THE High Court has dismissed an application by a Siteki man seeking to overturn a divorce settlement requiring him to pay his estranged wife E1.4 million and relinquish his rights to a business and the land on which it operates.
Judge Mumcy Dlamini dismissed Timothy John Smith’s application after finding that the disputed settlement agreement was not unlawful and that the magistrate had acted within her jurisdiction when making it an order of court.
Smith had challenged the order granted by Siteki Magistrate L.G. Shongwe, arguing that some of the settlement terms violated company law and that the magistrate had exceeded her civil jurisdiction by dealing with an amount above E30 000. However the court found no legal basis to set aside the agreement, which Smith had signed with his estranged wife Nomthandazo Prudence Smith (Mbatha) on October 9, 2023. The settlement was subsequently made an order of court in January 2024.
Smith argued that his estranged wife was not a director, shareholder, trustee or subscribing member of the company known as Lituba Investment (Pty) Ltd and therefore could not receive E1.4 million from the business.
He also contended that the company’s directors had never held a meeting to pass a resolution authorising the payment. In his founding affidavit, Smith argued that the magistrate had failed to consider the distinction between his personal affairs and the company’s legal personality.
He stated, “Being a company director does not mean my personal life is intertwined with the business of the company,” he said. Smith further argued that the business operated on Eswatini Nation Land and that its rights could not be transferred to his estranged wife without the involvement and authority of the relevant traditional structures.
However, Judge Dlamini found that the settlement clause did not establish that the parties intended to bypass traditional authorities when transferring rights relating to the land.
The disputed clause stated that the parties would deal with Lituba Investment Pty Ltd and any land that the business sits on and pay and/or buy out the defendant for E1.4 million. The judge said there was no law, whether statutory or common law that had been contravened by the parties through the agreement.
“This was an agreement to cede his rights over the land to his estranged wife. It was not an agreement to bypass the traditional authority in so doing,” the judgment reads.
The court added that the agreement did not state that the parties would avoid involving the traditional authorities when transferring the rights to the first respondent. Smith also argued that Magistrate Shongwe had acted beyond her powers because her civil jurisdiction was limited to claims of E30 000 and below.
Judge Dlamini said the distribution of matrimonial consequences was ancillary to divorce proceedings and should not necessarily be separated from the main matter. “It would be folly to expect the magistrate to deal with the decree of divorce and then transfer the question of distribution to this court,” the judge stated.
The judgment further explained that separating related issues could unnecessarily increase litigation costs. The court also rejected Smith’s argument that the payment could not be made because his estranged wife had no formal position within the company. Judge Dlamini noted that the agreement required Smith to pay his estranged wife E1.4 million and did not expressly state that the money had to come directly from the company.
The judge added that Smith was responsible for facilitating any necessary meeting of the company’s directors to comply with the agreement.
In this regard, the court applied the Turquand rule, which allows outsiders to presume that a company’s internal procedures have been properly followed. Smith had also alleged that he was coerced into signing the settlement agreement and that his former attorney had failed to explain his rights or the agreement’s legal validity.
However, his counsel abandoned this argument during the hearing. The judge considered that Smith had received the draft agreement on October 9, 2023 but only challenged it after his estranged wife’s attorney demanded compliance with its terms on December 5, 2024.
Smith filed his review application on December 16, 2024 more than 14 months after signing the agreement. The judgment noted that review applications must be brought within a reasonable time, depending on the circumstances of each case.
Ultimately, Judge Dlamini dismissed Smith’s application, leaving the challenged settlement order intact.
| Issue | Smith’s Argument | Court Finding / Hearing Outcome |
|---|---|---|
| E1.4 million payment | His estranged wife held no formal position in Lituba Investment (Pty) Ltd and could not receive the payment from the business. | The agreement required Smith to pay her and did not expressly require the money to come directly from the company. |
| Company approval | The directors had not met to authorise the payment. | Smith was responsible for facilitating any necessary directors’ meeting. The court applied the Turquand rule. |
| Land rights | Rights over Eswatini Nation Land could not be transferred without the relevant traditional structures. | The agreement did not provide for bypassing traditional authorities when transferring the rights. |
| Magistrate’s jurisdiction | The settlement exceeded the E30 000 civil jurisdiction limit he cited. | Distribution of matrimonial consequences was ancillary to the divorce proceedings; the magistrate acted within her jurisdiction. |
| Alleged coercion | He alleged coercion and inadequate advice from his former attorney. | His counsel abandoned this argument during the hearing. |
| Timing of review | Smith filed the review application on December 16, 2024, more than 14 months after signing. | The judgment noted that review applications must be brought within a reasonable time, depending on the circumstances. |
| Final outcome | Judge Mumcy Dlamini dismissed the application, leaving the challenged settlement order intact. | |
Summary of the arguments and findings reported in the article.
