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[2014] ZAFSHC 173
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Malherbe N.O v Kistein; InRe: Malherbe N.O v Malherbe N.O and Others (2597/2012) [2014] ZAFSHC 173 (18 September 2014)
IN THE HIGH COURT
OF SOUTH AFRICA
FREE STATE
DIVISION, BLOEMFONTEIN
Case
No.: 2597/2012
DATE:
18 SEPTEMBER 2014
In the
application between:-
SUZETTE MALHERBE
N.O
......................................
Applicant
And
PETRUS PAULUS
KIRSTEIN
..................................
Respondent
In Re:
Case No.:
2597/2012
In the matter
between:-
SUZETTE MALHERBE
N.O
........................................
Plaintiff
And
SUZETTE MALHERBE
N.O
...............................
1st
Defendant
PETRUS PAULUS
KIRSTEIN
..........................
2nd
Defendant
PETRUS PAULUS
KIRSTEIN N.O
...................
3rd
Defendant
(In his capacity
as a trustee of the
Tarentaalbos
Trust)
CAREL STEPHANUS
ERASMUS MULLER N.O
............
4th
Defendant
(In his capacity
as a trustee of the
Tarentaalbos
Trust)
PETRUS PAULUS
KIRSTEIN N.O
.................................
5th
Defendant
(In his capacity
as a trustee of the
Kirstein Boerdery
Trust)
HUGO AMOS
KIRSTEIN N.O
.......................................
6th
Defendant
(In his capacity
as a trustee of the
Kirstein Boerdery
Trust)
CAREL STEPHANUS
ERASMUS MULLER N.O
.............
7th
Defendant
(In his capacity
as a trustee of the
Kirstein Boerdery
Trust)
PETRUS PAULUS
KIRSTEIN N.O
...................................
8th
Defendant
(In his capacity
as a trustee of the
Rustig Trust)
HUGO AMOS
KIRSTEIN N.O
..........................................
9th
Defendant
(In his capacity
as a trustee of the
Rustig Trust)
CAREL STEPHANUS
ERASMUS MULLER N.O
.............
10th
Defendant
(In his capacity
as a trustee of the
Rustig Trust)
PETRUS PAULUS
KIRSTEIN N.O
..................................
11th
Defendant
(In his capacity
as a trustee of the
Mosega Trust)
HUGO AMOS
KIRSTEIN N.O
.........................................
12th
Defendant
(In his capacity
as a trustee of the
Mosega Trust)
CAREL STEPHANUS
ERASMUS MULLER N.O
............
13th
Defendant
(In his capacity
as a trustee of the
Mosega Trust)
CORAM: MOLOI, J
HEARD ON: 4
SEPTEMBER 2014
DELIVERED ON: 18
SEPTEMBER 2014
MOLOI, J
[1] This is an
application to compel the respondent to comply with two notices in
terms of the provisions of Rule 35(3) of the Uniform
Rules of Court,
the first dated 10 December 2013 and the second dated 4 July 2014.
The respondent is opposing the application.
[2] The applicant is
the executrix of the estate late Gerbreggie Dorothea Kirstein (the
deceased) who was married out community
of property with the
respondent, Petrus Paulus Kirstein (Kirstein). The applicant
instituted an action against the respondent
seeking the following
relief:
2.1 An order
declaring that a partnership existed between the deceased who died on
19 July 2011 and Kirstein in equal shares in
respect of the farming
business and the ceramics business conducted by them;
2.2 An order
declaring that the partnership between the deceased and Kirstein was
dissolved on the death of the deceased on 19 July
2011;
2.3 An order
appointing a liquidator with the authority to realise the whole of
the partnership assets, including the assets registered
in the
Tarantaalbos Trust, IT 1474/2000; the Kirstein Boerdery Trust, IT
1473/2000; the Rustig Trust, IT 1768/2002; the Mosega
Trust, IT
1472/2000. Kirstein and deceased, to liquidate the liabilities of
the partnership, to prepare a final account and to
pay to the
deceased’s estate and Kirstein whatever is owing to them by
virtue of the partnership agreement …”
[3] The basis of the
alleged partnership is that the deceased and the respondent ventured
into joint farming undertaking where each
one contributed financially
and through active participation in the activities of the business.
In due course a ceramic business
was established and the deceased and
the respondent conducted the same in partnership having agreed so
orally or tacitly. A good
number of farmers were acquired and held
by both the deceased and the respondent and the ceramic business also
grew substantially.
In his plea, the respondent disputed that a
partnership existed. In his discovery affidavit in terms of Rule
35(1) he listed
a number of documents in the different schedules to
such an affidavit. The applicant was, however, not satisfied about
that discovery
and served the notices in terms of Rule 35(3). When
the respondent failed to respond thereto, this application was
launched.
[4] In the first
notice dated 10 December 2013 the respondent is required to make
available for inspection or to state under oath
within ten days that
such documents are not in his possession. The documents sought to be
made available relate to proving all
the income and/or earnings per
year from the date bought until sold, if at all, from all the farms
and properties listed. The
respondent is also sought to disclose the
interest earned and bank statements, etc. The respondent, respondent
thereto on 18 December
2013 but the applicant is of the view that the
response was inadequate. A second notice dated 4 July 2014 was
served requiring
the respondent to make available for inspection
documents in his possession relating to the documents on which a
scientific research
was based to “determine rectifying
payments” between the estate of the deceased with certain
details, documents setting
out written results of the scientific
research, written appraisals used in the determination of the value
of the properties, complete
exposition of all income derived by the
respondent from mealie crops for a period of five years preceding the
deceased’s
death, a complete exposition of all assets alienated
or disposed of whether movable or immovable, etc.
[5] The respondent
did not respond to this notice but in opposition of the application
he contended that the financial statements
he discovered were a
complete record of all his dealings, involvement, income, expenses,
assets and obligation, meaning there were
no more documents in his
possession; the respondent furthermore pointed out that under order
of the Magistrate’s Court,
the applicant seized all the other
records required; the documents used during settlement negotiations
were privileged and documents
relating to activities subsequent to
the deceased’s death were irrelevant. The response of the
respondent was vehemently
attacked by Advocate du Bruyn for the
applicant. So I do not propose in this judgment, to deal with the
validity or otherwise
of those arguments. This I do because the
decision I reached is based purely on the interpretation of Rule
35(3) as expounded
in the cases I will refer to hereunder. The
second consideration is the urgency of the matter as the hearing took
place virtually
on the eve of a recess and the matter is enrolled for
hearing from 6 October 2014.
[6] Rule 35(3)
partly state as follows:
“If any party
believes that there are, in addition to documents or tape recordings
disclosed as aforesaid, other documents
(including copies thereof) or
tape recordings which may be relevant to any matter in question in
the possession of any party thereto
…”
On closer look at
the provision one cannot escape the two grounds on which such notice
may be served for it to be valid. Firstly,
is the phrase believes
and the second is relevant. It is required of the applicant to lay
sound grounds of his belief and not
a mere subjective belief that the
documents do, in fact, exists: Continental Ore Construction v
Highveld Steel and Vanadium Corporation
1971 (4) SA 589
(w) at 598.
In Bothma v Protea Furnishers (Pty) Ltd 1970 (3) 180 (0) at 183 E –
F, Erasmus J, stated:
“… it
would in order to succeed be sufficient for the applicant to
substantiate his belief in terms of Rule 35(3)
by showing that the
documents or books are in fact in existence and are relevant to any
matter in question concerning the case.”
In her founding
affidavit to the application, the applicant merely repeated the word
“believe” without substantiating
or expanding on the
grounds of such belief. Even in argument before me the grounds on
which such belief was based were not even
alluded to.
[7] The documents
required to be produced for inspection are set out in paragraph 4
above. They all relate to the values of the
properties, the income
derived there from, the details of the research conducted etc. The
issues that need to be resolved over
which there is a dispute in the
case and which the applicant prayed relate to the existence or not of
the partnership and, if it
is found that a partnership existed, the
liquidator be appointed to take control of the entire estate, settle
the debts and distribute
the residue between the estate of the
deceased and the respondent. At this point in time and before the
existence of the partnership
had been established, what have the
values, income, expenditure etc. got to do with the gravamen of the
claim. Only documents
relevant and “relating to the matters,”
and relevant to any aspect of the case must be produced for
inspection or discovered:
Durbach v Fairway Hotel Ltd,
1949 (3) SA
1081
(SR) at 1083. In her particulars of claim the applicant gave
grounds on which the claim of a partnership are based and they have
nothing to with the values, income, scientific research and so forth.
The key issue is whether there was a partnership or not
and only
documents relating to that issue are relevant and must be discovered.
[8] The relief of
the appointment of the liquidator illustrates the point even better.
There can be no liquidator appointed if
the applicant is not
successful with the declaration of the existence of a partnership.
The liquidator, if appointed, is the once
that will be given “the
authority to realise the whole of the partnership assets” as
prayed for in the particulars
of claim. S/He is the person that will
be entitled to determine the whereabouts of the assets, the income
they generated, what
assets were disposed of and their values, pay
the liabilities of the partnership and distribute the residue between
the respondent
and the deceased estate. Starting with the assets,
their values, the income etc is really putting the cart before the
horse.
Those will be relevant only after the partnership issue has
been settled.
[9] In The MV Group:
Owners of the MVURGUP v Western Bulk Carriers (Australia) (Pty) Ltd
and Others,
1999 (3) SA 500
(c) at 515 the following was stated:
“In the case
of rule 35(3) the intention is to supplement discovery which has
already taken place but which is alleged to
be inadequate. Rule
35(3) and (14) do not afford a litigant a licence to fish in the hope
of catching something useful.”
To my mind the
applicant failed to meet the requirements of the belief she had in
the inadequacy of the discovery made as well as
to illustrate the
relevance of the information or documents demanded to be inspected.
The entire exercise is nothing but the fishing
expedition referred to
above and amounts to abuse of legal process worthy of being visited
with a punitive costs order.
ORDER:
[10] In the premises
the following order is made:
(a) The application
is dismissed;
(b) Applicant is
ordered to pay the costs on attorney and client scale which costs
shall include the costs of two counsels.
K. J. MOLOI, J
On behalf of the
applicant: Adv. Du Preez
Instructed by:
PHATSHOANE HENNEY
BLOEMFONTEIN
On behalf of
respondent: Adv. Du Bruyn
Instructed by:
HILL, McHARDY &
HERBST
BLOEMFONTEIN