Ruskin, NO v Thiergen

• Jurisdiction: South Africa
• Judge: Hoexter JA, Van Blerk JA, Ogilvie Thompson JA, Van Winsen JA and Williamson JA
• Judgment Date: 07 June 1962
• Citation: 1962 (3) SA 737 (A)
• Hearing Date: 19 March 1962
• Court: Appellate Division

Ruskin, NO v Thiergen
1962 (3) SA 737 (A)

1962 (3) SA p737

Citation	1962 (3) SA 737 (A)
Court	Appellate Division
Judge	Hoexter JA, Van Blerk JA, Ogilvie Thompson JA, Van Winsen JA and Williamson JA
Heard	March 19, 1962
Judgment	June 7, 1962

Flynote : Sleutelwoorde A

Vindication — Which party the vindicator — On which party the onus rests to prove his ownership — Trustee in insolvent estate claiming motor car from respondent — Respondent claiming that he had B purchased it from a third party as owner, through the insolvent as agent — Insolvent having had detentio but not juristic possession — Onus rests on trustee as vindicator — No presumption from possession in his favour — Failure to discharge onus - Insolvency — Property passing to trustee — Act 24 of 1936, sec. 20 — Scope of.

Headnote : Kopnota

The appellant, as trustee in the insolvent estate of A, had brought a C vindicatory action in a magistrate's court against the respondent for delivery of a motor vehicle alleged to have been owned and possessed by A on the date of his provisional sequestration. Respondent, however, pleaded that the car had prior to A's sequestration been sold to one M, and that he had bought it from M, in whose name it was then registered, although A had acted as the agent of M in selling the car to him and although he, respondent, had paid the purchase price to A and not M, at D A's request and apparently with M's consent. The respondent, in his pleadings, admitted that A was the owner and possessor of the car at some stage before his insolvency and also that he was the possessor of the car immediately prior to his insolvency, but averred that he then possessed the car as the agent of M, and that he was not the owner thereof. Respondent claimed that M was then owner and juristic possessor. M stated in evidence that he had bought the car from A with a E view to selling at a profit, and that both he and A had been on the look out for a purchaser, but that two days after the provisional sequestration of which he was not aware, he had agreed to sell the car to the respondent for the same price as he had paid for it. The magistrate's court had been unable to conclude that the sale transaction between A and M was fictitious and had granted absolution from the instance. Such decision having been upheld by a Provincial Division, in a further appeal,

Held, that the appellant was the vindicator, and that respondent could not be stamped with the character of vindicator: accordingly that the F onus was on the appellant to prove his title as owner.

Held, further, that the trustee could not rely on section 20 of the Insolvency Act, 24 of 1936, in relation to the property of other persons in the insolvent's possession.

Held, further, that the appellant could not rely on the operation of the presumption of ownership which flowed from possession, since such presumption was attached to juristic possession, whereas A only had the G detentio of the car at the time of his insolvency.

Held, accordingly, that it could not be concluded that the magistrate had been wrong in holding that the appellant had failed to discharge the onus on him and in granting absolution from the instance. Appeal accordingly dismissed with costs.

The decision in the Transvaal Provincial Division in Ruskin, N.O v Thiergen, confirmed. H

Case Information

Appeal from a decision in the Transvaal Provincial Division [HILL, J.]. The facts appear from the judgment of VAN WINSEN, J.A.

R. L. Selvan, for the appellant: It being common cause on the pleadings that the insolvent was in physical possession of the motor car immediately prior to his insolvency on 20th November, 1958, and that the car was disposed of to respondent on 22nd November, 1958, the onus of proving that Moore was the owner on the latter date rested

1962 (3) SA p738

upon respondent. References to the authorities in this context refer implicitly or explicitly to ostensible possession which it is submitted means physical possession or detentio. See Zandberg v van Zyl, 1910 A A.D. at pp. 306, 315 Policansky Bros v Hanau, 25 S.C. at p. 672; Gobo v Davies, 1915 E.D.L. at p. 139; Pandor's Trustee v Beatley & Co. and Another, 1935 T.P.D. at pp. 361, 363; K. & D. Motors v Wessels, 1949 (1) SA 1. Gleneagles Farm Dairy v Schoombie, 1949 (1) SA at p. 836, does not support the contrary proposition. Alternatively, the onus should be placed upon respondent because all rules dealing with the B subject of burden of proof rest for their ultimate basis upon broad and undefined reasons of experience and fairness; see Drinkwater & Son v SA Trade Union Assurance Society, 1958 (1) SA at p. 308. The following cases illustrate the approach of the Courts in circumstances analogous to those in the present case, viz. Zandberg v van Zyl, supra C at p. 308; Gleneagles Farm Dairy case, supra at p. 837; Goldinger v Whitelaw, 1917 AD at pp. 74 - 5, 82 - 3, 91, 94, 97; van der Merwe v Olmesdahl, 1919 T.P.D. at pp. 173, 175; Dhlamini v Toms, 1929 N.L.R. 155. The fact that the appellant (plaintiff) was never in possession of the car and that at date of institution of action D respondent was, should not affect the incidence of the onus. It was fortuitous that appellant did not come into possession of the car on 20th November, 1958, the date of insolvency; cf. K. & D. Motors case, supra. In the following cases the Court did not regard as decisive on the question of onus the fact that one of the parties was claimant. See Pundor's Trustee case, supra at p. 364; van der Merwe's case, supra at E p. 173; McAdams v Fiander's Trustee & Bell, N.O., 1919 AD at p. 232. See also Beck, Theory and Principles of Pleadings in Civil Actions, 2nd ed., pp. 289, 296. If the onus was on respondent, he failed to discharge it. The only circumstances which support respondent's case are the alleged receipt, which was not produced, and the registration of the car in the name of Moore, under Ord. 17 of 1931 (T). But such registration F did not connote change of ownership. It would be consistent with a scheme to save the property from falling into the hands of creditors on insolvency and may have been part of the fraudulent scheme; Cf. Gracey Bros v Honikman, 27 S.C. 150; K. & D. Motor's case, supra. An adverse inference should be drawn against respondent for not calling the G insolvent as a witness. He was available. No adverse inference can properly be drawn against appellant for not calling him; See Zandberg's case, supra at pp. 311, 315; Webranchek v Jacobs & Co., Ltd., 1948 (4) SA 671; Gleneagles Farm Dairy case, supra. Alternatively, if the onus is upon appellant, it was discharged. In several of the cases quoted supra, it was assumed that the parties to a simulated transaction were H bona fide, e.g. Goldinger's Trustee case, supra at pp. 79, 82, 98; McAdams' case, supra at p. 223. Even in those circumstances the Court was able to come to the conclusion by process of inference from the facts that the purported transaction was simulated. The intention of the Legislature in secs. 20, 23 (2) and 24 (1) of Act 24 of 1936 is that all property of the insolvent at the date of sequestration shall be available for payment of creditors' claims. See Wessels v de Klerk and Another, 1960 (4) SA 310; Venter v Graan, 1929 T.P.D. at p. 438; Fairlie v Raubenheimer,

1962 (3) SA p739

1935 AD 135. It is consequently submitted that if the insolvent purports to alienate any asset of the insolvent's estate after sequestration, the position is no different from that where an unauthorised person, e.g. a thief, does the same, and the trustee is entitled to vindicate such asset without any obligation to compensate A the possessor for what may have been paid. It is analogous to the case of the alienation of his business by a trader, rendered void by sec. 34. Yet it appears that in the latter case the trustee may proceed by way of vindication from even innocent subsequent purchasers. See Mars, Law of Insolvency, 5th ed., at p. 229; Harrismith Board of Executors v. B Odendaal, 1923 AD at p. 539. Estate Louw v Credit Corporation of S.A., 1956 (3) SA 303, is distinguishable. Further regarding Louw's case; it was not necessary in that case to decide that the contract of the insolvent was voidable and capable of being ratified and the reasoning on this part of the case is incorrect. Reliance is placed upon C Fairlie's case, supra, which was decided on the wording of the 1916 Insolvency Act. Even on that wording it was accepted that, in order to be valid, the contract of an insolvent had to be ratified. See pp. 142, 143. The wording of sec. 23 (2) of the present Act gives effect to the intention of this decision. It is submitted that the effect of the first proviso is to prohibit absolutely a contract whereby an insolvent D disposes of any property of his insolvent estate and that the second proviso has the result of creating voidable contracts. Where an insolvent purports to dispose of property which vested in his trustee on sequestration and does not purport to act as agent for the trustee, such disposition is absolutely void and cannot therefore be ratified by the E trustee, unless the other party to the contract agrees to the trustee taking over the contract. In this sense only may the trustee ratify or adopt such a contract; see Wessels' case, supra. On the facts alleged in the summons, against this background, no suggestion can be made that the trustee adopted or ratified the contract. Hence there was no need for him to renounce any benefits flowing therefrom. Furthermore, against F this background, the duty to plead any such adoption or ratification and the onus on this issue would clearly rest on respondent.

P. R. van Rooyen, for the respondent: Die bewyslas om eiendomsreg te bewys rus in uitwinningsaksies op die eiser; sien K. & D. Motors v Wessels, 1949...