Kelly v Moodley and Others (1877/2009) [2010] ZAKZDHC 21 (1 June 2010)

IN THE KWAZULU-NATAL HIGH COURT

DURBAN AND COAST LOCAL DIVISION

REPUBLIC OF SOUTH AFRICA

CASE NO: 1877/2009

In the matter between:

GIRLIE KELLY Applicant

and

INDHRANI MOODLEY 1st Respondent

LOGANATHAN (a.k.a LOGAN) REDDY N.O. 2nd Respondent

FREDDY HYMAN N.O. 3rd Respondent

JUDGMENT

HUGHES-MADONDO AJ

The applicant (“Girlie”) is a 72 year old retired professional nurse. In 1957 Girlie formed an intimate relationship

with the late Francis Moodley (“Francis”). Girlie maintained her relationship with Francis until his death on the 23 June 1999. During his lifetime Francis operated a transport business, Rossburgh Passenger Services from a property registered in his name situate at 38 Sirdar Road, Clairwood, Durban (“the property”).

The first respondent Indhrani Moodley (“Rani”) is the daughter of Francis and his ex-wife Selina. They divorced each other several years prior to his death.

On the 10 June 1998 Francis executed his last will and testament. He bequeathed half of his estate to Girlie and the other half to his sister Muniamma Moodley (“Muniamma”). He appointed the second respondent, Loganathan Reddy (“Reddy”) and the third respondent, Freddy Hyman (“Hyman”) as his executor. During 2001 both executors signed the liquidation and distribution account and subsequently, in 2003, the property was transferred to Girlie and Muniamma. Muniamma died in 2005 leaving her entire estate to Rani. The executor, Hyman, removed himself as co-executor on the 23rd March 2006.

The order that the applicant sought when this matter was heard on the 17 March 2010 is as follows:-

“1. That the first respondent shall forthwith hand over the sheriff or his lawful deputy the following moveable goods:-

1.1 1986 Mercedes Benz bus bearing registration letters and numbers ND 7936;

1.2 1990 Mercedes Benz bus bearing registration letters and numbers ND 879;

1.3 1993 Leyland bus bearing registration letters and numbers ND 1192;

1.4 1990 DAF bus bearing registration letters and numbers ND 6080;

1.5 1990 Neoplan bus bearing registration letters and numbers ND 8392;

1.6 1995 Isuzu Bakkie – 280 DT bearing registration letters and numbers ND 4107;

1.7 1997 Isuzu Bakkie – 280 DT bearing registration letters and numbers ND 9360.

2. That the first respondent shall forthwith hand over to the Sheriff or his lawful Deputy the current passenger bus carrier certificates in respect of the buses described in paragraphs 1.1 to 1.7 hereof.

3. That the first respondent shall point out and disclose to the Sheriff or his lawful Deputy the whereabouts of the movable goods and passenger bus carrier certificates described in paragraphs 1 and 2 above.

4. In the event of the first respondent failing or refusing to comply with the orders in terms of paragraphs 1, 2 and 3 hereof, the Sheriff or his lawful Deputy is authorised and directed to forthwith take possession of the movable goods and the current passenger carrier certificates described in paragraphs 1 and 2 above.

5. That the Sheriff or his lawful Deputy is authorised and directed to sell by public auction the movable goods described in paragraph 1 above, the certificates described in paragraph 2 above and the immovable property described in ERF 237 DUNNS GRANT REGISTRATION DIVISION FT SITUATE IN THE DURBAN ENTITY, PROVINCE OF KWAZULU-NATAL, IN EXTENT 1116 SQUARE METRES AND WHICH IS PHYSICALLY SITUATED AT 38 SIRDAR ROAD, CLAIRWOOD, DURBAN (hereinafter referred to as the property) together with all the buildings and improvements on the property.

6. That, from the proceeds of such sale by the public auction of the aforesaid movable goods, passenger bus carrier certificates and the property, there shall be paid as a first charge the following amounts:-

[i] the expenses of advertising such sale by public auction of the aforesaid movable goods, passenger bus carrier certificates and the property;

[ii] the costs of the Sheriff or his lawful Deputy incurred in consequence of such a sale by public auction of the aforesaid movable goods, passenger bus carrier certificates and the property and such to include the commission of the Sheriff or his lawful Deputy;

[iii] any rates and other charges due to the eThekwini Municipality in respect of the property.

7. That the applicant shall be paid one half of the nett proceeds of such sale by public auction of the aforesaid movable goods, the passenger carrier certificates and the property and the other half of such nett proceeds shall be paid to the third respondent as the Executor of the estate of the late MUNIAMMA MOODLEY whose identity number was 231211 0132 088 and who died on the 18 August 2006 save that in respect of the amount due to the applicant one half of such amount shall be held by the second respondent or in the estate banking account of the late Francis Moodley pending an action to be instituted by the first respondent within TEN (10) days of the grant of this order for determination as to what is the Applicant’s share of the assets concerned.

8. That the Sheriff or his lawful Deputy is hereby authorized and empowered to effect the distribution of the proceeds as contemplated by this order and, in particular, in terms of paragraph

6 and 7 above.

9. That on behalf of the third respondent as the Executor the estate of the late MUNIAMMA MOODLEY the Sheriff or his lawful Deputy shall sign all such documents and take all such steps necessary to effect registration of transfer of the property and the transfer of the movable goods and certificates described in paragraphs 1 and 2 above into the name /names of the successful purchaser or purchasers pursuant to such sale by public auction.

10. That the attorneys PHIPSON DE VILLIERS of Durban and/or J. LESLIE SMITH & COMPANY INC. of 332 Jabu Ndlovu Street, Pietermaritzburg, shall be the Conveyancers in respect of the transfer of the property pursuant to such sale by public auction.

11. That, in the event of the original Deed of Registrar No. T231/2003 dated 6th January 2003 not being found or obtained, the Conveyancers are hereby authorised and empowered to do all things necessary and especially to sign all the necessary documents on behalf of the applicant and the third respondent on behalf of the estate of the late MUNIAMMA MOODLEY to obtain a certified copy of such Deed of Transfer referred to above from the Registrar of Deeds for the Province of KwaZulu Natal in Pietermaritzburg in terms of the Deeds Registries Act No. 47 of 1937 and under Regulation 68 promulgated in terms of that Act.

12. That the first respondent shall allow prospective purchases to inspect all the aforesaid moveable goods, the passenger bus carrier certificates and the property and, in the event of the first respondent failing or refusing to comply with such order, the applicant shall be entitled to engage the services of locksmiths and other persons to inspect the aforesaid movable goods, the passenger bus carrier certificates and the property for inspection of prospective purchasers and / or to enter the property.

13. That the first respondent shall give vacant possession and occupation of the property to the purchaser or purchasers into whose name the registration of transfer of the property has been effected into.

14. That, in respect of the conduct of the business by the first respondent utilising the passenger carrying busses and the passenger bus carrier certificates referred to in paragraphs 1 and 2 above:-

[a] the first respondent shall, not later than Five (5) days after service upon her this order, deliver to the applicant’s attorney:-

[i] a balance sheet and profit and loss account in respect of all such transactions of the business conducted by the first respondent with the buses and certificates referred to hereinbefore from the 23rd June 1999 and to the date of his order;

[ii] proper vouchers supporting the entries contained in the said balance sheet and profit and loss account;

[b] the applicant be granted leave to engage the services of the ACCOUNTING SERVICES CC one VISHNU ROOPNARAIN MAHARAJ of No. 11-294, Mount Batten Drive, Reservoir Hills Durban, KwaZulu-Natal to inspect all the books of account of such business so conducted by the first respondent utilising the aforesaid passenger carrying buses and the public passenger carrier certificates from the 23rd June 1999 and to the date of this order;

[c] the applicant be granted leave, supplemented insofar as it may be necessary, to re-set the matter down for hearing on a date to be arranged with the Registrar for:-

[i] a debatement of the said account;

[ii] a determination of the amount which may be due to the applicant and estate of the late MUNIAMMA MOODLEY;

[iii] judgment in the sum so determined and one half of the sum so determined shall be paid to the third respondent as the Executor of the estate of the late MUNIAMMA MOODLEY;

[v] costs of such proceedings;

15. That the first respondent shall pay to the applicant one half of all monies which the first respondent has received from the alienation or disposal of the assets which fell into the estate of the late Francis Moodley.

16. That the applicant’s costs of this application on the scale as between attorney and client shall be paid by the first respondent. ”

The factual foundation of the applicant’s case is that in terms of the will of Francis, she is entitled to half of his estate whilst Muniamma, his sister is entitled to the remaining half. In order to establish if this case can be determined on the affidavits filed, it is necessary for me to examine same carefully. Girlie avers in her founding affidavit that upon Francis death, the first respondent took occupation of the property and possession of all the motor vehicles inclusive of the passenger bus carrier certificates. She alleges further that Rani has been using these vehicles and conducting the business for her own benefit. The liquidation and distribution account has been finalized but she has not received her share of the estate but for the property being transferred into her name because everything is under the control of the first respondent and not the executors.

The first respondent in her affidavit denies that she just took control of the business and occupied the property as alleged by Girlie. She avers that whilst her father was still alive, he and her aunt requested that she and her husband relocate from Gauteng in order to assist in the managing of Rossburg Passenger Services. At that specific time they were running their own transport business in Gauteng. They acceded to the request and since 1999 she has been managing the business in a caretaker capacity.

After her aunts death during 2006, as she was going through her aunts personal documents she came across a copy of a partnership agreement which was concluded in 1987. According to this agreement her father and aunt were equal partners in Rossburgh Passenger Services. This business had a fixed property at 38 Sirdar Road, Clairwood, Durban from which it traded. It also had as part of its primary assets a number of the buses with their respective carrier permits. Rani alleges that as a result of the partnership she, as sole heir to her aunt’s estate, would in fact be entitled to her aunt’s half share as a partner to the partnership and her aunt’s share from the estate of her father as per his will. In the result Rani would be receiving a 75% share of the business and the property whilst Girlie would only receive a 25% share instead.

Girlie vehemently denies the existence of this partnership and persists with her claim for her half share of Francis’s estate. She argues that Francis is the only one recorded as the owner of the property in the liquidation and distribution account. The property has already been transferred into her and Muniamma’s names, this could never have occurred if it belonged to the partnership as alleged by Rani. Girlie avers that to her knowledge Munaimma ‘had no knowledge of business matters, had no income, had no monies of her own, no assets of her own and had nothing to do with the business of Francis.’

The applicant has submitted in her replying affidavit and it was argued that the authenticity of the copy partnership agreement was in dispute and they required the production of the original. Girlie goes so far as to aver that the document is a fraud. She disputed the signatures there upon and also pointed out that the description of the property as is set out in the agreement could not have been the description used at the time the agreement was concluded. This is because of the deeds office amended the property reading to that specific reading in 1989. The applicant argued that this Court ‘scrutinizes with caution’ the allegations contained in this alleged fraudulent agreement.

It was argued on Rani’s behalf that prior to the finalization of her father’s liquidation and distribution account there had been plenty of evidence available to the executors to substantiate

the existence of the partnership. This was evident from the annual financial statements of the partnership which dated back to 28 February 1990. Further, that the liquidation and distribution account drawn up by the executors indicate that Francis and Muniamma owned the vehicle belonging to the business as partners. It also documented that Francis had ceded an insurance policy to Standard Bank in respect of an overdraft taken for the business and Rossburgh Auto Services. The executors were claiming half of the value of that overdraft facility from Muniamma.

In respect of the transfer of the property to Girlie and Muniamma, Rani’s representative argued that the executors erred when they transferred the half share of the property to Girlie. Girlie should have received a 25% share instead, since the property was a partnership asset and Rani would be seeking for the transfer to be set aside and rectified.

The version put up by the applicant in the founding affidavit and that which appears in the replying affidavit contradict each other. On the one hand the applicant states that Francis had “never entered” into a partnership with Muniamma. But this flies in the face of what is contained in the liquidation and distribution account. In this account, as already stated above, Francis and Muniamma own the vehicles for the business as partners. It’s also recorded that they were co-debtors in equal shares for an overdraft facility from Standard Bank which was taken out for the business. The estate of Francis even seeks payment of half of the overdraft from Muniamma. According to the applicant in her replying affidavit Francis obtained the route permits for the business in the name of Muniamma. These factors give the impression that there was a partnership that existed between Francis and Muniamma.

Even though this is so I cannot say so with certainty. There are other factors present as well which indicate that there could not have been a partnership. These are as follows:

The property 38 Sirdar Road, Clairwood was transferred to both Girlie and Muniamma. The title deed is also before the transfer only reflects Francis as the owner. If as alleged by the partnership agreement the property was an asset of the partnership, the transfer could not have been effected by the executors; In the liquidation and distribution account the proceeds of the business are not recorded as being a half share of the business but rather it is reflected as being the entire proceeds of that business. If they owned the assets as partners and even had a

overdraft debt for the business in equal co-debtors, surely the proceeds would have had to be reflected as being a half share of the business if they were partners; and The authenticity of the partnership agreement, surfacing of a copy with no original been produced, the timing of it emerging and the land description explanation.

These are facts that need to be ventilated by in my view by oral evidence because explanations to the discrepancies are not found in the affidavits before me. There clearly exist a disputes of fact as to whether a partnership in fact existed between Francis and Muniamma and whether Francis made a contribution to the partnership, his property situated at 38 Sirdar Road Clairwood, Durban.

The first respondent has request that the matter be referred for oral evidence if I cannot make a finding on the pleadings.

It is trite that I can grant final relief as requested by the applicant if “in proceedings on Notice of Motion (where) disputes of facts have arisen on the affidavits, a final order,…, may be granted if those facts averred in the applicants affidavits which have been admitted by the respondent, together with the facts alleged by the respondent, justify such an order.” A real, genuine or bona fide dispute must have been raised by the respondent which is not farfetched or untenable. (My addition in italics) See Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd [1984] ZASCA 51; 1984 (3) SA 623 (A) at page 634H to 635C

The issue as to whether a partnership existed is a real and genuine one. The first respondent has documentation to substantiate this and the liquidation and distribution account to an extent substantiates this. The averments made by the first respondents are not far-fetched or untenable. The executor at no stage in the pleadings disputes the existence of the alleged partnership between Francis and Muniamma as is evident from the liquidation and distribution account that they drew up.

The existence of the partnerships has a profound effect on the division of Francis’s estate and it also has a bearing on the property already transferred to Girlie and Muinamma. The benefit of oral evidence would once and for all finalise Francis’ estate.

I am satisfied that this is a case that must be referred for oral evidence in terms of Rule 6 (5) (g) of the Uniform Rules. The issue to be determined as stated above is whether a partnership existed between Francis and Muniamma and if so, whether Francis made a contribution of his property situated at 38 Sirdar Road, Clairwood, Durban to the partnership. The founding affidavit will stand as the summons. The exchange of pleadings to be as normal and Rules 35, 36 and 37 of the Uniform Rules of court are applicable.

As regards cost as is generally accepted in matters dealing with deceased estate the costs are paid by the estate. I see no reason why it should not be so in this case.

For the reasons set out above I make the following order:

The matter is referred for oral evidence with the founding affidavit to stand as a summons; The exchange of pleadings will follow as normal; That the provisions of Rules 35, 36 and 37 of the Uniform Rules of court are applicable; and

The costs of this application are to be paid by the deceased estate.

costs of such proceedings

APPEARANCES:

Counsel for the applicant: Adv. K. Naidu

Attorneys for applicant: I. C. Meer, Motala and Company

Counsel for the first respondent: Mr. John Milne Murray

Attorney for defendants: Mooney Ford Attorneys.

Heard on: 17 March 2010

Delivered on: June 2010