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South Africa Judgment

Free State High Court, Bloemfontein

Harris and Another v Burger N.O. and Another (786/2017) [2017] ZAFSHC 68 (18 May 2017)

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Source document

01

Holding and result

The court found that the first respondent, as sole trustee and beneficiary of the Blue Ginger Trust, lacked the legal capacity to validly conclude the property agreements in question. His dual role contravened the trust deed and rendered the transactions null and void. The respondent's conduct in failing to file an answering affidavit and requesting a last-minute postponement was not bona fide and amounted to an abuse of process. The court refused the postponement, nullified the agreements, and ordered restoration of performances by a specified date, with costs awarded against the respondent.

Court disposition

Application granted; agreements nullified; restoration ordered; costs awarded against respondent.

Orders

  • The Lauw Wepener and Groenvlei agreements concluded by the parties on 9 December 2014 are declared null and void.
  • The effective date for restoration of performances is Friday, 30 June 2017.
  • The respondent is ordered to pay the costs of the application.

02

Material facts

Parties

Rudolf Johannes Harris

Applicant Counsel: Adv Grewar

Rachel Sophia Elizabeth Harris

Applicant Counsel: Adv Grewar

Zander Chris Burger N.O.

Respondent Counsel: Adv Olivier

The Master of the High Court

Respondent

03

Procedural history

  1. Posture

    Civil Application / Motion Proceedings; Unopposed Roll

04

Questions and positions

Legal issues

Party arguments

Applicant
The applicants argued that the agreements for the sale and exchange of properties were void because the first respondent, acting as trustee of the Blue Ginger Trust, was also a beneficiary at the time of contracting, which rendered him legally incompetent to bind the trust. They contended that the respondent had delayed proceedings and failed to file an answering affidavit, causing frustration and prejudice to the applicants.
Respondent
The first respondent, through his counsel, requested a postponement, arguing that denying the postponement would effectively deny him access to justice. He claimed the need for an opportunity to be heard, but failed to provide substantive opposition or file the required answering affidavit within the prescribed timeframes.

05

Court’s reasoning

  1. 01

    Blue Ginger Trust IT 276/2009 trust deed

    A trustee who is also a beneficiary may not act in a manner that creates a conflict of interest or binds the trust contrary to its deed.

  2. 02

    Uniform Rules of Court

    Failure to comply with procedural rules and timeframes may result in the refusal of postponement and adverse costs orders.

06

Ratio, limits and disposition

Ratio decidendi

The court found that the first respondent, as sole trustee and beneficiary of the Blue Ginger Trust, lacked the legal capacity to validly conclude the property agreements in question. His dual role contravened the trust deed and rendered the transactions null and void. The respondent's conduct in failing to file an answering affidavit and requesting a last-minute postponement was not bona fide and amounted to an abuse of process. The court refused the postponement, nullified the agreements, and ordered restoration of performances by a specified date, with costs awarded against the respondent.

Obiter and limits

  • Litigants who disregard procedural rules and delay proceedings undermine the efficiency of the civil dispute resolution system.
  • The court may vary its own order mero motu to correct an inadvertent omission regarding the date for restoration of performances.

Court disposition

Application granted; agreements nullified; restoration ordered; costs awarded against respondent.

  • The Lauw Wepener and Groenvlei agreements concluded by the parties on 9 December 2014 are declared null and void.
  • The effective date for restoration of performances is Friday, 30 June 2017.
  • The respondent is ordered to pay the costs of the application.

Source and reliance status

Free State High Court, Bloemfontein

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Judgment text

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Source document

Free State High Court, Bloemfontein

Judgment

[2017] ZAFSHC 68

SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document in compliance with the law and SAFLII Policy

IN THE HIGH COURT OF SOUTH AFRICA,

FREE STATE DIVISION, BLOEMFONTEIN

Case number: 786/2017

In the matter between:

RUDOLF

JOHANNES HARRIS 1st Applicant

[Identity number: [5...]]

RACHEL SOPHIA ELIZABETH HARRIS 2nd Applicant

[Identity number: [5...])

and

ZANDER CHRIS BURGER N.O 1st Defendant

[BLUE GINGER TRUST - IT 276/2009]

THE MASTER OF THE HIGH COURT 2nd Defendant

HEARD ON: 11 MAY 2017

JUDGMENT BY: RAMPAI, J

REASONS GIVEN: 18 MAY 2017

[1] The matter came to court by way of motion proceedings. The applicant sought an order whereby the two agreements concluded by the parties were declared null and void. The alternative relief sought was cancellation of those agreements. The application was, in a sense, unopposed - hence it was on the unopposed roll of the general motion court.

[2] The applicants sold their residential property to the first respondent who in turn sold his to the applicants. The exchange sales were concluded prior to the institution of the current restorative application on 15 February 2017.

[3] The file history of the matter shows:

3.1 that the application was issued on 15 February 2017;

3.2 that it was served on the first respondent on or before 2 March 2017;

3.3 that the first respondent served and filed notice of his intention to oppose the application on 2 March 2017;

3.4 that the applicants enrolled the matter on 23 April 2017 for hearing on 11 May 2017;

3.5 that the second respondent's report pertaining to Blue Ginger Trust IT 276/2009 was filed on 5 May 2017;

3.6 that the first respondent's attorney asked for a postponement on 10 May 2017 and

3.7 that the matter was duly listed on the unopposed roll of the general motion court of 11 May 2017 as item number 42.

[4] Before me on Thursday 11 May 2017 appeared Mr Grewar for the applicants and Mr Olivier for the first respondent. The two legal

representatives could not agree on any of the proposals contained in the first respondents' letter dated 10 May 2017.

[5] Mr Olivier urged me to give the first respondent an opportunity to be heard. He argued that unless the matter was postponed as the first respondent requested, the first respondent would be effectively denied access to justice. Mr Grewar argued that the first respondent had been dragging his feet for far too long and that the applicants were very frustrated.

[6] In the founding affidavit, Mr Rudolf Johannes Harris, the co-seller of the Lauw Wepener property, "anx hh7", and the

simultaneous co-purchaser of the Groenvlei property, "anx hh8", averred:

"8.6 Burger het op die 9 Desember 2014 twee koopkontrakte getekent in sy hoedanigheid as trustee, ten opsigte van Louw Wepener en Groenvlei, terwyl die trustakte op daardie stadium bepaal het dag hy nie gelyktydig as 'n trustee en begunstigde kan handel nie. (my emphasis)

8.7 'n Afskrif van die ooreenkoms van Louw Wepener word hierby aangeheg gemerk aanhangsel "HH7".

8.8 'n Afskrif van die ooreenkoms van Groenvlei word hierby aangeheg gemerk aanhangsel "HHS".

8.9 Burger was op daardie datum beide die alleen-trustee en 'n begunstigde van die trust en bygevolg is die transaksie nietig weens sy onbevoegdheid om te handel en die trust te bind.It

[7]

•

On the strength of those material averments, it appeared to me that the first respondent was not legally compent to alienate the

trust property known as Groenvlei seeing that he was both the trustee and beneficiary of the Blue Ginger Trust - vide "anx hh211 read with "anx hh311 to "anx hh6.

[8] The first respondent signalled his intention to oppose the application some 69 calender days before the date on which the matter

was heard. The applicants then waited and waited for the first respondent's answering affidavit. They waited in vain. On 23 April

2017, some 52 calender days after the filing of the first respondent's notice, the applicants served a notice of setdown. Again

there was no reaction from him. Hardly a day before the hearing the first respondent wrote to ask for a postponement.

[9] In my view the request for a postponement was not made in good faith. It was yet another ploy to delay the matter. All these indicated to me that the first respondent had no seriously genuine intention to oppose the application. He displayed complete disregard for the rules of procedure. This sort of a litigant's remissness undermines the norms and standards designed to enhance the efficiency of the civil dispute resolution by way of public adjudicative system.

[10] These then are the reasons for the order I made. I suppose they explain the order well. In view of the aforesaid considerations, I refused to have the application postponed. The first respondent did not act like a serious litigant with a bona fide defence. He only has himself to blame for the refusal. The refusal is the harvest of his neglect.

[11] I note that the second leg of the order does not accurately reflect my intention. I probably not pronounce the date on which the parties have to restore performances. The omission was an inadvertent oversight. I had a specific date scribbled in my bench book. In determining an appropriate date, I took into account the reasonable possibility that the applicants' residential property, Lauw Wepener, might currently be still occupied by innocent and lawful occupiers. I would, therefore, revisit the previous order by inserting a date in paragraph 2 thereof.

[12] In the circumstances, I hereby vary the previous order mero motu

to read as follows:

12.1 The Lauw Wepener and Groenvlei agreements concluded by the parties in Bloemfontein on the 9 December 2014 are hereby nullified.

12.2 The effective date of restoration shall be Friday 30 June 2017.

12.3 The respondent pays the costs of the application.

______

MH RAMPAI, J

On behalf of applicants: Adv Grewar

Instructed by:

Adrie Hechter Attorneys

Bloemfontein

On behalf of respondents: Adv Olivier

Instructed by:

Symington & De Kok

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