Da Silva and Another v Da Silva N.O and Others (2498/07 & 4247/07) [2007] ZAWCHC 82 (19 November 2007)

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[2007] ZAWCHC 82
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Da Silva and Another v Da Silva N.O and Others (2498/07 & 4247/07) [2007] ZAWCHC 82 (19 November 2007)

IN
THE HIGH COURT OF SOUTH AFRICA
(CAPE
OF
GOOD HOPE PROVINCIAL DIVISION)
REPORTABLE
CASE
NO:
2498/07
&
CASE
NO: 4247/07
In the matter between
VALERIE
MABEL DA SILVA
First
Applicant
VALENTIA
DA SILVA
Second
Applicant
and
MATTHEWS
JOSEPH DA SILVA N.
O.
First
Respondent
DONALD CLIFFORD
WICHMAN &
WILNA
JOY WICHMAN
Second
Respondent
MASTER
OF THE HIGH COURT
Third
Respondent
JUDGMENT
DELIVERED
ON 19 NOVEMBER 2007
ZONDI,
J
INTRODUCTION
[1]
In
the Notice of Motion issued on 5 March 2007 under case number 2498/07
the applicants seek the following relief:
“4.
An Order
Declaring
that the value of the Estate Late Elizabeth da Silva was worth in
excess of R125 000-00 on the date of her death namely
26 July 2004;
Declaring
that the Master of the High Court, Cape Town was not entitled to
make an appointment in terms of
section 18(3)
of the
Administration
of Estates Act 66 of 1965
;
Reviewing
and setting aside:
the appointment of the
First Respondent dated 3 August 205 as the representative of the
Master to take control of the assets
of the Estate Late Elizabeth
da Silva in terms of section 18(3) of the Administration of
Estates Act 66 of 1965 (annexure
“NoM.1”);
the certificate and/or
permission granted by the Master of the High Court, Cape Town
dated 15 February 2005 in terms of
section 42(2)
of the
Administration of Estates Act 66 of 1965
granting permission for
the property to be transferred from Estate Late Elizabeth da Silva
to the Second Respondent is set
aside;
Setting
aside the agreement of sale concluded between the first respondent
and the second respondent in respect of the property
concluded on
or about 22 February 2007(annexure “NoM.2”).
Directing
the First Respondent (and such other Respondent(s) as may oppose
this order jointly and severally with the First Respondent,
the one
paying the other to be absolved) to pay the costs of this
application.
5. Granting such further
and/or alternative relief as this Honourable Court may deem fit”.
[2] At
the hearing hereof
Mr
Berthold,
who appeared for the applicants, indicated that the applicants were
no longer seeking relief as set out in para 4.2 of the Notice
of
Motion.
Factual Background
[3]
During
her life-time the Late Elizabeth da Silva (“the testatrix”) was
the registered owner of the immovable propery namely
erf 5200 Hout
Bay, Cape Town (“the property”). This was the only asset of any
value in her estate. The testatrix died on 26
July 2004, leaving a
Last Will and Testament in which she appointed her son, the Late Tim
William John da Silva as her executor.
The Late Tim William John da
Silva predeceased the testatrix, and there was therefore no executor
testamentary.
[4]
The
Late Tim William John da Silva (“John da Silva”) was married to
the first applicant and there are four children born of
the marriage
between them. The second applicant is one of them.
[5] The
first respondent, being the only surviving brother of the Late John
da Silva and son of the testatrix, reported the estate
to the Master
of the High Court, the third respondent and later secured an
appointment in terms of the Letters of Authority issued
on 3 August
2005. These Letters of Authority were issued by the third respondent
in terms of section 18(3) of the Administration
of Estates Act, 66 of
1965 (“the Act”) on the basis that the value of the estate was
not more than R125 000-00. A municipal
valuation obtained by the
first respondent from the City of Cape Town and filed with third
respondent indicated that the value
of the property was R79 000-00 as
at 29 March 2005. The Letters of Authority authorised the first
respondent “to take control
of the assets of the Estate of the Late
Elizabeth Da Silva… to pay debts, and to transfer the residue of
the estate to the heir/heirs
entitled thereto in law”
[6
] Clause
6 of the testatrix’s Last Will and Testament provided as follows:
“ I
further direct that in the event that Tim William John Da Silva
should no longer wish to occupy the said property and elect
to sell
it or upon his death, whichever occurs first, that the proceeds of
any sale of the said property should be divided equally
amongst the
three beneficiaries of this Will or failing any of them, their
off-spring through representation per stirpes.”
[7
] On
about 17 April 2006 the first respondent, purporting to be acting as
a representative of the estate, sold the property to
the second
respondents for the sum of R120 000-00. On 4 July 2006 the first
respondent sought permission from the third respondent
to have the
property transferred into the names of the second respondents. The
permission was sought in terms of
section 42(2)
of the
Administration
of Estates Act.
[8
] The
third respondent requested the first respondent to obtain and submit
to it a sworn valuation of the property as minor children
were
involved in the estate. The first respondent submitted to the third
respondent a valuation report compiled by one P.N. Habutzel
on 13
February 2007 confirming that the fair and reasonable open market
value of the property was R120 000-00.
[
9] On
17 January 2007 the then first respondent’s attorneys wrote to the
first applicant advising her of the sale of the property
to the
second respondent and also informing her that she had 10 days within
which to lodge an objection, if she had one. The applicant’s

attorney of record in a letter addressed to the first respondent’s
attorneys and copied to the third respondent on 9 February
2007 noted
an objection on behalf of the first applicant to the sale on the
ground that the purchase price was less than the market
value of the
property and that it was not in the interest of the other heirs and
stating that the market value of the property
according to valuation
report compiled by Prop-T Real Estate was R135 000-00. The letter
also pointed out that there was an offer
on the property for R140
000-00. In a letter dated 27 February 2007 the third respondent
informed the applicant’s attorneys that
a
section 42(2)
endorsement
was granted on 15 February 2007. The applicants then brought the
present application.
Statement of the
issues
[1
0] The
issues which remain for determination are the following:
What is the fair market
value of the estate; and
Whether the third
respondent’s decision to appoint the first respondent in terms of
section 18(3)
of the
Administration of Estates Act should
be
reviewed and set aside.
[11
]
That the decision taken by the third respondent is reviewable is
beyond question.
Section 95
of the Administration of the Estates Act
is the answer to this question. Any decision taken by the third
respondent in terms of
the Act is reviewable under the Promotion of
Administrative Justice Act 3 of 2000 (“PAJA”) and the point is
clearly emphasised
by O’Regan J in
Bato
Star Fishing (Pty) Ltd v Minister of Environmental Affairs
2004(4) SA 490 (CC) at 504G – 505B:
“
The
Courts’ power to review administrative action no longer flows
directly from the common law but from PAJA and the Constitution

itself. The groundnorm of administrative law is now to be found in
the first place not in the doctrine of
ultra
vires,
nor in the doctrine of parliamentary sovereignty, nor in the common
law itself, but in the principles of our Constitution. The
common law
informs the provisions of PAJA and the Constitution, and derives its
force from the latter. The extent to which the
common law remains
relevant to administrative review will have to be developed on a
case-by case basis as the Courts interpret
and apply the provisions
of PAJA and the Constitution”.
[12
]
Mr
Berthold
,
who appeared on behalf of the applicants, attacked the correctness of
the third respondent’s decision on two grounds. Firstly,
he argued
that the third respondent’s decision not to revoke the appointment
of the first respondent in terms of section 18(3)
of the Act after it
had been brought to its attention that the value of the estate was
above R125 000-00, was irregular. Secondly,
he argued that the
appointment of the first respondent as a representative of the estate
had been irregularly obtained by the first
respondent. In this regard
it was submitted by
Mr
Berthold
that the first respondent had deliberately furnished factually
incorrect information to the third respondent in order to persuade

the latter to authorise the first respondent to represent the estate.
The first respondent is accused of having failed to disclose
in both
the Death Notice and Next of Kin Affidavit particulars of the
descendants of the deceased.
[13
]
Mr
Beale,
who appeared on behalf on the first and second respondents, submitted
that the decision of the third respondent to appoint the
first
respondent in terms of section 18(3) of the Act was correct. He
argued that the third respondent was correct in appointing
the first
respondent as a representative of the estate because the value of the
estate was less than R125 000-00. The municipal
valuation of the
property reflected that its value was R79 000-00 and that municipal
valuation is a fair and reasonable means of
determining the value of
the estate for the purpose of section 18(3) of the Act. He further
submitted that other methods used to
determine the value of the
property confirmed that its value was below R125 000-00.
Discussion
[14
] The
question is whether the third respondent was correct in appointing
the first respondent to represent the estate in terms of
section
18(3) of the Act. Section 18(3) of the Act provides as follows:
“
If
the value of any estate does not exceed the amount determined by the
Minister by Notice in the Gazette, the Master may dispense
with the
appointment of an executor and give directions as to the manner in
which such estate shall be liquidated and distributed.”
(Amount
determined under Government Notice No. R.1318 in the Government
Gazette 25456 of 19 September 2003 is R125 000-00).
[15]
It
is clear from the provisions of section 18(3) of the Act that if the
value of the estate does not exceed R125 000-00 the third
respondent
is entitled to dispense with the appointment of an executor and give
directions as to the manner in which such estate
is to be liquidated
and distributed. In making that decision the third respondent is
guided by the information which is presented
to him in the inventory
by the person who is the deceased’s nearest relative. In the
present case the value of the estate was
indicated in the inventory
by the first respondent to be R79 000-00 and this was based on the
municipal valuation provided by the
City of Cape Town. There is
nothing preventing the third respondent from relying on the municipal
valuations as a means to determine
the value of the immovable
property. It is common cause in the present matter that the only
asset of value was the immovable property.
[16
] It
is not suggested by the applicants that when the third respondent
made a section 18(3) appointment on 3 August 2005 he was
aware that
the value of the estate was being challenged. The first complaint
which was addressed by the first applicant to the
third respondent on
3 August 2006 did not relate to the value of the estate. It was about
the manner in which the first respondent
administered the estate. He
was accused of failing to consult with other heirs when taking
decisions affecting the estate. On 29
August 2006 the first applicant
wrote to the third respondent requesting him to “rescind the
Letters of Authority” which he
granted to the first respondent and
suggesting that “an executor from outside the family” be
appointed. Again the complaint
was not about the misrepresented value
of the estate but was about the conduct of the first respondent.
[1
7] The
first time that the third respondent became aware that the value of
the estate was being challenged was on about 9 February
2007. In a
letter dated 9 February 2007 the applicants’ attorney of record
informed the first respondent’s attorneys that the
applicants were
objecting to the sale of the property to Mr and Mrs Wichman for R120
000-00 as according to them its market value
was R135 000-00 and that
there was an offer on the property for R140 000-00.
[1
8] On
15 February 2007 the third respondent granted a section 42(2)
endorsement allowing the first respondent to transfer the property
to
Mr and Mrs Wichman. Section 42(2) of the Act provides that no
transfer pursuant to a sale can be effected without obtaining
the
Master’s Certificate that no objection exists to the transfer.
[1
9] In
my view it was improper for the third respondent to issue a section
42(2) certificate in circumstances where he was aware
that there had
been an objection to the sale as well as the grounds upon which such
objection was based. The applicants lodged
an objection with the
third respondent on 12 February 2007. In any event the provisions of
section 42(2) of the Act do not apply
in section 18(3) estates. The
third respondent should have revoked first respondent’s appointment
in terms of section 18(3) as
soon as it became aware that the value
of the estate exceeded the section 18(3) limit. In granting a section
42(2) certificate
the third respondent thus misdirected himself. The
third respondent’s decision was not rationally related to the
purpose for
which the power was given and for that reason it ought to
be set aside as it was unlawful. (
Pharmaceutical
Manufacturers of SA: In Re
Ex
Parte President of the RSA.
2000(2) SA 674 (CC) para 85). He should not have granted a section
42(2) certificate in the face of the objection by the applicants.
In
disregarding the applicant’s objection the third respondent acted
unlawfully.
[
20] The
third respondent, however, contended that it was entitled to grant a
section 42(2) certificate even though there was a higher
offer. It
relied upon a decision of
Gray
v The Master
1984(2) SA 271(T) in support of its contention. The reliance by the
third respondent on the decision on
Gray
v
The
Master
is misplaced. The decision does not support the third respondent’s
contention. In that case a sale having been concluded at a
public
auction, the Master refused to grant his certificate under section
42(2) because a higher offer had been received subsequent
to the
auction. The question was whether the mere fact that a higher offer
was received after the conclusion of a sale precluded
the Master from
issuing a section 42(2) certificate and therefore released the
executors from the obligations imposed upon them
in terms of the
contract concluded.
[2
1]
The answer to this question is to be found at 275G-H of the judgment
where McCreath, J had this to say:
“
I
am of the view that the Master is required to consider whether at the
time when a sale is concluded the executors have acted within
the
powers conferred on them by the provisions of the will, and whether
the sale is a
bona
fide
and genuine sale and whether the circumstances existing as at the
time of the sale are such as to warrant any objection to the
sale at
the figure to be paid by the purchaser. In the absence of any such
objection to the sale, the sale is in my view a valid
contract and is
binding upon the executor and the purchaser”.
[2
2]
The
Ratio
of the decision therefore is that the mere fact that after the
conclusion of the sale, a third party makes a better offer cannot
be
used as a valid reason to prevent the transfer of the property to the
purchaser and that consequently the Master should not
refuse to issue
his certificate on that account.
[23
] The
case of
Gray
v The Master
does not assist the third respondent in this case because the present
case deals with a section 18(3) estate and the provisions
of section
42(2) do not apply to such an estate. In other words the Master
cannot issue a section 42(2) certificate in a section
18(3) estate.
Therefore the moment the operation of the provisions of section 42(2)
of the Act is triggered, the Master should
revoke an appointment in
terms of section 18(3) of the Act. The third respondent should
accordingly have refused to issue a section
42(2) certificate when
the applicants objected to the sale at the figure to be paid by the
purchasers (second respondents).
[2
4] It
was contended by
Mr
Beale
that the applicant’s application should be dismissed as there is a
dispute of fact regarding the value of the property and that
in so
far as that dispute of fact is concerned the matter should be decided
in the first respondent’s version. He cited the case
of
Plascon-Evans
Paints v
Van
Riebeeck Paints
1984(3) SA 623(A) in support of his contention. According to
Plascon-Evans
case whenever a dispute of fact has arisen in affidavits in motion
Court proceedings when final relief is sought and there is no
request
for the matter to be referred to oral evidence the Court makes its
decision, in so far as any dispute of fact is concerned,
on the basis
of the version of the respondent party unless that version is so far
fetched or clearly untenable that the Court is
justified in rejecting
it merely on the papers or the denial by the respondent of a fact
alleged by the applicant is such as not
to create a real or genuine
or
bona
fide
dispute of fact. In a case where the respondent’s version is so
far fetched or so untenable that the Court is justified in rejecting

it merely on the papers or where the denial by the respondent of a
fact alleged, by the applicant is not such as to create a real
or
bona
fide
dispute of fact, the Court must include the fact alleged by the
applicant among the facts it takes into account on deciding whether

or not to grant the final relief.
[2
5] In
the present case there is no genuine dispute concerning a fair market
value of the property. The value of R79 000-00 is not
based on the
open market value of the property but is based on a municipal
valuation. Mr P.N. Habutzel, the first respondent’s
valuation
expert and upon whose report the first respondent relies, estimated
the open market value of the property to be in the
region of R 120
000-00 as at 13 February 2007. This approach was wrong. The property
should have been valued as at July 2004. The
only reliable and
credible valuation is one done by one Quentine Pavin. He used the
comparable sales method in undertaking the
valuation exercise and he
valued the property as at the date of death of the deceased namely 26
July 2004. In his opinion the market
value of the property is R160
000-00 as at the relevant date. In the circumstances the Court cannot
decide the matter on the basis
of the first respondent’s version
because that version is based on facts which are not reliable and
credible.
The Cost Order
[2
6] The
next question to consider is one relating to costs of this
application as well as costs which were reserved in the application

which was brought by the applicants under case number 13813/2007. The
applicants were successful in that application. The third
respondent
did not oppose either the present application or the application
brought under case number 13813/2007. In the circumstances
the third
respondent will not be ordered to pay costs of either application.
[27
] The
second respondents gave a notice of their intention to oppose both
applications through their then attorneys of record, Rob
Green and
Associates. Thereafter the second respondents did not file their
answering affidavit. In the circumstances there is no
reason to order
the second applicants to pay costs of the applications. In both
applications the applicants cited the second respondents
by virtue of
the fact they bought the property from the first respondent. It is
not suggested by the applicants that the second
respondent acted
mala
fide
in buying the property from the first respondent or in occupying the
premises during August 2007.
[2
8] As
far as the position of the first respondent is concerned, different
considerations apply. He opposed the application in his
capacity as a
representative of the estate by virtue of his appointment by the
Master in terms of section 18(3) of the Act. The
general rule is that
an executor who litigates on behalf of an estate is not mulcted in
costs. However the executor can be ordered
to pay the costs
de
bonis propriis
where there was mala fides, unreasonable or negligent conduct on his
part or where he acted against the interests of the estate.
[2
9] The
value of the estate is substantially low. It is in the region of R160
000-00 and any costs order against it will have an
effect of
depleting its value which clearly is not in the interest of the other
heirs. The estate should not be exposed to costs
which are incurred
by an executor in the course of pursuing a matter which he knows is
not in its own interest or has no authority
to bind the estate. The
first respondent did not have authority to enter into a lease of the
estate property. (
Amod’s
Executor v Registrar of Deeds
1906 TS 90).
He therefore acted without authority when he concluded a
lease agreement with the second respondents and allowing them to
occupy
the property on 15 August 2007. It then became necessary for
the applicants to bring an application under case number 13813/2007

for an order evicting the second respondents from the premises and
restoring the premises to them. It is the first respondent’s

unauthorised conduct which exposed the applicants to costs. The
applicants succeeded in their application and are accordingly
entitled to costs on a party and party scale. The first respondent is
accordingly ordered to pay the applicants costs
de
bonis propriis
.
[
30] As
far as costs of the present application are concerned, I find it
quite unreasonable for the applicants to insist that the
first
respondent’s section 18(3) appointment be set aside on the ground
that the value of the estate exceeds R125 000-00 even
though the
second respondents had increased their offer. In my view they should
have allowed the sale of the property to the second
respondents to
proceed in light of the fact that they were prepared to increase
their offer to purchase to R160 000-00. Had the
applicants accepted
the second respondents’ amended offer further administration costs
to the estate would have been avoided.
It is clear that they wanted
to have the property sold to their own preferred purchaser. In doing
so they acted against the interests
of the estate and for this reason
they should be deprived of costs of this application.
The Order
[3
1] In
the premises I make an order in the following terms:-
It is hereby declared
that the value of the Estate Late Elizabeth da Silva was in excess
of R125 000-00 on the date of her death
on 26 July 2004;
T
he
appointment of the first respondent dated 3 August 2005 as the
representative of the Master to take control of the assets of
the
Estate Late Elizabeth da Silva in terms of
section 18(3)
of the
Administration of Estates Act 66 of 1965
is reviewed and set aside;
T
he
certificate and/or permission granted by the third respondent
(Master of the High Court, Cape Town) dated 15 February 2007
in
terms of
section 42(2)
of the
Administration of Estates Act 66 of
1965
granting permission for the property to be transferred from
Estate Late Elizabeth da Silva to the second respondents is set

aside;
The
agreement of sale between the first respondent and the second
respondents in respect of the property concluded on or about 17

April 2006 is set aside;
T
he
first respondent is ordered to pay d
e
bonis propriis
the applicants’ costs as between party and party scale in the
application brought under case number 13813/2007
Each party to pay its
own costs in the application under case number 2498/2007.
____________________
ZONDI,
J