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[2012] ZAFSHC 111
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Erasmus v Jacobs and Another (5410/2011) [2012] ZAFSHC 111 (7 June 2012)
FREE STATE HIGH
COURT, BLOEMFONTEIN
REPUBLIC OF SOUTH
AFRICA
Case No. : 5410/2011
In the matter between:-
ELAINE ERASMUS
…...................................................................
Applicant
(Identity number: )
and
KOBUS JACOBS
…............................................................
1st
Respondent
(Identity number: )
THE MASTER, FREE
STATE HIGH COURT
….................
2nd
Respondent
_______________________________________________________
HEARD ON:
24 MAY 2012
_______________________________________________________
JUDGMENT BY:
MHLAMBI, AJ
_______________________________________________________
DELIVERED:
7 JUNE 2012
_______________________________________________________
[1] This is an
application to remove an executor from office in terms of
section 4
of the
Administration of Estates Act, No. 66 of 1965
.
[2] The Applicant seeks
to remove his brother, the First Respondent, from the office of
executor by reason of the fact that he is
not a fit and proper person
to be responsible for the administration of the estate; and that an
independent executor should be
appointed to investigate the
circumstances regarding the conclusion of the sale of the farms
forming the subject matter of their
deceased mother’s will.
[3] The sale agreement
was concluded on 13 April 2006 between the Applicant’s late
mother, who died on 22 May 2009 and Davis
Guitars (Pty) Ltd and
signed by the First Respondent, as sole director of the company. The
purchase price was R1 500 000.00
(one million, five hundred
thousand rand).
[4] Both Applicant and
First Respondent were the only beneficiaries in equal shares under
the will, which was made and dated 1 December
2005. First Respondent
was duly appointed as executor of the estate in terms thereof.
[5] The thrust of the
Applicant’s claim, according to her, was the dishonest manner
in which the sale agreement between her
late mother and First
Respondent’s company was concluded, which she viewed as an
orchestrated effort to prejudice her as
a beneficiary.
[6] She based her
conclusion on the following:
1) She never knew of the
will of 1 December 2005.
2) Both the will and sale
agreement were concealed from her and she had no knowledge of their
existence until after her mother’s
death.
3) The purchase price of
R1 500 000.00 was suspect as it was significantly lower
than the valuation of the property as
at the time of the sale.
4) Her late mother was
diagnosed with Alzheimer’s disease, a considerable period
before her death. It was, according to the
applicant, unlikely that
her deceased mother could have been of sound mind as at the time of
the sale.
[7] An objection was
lodged with the Master, the Second Respondent, on her behalf. The
correctness of the valuation of the property
in question was assailed
as well as the apparent conflict of interest of the First Respondent,
as the director of the company that
purchased the property. Second
Respondent rejected the objection.
[8] The First Respondent
admits having purchased the farms from his late mother on 13 April
2006. Applicant and her spouse have
been staying on the farms for
free since 2003. He contends that the sale of the farms to himself
occurred three years before their
mother’s death and had
nothing to do with the deceased estate.
[9] First respondent
further maintains the amount owing to the Applicant by virtue of the
Liquidation and Distribution Account was
paid to her on 16 or 18
November 2011.
[10] He, furthermore,
holds that the application to remove him as an executor of the
deceased estate is as a result of the Applicant’s
dissatisfaction with the Sale Agreement concluded by him with their
late mother, a transaction she was fully aware of.
[11] Counsel for
Applicant referred me to various authorities(for which I am grateful)
and seeks an order in terms of
section 54(a)(v)
for the removal of
First Respondent as an executor of the estate and the costs of the
application.
[12]
Section 54
reads as
follows:
54. Removal from office of
executor
.-
(1) An executor may at any time be
removed from his office-
(a) by the Court-
(i) .......
(ii) if he has at any time been a
party to an agreement or arrangement whereby he has undertaken that
he will, in his capacity as
executor, grant or endeavour to grant to,
or obtain or endeavour to obtain for any heir, debtor or creditor of
the estate, any
benefit to which he is not entitled; or
if he has by means of any
misrepresentation or any reward or offer of any reward, whether
direct or indirect, induced or attempted
to induce any person to
vote for his recommendation to the Master as executor or to effect
or to assist in effecting such recommendation;
or
if he has accepted or expressed his
willingness to accept from any person any benefit whatsoever in
consideration of such person
being engaged to perform any work on
behalf of the estate; or
if for any other reason the Court is
satisfied that it is undesirable that he should act as executor of
the estate concerned;
and”
[13]
“The
office of the executor should not be used in order to pursue a
private agenda”.
VAN NIEKERK v VAN
NIEKERK
2011 (2) SA 145
on page 150G.
[14] In
HARRIS V
FISHER, NO
1960 (4) SA 855
(A) on page 862E, it was said
“
Executors or
Administrators will not be permitted, under any circumstances, to
derive a personal benefit from the manner in which
they transact the
business or manage the assets of the estate.”
[15] The Court has a
discretion on removing an executor in terms of
section 54(a)(v)
of
the Act and the main guide must be the welfare of the beneficiaries.
DIE MEESTER v MEYER EN ANDERE
1975 (2) SA 1
(TPD) at
17E - F.
[16] However, Solomon
ACJ, in
SACKVILLE-WEST v NOURSE AND ANOTHER
1925 (A)
516 on page 527, quoted as follows from Story’s Equitable
Jurisprudence (par 1289)
“
But in cases
of positive misconduct Courts of Equity have no difficulty in
interposing to remove trustees who have abused their
trust: it is not
indeed every mistake or neglect of duty or inaccuracy of conduct of
trustees, which will induce Courts of Equity
to adopt such a course.
But
the acts or omissions must be such as endanger the trust property or
to show a want of honesty or a want of proper capacity
to execute the
duties, or a want of reasonable fidelity” .
He then proceeds to lay
down the broad principle that the Court
“
if satisfied
that the continuance of the trustee would prevent the trusts being
properly executed,”
might remove the trustee.
[17] The cardinal
question is: Can the First Respondent be said to have acted, in his
capacity as Executor, dishonestly or in an
untrustworthy manner? In
my view, this question should be answered in the negative. The
conduct complained of falls outside or
took place before First
Respondent took office.
[18] Applicant has not
furnished an iota of evidence or factual basis in support of the
allegations she makes against the First
Respondent. She has received
her portion of the inheritance in terms of the Liquidation and
Distribution Account and accordingly
there is no indication that she
was concerned with the manner the estate was being administered. I am
inclined to agree with First
Respondent’s Counsel that the
Applicant’s main purpose is to achieve the setting aside of the
Sale Agreement.
[19] Respondent’s
Counsel advanced the following further arguments which, in my view,
are sound:
(a) The contract was
concluded three years prior to the parties’ mother’s
death.
(b) There was no medical
report or evidence to confirm that Applicant’s late mother was
of unsound mind as at the conclusion
of the contract of sale. Equally
strange is applicant’s statement in her replication that, she
handed the deceased the contract
document for signature.
(c) There are no
prospects of success with Applicant’s envisaged action against
First Respondent even in the event another
executor is appointed.
(d) In replication,
Applicant admits her signature on the contract, despite her having
stated in the Founding Affidavit that it
was concealed from her.
[20] In respect of costs
of the application, both Counsel referred me to
GROBBELAAR v
GROBBELAAR
1959 (4) SA 719
(A) and agree with the legal
position as set out therein that a person in a fiduciary position and
the unsuccessful litigant, should
not pay costs
de bonis propriis
.
ORDER:
[21] In the result, the
application is dismissed with costs.
________________
J.J. MHLAMBI, AJ
On behalf of applicant:
Adv. J.J.F. Hefer
Instructed by:
McIntyre & Van der
Post
BLOEMFONTEIN
(Ref. PH HENNING/EAL013/CB)
On behalf of respondent:
Adv. C.L.H Harms
Instructed by:
Honey Attorneys
BLOEMFONTEIN
(Ref. BM JONES/I20869)
JJM/sp