Sandra May Sim v Clayton Edward Sim

The parties married in Scotland in September 1970 and moved to Zimbabwe in 1972 after living in Switzerland and Canada. Both worked and acquired substantial property during the marriage. The marriage broke down in April 1991. The matrimonial estate included a residence in Highlands, shares in various companies, two plots at Mazvikadei, motor vehicles, boats, household furniture and effects, and monies in local and foreign bank accounts. During the trial, the respondent conceded that the appellant was entitled to 50% of the matrimonial estate as it existed on 24 April 1991. An independent valuer, Ian Ferreira, was appointed to value the assets. The main dispute concerned the valuation of shares in the Edisan Products Group of Companies and the distribution of foreign currency held in bank accounts (US$99,864.00).

• How should shares in companies be valued for purposes of dividing matrimonial property, particularly where the shareholder is a minority shareholder versus a majority shareholder?
• Whether the valuation of shares should be based on net asset value or earnings/dividend distribution method?
• How should foreign currency be distributed and converted to local currency in the division of matrimonial assets?
• What exchange rate should apply when converting foreign currency to local currency - the rate at the date of separation or the date of judgment?
• What costs order should be made in divorce proceedings involving division of assets?

The appeal was allowed in part. Paragraph (b) of the High Court order was amended to add a provision requiring the respondent to pay to the appellant the sum of US$49,932.00, or its equivalent in local currency using the rate of exchange applicable on the date of the order. The respondent was ordered to pay the costs of the appeal.

1. For purposes of dividing matrimonial property, shares held by a minority shareholder should be valued on an earnings/dividend distribution basis (market value), while shares held by a majority shareholder should be valued on a net asset value basis. This distinction is justified because a majority shareholder has control over the company and can dispose of its assets, whereas a minority shareholder can only dispose of his shares at market value. 2. Where foreign currency forms part of the matrimonial estate and a party makes an unconditional offer to pay a specific amount in foreign currency, that offer should be enforced. If payment must be made in local currency (because foreign currency payments cannot be enforced), the conversion should use the exchange rate applicable at the time of judgment, not the earlier date of separation, to ensure fairness and avoid prejudicing the receiving party due to currency fluctuations.

The court observed that given the respondent was a successful businessman and had made a firm offer at trial to pay 50% of the foreign currency, the probabilities were that he would have paid the local currency equivalent almost immediately. The court also noted that the matter of costs at trial is within the discretion of the trial court, and absent evidence that discretion was not exercised judicially, an appellate court should not interfere.

This case establishes important principles for the division of matrimonial property in Zimbabwe (and is relevant for comparative purposes in South African law). It clarifies the appropriate methodology for valuing shares in companies for matrimonial property division, distinguishing between majority and minority shareholdings. The case also provides guidance on how foreign currency assets should be treated in divorce proceedings, particularly regarding the appropriate exchange rate for conversion to local currency. The judgment emphasizes that where a party makes a clear offer to pay a portion of assets in foreign currency, that offer should be honored, and if conversion to local currency is necessary, it should be done at the exchange rate applicable at the time of judgment rather than at the earlier date of separation, to avoid the offeree being prejudiced by currency fluctuations.