAGANDIRA Ruled By: MAVANGIRA J

HH61-11 : COLLIN SYDNEY DICKS vs AVERIL CAROL DICKS Ruled By: CHITAKUNYE J

HH365-13 : LYDIA MAURO (NEE) NYAMBO vs REGIS MAURO Ruled By: UCHENA J

HB44-11 : JABULANI MANYATHELA vs THANDO MANYATHELA Ruled By: MATHONSI J

HB60-11 : REZIMOSI DUBE vs SANDRA FARAI DUBE Ruled By: KAMOCHA J

View Appeal HB159-11 : HILDA SIBANDA vs TEEJAY SIBANDA Ruled By: NDOU J

Appealed SC07-14 : TEEJAY SIBANDA vs HILDA M SIBANDA Ruled By: GWAUNZA JA, GARWE JA and GOWORA JA

HB14-05 : SMART MALABA vs NOMATHEMBA FENNY MALABA Ruled By: NDOU J

View Appeal HH18-06 : MASIYIWA CLEOPHAS GONYE vs STELLA MARIS GONYE (NEE MUCHENJE) Ruled By: UCHENA J

HH457-14 : PHILIPPA ANN COUMBIS vs RONALD JOHN COUMBIS Ruled By: MAWADZE J

SC25-09 : AIDAN BECKFORD vs ELIZABETH BECKFORD Ruled By: SANDURA JA, ZIYAMBI JA and GWAUNZA JA

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Law Portal
Zimbabwe

HH128-12 : TENDAYI CHIKOMBA (NEE MANYERUKE) vs VITALIS CHIKOMBA
Ruled By: GUVAVA J

HH07-12 : IGNATIOUS GANYO vs MAULIDIA CHAONZA
Ruled By: CHITAKUNYE J

HH68-10 : ALVIN CRISP vs STELLA MARY MASVIKENI
Ruled By: MUSAKWA J

HH124-09 : MAXWELL TAWODZERA AND MARGARET TAWODZERA vs DANNY MASUKUMA
Ruled By: MAKARAU JP

HB34-09 : NOKUKHANYA MOYO vs ROBERT MOYO
Ruled By: BERE J

HB36-09 : SABRINA MUDENDA vs ANDREW MUZUWANI MUDENDA
Ruled By: NDOU J

HH35-10 : RUTH MUSONZA (nee MTANAUKWA) vs ESHMAEL MUSONZA
Ruled By: GUVAVA J

HH68-10 : ALVIN CRISP vs STELLA MARY MASVIKENI
Ruled By: MUSAKWA J

Appealed
HH109-10 : MICHAEL PATRICK MORONEY vs VYVYAN JEAN MORONEY
Ruled By: MUSAKWA J

HH115-10 : NASSAH MUKOMBERANWA vs VIVIAN MOKOMBERANWA
Ruled By: MUSAKWA J

HH240-10 : DOREEN SAGANDIRA vs PATRICK SAGANDIRA
Ruled By: MAVANGIRA J

HH61-11 : COLLIN SYDNEY DICKS vs AVERIL CAROL DICKS
Ruled By: CHITAKUNYE J

HH365-13 : LYDIA MAURO (NEE) NYAMBO vs REGIS MAURO
Ruled By: UCHENA J

HB44-11 : JABULANI MANYATHELA vs THANDO MANYATHELA
Ruled By: MATHONSI J

HB60-11 : REZIMOSI DUBE vs SANDRA FARAI DUBE
Ruled By: KAMOCHA J

View Appeal
HB159-11 : HILDA SIBANDA vs TEEJAY SIBANDA
Ruled By: NDOU J

Appealed
SC07-14 : TEEJAY SIBANDA vs HILDA M SIBANDA
Ruled By: GWAUNZA JA, GARWE JA and GOWORA JA

HB14-05 : SMART MALABA vs NOMATHEMBA FENNY MALABA
Ruled By: NDOU J

View Appeal
HH18-06 : MASIYIWA CLEOPHAS GONYE vs STELLA MARIS GONYE (NEE MUCHENJE)
Ruled By: UCHENA J

HH457-14 : PHILIPPA ANN COUMBIS vs RONALD JOHN COUMBIS
Ruled By: MAWADZE J

SC25-09 : AIDAN BECKFORD vs ELIZABETH BECKFORD
Ruled By: SANDURA JA, ZIYAMBI JA and GWAUNZA JA