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[2011] ZAGPJHC 177
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Reichman v Reichman and Others (2011/15348) [2011] ZAGPJHC 177; 2012 (4) SA 432 (GSJ) (23 November 2011)
REPORTABLE
SOUTH GAUTENG HIGH COURT, JOHANNESBURG
CASE NO
:
2011/15348
DATE:23/11/2011
In the
matter between:
JEFFREY
REICHMAN
..............................................................................................
Applicant
and
BARRY SOLOMON
REICHMAN
................................................................
First
Respondent
BARRY SOLOMON REICHMAN
N.O
....................................................
Second
Respondent
MASTER OF THE SOUTH
GAUTENG
......................................................
Third
Respondent
HIGH COURT, JOHANNESBURG
ARNOLD
SHAPIRO
.................................................................................
Fourth
Respondent
JUDGMENT
Scholtz A J
[1] On 15 April 2011 the applicant issued a notice of motion against
the respondents in which he claimed the following relief:
"1. First Respondent be and is hereby removed as executor in the
deceased estate of the late Lea Reichman appointed in terms
of letter
of executorship no: 26229/09 issued by the Master of the High Court,
Johannesburg, on 14 October 2009;
The First Respondent is directed forthwith to return to the Third
Respondent the aforesaid letters of executorship;
Declaring the First Respondent unfit to act as executor of the
aforementioned deceased estate;
Declaring the Fourth Respondent unfit to act as executor and/or his
agent in respect of the aforementioned deceased estate;
That the First Respondent forfeit any entitlement to executors fees;
That First Respondent be ordered to be personally liable for all
fees and/or disbursements incurred by the Fourth Respondent
in
administrating the aforesaid deceased estate on his behalf;
That the First Respondent, in his personally capacity, pay the costs
of the Application
de bonis propriis
,
alternatively
on
the scale as between attorney and client;
Fourth Respondent be ordered to pay the costs of the Application
de
bonis propriis,
alternatively
on the scale between
attorney and client, jointly and severally with the First Respondent
only in the event of him, directly
or indirectly opposing the
Application;
Granting the Applicant such further and/or alternative relief of the
above Honourable Court deems fit."
[2] The application is opposed by the first and second respondents,
who filed an answering affidavit. The applicant and the first
respondent are brothers. The first respondent acts in his personal
capacity and as the second respondent is the executor of the
estate
of his mother, the late Lea Reichman ("
the deceased
"),
who passed away on 11 September 2009. The fourth respondent is an
attorney and is acting as the agent of the second respondent
in
administering the estate of the deceased. The fourth respondent
abides the decision of the court. The references in this judgment
to
the fourth respondent will be to him in his capacity as the agent of
the second respondent.
[3] The applicant has filed a replying affidavit and the first and
second respondents have filed a further affidavit in response
to
alleged "new matter" raised in the replying affidavit. In
the applicant's practice note, which was filed before the
hearing of
the application, the applicant averred that prior leave had not been
obtained for the filing of the further affidavit
and that such
affidavit should be regarded as
pro non scripto
. However, in
the applicant's heads of argument, the applicant has referred to the
contents of the further affidavit. I will therefore
have regard to
this affidavit insofar as it may be necessary to decide the issues in
this case.
[4] In the affidavits before the court there are accusations and
counter-accusations between the applicant and the first and second
respondents. These give rise to factual disputes, many of which
cannot be resolved in motion proceedings. There are disputes
between
the applicant and the first respondent as to what assets each of them
and their sister, Marion Sacke ('
Mrs Sacke
"), received
from the deceased during her lifetime, whether such assets were gifts
or loans and whether a document, which the
deceased signed the day
before she died, constitutes a valid "will" in terms of
which the deceased left her entire estate
to the first respondent.
It nevertheless remains for the court to decide whether the applicant
is entitled to the relief sought
in his notice of motion.
[5] The following events do not appear to be in dispute between the
parties although many of the contentions advanced on their
behalf in
the letters written by their respective attorneys are clearly
disputed:
(a) on 14 October 2009 the second respondent was appointed by the
third respondent ("
the Master
") as the executor of
the estate of the deceased in terms of Letters of Executorship No:
26229/09 ("
the Letters of Executorship
"). The
applicant was not a party to the appointment;
(b) on or about 22 December 2009 the second respondent (through the
offices of the fourth respondent) submitted to the Master a
first and
final liquidation and distribution account in the estate of the
deceased ("
the L & D Account
"). The
distribution account reflected that the balance for distribution was
R64 628,58 and this amount was to be distributed
in terms of s
1(1)(b) of the Interstate Succession Act 81 of 1987, as amended.
Pursuant hereto, the amount of R64 628,58 was to
be distributed in
equal shares to the applicant, the first respondent and Mrs Sacke;
(c) on 19 January 2010 the applicant's former attorneys addressed a
letter to the fourth respondent in which they advised that
they were
acting for the applicant and requested copies of the draft L & D
Account and the will of the deceased;
(d) on 25 January 2010 the fourth respondent addressed a letter to
the applicant's former attorneys, to which he attached copies
of the
will, the letters of executorship and the L & D Account. He
advised that the L & D Account had been advertised
to lie for
inspection as from 29 January 2010;
(e) on 4 February 2010 the applicant's former attorneys addressed a
letter to the fourth respondent in which they alleged
inter alia
that certain assets were missing from the L & D Account, more
particularly that the deceased had made loans to the first respondent
and Mrs Sacke of about R470 000, that jewellery to the value of
about R5 million was missing from the L & D Account and
the
deceased had given the first respondent a fancy yellow diamond valued
conservatively at R1,1 million to sell on her behalf;
(f) on 17 February 2010 the fourth respondent addressed a reply to
the applicant's former attorneys, which was marked "without
prejudice". The applicant annexed the letter to his founding
affidavit and averred that the letter did not constitute any
form of
settlement negotiations and should accordingly be received in
evidence. in paragraph 7.8 of the first and second respondents'
answering affidavit he stated that the letter "contains a
correct rendition of the position in respect of the deceased estate."
Accordingly the admissibility of the letter is not is dispute. In
the letter the fourth respondent stated:
"I refer to your letter dated 4 February 2010.
At the outset, I must note that my clients are shattered and
devastated by the content of your letter.
I am advised that your client had no relationship with his mother for
a number of years prior to her death, and your client's alleged
knowledge as to the existence or non-existence of assets, is
incorrect and the assertions made by your client are harmful and
hurtful.
In reply to the specific allegations, our clients emphatically deny
that their late mother held the assets claimed by your client
at the
date of her death:
1.
Loan:
Our clients have no knowledge as to how your client has computed the
alleged loan to Barry and Marion in the sum of R470,000.00.
Neither
Barry nor Marion has any knowledge of this alleged loan. If your
client has proof of the allegation, with particular reference
to the
terms and conditions of the alleged loan, together with proof of
payment of same, please let us have same.
In regard to the above, it must be noted that the late Mrs Reichman
did make various payments to her children which were done out
of
love, kindness and benevolence and were a donation to Barry and
Marion.
It must be noted that Barry had Power of Attorney and signing power
on his mother's account. Barry did not draw a single cheque
on the
account. Whatever amounts were paid were made by Mrs Reichman
personally.
2.
Jewellery:
The jewellery Is not missing and the family deny the allegation and
imputation. The late Mrs Reichman did not own any jewellery
at the
time of her death. Whatever jewellery Mrs Reichman owned prior to her
date of death, had been dealt with in her lifetime.
3.
3
Carat fancy yellow diamond:
It must be noted that this diamond was valued and found not to be an
intense fancy yellow, but to be a natural yellow. The value
accordingly changed from approximately R400,000.00 to R100,000.00.
It must be further noted that your client removed the setting
containing the diamond which also contained a wave of baguettes.
Your
client Is still in possession of that setting with the wave of
baguettes, which Is valued at approximately R150,000,00.
In order to obtain return of her diamond, the late Mrs Reichman and
Barry were compelled to consult the Police for assistance in
recovering the ring, but were only able to recover the diamond from
the EGL Laboratory.
The stone was sold by Mrs Reichman for R110,000.00. The ring and
baguettes are and remain In the possession of your client.
The proceeds of the sale of the ring were used by the late Mrs
Reichman for the payment to Jaffa of R50,000.00 and most of the
balance was used to pay liabilities, including to settle Iegal action
which had been instituted against Mrs Reichman by "the
Little
Company of Mary.";
(g) on 25 February 2010 the applicant's former attorneys addressed a
letter to the Master in which they lodged on his behalf an
objection
to the L & D Account. The letter stated:
"We act on behalf of Mr Jeffrey Reichman, one of the heirs in
the abovementioned estate.
Our client has examined the Liquidation and Distribution Account and
is of the opinion that it does not correctly reflect the assets
and
claims of the deceased.
Our client has instructed us, in the circumstances, to lodge an
objection to the Account on his behalf.
The basis of our client's objection is as follows:-
1. An amount of approximately R487 000 was loaned by the deceased to
her son Barry Reichman and her daughter Marion Reichman. The
amounts
loaned to Barry and Marion were as follows:-
R387 530 to Barry; and
R100 000 to Marion.
2. In addition jewellery to the value of approximately R5 million is
missing and should have been included in the Liquidation and
Distribution Account. According to our client the jewellery was taken
by Marion from the deceased without the deceased's permission
and
consent.
3. The deceased also gave her son Barry a 3 carat fancy yellow
diamond to sell on her behalf. The stone was valued at not less
than
R1,1 million. According to our client the stone was sold and the
monies were retained by Barry without the deceased's permission
or
consent.
Attempts were made to resolve this matter but without success.
You are requested, in the circumstances, to advise the Executor of
our client's objection to the Liquidation and Distribution Account.
Kindly acknowledge receipt.
We await your reply."
(h) On 19 April 2010 the fourth respondent addressed a letter to the
Master which read as follows:
"We refer to the Master's letter dated 5 March 2010.
We apologise for the delay in replying to the objection.
At the outset, the following matters must be noted by the Master:
The late Mrs. Reichrnan died testate.
The late Mrs. Reichman left her entire estate to her son, Barry
Solomon Reichman.
We are advised that the late Mrs. Reichrnan had been estranged from
her son Mr. Jeffrey Reichman, who is the objector to the
Account.
Mr. Jeffrey Reichman is in possession of assets of the estate
including a ring and baguettes which he has to date failed to
deliver to the Executor.
The original Will was delivered to the Master. We enclose a copy for
ease of the objector's attention. It will be noted that
the Will was
not properly executed and for that reason, we proceeded with the
administration as intestate. The objector must
be mindful of the
fact that the family do retain the right to declare the Will to be
the intended Will of the deceased, should
same be necessary in terms
of
Section 2(3)
of the
Wills Act of 1953
. If the Application is
successful, Mr. Jeffrey Reichman and his sister will receive
nothing.
Notwithstanding the above, an objection to the L & D Account was
noted to our offices by the objector's attorney Kasimov
&
Associates undercover of their letter 4 February 2010, a copy of
which we enclose for the Master's ease of reference.
We replied to Attorney Kasimov & Associates letter undercover of
our letter dated 17 February 2010.
We attach a copy of our letter of 17 February 2010 which deals with
each and every allegation objected to and disputes, denies
or
rejects the validity of same.
The Executor stands by his contentions and should the objector wish
to proceed to Court, which would be regretful, the matter
will be
defended with a request to stay the proceedings pending the
Executor's Application to declare the draft Will to be the
intended
Will of the late Mrs. Reichman.";
(i) on 21 April 2010 the applicant's former attorneys addressed a
letter to the Master in which they stated that the applicant
had
examined the deceased's diary and had located a number of extracts
therein which supported his contention that the first respondent
and
Mrs Sacke had loaned monies from the deceased and had also taken her
jewellery and personal effects;
(j) on 10 June 2010 the applicant's former attorneys addressed a
further letter to the Master, in which they stated:
"1. We are in receipt of your letter 8 June 2010, together with
enclosures, the contents of which are noted.
2.1 Insofar as proof of the amount owing by the deceased's two
children is concerned, we respectfully refer you to our letter 21
April 2010, together with the annexures thereto, which was delivered
to your offices on 22 April 2010.
2.2 A copy of our letter together with the annexures is annexed for
your ease of reference.
2.3 In addition, we annex hereto a copy of the late Lea Reichman's
bank statement reflecting a reference, in the late Lea Reichman's
own
handwriting, of amounts owing by her children, Barry and Marion.
2.4 The amounts reflected in the aforesaid statement accords with the
amounts referred to in our letter to you of 25 February 2010.
3.1 Insofar as the Executor's threats to launch an Application to
declare the draft Will of the late Mrs Lea Reichman to be her
intended Will, our instructions are that our client is of the opinion
that the draft Will was not signed by his late mother alternatively
it was signed under duress and accordingly any such Application to
Court will be opposed.
3.2 It is to be noted that although the deceased's son, Barry
Reichman and/or the Executor were in possession of the deceased's
"Will" they did not seek to wind up her estate in terms
thereof. Clearly they did not accept the Will as being that of
the
late Lea Reichman and are only now seeking to do so, due to our
client's objection.
3.3 These facts, together with such other facts as are relevant, will
be brought to the Courts attention at the appropriate time.
4. Please furnish us with your reply as soon as possible.";
(k) on 28 September 2010 the fourth respondent addressed a letter to
the Master, which was copied to the applicant's former attorneys,
in
which he stated:
"We refer to the Master's letter dated 8 September 2010 and
enclosures being a copy of a letter from Kasimov and Associates
dated
10 June 2010.
Our client had no knowledge of Attorney Kasimov and Associates letter
of 21 April 2010 addressed to the Master.
In reply to the bank statements and extracts from the diary, we
advise as follows:
The handwritten markings, notes and summary recorded on the bank
statements are not that of the late Mrs. Reichman.
Barry Reichman did receive an amount of R250,000.00 from his mother
on 10 June 2005.
Barry Reichman has no knowledge and denies receipt of the sum of
R100,000,00 on 22/07/2005 and R26,530.00 on 22 June 2005.
Marion Sacke denies that an amount of R100,000.00 was paid to her
on 10/05/2006.
The extracts from the diary are not in the deceased's handwriting.
We will arrange with Mr Kasimov for a copy of the original diary
and if necessary, will set up a meeting to peruse same at
his
offices. If necessary, we will address this matter further.
Mrs Reichman was known to blow hot and cold. It is contended that
she had a vicious streak. She would make the most horrendous
allegations about her children's conduct and the next day, be more
than generous to them. She believed that many people had
stolen
from her. The home has confirmed that Mrs Reichman on more than one
occasion contended that her son Jeffrey Relchman
being the objector
to this Account had stolen all her diamonds. She at some stage even
contended that the home had stolen her
money. Her irrational
behaviour was known to all of those who were associated with her.
Mr Jeffrey Reichman had limited contact
and no relationship with
his mother. As far as the home is aware, Mr Jeffrey Reichman never
visited his mother. The daily care
and visiting and attention given
to the late Mrs Reichman in the main was attended to by her son
Barry Reichman.
It must be noted that the complainant is in possession of a ring of
the deceased with diamond baguettes. His attorney has admitted
that
his client is in possession of this ring and the baguettes but
notwithstanding demand, he has to date failed to return
same to the
Executor. Is the Master able to assist in prevailing upon the
objector to deliver the ring to the Executor and
failing this, the
Executor regretfully will have no alternative but to institute
legal proceedings for recovery of this item.
The Will was signed by the late Mrs Reichman in the presence of a
witness, R Wilson who is employed at Jaffa. The Will was
not
properly executed in that it was witnessed by a single witness. The
handwritten portion of the Will was also completed
by Mr Barry
Reichman. It was decided to proceed with the administration as
intestate, The rights to proceed in terms of the
Wills Act to
declare the document to be the intended Will of the late Mrs
Reichman and Barry Reichman's right to inherit have been
reserved.";
(l) on 5 November 2010 the applicant's present attorney addressed a
letter to the fourth respondent in which he stated:
"As you are aware, we have been appointed to act on behalf of Mr
Jeffrey Reichman, one of the heirs in the above Estate.
The writer is not sure whether Mr Shapiro is the Executor of the
above Estate or whether he merely acts as agent. On the assumption
that he is the agent, and that Mr Barry Solomon Reichman is the
Executor, our instructions are as follows:
1. The Estate must retain the net capital for distribution of R64
000.00 pending a High Court application removing the Executor
and the
appointment of an independent third party.
2. An enquiry alternatively an investigation shall thereafter
immediately proceed and the theft and location of approximately R8
000.000.00's worth or jewellery belonging to the late Leah Reichman
shall be appropriated as an asset/s of the Estate.
3. The cost of the aforegoing shall be payable by the Estate,
alternatively the party/ies in whose possession the said assets are
located.
4. The alleged donations made to your clients, Mrs Marion Sacke and
Barry Solomon Reichman are to be set aside and these parties
will
similarly be obliged to make payment back to the Estate as these
payments were loans and not donations.
The aforegoing is not to be construed as exhaustive relief to be
sought in the application set out above. If there is a dispute
of
fact, then Summons will be issued and the administration of the
Estate will be held up until a trial takes place. It is therefore
incumbent upon the parties in whose possession these assets are at
present to provide an Inventory of same, together with an undertaking
not to dissipate or sell same. If this is refused, then clearly
criminal charges will also have to be laid against the concerned
parties.
The parties to the application or Summons will be our client, Mr
Jeffrey Reichman and the Estate as they both have locus standi.
We
assume that the Master of the High Court will also have to be cited
as an interested party.
We would appreciate your Mr Shapiro's comments on the aforegoing.
However, as previously advised by the writer to Mr Shapiro, should
the parties refuse to settle their differences we are instructed to
brief Counsel and will proceed with whatever action is required
and
advised. All our client's rights and those of the Estate are
reserved.";
(m) on 11 November, 26 November and 15 December 2010
and 11 January 2011 the fourth respondent addressed
further
letters to the Master in which the Master was requested to provide
his ruling on the applicant's objections to the L &
D Account.
No such ruling has been forthcoming from the Master;
(n) on 17 March 2011 the second respondent (i.e. the first respondent
in his capacity as the executor of the deceased estate) issued
summons against the applicant in which the second respondent made two
claims against the applicant ("
the Summons
"). In
the first claim the second respondent made the following averments:
"3.1 The deceased died testate in that she executed the Will
annexed hereto marked "BR1" on the 9
th
September 2009.
3.2 The deceased's last Will and Testament annexed hereto does not
comply with the provisions of Sections 2(1)(a)(ii) and (iii)
of the
Wills Act 7 of 1953 (as amended) in that the deceased's last Will and
Testament:
3.2.1. was signed at the end thereof by the deceased in the presence
of only one competent witness being one Mrs Wilson ("Mrs
Wilson"), alternatively was signed by the deceased whereafter
she acknowledged her signature to Mrs Wilson.
3.2.2 was signed and attested to by Mrs Wilson at the end thereof in
the presence of the deceased and whilst the deceased was in
a mental
state fit to execute a valid Will and whilst she appreciated the
nature and contents of the Will and her conduct.
3.3 The deceased passed away on the 10
th
September 2009,
being one day after the deceased and the aforesaid witness signed the
Will but, before the deceased could request
a second witness to
attest to, and sign the Will in her presence and that of Mrs Wilson.
3.4 The deceased requested the plaintiff on the 9
th
September 2009
to complete the blank spaces contained in her last Will and Testament
as she was unable to write, which
task he duly performed in her
presence.
3.5 The plaintiff complied with the deceased's request and with each
and every instruction given to him by the deceased, which
instructions were clear, to the point and without hesitation.
3.6 The plaintiff would, in terms of the law relating to intestate
succession have been entitled to inherit from the deceased if
the
deceased died intestate.
3.7. The deceased at all times intended the document annexed hereto
to be her last Will and Testament.
4. In the premises:-
4.1 the plaintiff prays for an order whereby the Master is authorised
to accept the deceased's last Will and Testament annexed
hereto
marked "BR1" as a Will for purposes of administering the
deceased estate;
4.2 the plaintiff prays for an order declaring him to be competent to
receive the benefits emanating from the deceased's last Will
and
Testament as envisaged by the provisions of
Section 4A(2)(a)
and (b)
of the
Wills Act 7 of 1953
.
5 The plaintiff called upon the first defendant to consent to the
aforesaid, whereafter:
5.1 the defendant lodged a complaint against the liquidation and
distribution account which had been prepared by the plaintiff
without
having regard to the deceased's last Will and Testament;
5.2 the first defendant advised the plaintiff that he contests and
intends to contest the deceased's last Will and Testament."
(o) in the second claim in the Summons the second respondent:
(i) claimed that the applicant was in possession of certain of the
deceased's jewellery, the reasonable market value of which was
R150 000. Despite the applicant having been called on to return
the jewellery to the deceased estate, the applicant refuses
to do so;
(ii) in the alternative alleged that the applicant disposed of the
jewellery to the detriment and without the knowledge and/or
consent
of the deceased estate;
(iii) accordingly claimed from the applicant the return of the
jewellery, alternatively payment of the amount of R150 000
plus
mora interest and costs.
[6] In the applicant's founding affidavit he stated
inter alia
the following:
"8.12
What is abundantly clear at this juncture is that the
First Respondent has a clear conflict of interest and yet refused to
step
down as executor
. Shapiro is also callously refusing to
deal with any of the documentation which has now been put at his
disposal namely the diary
of the deceased, her bank account
statements and cheques.
8.13 This is now even further exemplified by the first respondent
fortuitously issuing summons only against myself to declare the
will
valid and demanding return of the ring which contained the vivid
yellow fancy diamond."
(my emphasis)
"9.7.1 The First Respondent, in his capacity as executor, finds
himself in the untenable position that personally as a debtor
of the
estate he must defend for his claim, and on the other hand in his
capacity as executor of the estate he must fight for the
same claim.
It is for this reason alone that the Honourable Court should remove
the First Respondent as executor, as it is undesirable
in the
circumstances for the First Respondent to continue to retain such
office."
[7] In the first and second respondents' answering affidavit he
stated
inter alia
the following:
"2. IN LIMINE
2.1. Prior to replying to the applicant's founding affidavit in some
detail, I refer the above Honourable Court with respect to
the
summons and particulars of claim annexed as "JR12" to the
founding affidavit, being a summons issued by me, inter
alia, against
the applicant and wherein I pray for the following relief:
2.1.1. that the Master of the above Honourable Court be authorised to
accept the deceased's last Will and Testament annexed to
the
particulars of claim marked "BR1" as a Will for purposes of
administering the deceased estate; and
2.1.2 for an order declaring myself to be competent to receive the
benefits emanating from the deceased's last Will and Testament;
and
2.1.3. that the applicant be ordered to forthwith return to me, in my
representative capacity, the jewellery, being the deceased's
wedding
band, consisting of a setting and a wave of baguettes belonging to
the deceased estate;
2.1.4. and, in the alternative, payment of an amount of R150,000.00
together with interest thereon, and
2.1.5. that the costs of the action be costs in the administration of
the deceased estate, alternatively, be paid by the applicant
in the
event of the action being opposed.
2.2. The summons was issued on the 17th March 2011 and, thereafter
served upon the applicant.
2.3. Subsequent to the service of summons upon the applicant, the
applicant launched this application for an order that I be removed
as
the Executor in the deceased estate and that I be declared to be
unfit to act as Executor in the aforesaid deceased estate.
The
applicant similarly prays that Attorney Arnold Shapiro, be removed as
my agent in the administering of the deceased estate.
2.4. The action that is pending pertains to the question as to
whether the estate should be administered as an intestate or a
testate one. Should the above Honourable Court find that the
deceased's last Will and Testament is a valid document, the
application
launched by the applicant becomes irrelevant,
particularly in light of the contents of the deceased's last Will and
Testament,
which document is annexed as "JR1" to the
founding affidavit. In that Will, the deceased stated as follows:
"I, the undersigned,
Lea Reichman
ID Number 2405260042089
Of Jaffa Muckelneuk
Pretoria
hereby declare this to be my Will.
1. I hereby revoke all previous Wills.
2. I nominate
to be the Executor of my Estate with the power of assumption.
3. I direct the Master of the High Court to dispense with the
furnishing of security by my nominated Executor for the proper
administration
of my Estate.
4. I bequeath my whole Estate to:
BARRY SOLOMON REICHMAN
ID 6006065042088"
2.5. The deceased's last Will and Testament was signed at the end
thereof by the deceased in the presence of only one competent
witness, being one Mrs Wilson. Mrs Wilson signed the last Will and
Testament at the end thereof in the presence of the deceased
and
whilst the deceased was in a mental state fit to execute a valid
Will. She appreciated the nature and contents of the Will.
2.6. The difficulty is that the second witness did not sign the Will
in the presence of the other witness. A further difficulty
is that
the deceased requested me to complete the blank spaces in her last
Will and Testament as she was unable to write, which
task I duly
performed in her presence.
2.7. I complied with the deceased's request and with each and every
instruction given to me by the deceased, which instructions
were
clear, to the point and without hesitation.
2.8. Should the above Honourable Court find that the Will is a valid
document, then and in that event the deceased bequeathed her
entire
estate to me and the first respondent's objections, which are, with
respect, unfounded, would be irrelevant.
2.9. For the reasons aforesaid, I pray that the applicant's
application be dismissed with costs, alternatively, that the
applicant's
application be stayed pending the outcome of the action
instituted as aforesaid.
3.
3.1. In addition, it was always open to the applicant to launch an
application against the Master of the above Honourable Court
and
against myself for an order that the administration of the deceased
estate be stayed pending the outcome of the action but,
the applicant
elected to follow the route of attacking me in my personal capacity,
and in my capacity as the Executor in the deceased
estate.
3.2. It was also open to the applicant to launch an application
against the Master of the above Honourable Court praying for an
order
that the Master be ordered to immediately give attention to the
applicant's objections. The applicant also, could have requested
that
the Master convene an enquiry in terms of the Provisions of the
Administration of Estates Act 66 of 1965
, in order for him to raise
his objections at such an enquiry.
3.3. The applicant however, elected to launch an application which
makes little sense under circumstances where a summons had been
issued, and an action pending in the above Honourable Court.
3.4. I am, with respect, of the opinion that the applicant is
embittered by the fact that summons had been issued for the relief
as
more fully set out in the particulars of claim."
[8] The first and second respondents' answers to the allegations,
which I have quoted in [6] above, were as follows:
"7
.8.
I
deny that it is either abundantly clear or at all, that there exists
a conflict of interest as my duty and my interest is not
in conflict
.
The letter addressed to the applicant's attorney by Mr Shapiro,
annexed "JR9" contains a correct rendition of the position
in respect of the deceased estate but, it appears as if the applicant
simply ignores the contents thereof, and nitpicks certain
sentences
thereof, in order to come to his conclusion which is more fanciful
than real.
I deny that
I
"fortuitously" issued summons against the applicant and,
respectfully state that
Section 2(3)
of the
Wills Act allows
for an interested party to approach a Court
to declare a Will to be a valid Will. To say that I am "unfit"
because
I issued summons in the above Honorable Court, is, with
respect, denying me the right to which I am entitled in terms of
the
Wills Act
."
(my emphasis)
"9.1. I have read the unsubstantiated and
speculative allegations made against myself and my sister and deny
each and every
allegation where the applicant intends
the
above Honorable Court to make a negative finding against either
myself or my sister.
9.2. In the light of the fact that summons had
been issued and that the above Honorable Court may grant an order to
the effect that
the deceased died testate and that her last Will and
Testament is a valid document, I do not intend to reply to the
allegations
herein contained, either in detail or at all. I have been
advised that there exists no reason to deal with any of the false
allegations
made against me or my sister as the application launched
by the applicant:
9.2.1
is premature,
in that these allegations will only become relevant should the above
Honorable court find that the deceased's Will
and Testament is an
invalid document
;
9.2.2 has, as its basis, a motive which emanates from the fact that
the applicant is embittered by reason of the summons served
upon him.
9.3 The allegations herein contained are, in any
event, false and based upon speculation.
The
applicant would prefer me to be dismissed as the Executor in the
deceased estate as, he believes that should I be dismissed,
the
action against him will be withdrawn
.
9.4 Save as aforesaid the allegations herein
contained are denied and, I reserve the right to reply hereto,
either
where the applicant convinces the Master to convene an enquiry in
terms of the
Administration of Estates Act or
, should the applicant
intend to proceed with the application subsequent to the conclusion
of the action against him."
(my emphasis)
[9] It is apparent that there are serious disputes between the
applicant on the one hand and the first respondent (in his personal
capacity) and the second respondent (in his capacity as the executor
of the deceased estate) on the other hand.
[10] Although the Summons was issued by the second respondent, in
reality the first respondent is seeking to have the deceased's
"will"
declared to be valid so that he can receive all the benefits of such
"will" to the exclusion of the
applicant and, for that
matter his sister, Mrs Sacke. The second claim in the Summons is one
which, if valid, should be pursued
by the executor.
[11] The first respondent has a personal interest in (a) precisely
what assets should be recovered by the executor for the benefit
of
the heirs of the deceased. Indeed, one of the duties of an executor
is to recover any debts owing to the estate; (b) warding
off the
applicant's contentions that he owes money to the estate; (c) whether
the last "will" of the deceased should
be accepted as
valid; (d) the litigation which he has instituted against the
applicant in his capacity as executor of the deceased
estate; and (e)
the manner in which the assets of the estate are distributed. All of
these interests conflict with those of the
applicant. The first
respondent is entitled to take such action as he considers to be
appropriate in order to protect his personal
interests. However, it
is undesirable that he should use his office as the executor of the
estate in order to pursue such interests.
[12] During the hearing of this matter the first and second
respondents' counsel argued that, until such time as the trial court
has pronounced on the first claim being made in the Summons, namely
the claim that the deceased's "will" should be accepted
as
a valid will for the purposes of winding up the estate, the second
respondent does not have a conflict of interest with the
other
potential heirs of the estate. If the trial court finds in favour of
the first respondent, he will inherit the entire estate
and will have
no conflict with the disappointed "heirs". The first
respondent will have a conflict with the disappointed
heirs only if
the trial court finds that the "will" should not be
accepted as the last will of the deceased. In my view,
this argument
is unsound. The first respondent already has an irreconcilable
conflict between his personal interests and his duty
as executor to
act impartially in the best interests of the estate. One of the
duties of the executor must be to investigate the
validity or
otherwise of the debts which the applicant alleges the first
respondent owes to the estate. The first respondent cannot
be a
judge in his own cause and cannot rely on the Master to resolve this
factual dispute. If the parties are unable to resolve
the dispute
among themselves only a court of law would be able to do so.
[13] Even if I am incorrect in this view it is undesirable to defer a
decision on the applicant's application until the litigation,
which
the second respondent has instituted against the applicant by the
Summons, has been finalised. The final outcome of this
litigation
could take several years, bearing in mind that there is the
possibility of an appeal. There is no certainty as to the
outcome of
that litigation. If the final decision does not go in favour of the
fist respondent, he acknowledges that at that stage
he will have a
conflict of interest with the applicant. In that situation he would
not be able to continue to act as the executor
of the estate. On the
other hand, if the second respondent ceases to act as the executor of
the estate at this stage, he will
not suffer any prejudice.
[14] In a number of cases our courts have had to consider the
position of an executor who had a conflict between his personal
interests and his duties as the executor of an estate or trustee of a
trust. I set out hereunder the principles which were enunciated
in
these cases.
[15] In Lindenberg v Giess, No and Another
1957 (3) SA 30
(SWA)
Claassen JP stated the following at 33 G - 34 A:
"The question of costs must be considered. The executor was
faced with an objection to the account. He acted on a valuation
not
in terms of the will.
When confronted with another valuation of
van Helsdingen he was placed in a position where his fiduciary
functions, which required
the exercise of the utmost good faith,
conflicted with his own interests. He followed the line dictated by
his own interests
. Such conduct cannot be allowed to stand. As
was said by INNES, C.J., in Robinson v Randfontein Est. G.M. Co.
Ltd.,
1921 AD 168
at p. 177:
'Where one man stands to another in a position of confidence
involving a duty to protect the interests of that other, he is not
allowed to make a secret profit at the other's expense or place
himself in a position where his interests conflict with his duty.
The
principle underlies an extensive field of legal relationships. A
guardian to his ward, a solicitor to his client, an agent
to his
principal, afford examples of persons occupying such a position. As
was pointed out in The Aberdeen Railway v Blackie Bros.
(1 Macqueen
474) the doctrine is to be found in the Civil Law (Digest 18.1.34.7),
and must of necessity form part of every civilised
system of
jurisprudence.'
The first respondent being personally interested and having acted in
his own interests in a position where his own interests conflicted
with his duty, he must pay the costs de bonis propriis."
(my emphasis)
[16] In Grobbelaar v Grobbelaar
1959 (4) SA 719
(A) van Blerk JA
stated the following at 724 G - 725 A:
"Dit is duidelik dat hier 'n wesenlike botsing bestaan tussen
die persoonlike belange van die respondent en die van die boedel
waardeur 'n toestand geskep is wat respondent se posisie as
eksekuteur vir hom onhoudbaar maak. Hy bevind hom in die onmoontlike
posisie dat hy enersyds as skuldeiser van die boedel sal moet veg vir
sy eis en andersyds in sy hoedanigheid as eksekuteur die
boedel sal
moet verdedig teen dieselfde eis. In hierdie rol sal hy genoodsaak
wees om kant te kies. Hy kan nie onsydig of onpartydig
bly nie.
'n Dergelike posisie het ontstaan in die saak van
Barnett v Estate Beattie,
1928 CPD 482
, 'n appèl teen 'n
beslissing van die Hooggeregshof van Suid Rhodesië, waar 'n
eksekuteur vir die rede uit sy amp ontset
is.
Daar
het die Hof heeltemal tereg daarop gewys dat op hierdie stadium dit
nie nodig is nie om in te gaan op die geldigheid van respondent
se
eis, want die vraag oor wie reg of verkeerd is, is nie hier ter
sprake nie.
Die toestand wat in die onderhawige geval ontstaan
kan slegs verhelp word deur die respondent uit sy amp as eksekuteur
te ontset.
Alleen daardeur kan myns insiens die belange van die
boedel gedien word soos art. 99 van die Boedelwet dit uitdruk.
Deur
die ontsetting van respondent uit sy amp verval sy bevoegdheid om met
die bates van die boedel te handel. Dit sal dus die taak
wees van die
eksekuteur datief wat respondent opvolg om die eise teen, en die
regte van, die boedel te ondersoek
.”
(my emphasis)
[1
7] In Harris v Fisher,
No
1960 (4) SA 855
(A) Ogilvie Thompson JA stated the following at
861 H - 862 E:
”It was argued by counsel for respondent, relying upon English
authority (viz. Re Charteris,
1917 (2) Ch. 379
; Hampden v Earl of
Buckinghamshire,
1893 (2) Ch. 531
; Halsbury (2nd ed.) vol. 33 paras.
401 - 6, 431, 539), that the transaction as contended for by
appellant would constitute a breach
of trust and that, solely upon
that ground, appellant's claim must fail. It is not clear to me that
our law relating to breach
of trust is the same as that of England as
reflected in the above-mentioned authorities; and, in the absence of
much fuller argument
on the point, this appeal should not, in my
opinion, be decided upon the ground thus advanced by counsel for
respondent.
Nevertheless, it was appellant's duty, in her capacity
as executrix and administratrix, to discharge the estate's debts, so
far
as practicable, in a manner which would be least burdensome for
the ultimate heirs. Although herself a beneficiary, appellant, in
her
aforementioned capacities, stood in a fiduciary position towards the
heirs of the corpus
. As WESSELS, A.C.J., remarked in Colonial
Banking and Trust Co. Ltd v Estate Hughes and Others,
1932 AD 1
at p.
16
'If the trustee is also a beneficiary and he acts in such a way as to
benefit himself at the expense of the other beneficiaries,
his acts
will be narrowly scrutinised.'
It is, I think, a well established rule of our law that a party
occupying a fiduciary position must not as such engage in a
transaction
by which he will personally acquire an interest adverse
to his duty'
(per DE VILLIERS, A.J., later J.A., in Horn's Executor v The Master,
1919 CPD 48
at p. 51 and cf. Grobbelaar v Grobbelaar,
1959
(4) SA 719
(AD)
at p. 724G). Story Equity
Jurisprudence, in the course of a long discussion upon the subject of
fiduciary relationships, and after
stating that trustees are, for
this purpose, to be treated on the same footing as guardians (which
is also the position under our
law: see Sackville West v Nourse and
Another,
1925 AD 516
at pp. 533 - 4) remarks in
sec. 322
, p. 212 of
the 2nd ed., that
'Executors or administrators will not be permitted, under any
circumstances, to derive a personal benefit from the manner in which
they transact the business or manage the assets of the
estate
.
"
(my emphasis)
[1
8] In Webster v
Webster en
ʼn
Ander
1968 (3) SA 386
(T) Hiemstra R J stated the following at 388 B
- D:
"
Wanneer een van
die twee mede-eksekuteurs weier om te ageer, kan die ander verlof van
die Hof kry om onafhanklik eisende of verwerende
op te tree (Van der
Merwe v Heydenrich, 19 C.T.R. 460, obiter deur die Appèlhof
goedgekeur in Conradie en Andere v Smit,
1966
(3) SA 368
(AA)
op
bl. 374D; Baard v Estate Baard,
1928 CPD 505).
Dit
skyn selfs 'n geval te wees waar 'n aansoek om verwydering van die
eerste respondent as eksekutrise sterk beredeneerbaar sou
wees
,
volgens die beslissings in Basson v Redelinghuys,
1945 CPD 194
, en
Grobbelaar v Grobbelaar,
1959
(4) SA 719
(AA)
op
bl. 725. Die blote feit dat sy nie onpartydig kan wees by die
beoordeling van eise teen die boedel nie, is voldoende grond
daarvoor. Dit kan wees dat die ander eksekuteur ook behoort terug te
tree, maar aangesien daar nie sodanige aansoeke voor my is
nie, gaan
ek nie verder daarop in nie."
(my emphasis)
[1
9] In Die Meester v
Meyer en Andere
1975 (2) SA 1
(T) a Full Court was faced with an
application to remove an executor in accordance with
s 54(1)(a)(v)
of
the
Administration of Estates Act. One
of the allegations against
the executor was that he had a conflict of interests. Margo J (with
whom Davidson J and Franklin J
concurred) stated the following at 16
C - 17 F:
"
Die vraag wat nou
ondersoek moet word is of bogenoemde gronde die verwydering van die
eerste respondent uit sy amp sou regverdig.
Kragtens art. 54 (1) (a)
kan 'n eksekuteur te eniger tyd van sy amp onthef word deur die Hof
op enigeen van die spesifieke gronde
in paras. (i) tot (iv) van die
artikel vermeld; en kragtens art. 54 (1) (a) (v) kan 'n eksekuteur te
eniger tyd van sy amp onthef
word indien die Hof om "enige ander
rede" oortuig is dat dit onwenslik is dat hy as eksekuteur van
die betrokke boedel
optree. Vgl. art. 99 van die ou Boedelwet. Die
huidige bepaling in art. 54 (1) (a) (v) is iets nuuts. Die ou art. 99
het die Hof
gemagtig om 'n eksekuteur te skors of uit sy amp te
"ontzet" indien die Hof van oordeel was dat uit hoofde van
afwesigheid,
"ander bezigheden, zwakke gezondheid of andere voldoende
redenen, de belange van de boedel onder zijn beheer gediend zijn
door
zijn schorsing of ontzetting".
Die Hof sal nie ligtelik 'n eksekuteur van sy amp
onthef nie, veral waar hy 'n eksekuteur-testamentêr is.
Tog
is hierdie oorweging nie deurslaggewend nie.
In
Port Elizabeth Assurance Agency & Trust Co. Ltd. v Estate
Richardson,
1965
(2) SA 936 (K)
,
het VAN WINSEN, R., op bl. 940, gesê:
"I have no doubt that in the exercise of its power to appoint or
remove an administrator the Court will pay close attention
to the
wishes of the testator as expressed in or implied from the terms of
the will. The Court cannot, however, necessarily be
bound by these
wishes even to the detriment of the beneficiaries to whose interest
it must equally clearly have regard."
In Sackville-West v Nourse and Another, 1925 A. A. 516, het SOLOMON,
WN. H. R., op bl. 527 na die uitspraak van Lord BLACKBURN
in
Letterstedt v Broers,
9 A. C. 371
, (op appèl van die ou Kaapse
Hooggeregshof) verwys, en het voortgegaan:
"He then quotes a passage from Story, Equitable Jurisprudence...
as follows:
'But in cases of positive misconduct Courts of Equity have no
difficulty in interposing to remove trustees who have abused their
trust; it is not indeed every mistake or neglect of duty or
inaccuracy of conduct of trustees, which will induce Courts of Equity
to adopt such a course. But the acts or omissions must be such as
endanger the trust property or to show a want of honesty or a
want of
proper capacity to execute the duties, or a want of reasonable
fidelity.'
He then proceeds to lay down the broad principle that...
'In exercising so delicate a jurisdiction as that of removing
trustees, their Lordships do not venture to lay down any general
rule
beyond the very broad principle above enunciated that their main
guide must be the welfare of the beneficiaries.'"
Hierdie beginsels, wat deur SOLOMON, WN. H. R., goedgekeur is, is ook
van toepassing op 'n eksekuteur. Sommige van die latere beslissings
van ons Howe wat hierdie beginsels illustreer is in Ex parte Hills,
1959 (4) S. A. 644
(O. K.) op bl. 647, versamel.
Op bl. 528 van die Sackville-West saak het
SOLOMON, WN. H. R., bygevoeg dat blote wrywing of 'n vyandige
verhouding tussen die administrateur
en die begunstigde nie per se '
n genoegsame rede is vir die verwydering van die administrateur uit
sy amp nie tensy dit waarskynlik
is dat dit die bereddering van die
trust sou verhoed.
Soos MURRAY, R., gesê
het in Volkwyn, N. O. v Clarke & Damant, 1946 W. P. A. 456 op bl.
474:
"... the essential test is whether such disharmony as exists
imperils the trust estate and its proper administration".
Mnr. Van Dijkhorst het hom beroep op die volgende passaat in MURRAY,
R., se uitspraak in Volkwyn se saak op bl. 464:
"Both the statute and the case cited (Letterstedt v Broers )
indicate that the sufficiency of the cause for removal is to
be
tested by a consideration of the interests of the estate. It must
therefore appear, I think, that the particular circumstances
of the
acts complained of are such as to stamp the executor or administrator
as a dishonest, grossly inefficient or untrustworthy
person, whose
future conduct can be expected to be such as to expose the estate to
risk of actual loss or of administration in
a way not contemplated by
the trust instrument."
Hierdie beginsel is deur MURRAY, R., omskryf slegs
in verband met "acts complained of", d. w. s. die doen en
late van
'n eksekuteur wat hom onbevoeg maak om sy pligte uit te
voer. Die beginsel is nie veelomvattend nie.
Dus,
bv. kan omstandighede ontstaan waar 'n eksekuteur hom in 'n
onhoudbare posisie teenoor die boedel vind. Grobbelaar v Grobbelaar,
1959
(4) SA 719
(AA)
op
bl. 724G.
In die geval van botsende
belange, is die blote feit dat 'n eksekuteur nie onpartydig kan wees
by die beoordeling van eise teen
die boedel nie, prima facie grond
vir sy verwydering.
Webster v Webster
en 'n Ander,
1968
(3) SA 386
(T)
op
bl. 388C - D.
Hoe dit ook al sy onder die gemenereg en
ingevolge die gewysdes onder die ou Boedelwet, 24 van 1913, is die
Hof nou gemagtig kragtens
art. 54 (1) (a) (v) van die huidige
Boedelwet om 'n eksekuteur te verwyder indien dit onwenslik is dat hy
as eksekuteur van die
betrokke boedel optree. Die Hof het hier 'n
diskresie en myns insiens bly die oorheersende oorweging die belange
van die boedel
en van die begunstigdes
."
(my emphasis)
[20] Although the facts in the cases, which I have quoted in [15] to
[19] above, are not on all fours with the facts in the present
case,
I am of the view that the principles enunciated in those cases are
relevant to this case. In a dispute of the nature set
out in the
Summons, and the other disputes which have been raised in the
correspondence between the parties' attorneys, it is desirable
that
the executor of the estate should be independent of the two factions
in the family of the deceased, so that he or she will
be in a
position to decide:
(a) whether it is in the best interests of the estate to continue
with the litigation, which the second respondent has instituted
against the applicant; and
(b) whether the executor has claims against the first respondent and
Mrs Sacke, as alleged by the applicant, and whether it is
in the best
interests of the estate that these claims should be pursued. If the
applicant's allegations are found to be correct
and if claims are
successfully pursued against the first respondent and Mrs Sacke, the
executor will need to prepare a revised
L & D Account.
[21] If the
Administration of Estates Act permitted
the court to
request or direct the Master to appoint an independent co-executor of
the estate to act jointly with the second respondent,
this might have
been a satisfactory solution to the dispute. During the hearing the
applicant's counsel indicated that this would
be acceptable to his
client. The second respondent could then have recused himself on all
matters in which he had a personal interest.
However, it appears
that the
Administration of Estates Act does
not confer such a power
on the court.
[22] When the dispute between the applicant and the first respondent
arose, the first respondent could have resigned as the executor
of
the estate and proposed to the applicant that the children of the
deceased jointly approach the Master to appoint an independent
executor to deal with the disputes and to wind up the estate.
However, the first respondent did not follow this course. He chose
rather to issue the Summons against the applicant in which he (acting
as executor) is seeking an order that the "will"
is valid
and that he (in his personal capacity) should be declared the sole
heir of the deceased.
[23]
Section 54(1)
of the
Administration of Estates Act 65 of 1965
,
as amended ("
the
Administration of Estates Act
"
;)
provides as follows:
"
Removal from office of executor
(1) An executor may at any time be removed from his office-
(a) by the Court-
(i) ......
[Subpara (i) deleted by
sec 18(a)
of Act 6 of 1986.]
(ii) if he has at any time been a party to an agreement or
arrangement whereby he has undertaken that he will, in his capacity
as executor, grant or endeavour to grant to, or obtain or endeavour
to obtain for any heir, debtor or creditor of the estate, any
benefit
to which he is not entitled; or
(iii) if he has by means of any misrepresentation or any reward or
offer of any reward, whether direct or indirect, induced or
attempted
to induce any person to vote for his recommendation to the Master as
executor or to effect or to assist in effecting
such recommendation;
or
(iv) if he has accepted or expressed his willingness to accept from
any person any benefit whatsoever in consideration of such
person
being engaged to perform any work on behalf of the estate; or
(v) if for any other reason the Court is satisfied that it is
undesirable that he should act as executor of the estate concerned;
and
(b) by the Master-
(i) if he has been nominated by will and that will has been declared
to be void by the Court or has been revoked, either wholly
or in so
far as it relates to his nomination; or
(ii) if he fails to comply with a notice under subsection (3) of
section 23 within the period specified in the notice or within
such
further period as the Master may allow; or
[Subpara (ii) substituted by sec 18(b) of Act 6 of 1986.]
(iii) if he is convicted, in the Republic or elsewhere, of theft,
fraud, forgery, uttering a forged instrument or perjury, and
is
sentenced therefor to serve a term of imprisonment without the option
of a fine, or to a fine exceeding twenty rand; or
(iv) if at the time of his appointment he was incapacitated, or if he
becomes inapacitated to act as executor of the estate of
the
deceased; or
(v) if he fails to perform satisfactorily any duty imposed upon him
by or under this Act or to comply with any lawful request
of the
Master; or
(vi) if he applies in writing to the Master to be released from his
office."
[24] I am satisfied that it is undesirable for the first respondent
to continue to act as the executor of the estate of the deceased.
I
make this finding without any finding that there has been wrongdoing
on the first respondent's part (or on the part of the fourth
respondent) as contemplated in
s 54(1)(a)(ii)
, (iii) or (iv) of
the
Administration of Estates Act. However
,
s 54(1)(a)(v)
provides that an executor may at any time be removed from his office
by the court "if for any other reason the Court is satisfied
that it is undesirable that he should act as executor of the estate
concerned". In s 1 of the Act "
Court
" is
defined as "the provincial division of the Supreme Court (now
the High Court) having jurisdiction, or any judge thereof,
and
includes, whenever a matter in relation to which this expression is
used is within the jurisdiction of a local division of
the Supreme
Court, that local division or any judge thereof".
I accordingly make the following orders:
(a) the first respondent, Barry Solomon Reichman, is removed from his
office as executor of the estate of the late Lea Reichman,
who died
on 11 September 2009;
(b) in terms of
s 54(5)
of the
Administration of Estates Act, the
first respondent must forthwith return his Letters of Executorship to
the Master;
(c) the issue of whether or not the second respondent is entitled to
receive any fees for his services during the period that he
acted as
the executor of the estate should be left over for determination
after the disputes concerning the estate have been resolved;
(d) the Master should as soon as possible exercise his powers under
the
Administration of Estates Act to
appoint and grant letters of
executorship to such person or persons whom he may deem fit and
proper to be the executor or executors
of the estate of the deceased;
(e) the first respondent is ordered to pay the costs of the
application.
__________________________
D.R. SCHOLTZ
ACTING JUDGE OF THE SOUTH GAUTENG
HIGH COURT, JOHANNESBURG
Date of hearing: 3 November 2011
Date of judgment: 23 November 2011
For the applicant: Adv. R J Bouwer
Instructed by: Attorney George Wolfe
For the first and second respondents: Adv. G H Meyer
Instructed by: Eversheds