Callinicos v Burman

• Jurisdiction: South Africa
• Judge: Hoexter JA, Beyers JA, Ogilvie Thompson JA, Botha JA and Williamson JA
• Judgment Date: 20 November 1962
• Citation: 1963 (1) SA 489 (A)
• Hearing Date: 23 September 1962
• Court: Appellate Division

Ogilvie Thompson, J.A.:

Appellant sued respondent - who is the duly appointed trustee in the insolvent estate of one D. Maserowitz which was sequestrated on 17th February, 1959 - in the Johannesburg magistrate's court - for two sums of R188.10 and R210 respectively. C Two separate claims were incorporated in the summons, the second claim being framed in the alternative. I hereafter refer to the parties as plaintiff and defendant respectively; and I shall speak of the Insolvency Act, 24 of 1936 as 'the Act'. After unsuccessfully excepting to all the claims in plaintiff's summons on the ground that they D disclosed no cause of action, defendant filed various alternative pleas to plaintiff's claims. Exceptions taken by plaintiff to defendant's first and second alternative pleas to plaintiff's first claim (for R188.10) were upheld by the magistrate; but on appeal that decision was reversed by the Transvaal Provincial Division which altered the magistrate's judgment to read: 'Exception to defendant's first and second E alternative pleas dismissed with costs.' On leave granted by the Provincial Division, plaintiff has now appealed to this Court.

Plaintiff's first claim is for damages against defendant in his personal capacity. In her summons plaintiff made averments to the effect that (i) F the said Maserowitz was at all material times indebted to her in the sum of R280 for rent in respect of certain named premises leased by her to him; (ii) that on 19th November, 1959, plaintiff filed with defendant a claim which included a preferent claim for rent in respect of those premises in the sum of R228.57; (iii) that this claim was duly admitted G by defendant; (iv) that the proceeds of the property subject to plaintiff's legal hypothec for rent were sufficient to pay this claim of R228.57. Plaintiff's summons then averred, in para. 6 thereof, that, upon admitting plaintiff's claim, it became the trustee's

'duty to apply the proceeds of the property subject to plaintiff's legal hypothec in satisfying the said claim for rent amounting to R228.57 in terms of the provisions of sec. 95 of the Insolvency Act 1936';

but that (I quote from para. 7 of the summons):

H 'the said trustee, wrongfully, unlawfully, negligently and in breach of his said duty neglected and failed to apply such proceeds for the payment of plaintiff's said claim, but treated plaintiff's claim as a concurrent claim and tendered her an amount of only R40.47 in respect of her preferent claim'.

Paras. 8 and 9 of plaintiff's summons then continued as follows:

'(8)

The said trustee filed a final account in the said estate which account was confirmed on or about the 17th January, 1961, and has distributed the dividends to creditors leaving only the sum of R40.47 available for payment of plaintiff's claim in terms of the said account.

(9)

Plaintiff says that in the premises she has sustained damage by reason

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of the said breach of duty, amounting to R188.10 for which defendant in his personal capacity is liable to her'.

After admitting paras. 1 - 5 of the summons, defendant's first alternative plea (defendant's main plea is not in issue in these proceedings) to plaintiff's first claim reads:

A '2. Ad paras. 6 and 8:

(a)

The defendant was satisfied as to the amount of the claim, but did not admit that the said claim was entitled to the preference claimed or to any preference.

(b)

On the 10th August, 1960, one Stanley Wilfred Lief was duly appointed by the Master of the Supreme Court to act as co-trustee with the defendant.

(c)

The defendant and his co-trustee the said Stanley Wilfred Lief, B in good faith in framing the liquidation and distribution account in the said estate did not allot any preference to the plaintiff in respect of the said claim and in terms of the said account provided for payment to the plaintiff of a dividend in the sum of R40.47, which was the amount payable to plaintiff on the basis that such claim was no entitled to any preference, and which amount the defendant paid to plaintiff.

(d)

The said account was a final account, and the same was duly C confirmed by the Master of the Supreme Court in terms of sec. 112 of Act 24 of 1936, after all the formalities prescribed by the said Act had been complied with, no objection to the said account having been lodged.

(e)

Save as aforesaid the allegations in these paragraphs are admitted.

3. Ad para. 7:

Save as aforesaid and save for stating that in the premises he denies that his conduct was unlawful, negligent or in breach of his said duty, the defendant admits the allegations in this paragraph.

D 4. Ad para. 9:

Save as aforesaid the defendant denies this paragraph.'

The effect of para. 2 (e) of the plea is inter alia that the allegation (numbered (iv) above) in the summons that plaintiff's preferent claim for rent was adequately covered is admitted. By way of further E particulars, defendant intimated that plaintiff's claim was proved at a special meeting of creditors on 9th December, 1959.

The second paragraph of defendant's second alternative plea repeats para. 2 of his first alternative plea and the plea then concludes as follows:

'3. Ad para. 7:

(a)

The plaintiff was negligent in the manner in which she framed F her claim, in failing to inspect the aforesaid account and in failing to make any objection thereto.

(b)

The damages recoverable by the plaintiff in respect thereof should be reduced by this honourable court to such extent as the court may deem just and equitable, having regard to the degree in which the plaintiff was as fault in relation to such damages.

G Wherefore the defendant prays that the plaintiff's claim may be dismissed with costs.'

The exception taken by plaintiff to both the above pleas was that they fail to 'disclose a ground of defence'. In the alternative, application was made to strike out paras. 2 (a), (c) and (d) of the first alternative plea and para. 2 of the second alternative plea as being H 'argumentative, irrelevant, superfluous, and contradictory'. The prayers in each case were that the plea be set aside with costs or, alternatively, that the application to strike out be granted with costs.

Plaintiff's second claim (for R210) is against defendant in his capacity as trustee and, alternatively, in his personal capacity. Plaintiff's summons in relation to this claim, after averring that the aforementioned lease with Maserowitz was at the rental of R210 per month, that the said lease was in force at the date of Maserowitz's insolvency on 17th February, 1959, and that defendant retained occupation of the

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premises until 7th April, 1959, when he terminated the lease, continues by making averments to the effect that: (i) defendant in his capacity as trustee is indebted to plaintiff in the sum of R210, being rent for the period 17.2.59 to 7.4.59; or alternatively, in the event of defendant being unable to pay in his said capacity, that (ii) by reason of his A breach of duty to apply the free residue of the estate, in terms of sec. 97 of the Insolvency Act, to paying plaintiff's rental for the said period, defendant is in his personal capacity liable to plaintiff in damages in the sum of R210.

B To this claim for R210, defendant first pleaded three 'special pleas', viz.:(a) misjoinder in that

'defendant is cited in two capacities in this claim and only in one capacity under claim 1 in the summons'.

alternatively, (b)

'the joinder of the defendant in this claim in his capacity as trustee is misjoinder';

and, alternatively, (c) that Lief

C 'should have been joined with the defendant in his capacity as trustee as co-defendant'.

(This plea of non-joinder was not argued either in the Courts below or in this Court.) The plea then continued,

'in the event only that the defendant's special pleas above are overruled',

D to set out various alternative pleas to plaintiff's second claim. No exception was taken by plaintiff to defendant's plea to her second claim. The further details of that plea are, therefore, irrelevant to this appeal.

Although the record is silent on the point, we were informed from the Bar that the above-mentioned plea of misjoinder (advanced by defendant to plaintiff's second claim) was set down for hearing concurrently with E the hearing of plaintiff's exception to defendant's first and second alternative pleas to plaintiff's first claim, and that the two matters were argued together. In the course of his reasons for upholding, with costs, plaintiff's exceptions to both of defendant's alternative pleas, the magistrate expressed himself as satisfied that 'the special plea as F regards misjoinder must fail'; he, however, apparently omitted to make any specific order in that regard. The Provincial Division found it unnecessary to deal with the question of misjoinder and expressed no opinion thereon.

The issue for decision in this appeal is whether defendant's first and G second alternative pleas disclose a defence, not whether the summons discloses a cause of action. In order, however, to determine whether the above-mentioned pleas disclose a defence, it is necessary first to ascertain what is the case made, or sought to be made, in the summons. From the averment of the duty set out in para. 6 of the summons, from the general frame of the summons, and from the wording of para. 9 thereof, H it would, I think, at first sight appear that plaintiff was merely relying upon a breach of statutory duty per se, as distinct from a negligent breach of that duty. That is certainly how the position was understood in the Court a quo; for in his reasons LUDORF, J., said:

'It was conceded, and indeed argued by Mr. Schaeffer on behalf of the respondent, that on a true interpretation of the...