Louis Case Reports

FORFEITURE OF BENEFITS

Family – Divorce – Forfeiture of benefits – Substantial misconduct – Undue benefit – Husband having used his pension payment for his own benefit – Not contributing to children and household – Wife paying bond and car instalments – On divorce ex-wife retaining immovable property and two vehicles – Ex-husband forfeiting claim to 50% of former spouse’s pension – Divorce Act 70 of 1979, s 9(1).

M v M [2023] ZAGPPHC 48 at [19]-[33]

Facts: The couple married in community of property in 2006 and two children were born. The wife (plaintiff) instituted divorce proceedings against her husband (defendant) claiming a decree of divorce and forfeiture of the patrimonial benefits of the marriage by the defendant, including an immovable property, pension interest in the Government Employees’ Pension Fund and the two vehicles. The defendant filed a plea claiming a division of the joint estate.

Claim: The only issue for determination was the forfeiture of the patrimonial benefits by the defendant.

Discussion: The plaintiff bought the immovable property and the defendant made no contributions towards the bond instalments; the plaintiff was responsible for the payment of the vehicle instalments; the plaintiff’s evidence that: when she and the children lived in Germany she paid for the bond and other expenses and the defendant paid for only water and electricity and that the defendant made no contribution to the household expenses; that the defendant had received R270,000 from his pension fund in 2017 when dismissed and used it solely for himself; forfeiture of benefits and section 9(1) of the Divorce Act 70 of 1979; and the factors to be considered when one party will be unduly benefited.

Findings: Plaintiff impressed the court as a candid witness whose evidence was credible and reliable, while the defendant was evasive and tended to exaggerate his evidence. He used the pension payment for his sole benefit and conceded that he never contributed anything towards the children and household. The defendant committed substantial misconduct as envisaged in section 9(1) of the Divorce Act by using his pension fund for his own benefit and to the prejudice of the joint estate and he will be unduly benefited in relation to the plaintiff if the order of forfeiture is not granted.

Order: A decree of divorce is granted with the primary care of the minor children awarded to the plaintiff. The plaintiff shall retain the immovable property and the two cars. The defendant is to forfeit his claim to 50% of the plaintiff’s pension interest held in the Government Employees Pension Fund.

NGOBESE AJ

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10-YEAR DELAY ON EXECUTION OF HOME

Civil procedure – Execution – Primary residence – Ten-year delay between granting of order declaring property specially executable and steps to arrange the sale-in-execution – Bank having received payments during the ten years – Court empowered to suspend the order granting leave to execute pending provision of further information disclosing whether execution on the original judgment remains proportionate – Uniform Rule 46A.

Absa Bank v Gontsana [2023] ZAGPJHC 86 at [14]-[25]

Facts: The Gontsanas mortgaged the property in 2007 and appear to have resided there since. The principle debt with Absa was R65,000. In 2013, after they fell into arrears, Mali AJ granted judgment and declared the property specially executable. Absa then declined to execute Mali AJ’s order for almost a decade. During that time, the Gontsanas paid what they could and by December 2022 had paid just over R55,000.          

Application: In December 2022, Absa instituted an application for three orders, each sought in the alternative, seeking that the property be sold in terms of Rule 46A without a reserve price; in terms of Rule 46A subject to a reserve price; or sold as if Rule 46A had never been promulgated.

Discussion: That Absa’s conduct during that time did not amount to a waiver of its right to execute or an outright abandonment Mali AJ’s judgment; proportionality of execution and abuse of process; and that the court was not presented with any facts that suggest that Absa ever engaged with the Gontsanas, much less that it did so in a meaningful way.

Findings: Absa advanced a loan to an impecunious family and took judgment when they failed to repay that loan. Having obtained judgment and the right to execute, it then left that judgment to lie fallow for ten years, all the while accepting payments and no doubt contributing to the impression that it was no longer interested in executing. After that decade had elapsed, it approached the court on the basis that it need only decide the technical matter of whether a reserve price should be set. Absa has not explained why it applied the Gontsanas’ payments to their loan account, and not in reduction of the judgment debt, and why it recently decided to reverse its course and execute against their home. In these circumstances, execution cannot be authorised.

Order: The application is dismissed, the order of Mali AJ suspended, and directions are given for Absa to engage with the Gontsanas such that it will not only allow the court to consider whether execution against the Gontsanas’ property is ultimately justified, but will also afford the Gontsanas a genuine opportunity to meet their obligations under Mali AJ’s order. There is no order as to costs. Absa may not recover the costs of this application, or any further action it is required to take in terms of this order, from the Gontsanas.

WILSON J

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LABOUR AND TRANSFER OF BUSINESS

Labour – Transfer of business – Going concern – New employer not taking machines, premises, ability to issue operational instructions – Core shopfloor assembly work not severable from overall task of vehicle manufacture – Business not transferred as going concern and contracts not automatically transferred – Labour Relations Act 66 of 1995, s 197.

Numsa obo Members v AIH Logistics [2023] ZALCD 2at [12]-[23]

Facts: The applicants allege that the transfer of a business from AIH to Blacksuits was a sham to get rid of them and that there has been no real transfer of a business as a going concern, but only a transfer of the services of the employees to a new employer. They contend that AIH is still substantively in charge and it remains the true employer.                     

Application: Seeking an order that the purported transfer of the business be declared unlawful and invalid and for the restoration of the status quo that prevailed immediately before the transfer.

Discussion: Section 197 of the Labour Relations Act 66 of 1995 and its aim of the protection of the employee right to continuity of employment; that the applicants continue to perform the same work of motor-vehicle assembly; the structural indications that there was no sale or lease of equipment and that Blacksuits has no meaningful control over its new employees; the contention that no ownership of a business as a going concern changed hands; and that the applicants contend that NUMSA had, shortly before the “transfer” started organising within AIH and employees had pushed wage demands.

Findings: Looking at the overall picture of the transfer, the indications are that AIH did not transfer a portion of the business as a going concern to the Blacksuits. The core shopfloor assembly work the applicants did is simply not functionally severable from the overall task of producing Mahindra pick-ups. Without its own machines, tools, premises, safety certification, team leaders, customers, and ability to issue operational instructions, Blacksuit’s role is akin to the work of an HR consultancy. Since no portion of the business was transferred as a going concern then section 197 of the LRA was not engaged and the contracts of the applicants did not automatically transfer from the old to the new employer.

Order: The transfer of a business from AIH to Blacksuits is not one that falls within the prescripts of section 197 of the LRA and the position between AIH and the further applicants must be restored. The respondents are ordered to pay the applicants’ cost of suit.

WHITCHER J

[19] The first respondent argues that the second respondent took over a portion of business which related to the labour involved in the assembly of the motor vehicles and that this was a severable portion of the business of the first respondent. Severable, yes, as body is from a head, but not as a going concern.

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ABOUT THE EDITOR

Louis Podbielski spent ten years at Juta working on various law reports and has read many thousands of judgments for case selection. He has considerable experience in writing flynotes and headnotes, compiling case annotations, and in refining subject indexes.​ During his four years at LexisNexis he was involved with legal data, analytics and in developing various legal tech solutions. He now runs his own case law service Louis Case Law

You can read his full CV and more about Louis on his LinkedIn profile where he shares interesting and recent cases.

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