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[2009] ZAGPPHC 341
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Philip v Tutor Trust (Pty) Ltd and Others (26952/09) [2009] ZAGPPHC 341 (11 June 2009)
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG HIGH COURT, PRETORIA)
NOT
REPORTABLE
CASE
NO: 26952/09
DATE:
11/06/2009
In
the matter between:
TIMOTHY
DAVID DAVENPORT PHILIP
Applicant
and
TUTOR
TRUST (PTY)
LTD 1
st
Respondent
VENDITOR
AUCTIONEERS (PTY)
LTD 2
nd
Respondent
ANTON
STRYDOM
N.O. 3
rd
Respondent
KAREN
KEEVY
N.O. 4
th
Respondent
HAASBROEK
& BOESAART
INC 5
th
Respondent
STANDARD
BANK 6
th
Respondent
MASTER
OF THE HIGH
COURT 7
th
Respondent
REGISTRAR
OF DEEDS
GAUTENG 8
th
Respondent
(MR
& MRS}
JORDAAN 9
th
Respondent
JUDGMENT
MURPHY
J
1. The applicant
originally sought as a matter of urgency an order directing the first
to fourth respondents to transfer certain
immovable property into
his name as well as ancillary relief related to the property
transaction in question. As will become apparent presently, he has
attempted through an amendment to alter his cause of action to one of
an enrichment claim.
2.
The property in question is a residential property in E […….].
The property forms part of the insolvent estate
of one Mr DP Venter.
The first, third and fourth respondents are the trustees of the
insolvent estate. The second respondent, Venditor
Auctioneers (Pty)
Ltd is the estate agent and auctioneer through whom the sale was
effected on behalf of the estate. The fifth
respondent is the firm of
attorneys tasked with the responsibility for transferring the
property. The sixth respondent is Standard
Bank, the bondholder on
the property. The applicant has also cited the Master of the High
Court, the Registrar of Deeds and a certain
Mr Jordaan to whom he has
re-sold the property. The applicant seeks no relief against the fifth
lo eighth respondents.
3.
After certain negotiations the applicant made an offer R131, 000
which was accepted on 16 October 2008 on behalf of the estate
with
the concurrence of the bondholder, Standard Bank, the sixth
respondent.
4.
The applicant then paid a deposit of R130 000 into the trust account
of the second respondent on 24 October 2009.
5.
On 27 November 2008, the applicant received an email from an employee
of the second respondent. Karen Coetzee instructing him
to pay the
balance of the purchase price into the account of the second
respondent and not as would normally be expected into the
account of
the transferring attorney. The applicant complied and the next day
transferred an amount of R1 180 000 into the second
respondent's
account. Thereafter, another employee of the second respondent drew a
cheque in favour of the transferring attorneys
Karen Coetzee hand
delivered this cheque to the transferring attorneys but instead of
crediting it to the account of the applicant
for the purposes of the
transfer of the property she appears to have been able to allocate
the amount of the cheque to ten different
accounts This seems to have
been part of a scheme in which she was engaged involving the
misappropriation of funds from the second
respondent and its clients.
In this way, Coetzee may have perpetrated a fraud on the applicant.
6.
Because neither the insolvent estate nor the transferring attorneys
have received the purchase price, the transferring attorneys
refused
to effect transfer. In its answering affidavit the fifth respondent
points out that the sixth respondent, Standard Bank,
is a bondholder
over the properly in terms of two bonds registered in its favour
being registered as security for amount of about
R1.8 million, The
fifth respondent also indicates that it holds instructions to cancel
the existing bonds registered against the
property but that it can
only do this on receipt of either the balance of the purchase price
or on receipt of acceptable guarantees
securing the balance of the
purchase price Because this has not happened they are unable proceed.
7.
The trustees of the insolvent estate maintain that the second
respondent, the agent, did not have a mandate to receive the balance
of the purchase price. In terms of clause 5 of the offer to purchase,
a 10% deposit was payable to the second respondent, who was
entitled
to deduct its remuneration and expenses, with the balance to be paid
over to the seller (the trustee) or the attorney
attending to the
transfer on confirmation. The only clause regulating the payment of
the balance of the purchase price is clause
5.2 which provides that
the balance of the purchase price shall be secured by means of an
approved bond by a financial institution
within 30 days after
confirmation by the seller.
8.
As I understand the case of the trustees and the agent, they maintain
that these clauses read together indicate that the agent,
the second
respondent, had no mandate to receive the balance of the purchase
price on behalf of the seller In terms of the agreement
the balance
ought to have been paid to the sellers attorneys. Only then would the
obligation have arisen to effect transfer to
the applicant. The fact
that Karen Coetzee may have paid amounts to the fifth respondent in
respect of other accounts, it was submitted,
did not amount to a
payment 1o the frrst respondent on behalf of the applicant.
9.
The respondents also raised the defence that the applicant failed to
join the wife of the insolvent who had a 50% share in the
property
and thus has a direct and material interest in the relief sought.
10.
The second respondent, the estate agent, joined in the defences
raised by the trustees and added that Karen Coetzee was not
acting in
the scope or course of her employment with the second respondent and
hence was on a frolic of her own.
11.
In an answering affidavit filed a few days before the matter was
enrolled for hearing, the fourth respondent raised another
point of
significant consequence. The fourth respondent is a practising
insolvency practitioner and an admitted attorney of this
court. She
is also a joint trustee of the estate of Mr DP Venter, having been
appointed jointly with the third respondent She states
in her
answering affidavit that she is not acquainted with the allegations
made by the applicants: nor has knowledge of the involvement
of the
second respondent; or knew about the alleged misappropriation of
funds by the second respondent's employee- However, she
states that
the applicant's application is fatally defective as she was not a
signatory to the agreement of sale annexed to the
founding affidavit.
She correctly points out that it is trite that joint trustees have to
act jointly She avers that she had no
knowledge of the conclusion of
the sale agreement and did not sign the agreement. Nor did she grant
anyone the authority to sign
the agreement on her behalf. She was
also not party to (he appointment of the second respondent for any
purposes whatsoever.
12.
At the commencement of the proceedings before me Mr. Brand, who
appeared on behalf of the applicant conceded that the latter
point
was a good point, that the relief sought in the original notice of
motion was accordingly not competent and that the claim
for transfer
of the property into the name of the applicant could not be
sustained. However, he filed an amended notice of motion
adding an
alternative prayer in the event that it is found that the sale
agreement is null and void ab initio seeking an order
that the first,
second, third and fourth respondents jointly and severally be ordered
to pay the applicant an amount of R1 310
000, being the deposit and
the balance of the purchase price. He predicated this claim upon the
alleged enrichment of the respondent
as a result of the payment
mistakenly made. From the applicant's perspective, the payment was
made pursuant to the mistake that
there was a valid sale, when there
was in fact not, and also on the mistaken basis that the second
respondent had a mandate to
receive payment of the balance of the
purchase price on behalf of the seller.
13.
In other words, the applicant through the amended notice of motion is
seeking to recover the money under the condictio indebiti.
The basic elements of the condictio
are that the plaintiff must prove that
the property or the amount reclaimed was transferred or paid by him
or his agent (o the defendant.
He must prove that such transfer or
payment was made indebiti
in
the sense that there was no legal or natural obligation or any
reasonable cause for the payment or transfer. And he must also
prove
that the property or money was transferred or paid by mistake
14.
In this instance there seems to be two species of indebiti.
The first is that it is alleged that
there was no debt of any kind owed at all because the sale was
invalid. The second form of
indebiti
is
that the amount has been transferred to the wrong creditor. It should
have been transferred to the seller but was in fact transferred
to an
unmandated agent
15.
Mr Labuschagne, who appeared on behalf of the first, second and third
respondents, made the predictable submission that the
amendment
sought to introduce a new cause of action, with the result that the
application upon which they were brought to court
is no longer the
application and claim which he was required to meet before me.
Moreover, in the context of an urgent application,
the applicant had
about five days before the hearing to consider the point raised by
the fourth respondent that the sale was invalid
and ought to have
made the concession at that time He accordingly strongly urged me not
to convert an application for the transfer
of immovable property into
an application for relief based on enrichment. None of the
respondents, he submitted, had had a proper
opportunity to consider
the various defences to the enrichment issue and to file papers
dealing with them.
16.
As a result also of the change in the cause of action, it was
submitted, the issue of urgency had lost some of its force. The
applicant's primary claim or urgency was that he had sold the
property for a handsome profit to the eighth respondent and that
such
sale was in jeopardy By virtue of the claim being one of enrichment
that is no longer so. He has no property to sell. He is
presently in
possession of the property, which may or may not provide him with
some form of security until the dispute is finally
resolved. He in
any event does not make out any case that he is about to be evicted
and hence there is no urgency arising from
that issue. In the absence
of any clear averments any consideration in that regard would be
speculative.
17.
Added to that, Mr Labuschagne submitted that the papers as presently
drawn do not make out a case for a condidio.
The factual averments set out in the
founding affidavit are insufficient to grant an enrichment action in
that they fail to deal
with the ongoing extent of the enrichment. In
our law enrichment is understood to mean the acquisition of an
economic benefit and
is calculated with reference to the net
surviving gain in the defendant’s estate - Kudu Granite
Operations (Pty) Ltd v Caterna
Ltd
2003
(5} SA 193
(SCA). Enrichment usually takes the form of an increase in
the defendant's assets but a defendant may also be enriched by his or
her assets not decreasing. And. furthermore, a decrease in the
defendant's liabilities might constitute enrichment, as may a
non-increase
in liabilities. Accordingly, before a court may
determine the extent of an enrichment claim, the quantum requires to
be calculated
on the basis of a difference in the patrimony of the
defendant before and after the enriching fact. An enrichment claim is
directed
at the value remaining with the enrichment debtor as suppose
to the value received. This gives rise to the possibility of
different
defences by the different respondents in this case
18.
It is not unusual for a court to allow an amendment to a pleading,
even an application that seeks to introduce a new cause of
action.
However, it should only do so where such an amendment would cause no
prejudice to the defendants or respondents. In the
context of this
urgent application, where the amendment was introduced at the
hearing, one must accept that the respondents have
indeed been
prejudiced by the amendment in that they have had no opportunity to
deal with the questions surrounding an enrichment
claim and possible
defences in their answering affidavits.
19.
In any event, on account of the applicant not having acquired any
right to sell the property on to the eighth respondent by
virtue of
the invalid sale, I am persuaded that the applicant s ground for
urgency has fallen away. There are also disputes of
fact with regard
to some of the earlier defences, and the difficulties that have
arisen with regard to any enrichment claim. Furthermore,
the issue of
whether the second respondent should be held vicariously liable for
the delict of Karen Coetzee cannot be determined
on the papers
Evidence will be required to establish whether there is a
sufficiently close link between Coetzee’s conduct
for her own
interests and the business of the second respondent to determine
whether her actions were modes of doing her employers
business,
albeit unauthorised, involving an element of mismanagement in the
performance of her work.
20.
Accordingly, the matter having lost urgency, the difficulties of
pleading enrichment and the disputes of fact that have arisen
all
cumulatively lead me to conclude that the matter should simply be
struck from the roll for want of urgency
21.
With regard to the question of costs, one has natural sympathy with
the applicant. He obviously has been defrauded by an employee
of the
second respondent. As 1 have just indicated, that may or may not
engender vicarious liability. I am also unimpressed by
the conduct of
the trustees. They entered into an invalid sale. While it is correct
that the point taken by the fourth respondent
would seem to be good,
and thus leads to the possibility of an enrichment action as the
primary cause of action despite her claim
that she did not sign the
sale nevertheless signed the transfer documents. At page 171 of the
record there is a power of attorney
to pass transfer wherein it is
recorded that the trustees. Anton Strydom (the third respondent) and
Karen Keevy (the fourth respondent),
in their capacities as trustees,
nominated, constituted and appointed the fifth respondent to be
attorneys to effect transfer in
respect of the sale entered into with
the applicant on 10 December 2008. This document was signed on 9
March 2009. It accordingly
does not sit well with the fourth
respondent two months later to assert that the sale was invalid
because she was not in any way
involved. Mr Brand, on behalf of the
applicant, has submitted that she may not be before the court with
clean hands. I agree that
such may be possible. The applicant may
consider submitting the matter to the Law Society for investigation.
22.
Accordingly, given what I consider to be the unsatisfactory conduct
of the trustees in this matter, despite the fact that I
am
disinclined to grant the applicant urgent relief. I do not propose to
burden him with a costs order at this stage.
23.
In the result, the following orders are issued:
(i)
The matter is struck from the roll for want of urgency:
(ii)
The costs of this application will be costs in the cause of the main
application or any action instituted in respect of this
or any
related cause of action;
JR
MURPHY
JUDGE
OF THE HIGH COURT
Date
Heard: 19 May 2009
For
the Applicant: Adv CFJ Brand, Pretoria
Instructed
By:Greyvenstein & Grundlingh, Pretoria
For
the 1st -3rd Respondent: Adv EC Labuschagne SC, Pretoria
Instructed
By: Jaco Roos Attorneys, Pretoria
Fourth
Respondent: Adv HA vd Merwe, Johannesburg
Instructed
By: Senekal & Simmons, Johannesburg