Prescient precedent: PAF v SCF (SCA) and a new paradigm for testing whether a trust has been abused to manipulate a spouse’s accrual (or redistribution) liability at divorce

NOTE

Prescient precedent: PAF v SCF (SCA) and a new paradigm for testing whether a trust has been abused to manipulate a spouse’s accrual (or redistribution) liability at divorce

Author: Bradley S Smith

ISSN: 1996-2177
Affiliations: Senior Lecturer: Research, The Independent Institute of Education’s Varsity College; Extraordinary Professor of Private Law, University of the Free State
Source: South African Law Journal, Volume 140 Issue 4, p. 697-714
https://doi.org/10.47348/SALJ/v140/i4a1

Abstract

In this note, I argue that PAF v SCF 2022 (6) SA 162 (SCA) is a groundbreaking judgment for curbing the abuse of the trust form by spouses who are married out of community of property and who engage in unscrupulous ‘divorce planning’ aimed at manipulating their personal estate values for the purposes of dividing matrimonial property at divorce. PAF not only removes several uncertainties regarding our courts’ ability to pierce the veneer of an abused trust but also broadens our conventional understanding of what trust-form abuse entails in the divorce setting, particularly by virtue of its engagement with the SCA’s earlier (prescient) judgment in Badenhorst v Badenhorst 2006 (2) SA 255 (SCA). In the process, I argue that there is a need to reconsider the test formulated in REM v VM 2017 (3) SA 371 (SCA) for taking the asset value of an alter-ego trust into account for accrual claims at divorce. I further assert that the new paradigm PAF ushers in requires formulating a consolidated test that takes into account this reconsideration, as well as the novel factual matrix in PAF. I conclude that this consolidated test is not only capable of being applied in the context of accrual liability, but also where a spouse is eligible to seek a redistribution order in terms of s 7 of the Divorce Act.

Progressive, yet problematic: Unpacking the therapy order and sentence in S v SN

NOTE

Progressive, yet problematic: Unpacking the therapy order and sentence in S v SN

Author: Delano Cole van der Linde

ISSN: 1996-2177
Affiliations: University of Cape Town
Source: South African Law Journal, Volume 140 Issue 4, p. 715-732
https://doi.org/10.47348/SALJ/v140/i4a2

Abstract

The judgment in S v SN [2022] ZAECGHC 35 is dichotomous as it is both progressive and problematic. The judgment is progressive as, for the first time, a South African criminal court imposed a therapy order for a victim of rape. The minor victim in this case was raped multiple times by her uncle in a familial home. The court was further enjoined to impose a minimum life sentence under the Criminal Law Amendment Act 105 of 1997, as the victim was under the age of 16 and had been raped on multiple occasions. However, the court in SN was entitled to deviate from the minimum sentence when ‘substantial and compelling circumstances exist’ to do so. In considering the mitigating and aggravating factors present in the case, the court deviated from the minimum life sentence based on the remorse of the accused and the lack of force used during the rape. The judgment is problematic because considering these factors unearthed problematic narratives surrounding the nature of rape. This note critically analyses the judgment in SN and submits that although the therapy order is a welcome development, the court erred in considering a lack of force employed during the rape as a mitigating factor.

Lawful act duress

Lawful act duress

Author: Jacques du Plessis

ISSN: 1996-2177
Affiliations: BCom LLB LLM (Stell) PhD (Aberdeen)
Source: South African Law Journal, Volume 140 Issue 4, p. 733-762
https://doi.org/10.47348/SALJ/v140/i4a3

Abstract

Legal systems generally accept that contracts may be concluded by way of hard bargaining. This could entail obtaining assent through threats of lawful acts, such as terminating a contract by notice, refusing to enter into a new contract, or instituting legal proceedings. However, in exceptional cases, a threat of a lawful act may be regarded as unlawful or contra bonos mores and give rise to duress. Unfortunately, the South African contract law on identifying these cases is undeveloped. Recent advances in English law may provide guidance on when a threat of a lawful act should be regarded as unlawful. Relevant considerations that could point to such a conclusion include whether the party making the threat created or increased a situation of vulnerability in an unacceptable manner, and what benefits such a party obtained from the threat. It is less clear why it should matter whether a demand was made in bad faith.