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[2011] ZAGPPHC 47
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Pricewaterhousecoopers Incorporated and Another v Du Toit and Others In re: Du Toit and Others v Pricewaterhousecoopers Incorporated and Others (73909/2009) [2011] ZAGPPHC 47 (1 April 2011)
NOT
REPORTABLE
IN
THE NORTH GAUTENG HIGH COURT,
(PRETORIA
REPUBLIC
OF
SOUTH AFRICA)
CASE
NUMBER: 73909/2009
DATE:01/04/2011
In
the matter between:
PRICEWATERHOUSECOOPERS
INCORPORATED
...............................................................................................
First
Applicant
MATTHYS
JOHANNES
BLOM
.....................................................................
Second
Applicant
and
BAREND
JOHANNES JACOBUS
DU
TOIT
.........................................................................................................
First
Respondent
DANIEL
PETER DU
TOIT
........................................................................
Second
Respondent
FRANCOIS
JONATHAN DU
TOIT
..............................................................
Third
Respondent
TAMARIN
DU
TOIT
....................................................................................
Fourth
Respondent
TIFFANY
ANASTACIA DU
TOIT
..................................................................
Fifth
Respondent
ALETTA
CATHARINA DU
TOIT
....................................................................
Sixth
Respondent
PIERRE
VAN
ROOYEN
...........................................................................
Seventh
Respondent
In
re:
BAREND
JOHANNES JACOBUS
DU
TOIT
................................................................................................................
First
Plaintiff
DANIEL
PETER DU
TOIT
................................................................................
Second
Plaintiff
FRANCOIS
JONATHAN DU
TOIT
.......................................................................
Third
Plaintiff
TAMARIN
DU
TOIT
...........................................................................................
Fourth
Plaintiff
TIFFANY
ANASTACIA DU
TOIT
..........................................................................
Fifth
Plaintiff
ALETTA
CATHARINA DU
TOIT
..........................................................................
Sixth
Plaintiff
and
PRICEWATERHOUSECOOPERS
INCORPORATED
............................................................................................
First
Defendant
PIERRE
VAN
ROOYEN
..............................................................................
Second
Defendant
MATTHYS
JOHANNES
BLOM
.......................................................................
Third
Defendant
JUDGMENT
GOODEY
AJ:
[1]
INTRODUCTION:
(1.1)
This is an application in terms of section 2(1 )(b) of the Vexatious
Proceedings Act, Act 3 of 1956.
(1.2)
The Applicants filed heads on 14 February 2011.
(1.3)
On Tuesday, 1 March 2011 my Registrar called adv Swanepoel whose name
appear on the heads of the Applicants as acting on behaif
of the
Respondents.
(1.4)
Mr Swanepoel informed her that he had previously acted on behalf of
the Respondents on a contingency basis, but due to financial
constraints on the part of the Applicants he is in any event no
longer available to act as he is also tied up in another matter.
He
further informed her that the Respondents would move for an
postponement.
(1.5)
Mr Swanepoel indicated that heads may possibly be filed but that the
Respondents would move for a postponement as aforesaid
on 7 March
2011.
(1.6)
Heads were indeed filed by Mr Swanepoel on behalf of the Respondents
on Thursday afternoon, 3 March 2011.
(1.7)
Though late, I accepted the said heads.
[2]
POSTPONEMENT:
(2.1)
On 7 March 2011 when the matter was called, Mr De Beer, appearing on
behalf of the Respondents, moved for a postponement.
…
..........
(2.2)
A substantive application in this regard was brought.
(2.3)
The Applicants filed an opposing affidavit and the Applicants also
filed a replying affidavit in this regard.
(2.4)
The matter as to the postponement was duly argued on 7 March 2011.
(2.5)
Result:
2.5.1
I refused the postponement with costs and indicated that l would give
my reasons later. These reasons are clear from what
is stated below.
2.5.2
I
reiterated
that the Respondents should be granted an
opportunity
of being heard
and
that such an opportunity is either to argue the matter there and
then or to stand the matter down until Thursday, 10 March
2011 in
order to accommodate the Respondents and afford the Respondents all
possible opportunities to be heard.
2.5.3
Mr De Beer informed me that he was only briefed on the postponement.
2.5.4
The matter stood down and Mr De Beer (on behalf of the Respondents)
as well as Mr Steyn (on behalf of the Applicants) informed
me that
contact was made with Mr Swanepoel who would then argue the main
action (vexatious proceedings) on Thursday, 10 March
2011.
(2.6)
Respondents
reasons for postponement:
2.6.1
In essence the Respondents say that the matter is not ripe for
hearing. In this regard the First Respondent says the following
in
paragraphs 3 and 4 of the founding affidavit pertaining to the
postponement:
"3.
On Thursday, 3 March 2011, during a conversation between counsel in
this matter, it came to the attention of counsel that
a replying
affidavit had been served by Applicant on or about 8 February 2011.
4.
Upon enquiry, my attorney's correspondent perused his file and
ascertain that in fact such an affidavit had been served upon
him,
but that it had not been forwarded to my attorney. As a consequence,
the heads of argument have been predicated on the premise
that no
replying affidavit has been filed".
2.6.2
They further argue that Mr Swanepoe! was not informed pertaining to
the hearing on 7 March 2011 and no heads were consequently
prepared
and filed timeously.
2.6.3
I find no merits in these grounds and they all have been addressed as
is clear from what is stated hereinafter. Their undertaking
to pay
costs for the postponement somewhere in the future is also without
merits.
(2.7)
Fact
of the matter is:
2.7.1
I have received and perused the replying affidavit.
2.7.2
I have had Mr Swanepoel (on behalf of the Respondents and who has
been acting for them and is well familiar with the matter)
contacted
as aforesaid.
2.7.3
I accepted the heads prepared by Mr Swanepoel although out of time.
2.7.4
I have afforded the Respondents the opportunity to be heard on
Thursday, 10 March 2011 when Mr Swanepoel would also be available.
I
then in actual fact heard the matter as aforesaid.
Consequently,
apart from the fact that there are no merits in the application for
postponement which has been refused there
is no prejudice for the
Respondents in view of the aforesaid and the fact that the matter
stood down until 10 March 2011 (par
2.7.4 above).
[3]
MAIN APPLICATION (VEXATIOUS
PROCEEDINGS):
(3.1)
General
3.1.1
The main application is an application in terms of section 2(1)(b) of
the Vexatious Proceedings Act, Act 3 of 1956, for a
permanent stay of
an action instituted by the First to Sixth Respondents under case
number 73909/09 and ancillary relief.
3.1.2
The said section reads as follows:
"
If on an application made by any person against whom legal
proceedings have been instituted by another person or who has
reason
to believe that the institution of legal proceedings against him is
contemplated
by any other person, the Court is satisfied that the said person has
persistently and without any reasonable ground
instituted legal
proceedings in any Court or in any inferior Court, whether against
the same person or against different persons,
the
Court may, after hearing that other person or giving him an
opportunity of being heard, order that no legal proceedings shall
be
instituted by him against any
person in any Court or any inferior Court without the leave of that
Court, or any Judge thereof, or that inferior Court, as the
case may
be and such leave shall not be granted unless the Court or Judge or
the inferior Court, as the case may be, is satisfied
that the
proceedings are not an abuse of the process of the Court and that
there is a
prima
facie
ground
for the proceedings."
(my
underlining)
3.1.3
I have already indicated that the Respondents were granted that the
Respondents were granted the full opportunity of being
heard and they
were in fact heard as required by the section.
(3.2)
Background
3.2.1
The background is for all practical purposes common cause and a handy
summary thereof is to be found in paragraphs 6 tot 10
of the
Applicants' heads which read as follows:
"6.
These events occurred against the backdrop of the tragic story of the
murder of Mrs Joyce Du Toil on the 11
th
of June 1992. The First Respondent was married to Mrs Joyce Du Toit
in community of property. More than five years after her murder
the
First Respondent was found guilty on counts of inter alia the murder
of his wife and the falsification of her last will and
testament. He
was sentenced to an effective 28 years' imprisonment The First
Respondent has since been released on parole in and
around June 2008.
See:
Record, p.718-736; p.15-19.
7.
A
brief summary of the background facts relevant to this application
are as follows:-
7.1
After the death of his wife, the First Respondent inherited her half
share of the joint estate in terms of, what later turned
out to be a
falsified will.
7.2
The First Respondent transferred the entire estate to the Ben Du Toit
Family Trust. In terms of the liquidation and distribution
account
the joint estate was valued in an amount of R14,282,076.00.
7.3
The transfer of the assets happened subsequent to the 13
th
of September 1994 but at least before the 28
th
of January 1997.
7.1
On the 8
th
of September 1997 the First Respondent was convicted of the murder of
his wife.
7.5
On the 19
th
of November 1997 and pursuant to an application launched by family
members of the First Respondent's deceased wife, the Seventh
Respondent and the Second Applicant were appointed as trustees of the
Ben Du Toit Family Trust.
7.6
On the 7
th
of October 1998 a settlement agreement was reached, which was
sanctioned by this Honourable Court, between the Second Applicant,
the Seventh Respondent, the curator ad litem for the Second to Fifth
Respondents a and the First Respondent and his wife at the
time. In
terms of this agreement it was agreed that all the assets of the Ben
Du Toit Family Trust would be sold and that upon
sale of all the
assets the Second Applicant and the Seventh Respondent would resign
as trustees of the Ben Du Toit Family Trust.
7.7
All the assets of the Ben Du Toit Family Trust except for one
immovable property, being a game farm, were sold by way of a public
auction on the 26
th
of November 1998.
7.8
The Second Applicant and the Seventh Respondent resigned as trustees
on the 11
th
of January 1999.
7.9
Upon their resignation as trustees a nominee of ABSA Trust, being
Martha Magdalena Prinsloo, was appointed as trustee of the
trust.
7.10
On the 9
th
of December 2003 the trust was sequestrated by order of this Court
upon an application made by Prinsloo in her capacity as trustee
of
the trust. The application for the sequestration was precipitated by
a demand by the First Respondent for repayment of moneys
which he
alleged was owing to him in terms of a loan account.
See:
Record, p.9-15; p. 15-35; p.91-103.
8.
Since the settlement agreement which led to the sale of the
properties and the resignation by the Second Applicant and the
Seventh
Respondent as trustees of the trust, the Respondents have
instituted four actions/applications to seek redress for the alleged
unlawful conduct of the trustees. These were:
8.1
an application launched in December 1998 to set aside the sale of the
properties and interdict the transfer thereof. This application
was
dismissed.
See:
Record, p. 36; p.127.
8.2
The second was an application launched on an urgent basis under case
number 1164/2003 wherein the Respondents inter alia sought
to set
aside the sale of the properties and an order that the Second
Applicant and the Seventh Respondent restore the trust to
the
position it was at their appointment as trustees. This application
was struck from the roll for lack of urgency and apparently
abandoned
by the First Respondent.
See:
Record, p.38-40; p.140-224.
8.3
The Respondents instituted an action under case number 19546/07 for
damages based on the same cause of action and factual allegations
as
the present action. This action was disposed of in the following
mannen-
8.3.1
The summons and particulars of claim consisted of more than 450
pages. It included voluminous and irrelevant annexures. The
Second
Applicant was not joined as a defendant in that action. An
application in terms of Rule 30 was launched seeking to strike
out
the annexures to the particulars of claim. This application was
upheld.
8.3.2
An exception was filed to the particulars of claim. The Respondents
delivered a notice of intention to amend to which the
First Applicant
objected.
8.3.3
The Respondents filed an ex parte application to join the Second
Applicant as a defendant and filed an application for leave
to amend.
8.3.4
The Second Applicant sought leave to intervene in the joinder
application. After the Second Applicant's intervention the
application to join him as defendant was dismissed.
8.3.5
The application for leave to amend the particulars of claim was
dismissed.
8.3.6
The original exception to the particulars of claim was upheld. The
Respondents failed to amend.
8.3.7
An application to dismiss the action was filed whereafter the
Respondents withdrew the action.
See:
Record, p. 50-54; p.329-368.
8.4
Summons in the present action was issued on the 1
st
of December 2009. The Defendants have not yet pleaded but instead the
First and Second Applicants have launched the present application.
The Respondents have filed a notice of intention to amend their
particulars of claim increasing the claim to R652,657,276.00. No
objection was filed to this notice of intention to amend but the
Respondents have not pursued the amendment in that they have not
filed amended pages.
9.
Apart from these proceedings the First Respondent has also laid a
complaint with the Public Accountants and Auditors Board against
the
Second Applicant. After some investigation the Board and its
successor, IRBA, concluded that there was no prospect of success
in
the disciplinary enquiry and no further steps were taken against the
Second Respondent.
See:
Record, p.39-42; p. 224-268.
10.
The Second Respondent was also summonsed to appear at an insolvency
enquiry on the 19
th
of August 2004 into the affairs of the insolvent estate of the
trust."
(3.3)
Applicants' case
3.3.1
In essence the Applicants argue that the actions instituted by the
Respondents (especially the First Respondent) are vexatious,
without
substance and an
abuse
of the Court proceedings as more fully set out in the following
sub-paragraphs.
3.3.2
In essence the Applicants say that the unlawful conduct complained of
by the Respondents has nothing to do with the Applicants
as they had
nothing to do with same. In any event, there has been a settlement
which was implemented.
3.3.3
Furthermore, in terms of the settlement between the trustees and the
beneficiaries (including all the Respondents) it was
agreed that all
the assets of the trust would be sold. The nett proceeds from the
sale of the assets would be invested and ABSA
took over as trustee.
3.3.4
in short, the Second Applicant and the Seventh Respondent's
involvement in the trust terminated on the
11
th
of January 1999
and the damages
claimed by the Respondents have no casual nexus with the alleged
unlawful conduct.
3.3.5
In any event, (so the Applicants say) the alleged claims of the
Respondents have prescribed.
3.3.6
During argument, the Respondents also raised the issue that the Sixth
Plaintiff (Aletta Catharina du Toit) is still a minor.
This impacts
on prescription.
3.3.7
Only Mr Steyn (on behalf of the Applicants) filed supplementary heads
in this regard.
3.3.8
In this regard the provisions of section 13(1)(i) of the Prescription
Act read together with subsection (1)(a) are applicable.
3.3.9
The effect of this section of the Prescription Act is that
prescription continues to run against a minor Plaintiff but that
the
prescription is not completed until a period of one year has expired
from the date that the Plaintiff has reached the age of
majority.
3.3.10
The gist of Mr Steyn's argument is briefly as follows (as per his
supplementary heads of argument):
"5.
The fact that the Sixth Plaintiff was also a party to the action
instituted in 2007 has not affected the protection that
she as a
minor has in terms of section 13(1)(i) of the Prescription Act.
Similarly the institution of this action, should it be
withdrawn or
barred, would not affect the protection afforded to her as a minor.
8.
It is not alleged by the Plaintiffs that any one of them has a
divisible claim against the Defendants separate and independent
from
the other Plaintiffs.
9.
The fact that the Sixth Plaintiff is still a minor cannot assist the
Plaintiffs as a group.
12.6
The Plaintiffs cannot now, nine years after the resignation of Messrs
Blom and Van Rooyen, in their own name institute an action
for the
recovery of damages which is calculated on the devaluation of the
trust assets which occurred between November 1997 and
December 1998
because:
12.6.lit
is not damages that they have suffered in their own name or as a
group;
12.6.2the
damages that the trustees nomine officio for the trust allegedly
suffered has prescribed;
12.6.3any
derivative action by the beneficiaries upon the failure of the
trustees for the trust has prescribed."
3.3.11
Reference to various authorities were also made which are
well-known and not necessary to repeat.
(3.4)
Respondents case
3.4.1
The Respondents confirm that the
facts
are
common cause which has been
referred to in paragraph 3.2 above.
3.4.2
In a nutshell Mr Swanepoel, on behalf of the Respondents argues as
follows:
3.4.2.1
Firstly, it is argued that the previous matters cannot be considered
as vexatious in that they are not by a long shot as
numerous as those
that came up in instances where the Courts have granted relief under
the Act (Act 3 of 1956).
3.4.2.2
Secondly, in none of the previous matters were the merits of
Respondents' claim/s ever considered, and on each occasion
the matter
was disposed of on a technicality.
3.4.2.3
Thirdly, the following are referred to in the heads of argument
(paragraph 4 thereof):
"4,
Applicants aver that the 11 farms which constituted the majority of
the trust assets were in a poor state when the trustees
took over the
management thereof. (4) This does not explain the following:
Why
the trustees appointed a farm manager with no experience in ostrich
farming;
Why
some 319 ostriches died of hunger in less than a year;
Why
if the trust only owed some R 60 000.00 when the trustees took over,
and had no overdraft, they incurred an overdraft of R1.5
million in
less than a year, in contravention of the Court order which
authorised an overdraft of only R 500 000.
Why
no business plan was prepared.
Why
the assets were sold in direct breach of the settlement agreement
without any attempt to market same.
Why
the farms were sold at R 500.00 per hectare by the trustees when in
1996 First Respondent had attained a price of R 5 400.00
per hectare
for an adjacent farm."
3.4.2.4
Fourthly, the Respondents alleged that the Applicants have not in any
satisfactory manner dealt with Respondents' contention
that they were
grossly negligent in managing
the
affairs of the trust, and so such denial is found in the Applicants'
papers.
3.4.2.5
Lastly, the issue of the Sixth Respondent being a minor (paragraph
3.3.6 above) is raised.
(3.5)
The Law:
3.5.1
It is trite law that the "doors of the Court" are not
lightly close to a litigant. In this regard the following
is stated
by Solomon AJ (although before the Act) in
Western
Assurance Co v Caldwell's Trustees 19'8 A.D. 262 (at 273):
"strong
grounds must be shown to justify a court in granting so exceptional a
remedy. The Courts of law are open to all, and
it is only in very
exceptional circumstances that the doors will be closed on anyone who
desires to prosecute an action".
3.5.2
Also see:
Argus
Printing & Publishing Co Ltd v Anastassiades
(1954) 1 ALL SA 111
(W)
where
the test to be applied is set out as follows:
"It
seems clear from these decisions that the elementary right of free
access to the courts should not be interfered with by
the summary
dismissal of an action without hearing evidence, on the ground that
it is vexatious, unless it is manifest that the
action is so
unfounded that it could not possibly be sustained. It must be quite
clear that failure of the action is a foregone
conclusion".
3.5.3
The fundamental right of access to the courts have been once again
dealt with by the Constitutional Court in Road Accident
Fund v
Mdeyide 2011(2) SA26 CC at p30 where the following was said:
"[1.]
The fundamental right of access to courts is essential for
constitutional democracy under the rule of law
(According
to s 1(c) of the Constitution, the Republic of South Africa is a
sovereign democratic State founded on the
values
of, inter alia, supremacy of the Constitution and the rule of law.)
In
order to enforce one's rights under the Constitution, legislation and
the common law, everyone must be able to have a dispute
that can be
resolved by the application of law, decided by a court. The right of
access to courts in thus protected in the Constitution
(Section
34 of the Constitution states: 'Everyone has the right to have any
dispute that can be resolved by the application of law
decided in a
fair public hearing before a court or, where appropriate, another
independent and impartial tribunal of forum.')
[2.]
In the interests of social certainty and the quality of adjudication,
it is important, though, that legal disputes be finalised
timeously.
The realities of time and human fallibility require that disputes be
brought before a court as soon as reasonably possible.
Claims thus
lapse, or prescribe, after a certain period of time. If a claim is
not instituted within a fixed time, a litigant may
be barred from
having a dispute decided by a court. This has been recognised in our
legal system - and others - for centuries."
(3.6)
Apart from other authorities both counsel also referred to:
Ernest
& Young & Others v Beinash & Others 1999(1) SA 1114, at
1138-1139
Beinash
& Another v Ernest & Young & Others 1999(2) SA 116 (CC),
at 120-122
[4]
CONCLUSION:
(4.1)
Taking all the circumstances into account, I have not been persuaded
that the relief sought should be granted.
(4.2)
Therefore, I make the following order:
(a)
"The application for postponement is dismissed with costs".
(b)
"The application is dismissed with costs".
GOODEY
AJ
Counsel
for Applicants:
Adv
JF Steyn
Attorneys
for Applicants:
DENEYS
REITZ
C/o
MOTHLE JOOMA SABDIA INC
1
st
Floor, Duncan Manor
Cnr
Duncan & Brooks Street
Brooklyn
Pretoria
Counsel
for Respondents:
Adv
JJC Swanepoel and J de Beer
Attorneys
for the Respondents:
GALLOWAY
VAN COLLER & GRIESSEL
C/o
TIM DU TOIT ATTORNEYS
433
Roderick Avenue
Lynnwood
Pretoria