MATRIMONIAL ACTION
CHITAKUNYE J: The
plaintiff and defendant were joined in holy matrimony in terms of the
Marriages Act, [Cap
5:11]
on 8 January 1988 at Harare. Their marriage subsists. Their marriage
was blessed with two children who are now adults.
During the subsistence of the
marriage they acquired both movable and immovable properties.
After many years of marriage some
irreconcilable differences arose which led to the plaintiff filing
for divorce and other ancillary relief against the defendant. The
plaintiff alleged that the marriage relationship has irretrievably
broken down to such an extent that there are no prospects of
restoration of a normal marriage relationship in that:
(a) The parties do not have any
meaningful communication resulting in each party living his/her own
life.
(b) The plaintiff has lost love
for the defendant.
(c) There is disharmony, distrust
and disrespect between the parties and as a result there is no peace
between the parties.
At the time of issuance of the
summons the children were still minors and so the plaintiff had asked
to be granted custody of the minor children.
On immovable property she asked
for a 50% share in the matrimonial house; namely 18 Normanton Close,
Marlborough, Harare. She provided what she deemed an equitable
distribution of the movable property.
The defendant initially contended
that the marriage had not irretrievably broken down; he envisaged it
could be salvaged.
He also made a counter claim in
which he claimed custody of the minor children, and that the
immovable property 18 Normanton Close be donated to the children of
the marriage. He later amended his claim to include that in the
alternative he be declared the sole and absolute owner of number 18
Normanton Close, Marlborough, Harare. This amendment came about
because the plaintiff had categorically rejected the suggestion that
the property be donated to the children.
At a pre-trial conference held on
13 September 2005 most of the issues were resolved. The major issue
referred to trial pertained to the distribution of the immovable
property.
On the date of trial all issues
except on the immovable property were confirmed as having been
settled.
The two children were now adults
and so any issue relating to children was no longer sustainable.
The parties had distributed the
movable assets in terms of a document they tendered as exhibit 3.
Both had finally accepted that
the marriage has irretrievably broken down.
The parties could not settle on
the immovable property due to the fact that apart from the
Marlborough house the plaintiff had also bought number 60 Garlands
Ride, Mt Pleasant during the subsistence of the marriage.
They could not agree on how to
treat that property.
The defendant wanted it to be
considered in the division, apportionment and distribution of the
assets of the spouses whilst the plaintiff contended that it should
not be considered as it was registered in the name of a company whose
shareholding was 100% held by Garlands Trust.
The plaintiff gave evidence after
which the defendant gave evidence.
From the evidence adduced it is
common cause that both parties had contributed financially to the
purchase of the Marlborough house. That property is registered in
their joint names and so joint ownership is not disputed.
It is common cause that after
living in the Marlborough house for some time the couple moved to
number 60 Garland Ride Mt Pleasant in 1993 which the plaintiff had
bought that same year.
They have since been living in
that house serve for a period of two years when they moved back to
the Marlborough house.
The Mt Pleasant property was
bought by the plaintiff and is registered in the name of a company,
Linford Investment (Pvt) Ltd.
It is common cause that the
couple lived in that property rent free.
The plaintiff's argument was to
the effect that as the Mt Pleasant property was registered in the
name of a company it should not be considered as matrimonial
property. In any case she is not a shareholder in that company. The
entire shareholding is held by a trust - Garlands Trust of which she
is one of the three Trustees. She formed that Trust for the benefit
of the children, her parents and her sister.
The plaintiff indicated that she
and her daughter, Chiedza, were the directors in Linford Investment
(Pvt) Ltd.
The plaintiff confirmed that she
was the accounting officer of the company and that for all intents
and purposes she controls the assets of Linford Investment (Pvt) Ltd.
She is the one with the power to make decisions concerning the
company. She does the annual returns which are then signed by herself
and Chiedza.
It was clear that the plaintiff
did not want this property considered in anyway in the distribution
of assets of the spouses.
She contended that the only
immovable property for sharing is the Marlborough house which she
insisted must be shared equally.
On his party the defendant
contended that the Mt Pleasant house must be considered in the
apportionment and distribution of the property. It is a property that
was acquired during the subsistence of the marriage and the plaintiff
still stands to gain from it by living in it rent free.
Though registered in the name of
a company it is for all intents and purposes the plaintiff's
property.
The division of assets consequent
to a divorce is governed by s7 of the Matrimonial Causes Act, [Cap
5:13]
herein after referred to as the Act. Section 7(1)(a) of the Act
states that:
“Subject to this section, in
granting a decree of divorce, judicial separation or nullity of
marriage, or at any time thereafter, an appropriate court may make an
order with regard to -
(a) the division, apportionment
or distribution of the assets of the spouses, including an order that
any asset be transferred from one spouse to the other;”
Subsection (4) of s7 then enjoins
the appropriate court to consider all the circumstances of the case
in the exercise of its discretion in this regard by stating that:-
“In making an order in terms of
subsection (1) an appropriate court shall have regard to all the
circumstances of the case including the following -
(a) the income-earning capacity,
assets and other financial resources which each spouse and child has
or is likely to have in the foreseeable future;
(b) the financial needs,
obligations and responsibilities which each spouse and child has or
is likely to have in the foreseeable future;
(c) the standard of living of the
family, including the manner in which any child was being educated or
trained or is expected to be educated or trained;
(d) the age and physical and
mental condition of each spouse and child;
(e) the direct or indirect
contribution by each spouse to the family, including contributions
made by looking after the house and caring for the family and any
other domestic duties;
(f) the value to either of the
spouses or to any child of any benefit, including a pension or
gratuity, which such spouse or child will lose as a result of the
dissolution of the marriage;
(g) the duration of the marriage;
and in so doing the court shall
endeavour as far as is reasonable and practicable and, having
regard to their conduct, is just to do so, to place the spouses and
the children in the position they would have been in hard a normal
marriage relationship continued between the spouses.”
As aptly noted by MALABA JA in
Gonye v
Gonye
2009 (1) ZLR 232 at p236H to 237B:
“It is important to note that a
court has an extremely wide discretion to exercise regarding the
granting of an order for the division, apportionment or distribution
of the assets of the spouses in divorce proceedings.
Section 7(1) of the Act provides
that the court may make an order with regard to the division,
apportionment or distribution of 'assets of the spouses'
including an order that any asset be transferred from one spouse to
the other.'
The rights claimed by the spouses
under s7(1) of the Act are dependent upon the exercise by the court
of broad discretion…
The terms used are the 'assets
of the spouses' and not matrimonial property.
It is important to bear in mind
the concept used, because the adoption of the concept 'matrimonial
property' often leads to the erroneous view that assets acquired by
one spouse before marriage or when the parties are separated should
be excluded from the division, apportionment or distribution
exercise.
The concept 'assets of the
spouses' is clearly intended to have assets owned by the spouses
individually (his or hers) or jointly (theirs) at the time of the
dissolution of the marriage by the court considered when an order is
made with regards to the division, apportionment or distribution of
such assets.”
The wide discretion must of
course be exercised judicially taking into account the circumstances
of each case. The object of the exercise must be to place the spouses
in the position they would have been in had a normal marriage
relationship continued between them.
In an effort to achieve this
object court has demanded of spouses to be candid with court in
respect of their assets individually and jointly.
The question in the instant case
is whether the Mt Pleasant house should be considered in assessing a
fair and equitable manner in the division, apportionment and
distribution of assets of the spouses.
The plaintiff says it must not be
considered because it is owned by a company. The defendant says it
must be considered as for all intents and purposes it is the
plaintiff's property or at least it is for her benefit.
It is important to examine the
relationship between the plaintiff and the company in question.
In Sibanda
& Anor v
Sibanda 2005 (1) ZLR
97 (S) when the marriage failed the wife obtained a decree of
nullity. The parties were possessed of nine immovable properties, as
well as numerous vehicles. Apart from one property and one car, all
the property, movable and immovable, including the matrimonial home,
was registered in the name of one or other company or nominee of the
appellant. The directors of those companies were the appellant's
parents and one of his girlfriends - but the sole signatory on the
various bank accounts was the appellant, who controlled all the
companies. The trial judge awarded the wife a house which was
registered in the name of one of the companies. That house had been
the matrimonial home for ten years before the marriage was annulled.
The husband contended that as the house was owned by a company wholly
owned by the appellant, it did not constitute matrimonial property
which fell to be divided in terms of the Matrimonial Causes Act. The
Supreme Court, at p103E-F, whilst acknowledging the fact that a
company duly incorporated is indeed a distinct legal entity endowed
with its own legal personality went on to state that:
“However, the veil of
incorporation may be lifted where necessary in order to prove who
determines or who is responsible for the activities, decisions and
control of a company.”
Upon finding that the appellant
was the one who controlled the company the court of appeal dismissed
the appeal.
In Mangwendeza
v Mangwendeza
2007 (1) ZLR 216 (H) NDOU J followed the above reasoning and
considered property registered in the name of a company in the
division, apportionment and distribution of assets of the spouses.
Equally in Gonye
v Gonye supra
at page 233 the Supreme Court held that:
“Where the issue arises of
whether the property rights, a proportion of the value of which is
claimed by the one of the spouses, in reality lay with the other
spouse or a company run by him, it is permissible to 'lift the
corporate veil' in order that justice could be done in the
apportionment of the assets in terms of s7(1) of the Act. Where the
company can be said to be the spouse's alter ego, the company's
assets and proceeds can be said to be the spouse's and thus can be
subject of an order under s7(1).”
It is apparent that a primary
consideration is on the relationship between the person seeking to
distance the assets and the company or entity in whose name the
property may be registered.
In
casu the plaintiff
said that in about 1993 she bought the house in question by buying
shares in the company that previously owned the house. In 1992 she
had created a Trust in which she is one of the three Trustees. She
said the Trust is for the benefit of the couple's children, her
parents and her sister. The other trustees are apparently people of
her choice. The directors of the company herself and Chiedza were
apparently out of her choice as well.
As already alluded to above it is
common cause that the plaintiff has been the accounting officer for
the company since its inception. She will continue to be so. There is
no denying that she is the one in total control of the company. From
her own evidence it is clear that she is the one who has been and
will continue to make decisions for the company. Other persons
mentioned even as Trustees appear to be her nominees.
It is common cause that since the
family started living at 60 Garland Ride they have not been paying
rent. The family has been living rent-free. The plaintiff will
continue to live in the house in question rent free for as long as
she desires.
Apparently no one has the power
to deny her of this.
It is my view that all this
points to the fact that the plaintiff has more interests in the house
in question than she would like court to believe. The property is
virtually hers as she has the mandate to do as she pleases with it.
In the circumstances I am of the
view that the property ought to be considered in the division,
apportionment and distribution of assets of the spouses.
The defendant's claim is not
for a share in the Mt Pleasant house but that it be considered in
determining his claim for an award of the Marlborough house since he
needs a roof over his head. The plaintiff will have the Mt Pleasant
house.
Taking into account the object of
s7(4) of the Act, particularly the need to place the spouses in the
position they would have been in had a normal marriage relationship
continued, it is clear that each party would have remained entitled
to live in the Mt Pleasant house rent free at the determination of
the plaintiff. The defendant would not be without a roof over his
head.
It is only fair that whatever
apportionment or distribution is done does not burden the defendant
so much that he is left without accommodation.
Mention was made that the
defendant has a farm which he can use.
Unfortunately not much was said
about this farm save to say it is far away and the defendant would
not be able to commute there to and from on a daily basis in order to
run his business. Not much was said on the suitability of the
accommodation at this farm for a husband who had been used to living
in the Mt Pleasant house.
In deciding on the issue of how
much to award the defendant as his share of the Marlborough house I
will also consider the fact that whilst in the Marlborough house both
parties contributed in its purchase, in the Mt Pleasant house the
defendant did not make a direct contribution towards its purchase.
The Marlborough house is
registered in the joint names of the parties whilst the Mt Pleasant
house is not.
Registration in joint names is
prima
facie
proof of a 50:50 ownership in the property.
The question to be answered is
whether the justice of the case requires that a spouse's share be
awarded to the other if so how much of that share.
After a careful assessment of the
parties contributions, needs and other factors as detailed in s7(4)
of the Act I am of the view this is a case where a part of the
plaintiff's share should be transferred to the defendant to achieve
a just and equitable distribution of the assets of the spouses. A
deduction of 15% would in my view be appropriate in the
circumstances. I thus conclude that that the defendant deserves a 65%
share in the Marlborough house and the plaintiff a 35% share.
The defendant will be granted the
option to buy out the plaintiff's share within 120 days.
Accordingly it is hereby ordered
that:
1. A decree of divorce be and is
hereby granted.
2. The movable property be
distributed in terms of exhibit 3 with the plaintiff being awarded
items under annexure A and the defendant items under annexure B. The
document as agreed by the parties is hereby attached as part of this
order.
3. The plaintiff is hereby
awarded a 35% share in the immovable property namely No. 18 Normanton
Close, Marlborough, Harare, also known as Stand 728 of Stand 558A
Marlborough Township, Harare.
4. The parties shall agree on the
value of the property within 14 days of the date of this order
failing which they shall appoint a mutually agreed evaluator to
evaluate the property within 30 days of the date of this order.
5. Should the parties fail to
agree on an evaluator the Registrar of the High Court shall be and is
hereby directed to appoint one from his list of independent
evaluators to evaluate the property.
6. The parties shall share the
cost of evaluation in the ratio 35:65 (as per their shares in the
property). The defendant shall pay off the plaintiff her share within
120 days from the date of evaluation unless the parties agree on a
longer period.
7. Should the defendant fail to
pay or to make a payment plan acceptable to the plaintiff within the
period stipulated in (6) above, the property shall be sold to best
advantage by a mutually agreed estate agent or one appointed by the
Registrar of the High Court and the net proceeds therefore shall be
shared as per their respective shares in the property.
8. Each party shall bear their
own costs of suit.
Honey & Blanckenberg, plaintiff's legal practitioners
Mtetwa & Nyambirai, defendant's legal practitioners
