Bequest of a 'Business Concern with all its Assets and Liabilities': Some Comments

• Jurisdiction: South Africa
• Pages: 99-115
• Citation: (2014) 25 Stell LR 99
• Date: 16 August 2019
• Author: Anton van der Linde
• Published date: 16 August 2019

99

BEQUEST OF A “BUSINESS CONCERN

TOGETHER WITH ALL ITS ASSETS AND

LIABILITIES”: SOME COMMENTS

[DISCUSSION OF GRADUS V SPORT HELICOPTERS

ALSO KNOWN AS SPORT AVIATION (19879/2008) 2012

ZAWCHC 365 (28 NOVEMBER 2012)]

Anton van der Linde

BLC LLB LLM LLD

Professor of Law, University of Pretoria

1 Facts

In Gradus v S port Helicopters also know n as Sport Aviation1 (“Gradus”),

the cause of action arose from a helicopt er accident which occurre d on 23

Febr ua ry 2 006 .2 Duri ng his lifetime, ESD MacDonald owned and ope rated

a business known as Spor t Aviation/Sport Helicopters. The mai n business

of Sport Helicopters was to conduct scen ic tours of the Cape penin sula for

tourists. Spor t Aviation/Sport Helicopters was a sole proprietorsh ip owned

by a certain ESD MacDonald. T he business owned several helicopters. In the

course of transp orting tour ists a helicopter crashed on the bea ch of the Cape

Point Nature Reserve. The plaint iffs, all of whom were tourists and passenger s

in the helicopter, were injured.

ESD MacDonald (the deceased) died later that year on 9 D ecember 2006

without any personal injur y claims or other claims being instit uted against the

business. The deceased lef t a valid will and paragraph 5.5 of his will conta ined

the following bequest:

“To my son ROBERT GRAHAM MACDONALD I … bequeath the business concern known as Sport

Aviation together with all its assets and liabilities.” (Emphasis added.)

The plaintiffs (the touri sts) issued summons on 28 November 2008.

The deceased’s estate was not cited as defendant. T he action was brought

against the beneciary and son, Robert MacDonald.3 They alleged that the

beneciary was liable for the damage s arising fr om the helicopter accident as

1 (19879/2008) 2012 ZAWCHC 365 (28 Nove mber 2012) S AFLII /www saflii org/za/cases/

ZAWCHC/2012/365 html> (accessed 27-06 -2013)

2 Para 5

3 In the part iculars of claim the f irst defendant is de scribed as “Rober t MacDonald, an adu lt male … who

is the proprie tor of Sport Helicopters also k nown as Sport Aviation … First d efendant inherited Sp ort

Helicopters, i ncluding all of its as sets and liabilitie s, from his late fat her, the former propr ietor”

(2014) 25 Stell LR 99

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he “inherited Spor t Helicopters, including all it s ‘assets and liabilities’, from

his late father, the former propr ietor”.4

The q uestion before the court wa s whether Rober t MacDonald, t/a Sport

Aviation/Sport Helicopters (rst defendant) in herited the delictual liability

arising from the me ntioned accident, or whether the deceas ed estate bore

liability.5 The essence of their arg ument was that shortly after the deceased’s

death, the executor gave effect to the bequest and that Robert MacDonald

accepted or ad iated the bequest.6 The benecia ry comme nced a sole

proprietorship, Robert Ma cDonald t/a Sport Aviation a few days after the

deceased died.

The claims against the rst defendant were brought on the basis of breach of

contract,7 alternatively in delict.8 The plainti ffs elected not to claim against

the deceased’s estate (which claims would in the meantime have prescr ibed).

They submitted th at a reading of the will left no doubt th at the deceased

intended the beneciar y to carry on Sport Helicopters as a going concern.

They argued that the b eneciary accept ed the benet and that accordi ngly

the liabilities, including t he claims of the plaintiffs, passed t o him.9 Some

documentar y evidence was produced to indicate adiat ion of the inheritance by

Robert MacDonald soon afte r his father’s death.10 Robert MacDonald and the

executor denied this al legation and both te stied in defence. The defence can

be summar ised as follows:

4 Gradus v Spo rt Helicopters a lso known as S port Aviatio n (1987 9/20 08) 20 12 ZAWCH C 365 (2 8 Nove mbe r

2012) SAFL II paras 5-10 First defenda nt was cited as Sport Hel icopters, also k nown as Sport Aviation , a

firm, t he proprietor of which is R obert MacDonald

5 Para 8 Th is issue, namely whe ther the corr ect party h as been sued wa s, by agreement b etween the par ties,

separated f rom other defences fo r determinat ion in limine (para 1) The onus of proof was o n plaintiffs to

show that the liab ility had shif ted from the decea sed estate to Rober t MacDonald (pa ra 11)

6 Para 12

7 Based on an oral a greement that plaint iffs be taken on a sightseei ng tour; that the helicopt er would be

airwort hy and that the pilot would ex hibit the necessa ry expertis e and diligence to en sure a safe flig ht et

cetera Plaintiff s undertook in r eturn to pay th e said fee (See cls 11-16 of the summons retai ned from the

case file)

8 Based on the arg ument, inter alia, tha t the crash landing was solely d ue to the unlawful and n egligent

action of the fi rst defendant (For f urther par ticulars see cls 8-20 of t he aforementioned su mmons ) In so

far as it could be a scertained t hat plaintiffs sus tained injurie s resulting in a clai m for pain and suffer ing

First defenda nt’s liability r ests on him because of him i nheriting all the asse ts and liabilities of Sport

Helicopters (cl 20 4 of the su mmons)

9 Gradus v Spo rt Helicopters a lso known as S port Aviatio n (1987 9/20 08) 20 12 ZAWCH C 365 (2 8 Nove mbe r

2012) SAFL II para 25

10 Paras 28-29 In respons e to a letter from an atto rney of one of the various benef iciaries in the ongoin g

disputes abo ut the estate, the exec utor, for example stated ( para 28 (c)):

“RG MacDonald het on middellik na dood die bat es en laste van Sport Helic opters oorgeneem soda t

die boedel onthef k an word om die koste van di e laste van Sport Helic opters te diens, wel ke kostes die

boedel nie kan b etaal nie ”

Later, in response to a question by the plaint iffs’ attorneys with regar d to the date Robert MacDonald took

over the assets a nd liabilities, th e executor replied (p ara 29):

“Kindly note tha t the Li quidation a nd Distr ibution Accou nt of the Estate Late Mr ESD MacDonald

has not yet been f inalized as the re have been a number of object ions lodged against it I am c urrently

waiting on fu rther corre spondence from t he Master in that reg ard As such, Mr R D Ma cDonald is not

in position to re ceive any inherit ance under the wi ll ”

In other words , at one stage the executo r wrote that the busi ness vested in Robe rt MacDonald on the d ate

of ESD MacDonald’s death, a nd at another stage he wro te that the business for med part of the estat e of

ESD MacDonald Plain tiffs argued that t he contrast in the t wo responses pointed t o the executor tryi ng

to support t he contention that Rob ert MacDonald did n ot receive his beques t soon after the dea th of ESD

MacDonald (Pa ra 29) For the court’s respon se see para 35

100 STELL LR 2014 1

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