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[2023] ZAFSHC 83
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De Bruyn N.O. and Another v Koot Oosthuizen Attorneys and Another (A65/2022; 3668/2021) [2023] ZAFSHC 83 (24 March 2023)
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IN THE HIGH COURT
OF SOUTH AFRICA,
FREE STATE
DIVISION, BLOEMFONTEIN
Appeal Case Number:
A65/2022
Court a quo case number:
3668/2021
Reportable:
YES/NO
Of Interest to other
Judges: YES/NO
Circulate
to Magistrates: YES/NO
In the matter between: -
CORNELIUS
JOHANNES DE BRUYN N.O.
First Appellant
CORNELIUS JOHANNES DE
BRUYN N.O.
Second Appellant
and
KOOT OOSTHUIZEN
ATTORNEYS
First Respondent
MASTER OF THE HIGH
COURT, BLOEMFONTEIN
Second Respondent
CORAM:
MBHELE, DJP, VAN ZYL, J, BOONZAAIER, AJ
HEARD
ON:
02 DECEMBER 2022
DELIVERED
ON:
24
MARCH 2023
[1]
This is an appeal against the cost order in the judgment of a single
Judge of this
division delivered on 25 November 2021 wherein the
court a quo ordered that each party shall pay their own costs after
the parties
entered into a settlement agreement on the date of the
hearing.
[2]
The appellants, aggrieved by the
decision of the court a quo not to award costs in their
favour,
approached this court on appeal. The appellants submitted that the
court a quo failed to exercise its discretion judicially
when it did
not find that the first respondent conceded all of the relief prayed
for by the appellants, save for costs and that
they were
substantially successful and were entitled to a cost order in their
favour. They further contended that the court a quo
erred in finding
that the first respondent was justified in opposing the application
based on its apprehension that its fees would
not be paid.
[3]
The germane facts are the following. The appellants approached the
court a quo and
moved an application in which they sought files of
the estates of the late Magdalena Pienaar De Bruyn and the late
Hendrick Petrus
De Bruyn (deceased estates) from the first
respondent. The parties reached a settlement on the date of the
hearing but could not
agree on the issue of costs. The following are
the terms of the settlement which became an order of court:
1.
‘The First Respondent shall, within fourteen days of date of
this order,
release all such documents contained in its file(s)
pertaining to the estates set out in paragraphs 1.1 and 1.2 below
into the
possession of the Applicant.
1.1
Estate Late Magdalena Pienaar De Bruyn, Estate number [....];
1.2
Estate Late Hendrik Petrus De Bruyn, Estate number [....];
2.
The First Respondent shall within fourteen (14) days of date of this
order, draft
a bill of costs on an attorney and client scale in
respect of the work done by the First Respondent in the
administration of the
estates set out in paragraphs 1.1 and 1.2 and
submit such bill of costs together with copies of the file(s) and
documents referred
to in paragraph 1 (one above to the Master of the
High Court, alternatively the Legal Practice Council to be taxed in
terms of
Regulation 10.1 and 10.2 of the Regulations published under
Government Gazette 42337 of 29 March 2019 for the purpose of
determining
what fee the First Respondent is entitled to for work
done in respect of the administration of the estates set out in
paragraphs
1.1 and 1.2 above;
3.
The Applicant shall upon the determination of the First Respondent’s
reasonable
fees(s) as contemplated in paragraph 2 above, furnish
adequate security in the form of an office undertaking by the
Applicant’s
attorneys for the payment of the amount so
determined by the Master by the Legal Practice Council in the
aforementioned taxation
to be due to the First Respondent, which
amount shall be payable upon finalisation of the administration of
the two estates set
out in paragraph 1.1 and 1.2 above.
4.
The First Respondent shall make payment to the Applicants’
legal representative
trust account, PHH Badenhorst Incorporated, FNB,
Account number: [....], of the funds under its control in
favour of the
estates listed in paragraph 1.1 and 1.2 above within
fourteen (14) days of the date of this order.’
[4]
The second appellant and his
brother (erstwhile co-executor) were co-executors of the
aforementioned deceased estates. The first respondent was appointed
as the representative of the erstwhile co-executor of the two
aforementioned estates. The erstwhile executor was finally
sequestrated on 10 September 2020 leading to his automatic
disqualification
as the executor in the estates.
[5]
The erstwhile co- executor resigned on 8 March 2021 leaving the
second applicant as the sole executor of the estate. His resignation
terminated the mandate of the first respondent as the erstwhile
co-executor’s agent. The first respondent, in his capacity
as
the representative of the erstwhile co-executor, had administration
files, bank details as well as important documents relating
to the
estate in its possession.
[6]
The second appellant demanded
all documentation and bank account details of the estates
from the
first respondent after the erstwhile co-executor resigned. The first
respondent refused to hand over the requested documents
within 14
days as demanded, it asserted that it held a lien on the requested
documents. The first respondent informed the appellants
that in view
of the fact that the first respondent had already drafted the
liquidation and distribution accounts on both estates,
it sought an
opinion from the second appellant regarding the administration of the
estates and the amount of administration costs
payable to the first
respondent for the administration services rendered until the date of
resignation of the erstwhile co-executor.
[7]
The first respondent submitted
that it was awaiting guidance from the second respondent.
It
submitted, further, that there was an issue with security to be
provided by the appellants and that the parties were not in
agreement
as to the tariff the respondent may levy for the services rendered.
This dispute was only settled on the date of the
hearing.
[8]
The first respondent contended
that a long family feud between the appellant, the erstwhile
co-executor and their late father created a mistrust between the two
brothers making it difficult for the first respondent to release
the
requested documents without a guarantee that its account would indeed
be settled once the files have been released.
[9]
The appellants, through their
legal representative, and the first respondent exchanged
correspondence wherein each party communicated their views on what
the way forward should be in the matter. The first respondent
informed the appellants in a letter dated 11 June 2021 that it was in
the process of obtaining an opinion from the second respondent
and
that it was not at that stage in a position to provide a breakdown of
the costs. It wrote a follow up letter on 14 June 2021
asserting its
right of retention. The appellants responded to these letters on 04
August 2021 requesting the first respondent to
draft its bill of
costs and submit it to the second respondent for taxing. On 12 August
the appellants filed the application in
the court a quo.
[10]
The general rule in litigation is that the successful party is
entitled to an order for costs.
See
Texas
Co. (S.A.) Ltd. v Cape Town Municipality
[1]
. The
court, however, retains the discretion to award costs which
discretion must be exercised judicially based on legal principles.
As
the starting point the court must determine whether any costs are
payable to any of the parties. Once the court has decided
that costs
are payable it has to decide who of the parties is entitled to costs.
This exercise cannot be embarked on capriciously
or by chance, there
should be sound legal principles upon which the decision is based.
[11]
In
Trencon
Construction (Pty) Ltd v Industrial Development Corporation of South
Africa Ltd and Another
[2]
Khampepe J remarked as follows quoting with authority
National
Coalition for Gay and Lesbian Equality and Others v Minister of Home
Affairs and Others
[3]
‘
[88]
When a lower court exercises a
discretion in the true sense, it would ordinarily be inappropriate
for an appellate court to interfere unless it is satisfied that this
discretion was not exercised —
'judicially,
or that it had been influenced by wrong principles or a misdirection
on the facts, or that it had reached a decision
which in the result
could not reasonably have been made by a court properly directing
itself to all the relevant facts and
principles'.
An
appellate court ought to be slow to substitute its own decision
solely because it does not agree with the permissible option
chosen
by the lower court.
[89]
In
Florence
[4]
Moseneke
DCJ stated:
'Where
a court is granted wide decision-making powers with a number of
options or variables, an appellate court may not interfere
unless it
is clear that the choice the court has preferred is at odds with the
law. If the impugned decision lies within a range
of permissible
decisions, an appeal court may not interfere only because it
favours a different option within the range. This
principle of
appellate restraint preserves judicial comity. It fosters certainty
in the application of the law and favours finality
in judicial
decision-making.'
[12]
A court exercising a wide discretion may choose from all the options
at its disposal and award
a cost order that it considers just in the
circumstances of the case at hand. The court of appeal can only
interfere if it is of
the view that such order is not within the
confines of the law. T
he
court has to,
inter
alia
,
consider the conduct of the parties during the actual litigation
process, all other matters that lead up to and occasioned the
litigation and whether there were attempts to settle the matter
before and during the litigation. The extent to which a party raised,
pursued or contested a particular issue and whether it was reasonable
for that party to pursue that issue. The court must consider
whether
a successful party exaggerated its claim in the course of litigation
and whether it was necessary for the opposing party
to oppose the
claim stated in that manner. See
Fripp
v
Gibbon &
Co
[5]
[13]
In
Fripp
v Gibbon
the court
further held:
'I
agree that as a rule it is fair and just that the costs should follow
the event, whether of claim or of counterclaim. But I cannot
agree
with the view that the unsuccessful party should bear the burden of
all the costs simply on the ground that in the final
result he is the
unsuccessful party. To me it seems more in accordance with the
principles of equity and justice that costs incurred
in the course of
litigation which judged by the event or events, prove to have been
unnecessarily or ineffectively incurred should,
as a rule, be borne
by the party responsible for such costs.'
[14]
In the current matter there was exchange of
correspondence between the parties, the last letter from the
appellants being 8 days before the application was instituted. The
first respondent had communicated its fears of its fees not
being
paid without an agreement on the scale at which such fees are payable
and assurance that they will indeed be paid if files
were released to
the appellants. It then sought guidance from the second respondent in
dealing with this issue. The animosity between
the second appellant
and the erstwhile co-executor and the fact that the director of the
first respondent, Mr. Oosthuizen was reported
to the Free State Law
Society in the process of that feud made it difficult for the first
respondent to just release the requested
documents without some form
of security or guarantee which guarantee the second appellant was not
in a position to offer.
[15]
The second appellant was not willing to concede to the costs on
attorney and client scale until
the date of hearing when the matter
was eventually settled. It is only after the Master responded to the
enquiry from the first
respondent that the parties could settle the
matter and the second appellant agree to the first respondent’s
costs on an
attorney and client scale. It was not unreasonable for
the first respondent to pursue its opposition of the application
owing to
the prevailing circumstances. The court a quo considered all
these factors when exercising its discretion. I am unable to find
that the court a quo failed to exercise its discretion judicially.
The appeal ought to fail.
[16]
I make the following order:
[17]
ORDER:
1.
The appeal is dismissed with costs.
2.
The order of the court a quo is upheld.
3.
The appellants to pay costs of the first respondent.
4.
Costs to include that of Counsel.
N.M. MBHELE, DJP
I concur.
C. VAN ZYL, J
I concur.
S. BOONZAAIER, AJ
Appearances:
For the
Appellants:
Adv. R. Van Der Merwe
Instructed by
Badenhorst Attorneys
Bloemfontein
For the Respondents:
Adv. J.C. Coetzer
Instructed
by
Lovius Block Attorneys
Bloemfontein
[1]
Texas Co. (S.A.) Ltd. v Cape Town Municipality
1926
AD 467
at 488
‘
Now costs are
awarded to a successful party in order to indemnify him for the
expense to which he has been put through having
been unjustly
compelled either to initiate or to defend litigation ‘.
[2]
2015(5) SA 245 CC at par. 88 &89
[3]
2000
(2) SA 1
CC ZACC 17) para 11
[4]
Florence v Government of the Republic of South Africa
2014 (6) SA
456
(CC)
(2014 (10) BCLR 1137
;
[2014] ZACC 22)
(Florence) para
111.
[5]
Fripp
v Gibbon & Co.
1913 AD 354
at 363