Horowitz v Brock and Others

• Jurisdiction: South Africa
• Judge: Joubert JA, Grosskopf JA, Smalberger JA, Nicholas AJA and MT Steyn AJA
• Judgment Date: 05 November 1987
• Citation: 1988 (2) SA 160 (A)
• Hearing Date: 17 August 1987
• Court: Appellate Division

Smalberger JA:

Introduction

The appeal and the two petitions before this Court involve issues H inextricably linked to the proper interpretation of the joint will of the late Selig Hillel Hillman and Chane Rochel Hillman. For convenience I shall refer to them jointly as the 'testators', and individually as 'the testator' and 'the testatrix' respectively. The proper interpretation of certain relevant provisions of the testators' will, to which I shall advert in more detail later, was the subject of a declaratory order sought by the trustees of the testamentary trust I established in terms of the will in the Witwatersrand Local Division. The judgment on the application by McEwan J is reported sub nom Ex parte Gluckman and Others NNO 1980 (3) SA 1127 (W). McEwan J's judgment was taken on appeal to the Full Bench of the Transvaal Provincial Division and its judgment (delivered by I W B de Villiers AJ, De Villiers and J Moll JJ concurring) is reported sub nom Ex

Smalberger JA

parte Gluckman and Others NNO: In re Hillman's Estate 1982 (2) SA 628 (T). I shall refer to these judgments as the 'WLD' and 'TPD' judgments respectively. A

Much of the relevant factual background necessary for a proper appreciation of the issues before us appears from the two judgments referred to. In order to facilitate the reading of this judgment it is B necessary to recount certain of those facts. In doing so I shall borrow freely from the WLD judgment.

The joint will of the testators was executed on 13 May 1925. The testator died on 9 November 1928, and the testatrix on 8 March 1955. In terms of the will the estates of the testator and the testatrix were C massed and were to be held in trust subject to the conditions of the will. The testatrix, as survivor of the spouses, became entitled to a life usufruct in respect of the income from the trust subject to a certain maximum amount. On her death certain legacies were to be paid whereafter the balance of the trust was to be divided between the D testators' four children, namely, Maurice Hillman, Wolf Hillman, Fay Gluckman and Annie Brock in the proportions and subject to the limitations stated in the will. For the sake of convenience and brevity I shall refer to the children by their first names. The bequests to Maurice and Wolf fell away because they predeceased the testatrix without leaving lawful issue. As a result their shares devolved upon E their sisters subject to the same conditions as were imposed in relation to the sisters' own shares of the inheritance. Those conditions are set out in clause 7 of the will, to which I shall advert in greater detail later. Suffice it for the present to state that Fay and Annie were income beneficiaries only in respect of their shares, and in terms of the will the trustees were enjoined 'on their respective deaths to hold their shares as aforesaid for the benefit of and to pay over the same to F their lawful children in equal shares who shall attain the age of 25 years'.

Fay had two sons. She died on 26 November 1976. By that time both her sons had attained the age of 25 years. One-quarter of the trust estate was accordingly distributed to each of them. Fay's descendants do not claim to have any interest in the present proceedings, which revolve G around the rights of Annie's children and grandchildren.

Annie had two children, Richard and Theda. Richard has two sons, Julian and Alexander, both of whom are majors. Theda died in 1966. At the time of her death she was married to Ruben Horowitz, and was survived by a daughter, Elizabeth (also spelt Elisabeth). The latter H attained majority prior to the hearing of the present appeal.

At a certain stage Annie expressed the wish to renounce all her rights of whatsoever nature in and to the trust in favour of Richard. This led to the trustees of the trust seeking the declaratory order which gave rise to the WLD judgment. The declarations sought in the notice of I motion appear at 1130H - 1131E of the WLD judgment. In view of subsequent developments and their effect on the issues arising in the present appeal it is necessary, for the sake of clarity, to repeat these herein. They are as follows:

'2.1

Upon renunciation by Annie Brock in favour of Richard Brock of all her interests in and to the trust estate ("the trust") created in terms of the last will and testament ("the will") of J the late Selig

Smalberger JA

A Hillel Hillman and his subsequently deceased spouse Chane Rochel Hillman, the corpus in the trust will pass to Richard Brock to the exclusion of any living or unborn person, and the trust will terminate;

2.2

the estate of the late Theda Rhona Horowitz (born Brock) has no B claim to the corpus of the trust whether on a renunciation by Annie Brock to Richard Brock of all her interests in and to the trust, or failing such renunciation, on the death of Annie Brock and whether or not she is then survived by her son Richard Brock, other than in terms of the arrangement referred to in C these papers between Richard Brock and the said estate;

2.3

Elizabeth Horowitz has no claim to the corpus of the trust whether on a renunciation by Annie Brock to Richard Brock of all her interests in and to the trust or, failing such renunciation, on the death of Annie Brock and whether or not she is survived by her son Richard Brock;

2.4

D on the death of Annie Brock (failing any renunciation during her lifetime of her interests in the trust) her son Richard Brock will become exclusively entitled to the corpus of the trust as then existing;

2.5

on the death of Richard Brock during the lifetime of Annie Brock (failing any renunciation during her lifetime of her interests E in the trust) Annie Brock will acquire full dominium in the assets comprising the trust to the exclusion of any other person whether alive or unborn.'

In interpreting the will McEwan J concluded that the word 'children' in the phrase 'pay over the same to their lawful children in equal F shares' had to be given an extended meaning to include the children of predeceased children of Annie (in casu, Elizabeth). He expressed the view (obiter) that on Annie's death Richard and Elizabeth would be beneficiaries in equal shares of the corpus of the trust (at 1135F). In the result he refused prayers 2.1, 2.3, 2.4 and 2.5 of the notice of motion, but granted prayer 2.2 (in regard to which there was no real dispute). As at the time of the hearing Elizabeth, Julian and Alexander G were all minors, they were represented by curators ad litem: in the case of Elizabeth, by Mr Bashall, and in the case of Julian and Alexander, by Mr Cloete.

The trustees duly appealed, which appeal eventually gave rise to the TPD judgment. The appeal was partly heard on 27 May 1981. Prior to the hearing heads of argument were filed by the appellants (the trustees) as H well as by Messrs Bashall and Cloete as curators ad litem (in the case of the latter in the form of a report). On 21 May 1981 the attorney acting for Richard filed an affidavit intimating that Richard (who had not previously been represented) would be present at the hearing of the appeal and would seek leave to be heard through counsel. Richard was I duly represented by counsel at the hearing on 27 May 1981 (counsel having previously filed heads of argument). For reasons which are not germane to the present matter the appeal was postponed until 5 November 1981. On 29 October 1981 Annie died without ever having renounced her rights in and to the trust in favour of Richard. Consequent upon Annie's J death the appellants

Smalberger JA

A (the trustees) filed a notice of amendment on 2 November 1981 intimating that at the resumed hearing of the appeal they would seek leave to amend the original notice of motion in the following respects:

'(a)

By the deletion of prayer 2.1.

(b)

By the deletion of the contents of prayer 2.3 with the exception B of the following phrase:

"2.3 Elizabeth Horowitz has no claim to the corpus of the trust."

(c)

By the deletion in prayer 2.4 of the words in brackets and the substitution of the words "will become" with the word "became".

(d)

By the deletion of prayer 2.5.'

C At the same time they filed an affidavit in support of their application in which, inter alia, the following was said:

'3.

We respectfully submit that the death of Annie Brock has rendered academic all but one of the issues in this case. The issue which remains is the meaning of the phrase "their lawful children" in the context of the bequest of the corpus of Annie Brock's share on her death. The applicants wish to effect a distribution of the corpus D of the trust to the beneficiary or beneficiaries entitled thereto as soon as possible, and we submit that, as all the interested parties are before the above honourable Court, a decision on the meaning of this phrase on a proper interpretation of the will should be given at this stage.

4.

In consequence of the death of Annie Brock it has become necessary to amend the notice of motion in order to relate the relief sought to the remaining relevant issue, and application will accordingly E be made at the resumed hearing of this matter for an amendment to the notice of motion in the terms set out in the notice of application to which this affidavit is annexed.

5.

The applicants contend that the only lawful child of Annie Brock who survived her death is her son Richard and that he is consequently exclusively entitled to the corpus of the trust. However, should the appeal not be upheld against the ruling of the F learned Judge a quo that the word "children" must be given an extended meaning to include grandchildren, the applicants respectfully ask that the above honourable Court give a ruling on the question whether the two sons of Richard Brock are to be included in the concept of...