Cape Town – A court battle involving the family of late fishing tycoon Peter “Padda” Kuttell over the sale of the family trust’s shares – worth millions – to a company controlled indirectly by two of his three feuding sons has ended with the Supreme Court of Appeal (SCA) issuing a split judgment on the matter.
The Kuttell family has been involved in Cape Town’s fishing industry since family patriarch Padda Kuttel left a career as a lawyer in the early 1960s. Padda, who died in May 2019, after the launch of the application, and his wife Joy, who died a week before the SCA heard the application, set up the Padjoy trust in March 1981.
After Padda and Joy died the trust’s capital was to be distributed equally to their three sons, Peter, Francois and Adrian.
Peter co-founded Victor Seafoods and led that company until its acquisition in 1999. In 2000, he co-founded and served as majority investor in Bear & Wolf Salmon Company until its acquisition in 2008
When Francois was head of the Oceana Group he was credited with the worldwide success of the Lucky Star pilchards brand
Adrian is best known for racing over the seas and this year was hailed for being the first single-handed entry in Cape 2 Rio Yacht Race 2023.
Padda later resigned as a trustee due to ill-health and until recently, there were five trustees, Joy, Francois, Adrian and two independent trustees, attorneys John Levin and Barry Adams.
The matter had originally been brought by Peter at the Western Cape High Court which dismissed the case. Peter then petitioned the SCA which ordered that the application for leave to appeal be referred for oral argument.
The SCA had to decide whether the approval of the court was required for the validity of the sale of the shares; whether the transaction was open and bona fide; and whether Peter had been treated unfairly by not being given an opportunity to bid for the share.
Writing the majority judgment, Judge Clive Plasket said: “No doubt, the enmity between Peter and his father, in particular, as well as with the family more generally, probably also contributed to him being the only beneficiary who is not a trustee.”
The SCA found against Peter and ruled the court’s approval of the sale of the shares was not required and that the transaction was open and bona fide.
To the extent that Peter was treated differently to his brothers, the majority found that differentiation was justified in the context of the powers of the trustees and the fact that Peter as a beneficiary had no right to bid for the shares.
The minority judgment by Judge Mahube Molemela held the sale of the shares by the trust to Grace Investments, without affording Peter an opportunity to bid for them, was discriminatory and not justified.
She said that she would have granted Peter leave to appeal, with costs.