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[2010] ZAGPJHC 117
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Judin N.O v Jankelowitz and Another (2010/26572) [2010] ZAGPJHC 117 (22 November 2010)
NOT REPORTABLE
SOUTH GAUTENG HIGH COURT, JOHANNESBURG
CASE NO
:
2010/26572
DATE:
22/11/2010
In the matter between:
ALAN MICHAEL JUDIN N.O.
In his capacity as duly appointed Executor
in the Estate of the Late HAROLD MONTAGUE JUDIN
Identity
No. , Master’s Ref:
26427/2009
...........................
…
Applicant
and
MICHAEL
CHARLES JANKELOWITZ
...................................
First
Respondent
SHEENA
MARCELLE HEIKEL
...............................................
Second
Respondent
______________________________________________________________
J U D G M E N T
______________________________________________________________
LAMONT, J
:
[1] The applicant in his
capacity as the duly appointed executor in the estate of the late
Harold Montague Judin launched an application
against the first and
second respondents as a matter of urgency seeking to interdict the
first and second respondents from alienating,
selling, disposing of
or dealing with a variety of items and requiring them to deliver
possession of certain immovable property
by delivering the keys
thereof to the applicant. The first and second respondents (the
respondents) opposed the application and
in a counter-application
sought the removal of the applicant as the executor of the estate.
There are a number of trusts to which
reference will be made below.
The applicant did not launch the application
qua
trustee of those trusts and it is common cause before me that to the
extent that this application deals with trust matters that
such
matters are not properly before me.
[2] This application is the
product of a set of unfortunate circumstances which have produced
severe pain to persons who are related
to each other by marriage. It
is apparent from the affidavits before me that emotions have run high
and that there is a degree
of hostility and distrust between the
families
[3] In order to place the
application in context and understand the unfortunate set of factors
which operate upon the persons before
me it is necessary to traverse
the historic relationship between their parents. Two families were
neighbours, the Judin family
and the Jankelowitz family. The parents
of the Judin family consisted of the deceased (referred to hereafter
as the applicant’s
father), his then wife and their children
including the applicant. The Jankelowitz family comprised the
respondent’s mother,
her then husband and their two children,
the two respondents. There was a divorce in each of the Judin and
Jankelowitz families.
The divorce was occasioned by the discovery of
the then wife of the applicant’s father that the applicant’s
father
was conducting an extramarital relationship with the
respondent’s mother. The applicant’s father and the
respondent’s
mother married each other. During the marriage
the applicant’s father formed two trusts; one trust was the
Harold M Judin
Associates Trust, Trust No. IT6791/96 (the Business
Trust); the other was the Harold and Dolly Judin Family Trust, Trust
No. IT2347/97
(the Family Trust). The relationship between the
Trusts was that they were discretionary in the hands of the trustees
who had
far-reaching powers including the power to remove existing
beneficiaries, select other beneficiaries, receive payments of
various
monies and generally re-adjust the Trust affairs so that, at
the instance of trustees existing beneficiaries could be substituted
with other beneficiaries and the rights to receive monies could be
varied. The Business Trust which was the income-earning vehicle
of
the applicant’s father as well as the asset protection Trust of
the applicant’s father had as a beneficiary the
Family Trust.
[4] The capital beneficiaries of
the Family Trust included the applicant’s father, the
respondent’s mother, various
members of the Judin family and
the Jankelowitz family. It is not clear from the papers whether or
not there were additional beneficiaries
however this is of no
consequence in the present matter. This detail is set out purely for
the purposes of background.
[5] The applicant’s father
died. The applicant’s father left a Will under and in terms of
which all his assets were
left to the respondent’s mother. The
applicant’s fathers Will appointed the respondent’s
mother and/or one Davey
and/or the applicant as joint executors. On
16 September 2009 the respondent’s mother wrote a letter to the
Master notifying
him of the death of the applicant’s father,
enclosing various documents and seeking to be appointed as executor.
It is apparent
that the applicant also wished to be appointed as an
executor. The third person referred to in the Will one Davey
indicated in
advance that he would decline any appointment. There
were wide-ranging on going disputes between the parties as to whom,
if anyone,
the third executor should be. Subsequent to the death of
the applicant’s father the respondent’s mother paid out
various
monies including monies from the Business Trust. It seems
that these monies were on the papers probably used to pay the
mortgage
bond over the common home occupied by the applicant’s
father and the respondent’s mother (the common home) and
various
other debts of the applicant’s father’s estate
and of the Trust. At the time of these payments the respondent’s
mother was not authorised to make them in that the number of trustees
of the Business Trust was insufficient to authorize such
payment and
as she had not yet been appointed as the executor in the estate of
the applicant’s father. The respondent’s
mother in
addition paid her own living expenses out of the Business Trust
without the relevant authority. The respondent’s
mother
subsequent to the death of the applicant’s father found an
Investec policy. There was no linked beneficiary to the
policy. The
evidence of the respondent is that in cases where the policy does not
identify a beneficiary it is usually paid out
to a dependant, usually
the spouse or the heir of the deceased. Investec made a decision to
pay the respondent’s mother
and in April 2009 advised her
accordingly. Prior to the payment under and in terms of the policy
the respondent’s mother
died. Investec indicated that they
would pay the heirs of the respondent’s mother. The heirs
under and in terms of the
Will of the respondent’s mother are
the two respondents. Investec paid the two respondents the amount of
the policy.
[6] Over the period the relationship between the two families’
surviving relatives remained extremely poor.
[7] The applicant unbeknown to
the respondents applied to be granted letters of executorship in the
applicant’s father’s
estate and such letters were
granted. He made this application at a time when he must have been
aware that the respondents wished
to participate in matters
concerning the winding up of both the applicant’s father’s
estate and the respondent’s
mother’s estate. They were
the sole recipients of all the assets of both estates.
[8] At the time of the appointment of the applicant as executor to
the applicant’s father’s estate he had no interest
as an
heir in the estate.
[9] After the applicant had been
appointed as an executor to the estate of the applicant’s
father the relationship between
the respondents and the applicant
appears to have deteriorated even further. The applicant claimed
that the respondent’s
mother had not taken adequate or proper
steps to wind up the estate of the applicant’s father and that
in particular there
were debts which needed to be paid. These debts
in the result were identified as being, in the context of the
particular estate,
of a relatively small amount. The applicant
claimed that the monies paid to the respondents by Investec should
form part of the
estate and that the monies should be returned to the
estate. The estate is well solvent and any return of these monies had
no effect
upon the distribution of the estate save for the need to
value them to pay the fisc taxes and to inconvenience the
respondents.
There were policies which could have been used to pay
the debts relatively quickly and without hardship to anyone. In
particular
there was a policy in existence in respect of the
applicant’s daughter which had a cash value which could have
been used
to make payment; there were other insurance policies which
could have been cashed and were not. There are also apparently
valuable
movables and the common home is valuable and no money is
owing under the bond. In turn the second respondent has been paying
a
variety of debts of the applicant’s father’s estate
including monies due to the housekeeper and insurance over the common
home.
[10] Notwithstanding that the
disputes and distrust between the respondents and the applicant had
continued for a very long period
of time the applicant launched the
present application as a matter of urgency. The matter was not
urgent. There was no threat to
the estate which needed urgent
attention. Even assuming the Investec issue fell to be decided in
favour of the applicant there
were other assets under the applicants
control to cover any short term issue. In addition the respondents
were not going anywhere;
they were the heirs who were to be paid
significant sums of money in due course.
[11] In the application the
applicant sought a variety of relief which relates to questions
concerning the Trusts. One of the major
complaints of the applicant
was that he required books, records and documents and had been kept
out of these by the respondents.
It transpired that the books,
records and documents were documents concerning the Trust which were
kept within a room in the common
home. This relief patently is a
matter which relates to the Trust and not to the estate. At the time
of the application there
was no threat to any of the movable assets
contained within the common home. The bulk of the movable assets had
been there continuously
over the period, to the end they were
depleted and there was no indication when they were removed or by
whom. There was certainly
no imminent threat by the respondents to
remove any of the movables. As at February 2010 the parties were at
such loggerheads
that the first respondent was not prepared to meet
with the applicant unless legal representatives were present. During
April 2010
the first respondent notified the applicant that he
required correspondence to be directed through his attorney. During
May 2010
the applicant asked the respondents’ attorneys when
access would be given to the documents in the flat so that the
accounts
relative to the estate could be prepared. When the annexure
referred to is consulted it is apparent that the request concerned
information and details, accounting records and other information
already requested. The documents and information already requested
related to the Trust as appears more fully from the email dated 2
February 2010 in which the following appears:
“
Accordingly
and again I am asking you to please let me have copies of the Trust
documents and the bank accounts and the documents
relating to the
business which is owned by the Trust so as to enable Allan to obtain
advice and understand what his position is.
”
[12] The respondents at a point
in time agreed for joint access to take place to the contents of the
common home. Such access did
take place. Continued joint access has
been tendered. The common home appears to contain movables belonging
to the estate and
the trust.
[13] There was no threat to deal
with the common home. The applicant was not entitled to the
interdicts which he sought in paragraph
2 of the notice of motion.
To the extent that the applicant sought delivery of the keys of the
common home he was from time to
time afforded rights of access and
did not require sole and exclusive possession. There was no reason
why joint possession to
the common home could not have remained as
was the position prior to the application. The fact that the primary
objective of the
applicant was to obtain data concerning the Trust is
apparent from the additional prayers contained in the second part
(the B part)
of the notice of motion in which the applicant seeks
records relating to the Trust affairs. In that portion the applicant
seeks
relief concerning the Investec annuity (in paragraph 4). The
respondents explained how the Investec annuity was not part of the
estate and that dispute patently cannot be resolved on these papers.
It follows in my view that the applicant is not entitled
to the
relief which he sought and which he obtained
pendente
lite
and is also not
entitled to the relief he seeks now.
[14] The respondents launched a
counter-application. In the counter-application the respondent
sought the removal of the applicant
as an executor to the estate of
the applicant’s father. Their submissions commenced with a
consideration of the factual
position of the estate. The Will of the
applicant’s father contemplated appointment of joint executors
of whom the respondents’
mother would be one. The second
submission was that the applicant had no interest in the estate
whatsoever as the entirety of
the applicant’s father’s
estate had been bequeathed to the applicant’s mother who in
turn had bequeathed it to
the respondents. The third submission
concerned wide ranging matters dealing with the relationship of the
parties, the distrust
between them, the manner in which the applicant
had excluded them when he applied for appointment, the manner in
which he was dealing
with the estate which they perceived as being
without consideration of their interests as heirs as also his conduct
of mingling
trust affairs and estate affairs. The only persons with
any interest in the estate were the respondents. The applicant’s
submission as to why he should remain as an executor was that he had
not misconducted himself; the estate had not been well handled
by the
respondents’ mother as there were debts to be paid which had
not been paid. It appears that in the interim the applicant
also has
been supine and not paid the debts. There were funds within the
estate to enable the debts to be paid. The applicant
when he sought
his appointment as an executor, on the evidence placed before me by
the respondents, did so without notifying them
of his intention to do
so. The applicant further applied to the Master to be appointed the
executor at a time when the disputes
between the applicant and the
respondents were wide-ranging, when there was no personal trust
between them and when the relationship
between them had completely
collapsed. The applicant relied on the authoritative statement
contained within
Sackville
West v Nourse and Another
1925 AD 516.
The case is authority that in the case of positive
misconduct trustees who have abused their trust will be removed. It
is however
not every mistake or a neglect of duty or inaccuracy of
conduct of trustees which will result in such course being adopted.
If
the acts or omissions are such as to endanger the Trust property
or show a want of honesty or a want of proper capacity to execute
the
duties or a want of reasonable fidelity then the trustee will be
removed. The broad principle is that the court:
“
If
satisfied that the continuance of the trustee would prevent the Trust
being properly executed might remove the trustee …
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 guard must
be the welfare of the beneficiaries.
”
The authorities approving of the
Sackville West
case are collated in
Ex
Parte Executive Officer of the Financial Services Board; In Re Joint
Municipal Pension Fund
[2003] 4 All SA 603
(T) at 612 paras [38] to [39].
[15] In the
Sackville
West
matter it was
considered whether or not hostility was a relevant feature (page
528):
“
Counsel
for the appellant West, however, relied strongly upon the hostility
which he alleged existed between the trustees and the
beneficiary.
But here again it is said in the judgment in the
Letterstedt
case: "It is
quite true that friction or hostility between trustees and the
immediate possessor of the trust estate is not
of itself a reason for
the removal of the trustee." And as pointed out by counsel for
the trustees, the hostility, judging
from the correspondence, seems
to have been entirely on the side of the beneficiary, while the
trustees, on the other hand, have
advanced him a considerable sum of
money in excess of the interest which they received from the
investment. Considering, therefore;
the nature of the functions to be
discharged by the trustees, I am by no means satisfied that such
feeling as exists is likely
to prevent the trust being properly
executed by them.
[16] At the time the
Sackville
judgment was delivered section 54(1)(a)(v) had not been enacted.
Section 54(1)(a)(v)
of the
Administration of Estates Act No. 66 of
1965
reads as follows:
“
54(1)
An executor may at any time be removed from his office – (a)
by the court – (v) if for any other reason the court
is
satisfied that it is undesirable that he should act as executor of
the estate concerned; …
”
[17] Apart from the friction and
hostility which exists between the parties which I have noted earlier
in this judgment it came
to my attention when an open with prejudice
tender was made by the applicant that the applicant had an agenda.
The applicant in
fact has a hope that he will be able to purchase and
obtain for himself assets in the estate. In the proposed order which
was submitted
to me with prejudice there are set out a variety of
provisions which will result in the respondent valuing various assets
in the
estate of the applicant’s father and the applicant
having the right to purchase such assets at the value. This wish of
the
applicant is not surprising. It is understandable that as a son
he wishes to obtain certain of the assets owned by the applicant’s
father. This attitude towards estate assets has consequences in my
view. The applicant will not appear to be impartial in his
actions
in relation to the management of the estate. It cannot be in my view
that the applicant will be seen to be impartial and
will be able to
exercise a completely impartial mind when he as part of the agenda he
wishes to impose seeks pre-emptive right
in respect of certain assets
on the respondents. I emphasise that I do not regard this as
misconduct on the part of the applicant.
I regard it as undesirable
that the applicant when he has this approach (which appears to be
emotionally driven) towards assets
in the estate should be the person
who winds up the estate. It is not difficult to detect the
applicants: - grief at having been
disinherited by the applicant’s
father and hostility towards the recipients of those assets namely
the respondents. The applicant
without notice sought and obtained his
appointment as the executor. This conduct on the part of the
applicant is perceived by the
respondents as being a hostile act and
an act which they see as evidencing bias. The applicant for no
economic reason affecting
the winding up of the estate seeks
possession of the very movables he wishes to acquire and seeks to
embroil the estate in litigation
against the respondents over the
Investec payments. All of these actions of the applicant and his
appearance of bias make it undesirable
for him to continue as
executor.
[18] In my view it is desirable
that the Master appoint an appropriate executor who is neither the
applicant nor the respondents.
[19] It follows that the
applicant should not have brought the application either as a matter
of urgency or at all and that that
application falls to be dismissed
with costs. Insofar as the counter-application is concerned the
respondent established a right
to relief. The costs however in my
view of that application should be paid out of the estate of the
applicant’s father.
[20] I accordingly make the
following order:
The applicant’s
application in his representative capacity is dismissed with costs
including any reserved costs.
All interim orders are set aside
The applicant is removed as the
executor of the estate of the late Harold Montague Judin.
The Master is authorised and
directed to appoint one or more executors as he may decide to the
estate of the late Harold Montague
Judin.
The parties are afforded 14 days
to deliver to the Master a notice setting out names of persons they
propose as an executor.
Should the Master timeously
receive the notice referred to in 5 then the Master shall have due
regard to the wishes of the parties
and consider such persons who
have been proposed as an executors.
In the event that the heir of
the estate of the late Harold Montague Judin and/or the heir as
represented by the executor to the
estate of such heir so direct
then such person and/or persons as the Master may appoint as
executor shall be released from the
obligation to furnish security.
The costs of the counter-application are to be paid by the estate
late Harold Montague Judin.
______________________________
C G LAMONT
JUDGE OF THE SOUTH GAUTENG
HIGH COURT, JOHANNESBURG
Counsel for Applicant : Adv.
B E Gradidge
Attorneys for
Applicant : Adam Creswick Attorney
Counsel for Respondent
: Adv. M B G Da Costa
Attorneys for
Respondent : Litsa Skylakis Attorneys
Date of hearing : 26 October
2010
Date of Judgment : 22
November 2010