DISTRIBUTABLE 22

Judgment No. SC 27/08

Civil Appeal No 331/06

(1) JOSHUA KADENGU (2) LAMECK KADENGU (3) ROSA KADENGU v (1) OLGA KADENGU (2) RICHARD JOHN CHIMBARI (3) MASTER OF THE HIGH COURT

SUPREME COURT OF ZIMBABWE

SANDURA JA, ZIYAMBI JA & GARWE JA

HARARE, MAY 5, 2008 & JANUARY 19, 2009

H Zhou, for the appellants

G Mhlanga, for the respondents

ZIYAMBI JA: The late Job Bruno Kadengu died testate on 25 March 1990. His will contained the following clauses:

“2. The expression “Executors” or “Executor” wherever used in this Will mean either Executors or Administrators or Trustees or any two or all of these offices as may be appropriate in the circumstances and in the context thereof and the term “Executors” includes the singular and the term “Executor” includes the plural.

5. My Executor shall take possession of all my property, whether movable or immovable of whatsoever nature and sort and wheresoever situate and whether the same be in possession, reversion, remainder or expectancy, and after paying thereout all my just debts and taxes payable by reason of my death and the expenses of the administration of my Estate, then he shall pay and apply the same as hereinafter directed.

6. I hereby direct that my Executor shall purchase a house in the northern suburbs of Harare and I desire that such house be large enough and commodious enough in the discretion of my Executor to comfortably accommodate my wife, OLGA, and any dependent children born of me and my said wife who may survive me. I hereby give and bequeath to my said wife the said house as a special legacy. I further give and bequeath to my said wife as a special legacy (or special legacies) all the household furniture and effects of which I may die possessed and effects of which may, at the time of my death, be situate in the residential property where my said wife and I may be living as at the date of my death. The legacies referred to in this paragraph shall be conditional upon my said wife, OLGA, surviving me for a period in excess of thirty (30) days.

7. I record that I own a certain farming property situate near Rusape. Provided that my mother shall survive me for a period in excess of (30) thirty day and provided that I still own the said farming property as at the date of my death, I hereby give as special legacies to my mother all the farming implements, live-stock and other movables which may belong to me at my death and which may be situate on the said farm as at the date of my death. I further hereby give and bequeath to my said mother a life usufruct in respect of the said immovable farming property but subject to the provisions contained in the immediately subsequent paragraph hereof pertaining to my sister, ROSA CHIMAMBO. I direct that the dominium in the said farming property shall be assumed and taken by my Trustee appointed hereunder who shall deal with the same as directed hereunder.

9. After discharging my debts and taxes and paying the legacies and providing for the aforesaid usufruct and generally dealing with my directives detailed hereinabove, my Executor shall sell and liquidate and turn into cash the entire balance of my Estate and my Executor shall hold the resultant monies in his own name as Trustee of a Trust Fund and he shall apply the income and capital thereof as hereinafter directed. The successor in office as Trustee of my Trust Fund shall be the Senior Partner for the time being of the said Messrs Gollop & Blank.

10. My Executor, as Trustee, in such manner as he shall in his absolute discretion from time to time think fit, pay and apply the income of my Trust fund to or for or towards, the benefit, maintenance, education and advancement of my said wife, OLGA, my said mother and any and every child born of my union with my previous wife and any and every child born of my union with my said wife, OLGA, and, without derogating from the generality of the aforegoing the following persons; viz.”

The appellants were among the persons listed under paragraph 10.

It is common cause that Gregory Slater who was appointed executor of the will failed to complete the administration thereof before he fled the country on allegations of misappropriation of funds and that Messrs Gollop and Blank renounced their appointment as executors and trustees of the estate on 5 September 1997. The assets of the estate were given as 4 000 shares in Paradise Park Motel (Pvt) Ltd and a certain piece of land in the district of Makoni called Alloa Farm.

The Master, in an attempt to speed up the administration of the estate, on 2 July 1999 appointed the second respondent as executor dative of the estate. It seems that the second respondent was unable to remedy the problems left unresolved by Slater and, on 28 September 2000, the first and the second appellants wrote to the Master complaining of the second respondent’s inaction and his failure to wind up the estate in accordance with the wishes of the testator. The letter did not achieve the desired result and on 24 March 2003 the appellants made an application to the High Court seeking the following order:

“IT IS ORDERED THAT:

1. The Trust which was to be set up in terms of Clause 9 of the Will be and is hereby abandoned.

2. The deceased’s 4 000 shares in Paradise Park Motel (Pvt) Ltd shall be sold to the best advantage of the beneficiaries.

3. A large enough and commodious enough house shall be purchased for the first Respondent and her minor children from the proceeds of the sale of Paradise Park Motel (Pvt) Ltd. The Master of the High Court (the third respondent) shall determine whether the house which the estate shall be purchasing for the first respondent and her children is ‘large enough and commodious enough’.

4. After purchasing the house described above for the first respondent and her children, the residue shall be equally distributed among the surviving beneficiaries. The shares of the beneficiaries who are outside the country or who are not part (sic) to these proceedings shall be … (illegible).

5. The immovable property situate in Makoni District, namely Alloa Farm, held under Deed of Transfer 7689/81 shall not be sold. It shall be retained as the family home to be registered in all beneficiaries names or to be registered in the name of the nominated beneficiary in trust for the rest of the beneficiaries”.

It was their contention that the intention of the testator as expressed in clause 9 of the will could no longer be implemented because of the abdication of Slater and the renunciation by Gollop & Blank. They alleged that they could not agree on a suitable substitute and in any event some of the beneficiaries could not be located while others were resident outside Zimbabwe.

On 23 July 2003 the appellants obtained a default judgment in the terms set out above. This order was, however, rescinded by consent and the matter was argued before the court a quo.

The second respondent, the executor dative alleged that the estate was illiquid making it impossible for him to discharge his mandate. It was his view that the ownership of the 4 000 shares should be determined before the estate could be wound up. The three issues argued by the parties before the court a quo were as follows –

1. Whether or not the estate can no longer be wound up in terms of the will because some clauses have become irrelevant;

2. Whether or not the 4 000 shares in Paradise Park Motel (Pvt) Ltd form part of the deceased’s estate; and

3. Whether or not Alloa farm can still be dealt with in terms of the will.

The application was dismissed by the court a quo primarily on the grounds that the appellants had no locus standi to bring such an application. In this regard the learned Judge said:

“It seems to me however, that a more fundamental point, which unfortunately was not addressed, arises. It is whether or not the applicants have locus standi, that is, a direct and substantial interest in seeking variation or rectification of the will.”

And later at p 6 of his judgment:

“It seems to me therefore that the applicants in casu are obliged to show the direct and substantial interest that they have in the subject matter before me of seeking the variation of certain clauses of the will. In terms of the will they are residuary heirs. They will only be able to benefit from the will after clause 9 thereof has been fulfilled.”

The court a quo, though alive to the fact that neither party had been given the opportunity to make submissions on this issue, yet proceeded to decide the matter on an issue not raised during the hearing and addressed by the parties. In so doing the learned Judge misdirected himself. It was imperative that the issue was fully canvassed and investigated.

As it was said in Middleton v Carr 1949 (2) SA 374 (AD) at pp 385-6 of the judgment:

“… as has often been pointed out, where there has been full investigation of a matter, that is, where there is no reasonable ground for thinking that further examination of the facts might lead to a different conclusion, the court is entitled to, and generally should, treat the issue as if it had been expressly and timeously raised. But unless the Court is satisfied that the investigation has been full, in the above sense, injustice may easily be done if the issue is treated as being before the Court.”

The issue was not before the court a quo and in the absence of a full investigation thereof the court erred in treating the issue as one which was before it. Clearly there was a real chance of an injustice being done to the appellants against whom the finding was made.

In any event it would seem to me that the appellants, as beneficiaries under the will, would have a legal and substantial interest in the proper administration of the estate since a proper administration of the estate would ensure the protection of their inheritance. Their interest is, in my view, sufficient to give them locus standi in judicio in any matter relating to the proper administration of the estate.

I would therefore allow the appeal on this ground. But that is not the end of the matter for the court went on to decide the issues before it and found against the appellants on all three issues. I turn to consider the appeal against the court’s finding on the merits of the application.

The first and second issues which fell for decision by the court a quo may conveniently be dealt with together. They are, whether or not the estate could no longer be wound up in terms of the will because some of the clauses have become irrelevant; and whether Alloa farm could no longer be dealt with in terms of the will.

Mr Zhou’s submission, as I understand it, is that clause 3 of the will which nominated Gollop & Blank as Executors and Trustees has been overtaken by events by virtue of that firm of legal Practitioners having renounced its appointment as executors and trustees under the will. It was submitted further that with reference to clause 9 of the will, the appointment of a trustee was now a practical impossibility since the will envisaged the appointment of Messrs Gollop & Blank as Trustees and the second respondent, being an executor appointed by the Master, cannot assume the office in terms of the will. Further, the will itself makes no provision for the appointment of any other person as trustee in the event that the appointed firm fails to take up the appointment for any reason. The deceased, it was submitted, had specifically appointed his executors to be the trustees as he was clear as to who the executors were. There was nothing in the will, so it was submitted, that supports the conclusion that an executor dative would be entitled to become the trustee since the executor dative was not nominated by the testator but by the Master.

A reading of clauses 2 and 4 of the will would appear to support the submission on behalf of the respondents that a person other than Gollop & Blank was envisaged by the testator as being his executor and/or trustee. For instance reference is made to an accountant as being a possible executor or trustee:

“Any executor of this my will or any trustee of any Trust Fund hereinafter created who is by a (sic) profession a legal practitioner or conveyancer or accountant or notary may charge the estate or any such Trust Fund …”.

However, that having been said, an executor appointed by the Master cannot by virtue of that appointment assume the position of trustee or administrator of the estate. If he is to act as an administrator he must be appointed as such by the court. See Ex parte Atherstone, 1942 CPD 559; L Ferera (Pvt) Ltd v Vos, N.O & ORS, 1953 (3) SA 450 (A.D) at 463E-464A.

Thus where an executor has renounced his appointment under a will, the Master is empowered by the Administration of Estates Act [Cap 6:01], to appoint an executor whose duties are as set out in that Act, namely, to bring in the assets of the estate, file a liquidation and distribution account and to account to the Master for the assets of the estate as set out in that account.

However, the Master has no power to appoint a trustee so that if a trustee appointed in a will has renounced his appointment, or the trustee is incompetent or, having been appointed, is for some reason no longer acting or, if a testator has created a trust but failed to appoint a trustee, only the Court in the exercise of its inherent power to appoint, control and remove trustees can appoint a trustee to administer the estate in accordance with the wishes of the testator as set out in the will. The Court will exercise this power in order to enable the trust to be continued. See Ex parte Davenport & Anor 1963 (1) SA 728 (SR) at 731; The Master v Edgecombe’s Executors 1910 TPD 263 at 269-270; Port Elizabeth Assurance Agency& Trust Co. Ltd v Estate Richardson 1965 (2) SA 936 (C.P.D) at 938C-939D.

It is evident from the above that there is a distinction in our law between an executor and a trustee. In the case of The Master v Edgcombe’s Executors and Administrators supra, at 274, INNES CJ remarked as follows:

“The distinction between an executor and an administrator (now “trustee’) is well known in our law. The executor realizes the estate, reduces it into possession and accounts for it to the Master. When he has discharged his duties the administrator (trustee) (if one has been appointed) steps in and administers the fund, which the executor has realized in accordance with the terms of the will.”

See also The Law of Succession in South Africa by Corbett et al at p 414 where the authors say:

“Not infrequently, a testator appoints the same person to be both executor and trustee (or administrator) of the estate. There is no objection to this, but it must be emphasized that the two offices are quite separate and distinct under our law and the person who will be appointed to both will be required to act in two different capacities.”

In the instant case, once the executor has completed his duties in terms of the Act the Master, or the beneficiaries, may apply to the court for the appointment of a trustee to administer the estate in terms of the will.

With regard to Alloa Farm, there is nothing on record from which I can conclude that the intention of the testator regarding the farm as expressed in the will cannot be implemented. I would, accordingly, agree with the learned Judge that clause 9 of the will is capable of implementation.

I turn to the final issue which is whether the 4 000 shares in Paradise Park Motel (Pvt) Ltd form part of the deceased estate. The learned Judge dealt with the matter thus:

“The applicants referred to affidavits by the first respondent in which she stated that the shares belonged to the estate. They also attached the First Interim Liquidation and Distribution Account laid for inspection on 4 December 1992 and the subsequent First and Final Liquidation and Distribution Account of 1 November 1996 in which the shares are reflected as being assets belonging to the estate as proof that they are estate property.

In paragraph 13 of the Founding Affidavit the applicants aver that the shares belong to the Estate. In response in her opposing affidavit the first respondent averred that those shares in Paradise Park Motel (Pvt) Ltd had not been paid for at the time the testator died and that he never owned them. She then goes on to state that they never became part of the estate.

Apparently the sellers of the shares invited interested beneficiaries to participate in Paradise Park Motel(Pvt) Ltd. None was interested save the first respondent who negotiated transfer to herself and who took transfer.

In their answering affidavit the applicants insisted that the shares form part of the estate, no doubt on the basis of the earlier statements on oath to this effect by the first respondent. The applicants did not dispute the averment that the letter of 23 April 2002 by Messrs Gill, Godlonton & Gerrans was written in response to the one by their then erstwhile legal practitioners Messrs Musunga & Associates over the transfer of an immovable property associated with Paradise Park Motel (Pvt) Ltd. This letter on page 74 of the record indicated that the agreement referred to was entered into between Auto Export/Import (Pvt) Ltd and Auto Import/Export (Pvt) Ltd as purchaser and that transfer could only be effected to Paradise Park Motel (Pvt) Ltd and not the estate.

The applicants did not lay facts before this court on the status of Paradise Park Motel (Pvt) Ltd other than averments of the first respondent’s sworn affidavit to the effect that that she would become co-director with the testamentary executor in this company which was part of her late husband’s estate. The letter from Gill, Godlonton & Gerrans seems to suggest that post payments on the purchase price were paid by the first respondent. There would be need to lead evidence on the true circumstances surrounding the shares in question. It may very well be that the shares belong to the estate notwithstanding that in terms of section 104(1) of the Companies Act [Cap 24:03] the holder of a certificate duly signed and with the seal of the company is presumed to be the owner of the shares on a prima facie basis. This however is an area where further evidence will be needed. If so advised, it seems to me that this is an issue to be pursued by the second respondent with the Motel and the first respondent.

When the applicants brought the application it must have been in their contemplation from the contents of the letter from Gill, Godlonton & Gerrans that a dispute of fact would arise on the question of shares. They did not cite the company. These factors are fatal to the present application.

I would thus dismiss the request to hold that the 4 000 shares belong to the estate in the absence of further evidence.”

It appears to me that the dispute as to the ownership of the shares is bona fide and not merely illusory. In such a case the onus is on the appellants to satisfy the court that the matter could be resolved on the affidavits without the risk of injustice to the other party. See Zimbabwe Bonded Fibreglass (Pvt) Ltd v Peech 1987 (2) ZLR 338 (5) at 339C. This they failed to do. I cannot fault the learned Judge for finding himself unable to resolve the dispute on the papers without hearing evidence. In choosing to proceed by way of court application the appellants, aware of the dispute of fact, took the risk of failing to discharge the onus on them to convince the court that the matter could be determined without calling evidence.

In the premises, I would uphold the decision of the learned Judge on this issue as well.

Accordingly, while it is my judgment that the appellants had locus standi to approach the court, I am satisfied that their appeal on the merits must fail.

The appeal is, therefore, dismissed with costs.

SANDURA JA: I agree

GARWE JA: I agree

Hungwe & Partners, appellants’ legal practitioners

Chihambakwe, Mutizwa & Partners, respondents’ legal practitioners