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[2015] ZAGPPHC 391
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Nedbank Limited v Maloka N.O (2014/23242) [2015] ZAGPPHC 391 (17 May 2015)
REPUBLIC OF SOUTH
AFRICA
IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG DIVISION,
PRETORIA
CASE NO: 2014/23242
DATE: 17 MAY 2015
In the matter between:
NEDBANK
LIMITED
........................................................................................................
APPLICANT
And
MMATJALE FLORA MALOKA
N.O
.........................................................................
RESPONDENT
JUDGMENT
TWALA AJ
[1] On the 24th November 2014 this
court made an order in the following terms:
1.1 That the estate of the late Harry
Morwamocha Maloka be and is hereby place under provisional
sequestration.
1.2 That a Rule Nisi is issued calling
upon the respondent and all interested parties to show cause, if any,
to this court on 9th
March 2015 as to why:
1.2.1 A final sequestration order
should not be granted.
1.2.2 The costs of this application,
including the costs of the 24th November 2014 should not be costs in
the sequestration of the
estate.
1.3 That service of this order should
be effected as provided for in the Insolvency Act.
[2] It appears from the papers filed of
record that there was a delay in obtaining the court order from the
court due to the fact
that the court file could not be located. On
the 9 March 2015 the rule nisi could for this reason not be
confirmed. It was extended
to the 18 May 2015.
It is to be noted that the respondent
has at all times been opposed to this sequestration application. It
is common cause that she
is the daughter of the deceased and an
executrix in the estate. Further, she is a practising attorney.
[3] At the commencement of this
hearing, the respondent brought an application for a postponement and
tendered the costs for the
postponement The respondent argues that
she made a bona fide mistake when submitting the Liquidation and
Distribution account to
Master of the high Court and when she
admitted on affidavit that the estate is insolvent. The fact of the
matter is that the estate
is solvent for there is an asset worth R30,
million which when realised would extinguish the debt of the
applicant. Further, there
are no other creditors to the estate since
the South African Revenue Service (SARS) and Limpopo Development
Agency (Limdev) have
been paid in full.
[4] The respondent contends further
that the R30 million debt due to the applicant is not owed by the
estate alone. It is jointly
and severally owed by the estate and Mr
Conrad Hedrick Kruger who co-signed as surety with the deceased. The
applicant has entered
into a compromise agreement with Mr Kruger for
payment of a total sum of R6, million. The respondent as well as
other heirs to
the estate attended a meeting in Cape Town in January
2015 with one Dana van Zyl of the applicant. In this meeting,
agreement was
reached that the estate pays a sum of R480 000 in
February 2015 and thereafter R60 000 per every succeeding month. To
date hereof
the respondent has discharged her obligations in terms of
this agreement.
[5] The applicant argues that the
respondent wrote a letter to the Master of the High Court advising
that the estate is insolvent.
Once the estate is noted as insolvent
by the Master, then it falls to be dealt with under the Insolvency
Act. Further, the property
that is alleged to be worth R30, million
does not belong to the estate. It belongs to a company wherein the
deceased was a director
which company is under liquidation. The
property itself has not been valued. The respondent, as executrix of
the estate, has failed
to list the applicant as one of the creditors
of the estate in the liquidation and distribution
account submitted to the Master.
Although the respondent alleges to have settled the accounts of the
South African Revenue Service
and the Limpopo Development Agency, she
failed to list them as creditors on the liquidation and distribution
account. The January
2015 agreement entered into by the respondent,
the heirs of the estate and the applicant relates to the debts of a
related trust.
The subsequent payment of R480 000 in February 2015
and R60 000 in the following months were made to avoid the applicant
from proceeding
with two sales in execution in respect of the
properties belonging to the related trust. No agreement was entered
into between
the insolvent deceased estate and the applicant.
[6] Respondent is an attorney and was
appointed executrix in estate of her late father on the 13 February
2013 - a week after his
death on 4 February 2013. On the 31 May 2013
she was ready to submit and submitted the liquidation and
distribution account with
the Master of the High Court Polokwane.
Respondent was involved in this estate a week after the death of the
deceased and has opposed
the sequestration application from the
beginning. It cannot be accepted that she needs a postponement of the
matter to do further
investigations on the assets of the estate two
years later. It is clear that she has failed to handle and administer
the deceased
estate properly. I do not agree with counsel’s
submission that she be given a chance because she is a newly admitted
attorney.
[7] It was held by Fleming J in the
case of Ex Parte W J Upton Transport (Pty) Ltd - MAN Trucks & Bus
(SA) (Pty) Ltd vs W J
Upton Transport (Pty) Ltd 1985 (1) SA page 312
that:
“There should be finality one way
or the other in liquidation applications unless a case of adequate
strength for the extension
of a return date is made out. Undue
rigidity in that regard may obviously cause injustice. Injustice
should, however, not be caused
by a proper scrutiny of the actual
existence of true justification of an extension. Such a scrutiny is
necessary as inter alia:
(a) The existence of a provisional
liquidation order creates an inability on the part of creditors to
receive payment or to enforce
payment by way of execution or other
positive conduct, and
(b) There is no alternative to such
scrutiny which is truly effective to protect the general body of
creditors against costs of
legal fees, administration costs and other
financial disadvantages which are run up in the process of grating
extensions”
[8] The respondent have had all the
time it needed to attend to the issues she is now raising. She has,
as the executrix of the
estate declared to the Master of the High
Court that the estate is insolvent. She has not brought an
application to the court to
reverse her decision and advice to the
Master of the High Court that the estate is insolvent. Further, she
did not list worthy
creditors of the estate on the liquidation and
distribution account. She settled the Limdev and SARS without
reflecting their accounts
on the liquidation and distribution
account. Respondent’s counsel’s submission that the
liquidation and distribution
account can be amended is unsustainable
considering that the delay in finalising the liquidation and
distribution account comes
at a cost not only on estate but the
creditors as well. It should be accepted that the respondent has
shown lack of understanding
and experience in handling an estate of
this magnitude. The appointment of trustees will be to the benefit of
the creditors in
this instance.
[9] It is my view therefore that a
postponement will be prejudicial to the creditors and will only
burden the estate with unnecessary
costs. A final liquidation order
will place the estate in the hands of the trustees who will
administer the estate for the benefit
of all the creditors.
[10] In the circumstances, I make the
following order:
10.1 Application for a postponement is
dismissed with costs.
10.2 A final sequestration order is
granted.
10.3 Costs of this application
including the costs of the application of the 24 November 2014 to be
costs in the sequestration of
the estate.
TWALA
ACTING JUDGE OF THE HIGH COURT OF
SOUTH AFRICA
GAUTENG DIVISION, PRETORIA
Counsel for the Applicant: Adv. JE
SMIT
Instructed by: EDWARD NATHAN &
SONNERBERGS
Counsel for the Respondent: Adv.
LEBALLO
Instructed by: MF MALOKA ATTORNEYS
Date of Hearing: 20 May 2015
Date of Judgment: 17 May 2015