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REPUBLIC OF SOUTH AFRICA

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

(1)     REPORTABLE:  YES / NO

(2)     OF INTEREST TO OTHER JUDGES:  YES / NO

19/8/2021

                                                       CASE NO. 6884/2019

 

 

In the application between:

MARCELLE CHRISTINE NORTJE N.O.                                                     Applicant

 

and

 

JOHANNES VOS N.O.                                                                                     First Respondent

VOS STEYN LABUSCHAGNE INC                                                              Second Respondent

HELIENE MINNA SAWYER N.O.                                                                 Third Respondent

KARENT RITA GREYLING N.O.                                                                  Fourth Respondent

THE MASTER OF THE HIGH COURT                                                        Fifth Respondent

NEIL NORTJE                                                                                                   Sixth Respondent

EMILE NORTJE                                                                                              Seventh Respondent

RUAN NORTJE                                                                                                 Eighth Respondent

GEORGE CREYDT                                                                                          Ninth Respondent

MAGARIETHA GREYLING                                                                           Tenth Respondent

CORNEELS GREYLING                                                                                 Eleventh Respondent

JUDGMENT

 

 

NOCHUMSOHN (AJ)

 

1.            This is an Application for the removal of the First Respondent as a trustee of two trusts, namely the Rita Creydt Trust with Master’s reference number IT 9841/06 and the B & R Trust with Master’s reference number IT 9840/06 (“the Trusts”).

2.            The Trusts are for all intents and purposes family trusts created by the Applicant’s late mother.

3.            The Applicant and her sisters, respectively being the Third and Fourth Respondents are joint trustees and beneficiaries of the Trusts.

4.            The First Respondent is a chartered accountant and director of the Second Respondent, being an incorporated accountancy practice, to which the First Respondent is a director.  Such accountancy practice renders the auditing services to the Trusts.  In addition to being the accountant of the Trusts, the First Respondent is also a trustee of the Trusts.

5.            The relief sought for the removal as trustee from both Trusts, lies against the First Respondent only.  No such relief is sought against the Third and Fourth Respondents, and neither is any other relief sought against them.

6.            The Application was launched in two parts, Part A of which has already been determined, leaving me to determine only the aforementioned relief, which lies in Part B of the Application.

7.            Notwithstanding that Part A has already been determined, it is necessary for me to deal with the relief sought thereunder, in order for me to determine whether or not the Applicant is entitled to the relief sought in Part B.

8.            In Part A of the Application, the Applicant sought an order directing the First and Second Respondents to provide:

8.1.          documents with reference to which the audited financial statements were prepared for the Trusts, for the years 2011 to 2018, including, but not limited to the pastel books and all relevant vouchers and invoices;

8.2.          documents relevant to any payments made to any beneficiaries of the Trusts for the period 2011 to 2018, including but not limited to invoices and vouchers;

8.3.          documents relevant to the sale, alienation or disposal of any property of the trusts for the period 2011 to 2018, including, but not limited to invoices and vouchers;

8.4.          documents relevant to the entries on any loan accounts in the trusts for the period 20 November 2011 to 2018, including but not limited to invoices and vouchers.

9.             The Applicant alleges in the Founding Affidavit that the Application has been brought in this two-fold form:

“purely because the (proper) account will fully reveal the extent to which the Trusts and the Trust assets have been mismanaged and the full extent to which the First and Second Respondents have been derelict in the execution of their duties as trustees and accountant.”

10.          The Applicant sought in the Founding Affidavit, to supplement the Founding papers at a time after receipt of the documentation prayed for in Part A of the Notice of Motion.  This was in order to establish and/or embolden her case for the removal of the First Respondent, qua trustee of the Trusts.

11.          The Founding papers are replete with allegations of mismanagement of the Trusts by the First and Second Respondents, who is the appointed accountant for the Trusts.  The Applicant’s position is that her sisters, the Third and Fourth Respondents are complicit in the manner in which the Trusts have been mismanaged and have both benefitted from the manner in which the First and Second Respondents have “gone about their business”.

12.          The Applicant adumbrates further in the Founding Affidavit about extensive disputes between the trustees which ultimately left her with no option but to initiate arbitration proceedings against the remaining trustees, in accordance with the provisions of the Trust Deed.

13.          Such Arbitration proceedings led to the hearing of an opposed arbitration before Advocate J G Bergenthuin S.C., who handed down an extensive arbitral award on 9 April 2018.

14.          The relief sought in the arbitration was the resolution of a variety of disputes which were raised by the Applicant.  In relation to the First Respondent, the Arbitrator says at 2.4.4 of his award:

“Insofar as relief against First Respondent is concerned, Applicant seeks such relief because First Respondent allegedly did not comply with his duties as trustee.”

15.          The First Respondent in such arbitration was the same First Respondent in these proceedings.  The Second Respondent in such arbitration, was the Third Respondent in these proceedings.  The Third Respondent in such arbitration, was the Fourth Respondent in these proceedings.  The Applicant had brought the arbitration against the same parties i.e. the accountant and her sisters as she has done in the case in casu.

16.          In paragraph 1.2 of the Arbitrator’s award, he records that the mother of the Applicant, Third and Fourth Respondents, died on 4 October 2012, leaving a Will executed on 29 August 2012.  The First Respondent was appointed as the executor of the deceased estate.  The Rita Creydt Trust, barring certain legacies, was nominated as the heir.  The deceased had instructed further that at the termination of the two Trusts, the Trust assets should be divided equally between her three daughters, the Applicant, the Third Respondent and the Fourth Respondents.

17.          To some extent, the reasons put forward by the Applicant for the relief sought in Part B, overlap with some of the self-same disputes, which were articulated before the Arbitrator.  For this reason, it is necessary for me to consider an overview of the arbitration and the findings made.  Such necessity is actuated by an overall consideration of the measure of success achieved by the Applicant, in the arbitration.

18.          The first dispute concerned the sale of a Mercedes ML motor vehicle by the B & R Trust to the Fourth Respondent.  The sale was initiated at a meeting of trustees on 26 March 2013, and finally accepted on 5 April 2013.  The sale price was R540 600.00.  Central to the first dispute, the Applicant sought interest on the purchase price.  The arbitrator awarded interest calculated upon the R540 600.00, at 6.65% from 1 December 2012 until date of payment.  In view of the fact that the Applicant was not successful in seeking that an increased mora rate had to be applied, the costs relating to the first dispute was ordered to be shared equally by the Applicant and Fourth Respondent.

19.          The second dispute concerned the sale of a Colt vehicle for an amount of R83 700.00 by the B & R Trust to the Third Respondent.  The Applicant contended that interest should be payable by the Third Respondent since date of possession of the Colt, and thereafter at an increased mora rate since date of registration of the vehicle into the name of the Third Respondent.  The Arbitrator awarded payment of interest on the purchase price of R83 700.00 at 6.75% per annum from 26 March 2013 until date of payment.  In so awarding, the Arbitrator expressed that the Applicant was not successful in her contention that interest was payable since possession of the vehicle by the Third Respondent and that an increased mora rate had to be paid.  The Third Respondent was not successful in proving the termination of her obligation to pay interest after 30 September 2016.  For these reasons, the costs relating to the second dispute were ordered to be shared equally between the Applicant and Third Respondent.

20.          In the Applicant’s third dispute, the Arbitrator ordered the Third Respondent to account to the B & R Trust in the amount of R4 500.00 and R2 191.50.  In making such award, the Arbitrator found that the Applicant was only marginally successful in her third dispute, as a result of which he ordered that the costs relating to the third dispute were to be shared equally between the Applicant and the Third Respondent.

21.          In the fourth dispute before the Arbitrator, the Applicant sought a refund of certain insurance premiums which had already been paid.  The Arbitrator found that there could not be any possibility to obtain a refund of an insurance premium already paid with the result that the fourth dispute was decided against the Applicant.  In the result, the Applicant was ordered to pay the costs pertaining thereto.

22.          The fifth dispute before the Arbitrator, related to the sale of the immovable property known as Springbokkraal by the B & R Trust to the Applicant’s brother’s Trust, known as the Norman Creydt Trust.  Whilst it is not necessary, for purposes of this judgment, to delve into the minutiae of this dispute, it is necessary to record that the Arbitrator found against the Applicant in relation to this fifth dispute and ordered that the costs pertaining thereto must be borne by the Applicant.

23.          Similarly, the sixth dispute, which formed the subject matter of the Arbitration, related to payment of certain monthly rental by the Third Respondent.  The Applicant had persisted with her contention that such rental was to be paid by the Third Respondent to the B & R Trust.  Against the background of many decisions by the trustees which were not formally recorded, and the fact that the deceased, during her lifetime, utilised the two trusts as her alter ego, with the other trustees’ tacit consent, the sixth dispute was decided against the Applicant, who was ordered to pay the costs relating thereto.

24.          The seventh claim before the Arbitrator was for payment of some R50 000.00 and R8 878.50 which had been paid to one “George” without legal cause, which the Arbitrator found should be recovered from George.  In making such finding, the Arbitrator found that the Applicant was substantially successful in this seventh claim and thus awarded that her costs pertaining thereto should be covered by the First and Third Respondents jointly.  Significantly, this was the only finding against the First Respondent, whom the Applicant now seeks to have removed as trustee of the Trusts.

25.          The eighth dispute before the Arbitrator related to a reference to a sundry debtor in an amount of R3 213 834.00.  Whilst the details of such dispute are not relevant, the Arbitrator accepted that two experts were satisfied with the explanation tendered by the First Respondent and that any dispute in this regard was compromised.  Thus the eighth dispute was decided against the Applicant, who was ordered to pay the costs relating thereto.  No findings of any negligence were made against the First Respondent in relation to this dispute.

26.          The ninth dispute related to interest payable upon the purchase price of an immovable property in Umhlanga together with movable assets at the rate of 6.75% per annum.  The Applicant was successful in this claim with the result that the Fourth Respondent, who had refused throughout to make any payment relating to interest, was ordered to pay the costs relating to the ninth dispute.

27.          The tenth dispute related to a certain diamond ring belonging to the deceased estate.  The Applicant had noted an objection to the liquidation and distribution account framed in the estate, for want of an account relating to the diamond ring as part of the estate’s assets.  The Master of the High Court had overruled such objection, which decision was not taken on review by the Applicant.  In the Arbitration, the Applicant contended that notwithstanding the Master’s ruling, the Arbitrator should still determine that the diamond ring should be accounted for in a Supplementary Liquidation and Distribution Account.   The Arbitrator found this contention to be devoid of legal foundation, and ruled against the Applicant ordering her to pay the costs relating to such dispute.

28.          The eleventh dispute relating to a Sectional Title unit situate at Nooitgedacht Estate 38, Ermelo, did meet with success inasmuch as the Fourth Respondent was found to have been in possession of that property, without a valid resolution of the trustees and was therefore ordered by the Arbitrator to refund R110 559.00 to the Rita Creydt Trust.  Similarly, the Fourth Respondent was ordered to pay the costs of the eleventh dispute.

29.          Finally, the twelfth dispute before the Arbitrator related to a property dispute in relation to Erf 314 Piet Retief, the details of which for purposes of this Judgment are not relevant.  The Arbitrator found that the Applicant was partly successful in relation to payment of certain interest on the purchase price of the Piet Retief property, but apart from the aforegoing, such dispute was decided against the Applicant.  In the result, the Third Respondent was ordered to pay 25% of the costs relating to the twelfth dispute and the remainder of those costs were ordered to be paid by the Applicant.

30.          From the aforegoing brief synopsis, it is clear that the Applicant was not successful in her objections to the Estate’s liquidation and distribution account, lodged with the Master of the High Court.  Moreover, she was only marginally successful in the bulk of the relief sought by her, in the arbitration. 

31.          Whilst it is not in any way necessary for this court to redetermine the issues that were raised before the Arbitrator, it is clear from the Affidavits of the Applicant in these proceedings that she continued to raise the detail of the events pertaining to some of the disputes which had been determined in the arbitration, which remain res judicata.

32.          Much of this regurgitated material raised by the Applicant throughout the papers in these proceedings, was so raised with a view to portraying the First and Second Respondents in a bad light and to demonstrate maladministration of the Trusts, on the part of the First Respondent, with a view to seeking his removal from office.  None of these allegations seem to serve this intended purpose, leaving one to question the soundness of the reasoning for the seeking of such relief.

33.          Part B of the Application, was constructed upon the basis that the Applicant be given an opportunity to supplement her case, at a time after being furnished with the documentation sought in Part A of the Application.

34.          On 15 November 2019, the Honourable Acting Justice Diedericks granted an Order in relation to Part A of the Application and ordered the delivery of the documentation sought in Part A.

35.          In granting such Order, Part B of the Application was postponed, sine die and the Applicant was directed to deliver a Supplementary Founding Affidavit by no later than 7 February 2020.  Thereafter the normal time periods would apply to the exchanging of a Supplementary Answering and Replying Affidavit for the hearing of Part B.  As part and parcel of such Order, the costs of Part A were reserved and stood over for determination, in Part B.  However, the First and Second Respondents were ordered to pay the wasted costs of the day, for 15 November 2019.

36.          On 26 March 2020, the Applicant deposed to such Supplementary Founding Affidavit, at a time after receipt of the documentation so ordered.

37.          In such Supplementary Founding Affidavit, the Applicant alleges that there has been compliance, in part with the Order and some of the documents were so delivered.  The purpose of the Supplementary Founding Affidavit was to support the relief sought in Part B, with reference to the documents provided in Part A.  The affidavit fails in this purpose.

38.          Pertinently, such Supplementary Founding Affidavit does not speak to or pinpoint any specific maladministration in connection with the documentation that was provided, which would objectively give rise to sound reason for the removal of the First Respondent.

39.          Conversely, rather than dealing with the documentation which was so furnished, or the documentation which ought to have been furnished but was not so furnished, instead, the Applicant utilised the opportunity of deposing to a Supplementary Founding Affidavit in support of Part B, for purposes of setting out fresh grounds for the removal of the First Respondent as trustee, which were not included in the initial Founding Affidavit.  To this end, the Applicant abused the process of having been afforded an opportunity to depose to a Supplementary Founding Affidavit.  Such opportunity was not intended to afford the Applicant a second bite at the cherry in widening her case, without reference to the documents produced or the failure to have produced documents which were expected to have been produced.  This type of abuse of process is inimical to efficient and expedient litigation and is to discouraged.

40.          Whilst counsel for the Applicant, Mr Daniels SC, abandoned this ground in argument, one of such fresh grounds complained of was that the First Respondent is not independent, and is conflicted.  Such ground was based upon the Second Respondent acting as the auditing firm for the trusts, whilst such firm belongs to the First Respondent, who is a trustee of the trusts.

41.          Whilst it may not be ideal for an accountant to hold a seat as a trustee, and to undertake the auditing of a trust, for want of independence, no evidence of any such rule of practice was adduced by the Applicant from the professional bodies under which the accounting profession is governed.  Without such evidence, it is difficult to make any finding to accord with the Applicant’s submission.  In any event, this ground was removed in argument by Mr Daniels SC.

42.          Pointedly, the applicant regurgitates her allegations of mismanagement of the Trust by the First Respondent, pertaining to the sale of the aforementioned Mercedes, without obtaining the required permission by all the trustees.  The Applicant again utilised the Supplementary Founding Affidavit, to make the point that the Trust Deed requires the consents of all trustees in writing, for the disposal of the trust assets. 

43.          This was but one example of the Applicant regurgitating the issues that lay before the arbitrator, which had been ruled upon and in relation to which the Arbitrator correctly found that in accordance with paragraph 8.2 of the Trust Deed, decisions of the majority of the trustees would prevail, unless the decision related to an amendment of the Trust Deed, or the disposal of the Trust Capital, in which event there would be a need for such decisions to be unanimous. 

44.          One would have expected the Applicant to have set out, in the Supplementary Founding Affidavit, the exact finite detail in relation to each and every document given to her, pursuant to the Order handed down in Part A, and to comment upon the efficacy, legitimacy or otherwise of each and every document.

45.          In the same vein, one would have expected the Applicant to set out in detail those of the documents to which she felt entitled, which had not been provided, the absence of which would fortify her basis and reasoning for the relief.

46.          Absent such detail in the Supplementary Founding Affidavit, Mr Daniels SC hinged his argument against the non-delivery of the documents ordered.  In so doing, he argued that the First Respondent was in breach of his fiduciary duties foreshadowed in Doyle vs Board of Executors 1999 (2) SA 805 (CPD).

47.          With reference to Doyle, Mr Daniels SC argued that the Applicant is entitled to a full and proper account, and absent an account, by the delivery of the documents which underpin the preparation of the annual financial statements for the Trust, without explanation for such failure, the First Respondent must be removed.  I was not persuaded by this argument, as primarily, such failure, which is denied by the First Respondent, does not lead one to conclude that the administration of the trust property is imperilled thereby.  Neither does such failure establish conduct adverse to the interests of the beneficiaries, particularly where the relief is not supported by the remaining trustees or beneficiaries.

48.          One would have expected the Applicant to have launched an application for contempt of court, in order to properly address her grievances pertaining to the First Respondent’s alleged non-compliance with the order granted in Part A.  Such application was not launched.  The Applicant merely proceeded to enrol Part B of the Application for argument.  Mr Daniels SC suggested that I should find that there has been material non-compliance with Part A, which would entitle the grant of the relief sought in Part B.  I do not share this view.  The relief before me in Part B, is for the removal of the First Respondent.  I am not called upon to address any shortcomings in the implementation of Part A.  If the Applicant felt prejudiced in presenting Part B of her case, for an alleged want of compliance with the order granted in Part A, she should have launched an application for contempt of court prior to the enrolment of Part B.

49.          In filing their Supplementary Answering Affidavit to the Applicant’s Supplementary Founding Affidavit, the First and Second Respondents gave a very detailed chronological account of all of the steps taken by the Applicant over the years, and all of the responses given by the First and Second Respondents to each of those steps.  Such Supplementary Answering Affidavit is lengthy, detailed and serves to demonstrate that there is not much merit to any of the Applicant’s complaints against the First and Second Respondents.

50.          In the result, and having regard to the very detailed allegations made by the First and Second Respondents, in their supplementary Answering Affidavit, most of which are supported by correspondence annexed to such affidavit. I am persuaded by Mr Potgieter SC, who argued for the First and Second Respondent, that the Plascon-Evans principle finds strong application in these proceedings.

51.          Applying the principles of Plascon-Evans, the relevant facts are those stated by the First and Second Respondents.  This is so as the Respondents have not admitted the Applicant’s averments, such so as to justify the removal of the First Respondent as trustee.  Moreover, and by application of the Plascon-Evans principle, there is nothing advanced by the Respondents which is so farfetched or clearly untenable that the court is justified in rejecting the Respondents averments, purely on the papers.

52.          Even without application of the Plascon-Evans principle, in the Supplementary Founding Affidavit, the Applicant again denies that she had knowledge of the sale of the Mercedes and Colt.  Against this, she had signed the Resolution/Minute authorising such sale, which calls into question her bona fides.  The First Respondent labelled the Applicant as a liar, in relation to these denials.  In general, the allegations made vis-à-vis the alleged maladministration of the First and Second Respondents, are wide, vague and general, against which, the First and Second Respondents’ very detailed and lengthy chronological account of events, set out in their Supplementary Answering Affidavit, serves as a satisfactory response.

53.          Under Section 20(1) of the Trust Property Control Act 57 of 1988, a trustee may, on the Application of the Master or any person having an interest in the trust property, at any time be removed from his office by the Court if the court is satisfied that such removal will be in the interests of the Trust and its beneficiaries.

54.          As was held by Vally J (for the full court) in the reported judgment of McNair v Crossman & another 2020 (1) SA 192 (GJ)

“Statutorily then, a trustee could be removed from office if it is found that his or her continuance in office imperils the administration or affairs of the Trust or would be detrimental to the interests of the beneficiaries.  In Gowar discord between a trustee and beneficiary may not in and of itself meet the criteria set out in Section 20(1) of the Act for the removal of the trustee.  It was said that thus the overriding question is always whether or not the conduct of the trustee imperils the trust property or its proper administration.  Consequently, mere friction or enmity between the trustee and the beneficiaries will not in itself be adequate reason for the removal of the trustee from office.”

55.          Vally J did go further to add:

“However, there is a further ground which I elaborate upon below.  It is that the relationship between co-trustees is broken down to the extent that they no longer have any mutual respect and trust for each other.  This too, can be brought under Section 20(1) of the Act, for it could imperil the property or administration of the Trust.  But it does not always have to be so”

 

56.          Mr Daniels SC submitted in his Heads that McNair accordingly recognises that grounds traditionally, to justify the removal of a trustee would include, as a basis for such removal, the breakdown in the relationship between co-trustees, where same has resulted in a loss of mutual trust and respect. 

57.          I pause to consider this submission, in the context of the Applicant’s overall conduct.  From the version put forward by the First and Second Respondents, the detail in which they set out the chronological sequence of events and the steps which they took in each instance to address each complaint, I accept the submissions made by Mr Potgieter SC to the effect that it seems clear that the Applicant is difficult, unreasonable and determined to have the affairs of the Trust governed in her own manner and style.

58.          This does appear to be one of those instances where the continued demands of the Applicant have for the most part been met and are no longer reasonable.  Such demands do not constitute grounds for the removal of the First Respondent from the office of trustee.

59.          If a person is unreasonable in their approach, difficult to get along with, is in conflict with family members and their professional advisors, the raising of disputes, against such background, which serves to wear down and deteriorate relationships between trustees, should not in and of itself give rise to the meeting of the principle enunciated in McNair.  I am of the view that the principle enunciated in McNair would hold good where there is a breakdown of a relationship, based upon legitimate disagreements between trustees, rather than issues which are without foundation. 

60.          It bears mentioning that McNair was overturned on Appeal by the Supreme Court of Appeal in Fletcher v McNair (1350 /2019) [2020] ZASCA 135 (23 October 2020). As the court of first instance in the Gauteng Division of the High Court, Johannesburg, the Honourable Madau J dismissed McNair’s application for the removal of Fletchter as a trustee of the McNair Family Trust.  On appeal, the full court reversed such decision and removed Fletcher as a trustee.  With the special leave of the Supreme Court of Appeal, Fletcher appealed against the order and such order of the full court was set aside by the Supreme Court of Appeal.

61.          As in the case, in casu, apart from being a trustee, Fletcher was an accountant and director of Alchemy Financial Services Inc which was responsible for the monthly bookkeeping for the company, as well as the Trust.  He also operated the bank account, was the auditor of the company and was appointed to administer Mr McNair’s estate.  Certain disputes ensued which culminated in Mrs McNair launching an application in the High Court for the removal of Fletcher and Crossman as trustees of the Trust.  The facts of this case were remarkably similar to the facts, in casu.

62.          At paragraph 18 of the SCA Judgment, it was stated that a court has an inherent power to remove a trustee from office, at common law.  This power is also sourced in Section 20(1) of the Trust Property Control Act 57 of 1988.  However, to so remove, the court must be satisfied that the removal will be in the best interests of the Trust and its beneficiaries.

63.          At paragraph 19 of the Judgment, the SCA pointed out that the jurisprudence on the removal of trustees was neatly collated in “Gowar” at paragraph 31 to 32 where Petse JA undertook a useful examination of authorities from which the following principles can be distilled:

63.1.            The court may order the removal of a trustee only if such removal will, as required by Section 20(1) of the Act, be in the interests of the Trust and its beneficiaries;

63.2.            The power of the court to remove a trustee must be exercised with circumspection;

63.3.            The sufficiency of the cause for removal is to be tested by a consideration of the estate;

63.4.            The deliberate wishes of the deceased person to select persons and reliance upon their ability and character to manage the estate, should be respected, and not be lightly interfered with;

63.5.            Where there is disharmony, the essential test is whether it imperils the trust estate for its proper administration,

63.6.            Mere friction or enmity between the trustee and the beneficiaries will not in itself be an adequate reason for the removal of the trustee from office;

63.7.            Mere conflict amongst trustees themselves is not a sufficient reason for the removal of a trustee at the suit of another;

63.8.            Neither mala fides nor even misconduct are required for the removal of a trustee;

63.9.            Incorrect decisions and non-observance of the strict requirements of the law do not of themselves warrant the removal of a trustee;

63.10.         The decisive consideration is the welfare of the beneficiaries and the proper administration of the Trust and the trust properties. 

64.          At paragraph 21 of the SCA Judgment in McNair, attention is drawn to the provisions of Section 173 of the Constitution, which reads:

“173 inherent power – the Constitutional Court, Supreme Court of Appeal and High Courts have the inherent power to protect and regulate their own processes and to develop the common law, taking into account the interests of justice”

65.          It was was stated further at paragraph 22 of the Judgment that there are two distinct part of Section 173.  The first relates to the court’s inherent power to regulate its own processes.  This relates to matters of procedure.  The second concerns the court’s power to develop the common law, which relates to substantive issues of law.  It is the latter power that the court must have in mind when it made that reference.  This is because the removal of trustees is an issue of substantive law, and not of procedure.  The full court’s reference to the court’s inherent power to the removal of trustees should therefore not be conflated with the court’s inherent power to regulate its own process.  The court’s remarks should thus be understood to mean that in terms of Section 173 of the Constitution, the court has inherent power to develop the common law on the removal of trustees, where the interests of justice dictated.

66.          At paragraphs 23, 24, 25 and 26 of the SCA Judgment, the court analysed the further ground raised by the full court to the effect that if the relationship between co-trustees has broken down to the extent that they no longer have mutual respect and trust for each other, this too can be a ground brought under Section 20(1) for it could imperil the property or administration of the Trust.  This ground was qualified in paragraph 25 of the SCA’s judgment to the effect that if the loss of mutual respect and trust among trustees results in the trust property being imperilled, that could form a basis for removal of one or more of the trustees.

67.          From all of the evidence presented, in the case in casu, I cannot find any evidence to suggest that the breakdown in the relationship caused primarily by the Applicant’s unreasonable conduct, could serve to imperil the administration of the Trust and the management of its property.  It cannot be assumed that because there is a lack of trust, respect or compatibility amongst the trustees, that the trust property is imperilled and that therefore the removal of a trustee is justified.  There is no credible evidence to suggest that the trust property, or its proper administration has been placed at risk.  Ultimately, that is the test which the Applicant has failed to meet.  By the exercise of its common law powers, a court cannot permit an unreasonable trustee to scupper the appointment of another, based on ongoing disputes which lack foundation.  This cannot be what Section 20(1) of the Trust Property Control Act, or the common law, would have intended.

68.          Accordingly, the following Order is made:

68.1.            The Application is dismissed;

68.2.            The Applicant is ordered to pay the costs of the Respondent, on the scale as between party and party, to include the costs of senior counsel, which costs order shall include the reserved costs in relation to the prior hearing in relation to Part A of the Application.  Such reserved costs exclude the wasted costs of 15 November 2019, which were already dealt with in Part A of the order.

 

 

NOCHUMSOHN, G

ACTING JUDGE OF THE HIGH COURT

 

 

 

On behalf of the Applicant:            Advocate J Daniels SC

Instructed by:                                  Van Der Merwe & Associates

On behalf of the Respondents:       Advocate T.A.L.L. Potgieter SC

 

Instructed by:                                  Johan Van Der Wath Inc

Date of Hearing:                             16 August 2021

Date of Judgment:                          19 August 2021

Delivered via email:                       19 August 2021

 

 

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