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[2021] ZAGPPHC 37
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Moseia and Others v Master of the High Court: Pretoria and Others (36201/2018) [2021] ZAGPPHC 37 (26 January 2021)
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Note:
Certain
personal/private details of parties or witnesses have been
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IN THE
HIGH COURT OF SOUTH AFRICA
(GAUTENG DIVISION, PRETORIA)
REPUBLIC
OF SOUTH AFRICA
(1)
REPORTABLE: NO
(2)
OF INTEREST TO OTHER JUDGES: YES/NO
(3)
REVISED
DATE:
…26 JANUARY 2021
Case
Number: 36201/2018
MITTAH
KHOBOT MOSEIA
First
Applicant
SAMUEL
FIKI MABULA
Second
Applicant
THABO
SIMON MOHALE
Third
Applicant
And
MASTER
OF THE HIGH COURT: PRETORIA
First
Respondent
JACOB
SEKGETHI MOTAUNG N.O.
Second
Respondent
CLIFFORD
RAKGOLO MASHEGO
Third
Respondent
MOTLALEPULE
GASTINAH MASHEGO
Fourth
Respondent
REGISTRAR
OF DEEDS: PRETORIA
Fifth
Respondent
EKURHULENI
METROPOLITAN MUNICIPALITY
Second
Respondent
JUDGMENT
JANSE
VAN NIEUWENHUIZEN J
[1]
This application emanates from the passing
of Flora Motaung (“the deceased”) on 18 June 2015 and
pertains to the subsequent
administration of her deceased estate.
Parties
[2]
The deceased died testate in terms of a
Last Will and Testament (“the will”) executed on 22
September 2009.
[3]
The first applicant, Moseia Mittah Khobot,
is the nominated executrix and heir in terms of the will of the
deceased. The deceased
was the first applicant’s paternal aunt.
[4]
The second respondent, Samuel Fiki Mabula,
is a co-heir in terms of the will.
[5]
The third respondent, Simon Mohale, is a
beneficiary in terms of the will.
[6]
The first respondent, the Master of the
High Court (“the Master”), is cited in his/her official
capacity, appointed
in terms of
section 2
of the
Administration
of Estates Act, 66 of 1965
.
[7]
The second respondent, Jacob Sekgethi
Motuang, who was appointed by the Master on 11 August 2015 as the
Master’s representative
in the late estate of the deceased in
terms of a Letter of Authority No: 010104/2015.
[8]
The third and fourth respondents are cited
in their capacity as the co-owners of the property.
[9]
The fifth respondent, the Registrar of
Deeds (“the Registrar of Deeds”), cited in her capacity
as the custodian of the
records of immovable properties registered in
the Deeds Office.
[10]
The sixth respondent, Ekurhuleni
Metropolitan Municipality, is cited in its capacity as having
jurisdiction over the property in
dispute.
Background
[11]
The deceased did not have any children and
left no descendants when she passed away on 18 June 2015.
[12]
Prior to her death, the deceased resided
with the first applicant, who cared for the deceased, for a period of
five years. During
this period the deceased informed the first
applicant of the will and advised the first applicant that the will
was is in the custody
of Pretorius Osborne & Partners, the
deceased’s attorneys in Kempton Park.
[13]
Subsequent to the deceased’s passing
and during October 2015 the first applicant attended at the offices
of the deceased’s
attorneys who confirmed the will and informed
the first applicant that she was nominated as co-executor with a
certain Johan van
Aswegen.
[14]
The attorneys undertook to report the
estate of the deceased to the Master.
[15]
The first applicant visited the offices of
the deceased’s attorneys in May 2016 to follow up on the
progress in the winding
up of the estate of the deceased. To her
shock and amazement, the first applicant was informed that the second
respondent had already
reported the estate to the Master by
misrepresenting to the Master that he was the son of the deceased.
The misrepresentation led
to the Letter of Authority being issued to
the second respondent.
[16]
It is not clear from the papers what the
relationship between the deceased and the second respondent was.
[17]
In administrating the estate of the
deceased, the second respondent, purporting to be the only biological
child of the deceased,
caused the deceased’s property known as
[….] (“the property”), to be transferred
from the deceased
estate into his name.
[18]
The second respondent, thereafter,
sold the property to the third and fourth respondents for an amount
of R 100 000, 00.
The property was duly registered in the
names of the third and fourth respondents on 2 August 2017.
[19]
The first applicant upon becoming aware of
the second respondent’s misrepresentation and fraud enlisted
the services of her
attorneys of record, who submitted the will of
the deceased to the Master on 17 November 2017.
Applicants’ case
[20]
In view of the misrepresentation and
fraudulent conduct of the second respondent, the first applicant
submits that the transfer
of the property from the late estate to the
second respondent is null and void. Consequently, the sale agreement
between the second,
third and fourth respondents as well as the
subsequent transfer of the property to the third and fourth
respondents is also null
and void
ab
intio
.
[21]
The applicants, furthermore, state that the
third respondent was well aware of the misrepresentation and
fraudulent conduct of the
second respondent.
[22]
In terms of an amended notice of motion
dated 2 March 2018, the applicants claim the following relief:
“
1
Reviewing and setting aside the First Respondent’s appointment
of the Second Respondent
dated 11 August 2015 of the representative
of the Master to take control of the assets of the Estate late Flora
Motaung (Identity
Number: 180609 0203 083) in terms of
section 18(3)
of the
Administration of Estates Act, 66 of 1965
;
2.
That the Second Respondent is directed forthwith to return to the
First Respondent
(MASTER OF HIGH COURT: PRETORIA)
the
aforesaid original Letters of Authority;
3.
That the first Respondent is directed to appoint the First Applicant
as Executrix in the late estate
Flora Motaung; Identity Number :
180609 0203 083, who died on 18 June 2015 and to issue the First
Applicant with the necessary
Letters of Executorship;
4.
That the Fifth Respondent be, and is hereby directed to cancel in
terms of Section 6 of the Deeds
Registries Act, Act No. 47 of 1937,
registration of transfer under Deed of Transfer No. T 56469/2017
intestate inheritance in favour
of second Respondent (JACOB SEKGETHI
MOTAUNG);
5.
That Deed of Sale entered into between the Second, Third and Fourth
Respondents in respect of the
immovable property more fully described
as [….], Registration Division I.R., Province of Gauteng held
in terms of Deed of
Transfer No. T56470/2017 be declared null and
void;
6.
That the Fifth Respondent be, and is hereby directed to cancel in
terms of Section 6 of the Deeds
Registries Act, Act No. 47 of 1937,
the Deed of Transfer No. T 56470/2017 registered at the Registrar of
Deeds, Pretoria onto the
names of the Third and Fourth Respondents;
7.
An order directing the Fifth Respondent to re-register the immovable
property known as [….],
Registration Division I.R., Province
of Gauteng held in terms of Deed of Transfer No. T56470/2017 into the
name of the Deceased
(Flora Motaung);”
Opposition
[23]
Only the third and fourth respondents
oppose the relief claimed by the applicants.
[24]
The third respondent deposed to the
answering affidavit and explained that the second respondent is his
mother’s boyfriend.
He was aware that the first applicant
resided with the deceased for a period of five years before her
passing on 18 June 2015.
[25]
The third respondent was aware that the
second respondent was appointed as the executor of the estate of the
deceased. During the
beginning of 2017, the second respondent
informed him and the fourth respondent that he had acquired the
property of the deceased
and that he was intent on selling it.
[26]
They were interested in purchasing the
property and after negotiations entered into a written sale agreement
with the second respondent
on 17 June 2017. Pursuant to the agreement
the property was registered in their names on 2 August 2017 in terms
of Deed of Transfer
T1756470/2017. The third respondent denies any
knowledge of the fraud perpetrated by the second respondent.
[27]
In the result, the third and fourth
respondents submit that they are
bona
fide
third-party purchasers and that
the property cannot be vindicated in their hands.
Reports
[28]
On 10 June 2019 the Master filed a report
stating that he/she does not oppose the relief claimed by the
applicants.
[29]
Insofar as the records kept in the Master’s
office is concerned, the Master confirmed the following:
31.1 the estate of
the deceased was reported by the second respondent, who purported to
be the biological son of the
deceased, on 5 August 2015. The estate
was initially reported as intestate and the second respondent was
appointed as the Master’s
representative in administering the
estate.
31.2 it has, however,
subsequently been established that the second respondent is not the
biological son of the deceased as the
deceased did not have any
children of her own;
31.2 on 18 November
2017 the Master accepted the last Will and Testament of the deceased
and the estate will now be
administered in terms of the provisions of
the will;
31.3 the letter of
authority issued in favour of the second respondent has officially
been withdrawn on 9 June 2020.
[30]
On 19 June 2019, the Registrar of Deeds
filed a report confirming the sequence of transfers referred to in
the founding affidavit.
The Registrar, further, advised as follows:
“
As
a deed of Transfer must be lodged and registered in the Deeds Office,
the Sheriff may be instructed to sign any documents on
behalf of the
owner, should a said party refuse to sign, such document.”
[31]
Save for the aforesaid, the Registrar did
not have any objection to the relief being granted insofar as it
pertains to the transfer
process in the Deeds Office.
Issues for consideration
[32]
The parties are
ad
idem
that the following issues should
be decided:
34.1
the validity of the actions of the second
respondent whilst he was still the duly appointed representative of
the Master;
34.2
were the third and fourth respondents’
bona fide purchasers?;
34.3
the legal consequences emanating from the
second respondent
’
s fraudulent
conduct in transferring the property into his name and thereafter in
selling and transferring the immovable property
to the third and
fourth respondents.
Validity of second
respondent’s actions prior to the withdrawal of his appointment
[33]
The applicants submit that the withdrawal
of the second respondent’s appointment on the grounds that the
appointment was as
a result of misrepresentation and fraud entails
that the second respondent was never entitled to administer the
estate of the deceased.
The appointment is void
ab
initio
and any actions taken by the
second respondent until his authority was withdrawn by the Master
suffers the same fate.
[34]
The third and fourth respondents do not
agree. The third and fourth respondents with reference to
MJ
v Master of the High Court and Others
(15699/2017)
[2019] ZAWCHC 8
(18 February 2019), submit that the appointment of an
executor to a deceased estate is an administrative decision and
reviewable
in the terms of the Promotion of Administrative Justice
Act, 3 of 2000.
[35]
Once the appointment is set aside, it does
not mean that the subsequent actions flowing from the appointment is
null and void. With
reference to the decision in
Oudekraal
Estate (Pty) Ltd v City of Cape Town and Others
[2004]
3 All SA 1
SCA, the third and fourth respondents submit that even an
unlawful administrative act, i.e. the appointment of the second
respondent,
is capable of legally valid consequences for as long as
the unlawful act is not set aside.
[36]
The facts
in
casu
differ somewhat from the principle
relied upon by the third and fourth respondents. In the present
matter the appointment of the
second respondent was not due to an
unlawful decision by the Master, but due to the second respondent’s
fraud and misrepresentation.
[37]
In
Firstrand
Bank Ltd t/a Rand Merchant Bank and Another v The Master of the High
Court, Cape Town
case no: 679/13 (11
November
2013), ZAWCHC, 2013
, 173, the court considered the effect of
a fraudulent misrepresentation by an attorney to the Master in an
application to hold
an enquiry in terms of section 417 and 418 of the
Companies Act, 61 of 1973.
[38]
The court held as follows at paragraphs
[20] to [22]:
“
[20]
It is trite that the effect of fraud is far-reaching. In Farley
(Aust) Pty Ltd v JR Alexander & Sons (Qld)
Pty Ltd
[1946] HCA 29
;
(1946) 75 CLR 487
the High Court of Australia, per Williams J, said
this:
‘
Fraud
is conduct which vitiates every transaction known to the law. It even
vitiates a judgment of the Court. It is an insidious
disease, and if
clearly proved spreads to and infects the whole transaction.’
[21]
And in Lazarus Estates Ltd v Beasley
[1956] 1 QB 702
(CA) at 712 one
finds Lord Denning’s well known remarks:
‘
No
court on this land will allow a person to keep an advantage which he
has obtained by fraud. No judgment of a court, no order
of a
Minister, can be allowed to stand if it has been obtained by fraud.
Fraud unravels everything. The court is careful not to
find fraud
unless it is distinctly pleaded and proved; but once it is proved, it
vitiates judgments, contracts and all transactions
whatsoever.’
[22]
In South Africa the ‘insidious effect of fraud permeates the
entire legal system’.
It renders contracts voidable. It is one
of the elements of delictual liability. It constitutes a crime. Fraud
excludes the effect
of an ouster clause in legislation. See
Narainsamy v Principal Immigration Officer
1923 AD 673
at 675. It
also nullifies a contractual exemption clause which purports to
exclude a party from the consequences of fraudulent
conduct. See
Wells v SA Alumnite
1927 AD 69
at 72.”
[39]
It follows that the fraud perpetrated by
the second respondent vitiates his appointment by the Master. This
would entail that any
actions taken by the second respondent as a
result of the fraud is similarly tainted and has no legal effect.
[40]
As stated in
Lazarus
Estates Ltd
referred to in the
FirstRand Bank Ltd
matter,
supra “Fraud unravels
everything”
.
Are the Third and fourth
respondents
bona fide
purchasers?
[41]
The principle underpinning the vitiating of
transactions as a result of fraud is that a fraudster should not be
allowed to benefit
from the proceeds of the fraud.
[42]
The third and fourth respondents were, on
the common cause facts, not part of the fraudulent scheme. The
question then arises whether
they were aware of the fraud?
[43]
In the founding affidavit, the first
applicant made a single bald allegation that the third respondent
knew about the fraud. The
allegation is not substantiated by any
facts and reads as follows:
“
5.4.27
I submit that the sale agreement and subsequent transfer
of the
property of the Deceased is null and void ab initio on the basis that
it was as a result of misrepresentation and fraudulent
conduct of the
Second Respondent. The Third Respondent was well aware of the
misrepresentation and fraudulent conduct of the Second
Respondent.
Further submission and argument will be adduced in Court on the date
of the hearing.”
[44]
In response to this allegation, the third
respondent answered as follows:
“
18.
At the time we concluded the Agreement, we were not aware nor made
aware:
“
18.1
That on 2 August 2017, Motuang became the owner of the Property,
having acquired it from the Deceased’s
estate by way of
intestate
inheritance;
18.2
That Motaung had misrepresented himself as the son of the Deceased at
any time, as alleged or
at all;
18.3
That Motaung had perpetrated fraud in relation to the Deceased’s
late estate, at any time,
as alleged or at all;
18.4
Of the “misrepresentation” and “fraudulent conduct”
of Motaung as alleged
in paragraph 5.4.27 of the founding affidavit
or any “underhand tactics” of Motaung as alluded to in
paragraph 5.4.32
of the founding affidavit; or
18.5
That Motaung could not lawfully pass transfer of ownership in the
Property to us.”
[45]
The third respondent stated that he and the
fourth respondent only learnt of the fraud complaints on receipt of a
letter from the
applicant’s attorneys on 15 December 2017, some
four months after the immovable property was registered in their
names and
six months after the sale agreement was signed.
[46]
In view of the third and fourth
respondents’ denial that they were aware of the fraud, the
first applicant’s bald allegation
that the third respondent
knew about the fraud without any facts to substantiate the allegation
is not sufficient to prove the
allegation.
[47]
In the premises, the third and fourth
respondents’ assertion that they were unaware of the fraud
stands and they are considered
to be
bona
fide
purchasers.
The legal consequences of
fraud resulting in the transfer of property to
bona fide
purchasers
[48]
The applicants submit that, should the
court find that the third and fourth respondents were
bona
fide
purchasers, they are still
entitled to vindicate the property from the third and fourth
respondents.
[49]
In support of the aforesaid contention the
applicants rely on the following extract from
Nedbank
Limited v Mendelow NO
(686/12)
[2013]
ZASCA 98
, paragraph [12]:
“…
it
is trite that were registration of a transfer of immovable property
is effected pursuant to fraud or a forged document ownership
of the
property does not pass to the person in whose name the property is
registered after the purported transfer. Our system of
deeds
registration is negative: it does not guarantee the
title that appears in the deeds
registry. Registration is intended to protect the real rights of
those persons in whose names such
rights are registered in the Deeds
Office. And it is a source of information about those rights. But
registration does not guarantee
the title, and if it is affected as
result of a forged power of attorney or fraud,
then the right
apparently created is no right at all.”
[50]
The third and fourth respondents in answer
rely on the abstract theory of transfer which was explained in
Quartermark Investments (Pty) Ltd v
Mkhwanazi and Another
2014 (3) SA 96
SCA as follows at paragraph [24]:
“
This
court, in Legator Ms Kenna Inc and Another v Shea and Others
[1]
confirmed that the abstract theory of transfer applies to movable as
well as immovable Property. According to that theory the validity
of
the transfer is not dependent upon the validity of the underlying
transaction.
[2]
However, the passing of ownership only takes place when there has
been delivery effect by registration of transfer coupled with
what
Brand JA, writing for the court in Legator McKenna, referred to as a
‘
real
agreement
’
.
The learned judge explained that
‘
the
essential elements of the real agreement are an intention on the part
of the transferor to transfer ownership and the intention
of the
transfer to become owner of the property.
[3]
”
[51]
On the strength of the aforesaid authority,
the third and fourth respondents submit that the second respondent in
his capacity as
representative of the deceased estate had the
intention to transfer the property to himself in his personal
capacity and the second
respondent in his personal capacity had the
necessary intention to become the owner of the property.
[52]
This submission, however, loses sight of
the fact that the second respondent due to his fraud and
misrepresentation was never authorised
to represent the late estate.
[53]
As a result he could not in his capacity as
“
representative
”
of the late estate form an intention on behalf of
the estate to transfer the property to himself. Only a true
representative or
executor of the deceased estate could form an
intention to transfer the property. In the result there was no real
agreement to
transfer and the transfer is void
ab
initio
.
[54]
In respect of the third and fourth
respondents, the transfer from the second respondent to them suffers
the same fate as correctly
pointed out by the applicants with
reference to the authority
supra
.
(Also see:
Sterling v Fairgrove (Pty)
Ltd and Others
2018 (2) SA 469
GJ.)
[55]
In the result, the transfer of the property
from the deceased estate to the second respondent was, due to the
fraud perpetrated
by the second respondent, void
ab
initio
. Consequently, the second
respondent never became the owner of the immovable property and could
not pass ownership thereof to the
third and fourth respondents.
[56]
This contention is in line with the
authorities
supra
stating
that fraud unravels all subsequent transactions, even, as in this
instance, a subsequent sale to
bona fide
purchasers.
[57]
In the premises, the applicants are
entitled to the relief sought herein.
[58]
The third and fourth respondents are not
left remediless. They still have a claim against the second
respondent for any losses suffered
by them as a result of the
vindication.
ORDER
[59]
In the premises, I grant the following
order:
1.
The Fifth Respondent is hereby directed to cancel and remove from her
records the Deed of
Transfer No. T 56469/2017 issued by her in
respect of [….].
2. The
Deed of Sale entered into between the Second, Third and Fourth
Respondents in respect of the immovable
property more fully described
as [….], Registration Division I.R., Province of Gauteng held
in terms of Deed of Transfer
No. T56470/2017 is declared null and
void;
3. The
Fifth Respondent is hereby directed to cancel and remove from her
records the Deed of Transfer No.
T 56470/2017 issued by her in
respect of [….].
4. The
third and fourth respondents are ordered to pay the costs of the
application.
N. JANSE VAN NIEUWENHUIZEN
JUDGE OF THE HIGH COURT OF
SOUTH AFRICA
GAUTENG DIVISION, PRETORIA
[1]
Legator
McKenna Inc & another v Shea & others
2010
(1) SA 35
(SCA)
paras 20-22.
[2]
Ibid
para 20.
[3]
Ibid
para 22.