A hospitalised woman signed an agreement without reading it. Now, many years later, the courts have set the agreement aside, declaring it unenforceable.
The scheme of a “deceiving” former husband who tricked his former wife into signing a document depriving her of her share of a joint property has been unmasked and set aside by the courts. The woman had been in the hospital, sedated for pain after a serious accident, when the papers were presented to her for signature, and she signed without reading what they said. Years later, she discovered what the agreement really entailed, and she asked the court to intervene and declare the agreement “unenforceable.” First the high court and now the Supreme Court of Appeal (SCA) have agreed.
Read judgment
http://www.saflii.org/za/cases/ZASCA/2023/46.html
Even someone who knows next to nothing about the law will have a sense that signing a formal legal document is a serious thing to do. And that, at the very least, you must study the document carefully before signing.
But what happens when, many years later, the person who signed says she had no idea of the contents because she didn’t read the document before she added her signature and that she must therefore be released from the agreement it contained?
That’s basically the problem that presented itself, first to the high court and then to the SCA, via a case brought by Ruth Sechoaro against Patience Kgwadi.
Dissolved by divorce order
Patience Kgwadi married Israel Kgwadi in May 1987, and their marriage was dissolved four years later with a settlement agreement that was incorporated in the divorce court order. Israel was given 14 days to apply to court for a variation of the settlement agreement if he wished to do so, but this is something he never did.
The couple were joint owners of a property in Boksburg, and because the settlement agreement didn’t deal with what should happen to this property, they verbally agreed that they would both be entitled to half of its value. In terms of their agreement, Israel would pay Patience half the value of the property, but this, too, was something he never did.
After some years, Israel married again, this time to Ruth Sechoaro. In the month following their marriage, Israel made a will leaving half of his estate to Sechoaro, provided she survived him by a week and that they were still married at the time of his death. As executors, Israel appointed First National Bank Trust Services (FNB).
Six months in a hospital bed
About 18 months after this, Patience was seriously injured in a car accident and spent six months in the hospital. While she was hospitalised, a messenger from the law firm Denoon Sampson Ndlovu – she assumed the firm was acting for her former husband – arrived at her hospital bed for her to sign some documents. The papers were headed “Variation agreement.”
The terms of this document were that she agreed to hand over her half of the property to Israel. The document said, among other clauses, that Israel and Patience had agreed to “amend [their] settlement agreement in so far as it relates to the [Boksburg] property” and that they further agreed that the property “shall be awarded solely” to Israel. In addition, said the agreement, the two would fully cooperate with each other by signing all the documents needed by conveyancers appointed by Israel to finalise the transfer of the property into his name when it was necessary to do so.
Patience signed this document, and it was the enforceability of this “agreement,” that she was later to contest.
Challenge the enforceability of the agreement signed
Two years after this, Israel died. When a third party put in an offer to buy the Boksburg property, Patience (as the seller) and Prishania Naidoo, the FNB nominated executor, signed acceptance of the offer of R550 000.
As the transfer process made its way through the system, the attorneys dealing with the matter emailed Patience to say that she wasn’t entitled to half of the proceeds of the sale: in terms of the “variation agreement” she had signed, the property was awarded “solely to the deceased.”
Within a month, Patience was before the high court to challenge the enforceability of that agreement. She said that the disputed “variation agreement” had been made more than 20 years after their divorce, whereas the divorce court had given Israel just 14 days to apply to court if he wanted any variation of the original agreement.
Sedated for pain
More important, however, was her second argument. She said that she had signed the agreement “without any intention to be bound by its terms.” She had been in a serious accident and spent six months in the hospital recovering. Among other treatments, she had “skin traction” and surgery on her hip. She was “constantly in extreme pain,” for which she was “normally sedated to minimise” her pain.
She said she’d signed the agreement without reading it, and given her condition, she didn’t have the strength to do so. She had assumed that the document dealt with what she and Israel had agreed on, namely that he would pay her half the value of the property.
In addition, the attorneys’ messenger didn’t tell her anything about the contents of the document, except that it dealt with the property that she and Israel jointly owned.
Neither under duress nor unconscious
Given this background, her mistake in signing the agreement to give her half of the value of the property to her former husband without any payment from him was “reasonable,” she said, and she should not be bound by it.
Sechoaro’s counter to this argument was to say that the accident affected Patience’s hip, not her mental functioning, and that she had been “of sound and sober senses,” neither under duress nor unconscious, when she signed the agreement.
The high court was persuaded by Patience, however, and held that the agreement was not enforceable.
Damning passage
On appeal, the five judges first found that the agreement signed in the hospital by Patience was not in fact a “variation agreement”, altering the divorce settlement agreement as ordered by of court. Rather, it was simply an agreement that Patience would give her half of the property to her former husband, receiving nothing for it.
In a particularly damning passage, the appeal judges then set out what they saw as lying behind Israel’s request to Patience to sign the document in her hospital bed.
More than two decades after their divorce and the agreement about sharing the proceeds of their jointly owned property, Israel “caused his attorney to present the 2012 agreement, containing entirely different terms to those they had agreed upon over 20 years earlier,” for Patience to sign.
“It is clear on the objective facts that [Israel] did so deliberately and with intent to deceive [Patience] into forfeiting her half share in the joint property.”
No consent from Patience
Israel must have known, the court continued, that Patience had not consented to amend their prior agreement that he would pay her half the value of the property, that he was not entitled to sole ownership of the property, and that there was no basis for depriving her of her share.
“Consequently, when he received the agreement after [Patience] had signed it, [he] knew of her mistake as he was the cause of it.” Thus, Patience could not be said, by her signature, to have misled Israel into believing that she was binding herself to its terms and that he was solely entitled to the property for no value.
Given this background, the mistake by Patience in signing the document was “reasonable and excusable,” the court found.
Rare situation
It therefore ordered the conveyancers involved in transferring the property to pay half the proceeds of the sale to Patience within 30 days of Israel’s estate being finalised. And among the other terms of their order, the judges said Sechoaro had to pay Patience’s legal costs.
Is there anything to learn from this case? Obviously, it shows there is barely a limit on how mean and deceptive people can be, though that’s hardly something new. But it also underlines the need to read carefully and be certain to understand the meaning of anything you are asked to sign, even if you are sick in the hospital; a situation like this, where a court finds a signed undertaking unenforceable, is very rare indeed.
When parties are getting divorced, it is important to tie up all the outstanding issues and not leave certain issues unresolved, like in this case where Israel and Patience did not deal with a jointly owned property for more than twenty years. Problems inevitably creep in when an issue has not been dealt with in the original divorce agreement and parties are later unable to agree on how to deal with the asset; they do agree but never execute the agreement, like Israel and Patience. It is imperative that a party seek legal advice on how best to resolve this impasse.
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