GUVAVA
JA:
INTRODUCTION
[1]
At the hearing, the appeals were consolidated with the consent of
the parties,
and heard in the following manner; the appellant in SC109/21 made
submissions as the first appellant, the appellant in SC15/21 as
second appellant, and the appellant in SC17/21 as the third
appellant. The first to third respondents in all the appeals remained
as previously cited, with the Registrar of Deeds being the fourth
respondent, though there was no appearance on his behalf. Although
there were three different appeals attacking the same judgment, I
intend to address all the appeals in one composite judgment as the
issues raised are similar. In this judgment I will also refer to the
first appellant as 'the Master' the second appellant as 'the
executor' the third appellant as 'the purchaser' and the first
to third respondents as 'the beneficiaries'.
[2]
The three appeals herein are against judgment No. HH806/20 of the
High Court ('court a
quo')
dated 16 December 2020, which granted an application to set aside
“two consents of sale” issued by the Master, agreements of sale
signed between the executor and the purchaser and finally set aside
the transfer of title made in favour of the purchaser.
BACKGROUND
FACTS
[3]
The first to third respondents are beneficiaries of the estate of
the late Kudzai Takaendesa (the deceased), who died on 15 July 2015.
The second appellant was appointed as the executor of the estate in
terms of a Will in which the deceased directed that the senior
partner of Danziger and Partners be appointed as such upon her
passing. The estate comprised three farms being; Certain piece of
Land situated in the District of Gatooma called Koppies measuring
1,358,0053 hectares, Certain piece of Land situated in the District
of Hartley called Lorraine of Richmond measuring 595,5918 hectares
and Certain Piece of Land situated in the District of Hartley called
Remainder of Richmond measuring 679,7636 hectares ('the farms')
and a butchery in Kwekwe situated at stand 2040 Amaveni Township,
Kwekwe.
[4]
The estate had liabilities amounting to USD$16,287.13 arising from
administrative costs inclusive of the Master's fees, Value Added
Tax, advertising, valuation charges, and a provision for duty. The
executor, in the execution of his duties, requested the beneficiaries
to settle the estate liabilities. The beneficiaries only managed to
pay USD$2,625 leaving a balance of USD$14,047 as at 10 January 2018.
[5]
Following the beneficiaries failure to settle the full amount, the
executor wrote to the Master on 10 January 2018 seeking authority to
sell the three farms by private treaty in order to liquidate the
estate liability. The Master issued a consent to the sale in terms of
section 120 of the Administration of Estates Act [Chapter 6:01] (the
Administration of Estates Act) on 25 January 2018 in respect of two
farms known as Koppies measuring 1358,0053 hectares and Lorraine
Richmond measuring 595,5918 hectares, and on the 17th
of October 2019 in respect of the farm known as remainder of Richmond
measuring 679,7636 hectares. The consents were granted on condition
that the executor would first communicate the decision to dispose the
farms to the beneficiaries. As a result of the “consents to sell”
all three farms were sold to the purchaser represented by one Mr.
Arafas Mtausi Gwaradzimba, who owns a neighbouring farm for a total
amount of USD$700,000.
[6]
On 12 March 2018 the beneficiaries wrote an email to the executor
with an instruction that he should not sell the farms but that he
should rather sell the butchery in Kwekwe to recover the estate
liabilities. On the 20th
of July 2018, legal practitioners representing all the beneficiaries
wrote to the executor objecting to the proposed sale of the farms on
the basis that, firstly, they did not consent to the sale of the
farms and secondly, that the proceeds from the sale of the Kwekwe
butchery would be sufficient to settle the estates liabilities. This
letter was copied to the Master. It was further alleged that the
executor was advancing his own personal interest in insisting on the
sale of the farms rather than the interests of the beneficiaries. By
letter dated 6 of August 2018 the Master informed the beneficiaries
that their objections had been noted but however the consent to sale
could not be revoked as the decision had already been made.
[7]
Dissatisfied by the Master's decision to grant the executor's
request for “consent to sell” the three farms, the beneficiaries
made an application before the court a
quo
in terms of section 4 of the Administrative Justice Act [Chapter
10:28]
('the Administrative Justice Act') seeking the setting aside of
the decision of the Master on the basis that he acted unlawfully,
unreasonably and in an unfair manner in granting the consent.
DECISION
OF THE COURT A QUO
[8]
The court a
quo,
in dealing with the application held that the Master failed to
conduct a 'due inquiry' in accordance with section 120 of the
Administration of Estates Act. The court a
quo
further held that the decision to issue the “consent to sell” the
three farms without holding an inquiry in terms of section 120 of the
Administration of Estates Act was illogical and grossly unreasonable.
The court a
quo
reasoned that the Master ought to have enquired into the propriety or
otherwise of the sale of the three farms in light of other possible
assets that could have been sold and whether or not it was in the
best interest of the beneficiaries to sell the farms. The court found
that the Master ought to have granted the beneficiaries an
opportunity to be heard before making his decision.
[9]
The court a
quo
accordingly found that as section 120 of the Administration of
Estates Act had not been complied with, the decision by the Master
authorising the executor to sell the three farms was unlawful,
unreasonable, and unfair. It also found that the sales of the farms
were a nullity and ordered that they be set aside. The court
consequently vacated the agreements of sale entered into it between
the executor and the purchaser. It
set
aside the consents to the sales of the farms issued by the Master,
cancelled the transfers of the farms, and ordered the resuscitation
of the Estate Deed of Transfer Number 6708/2019 back into the
deceased's estate. With regards to costs, the court ordered that
the Master and the purchaser pay the beneficiaries costs on a party
and party scale with the executor being ordered to pay costs de
bonis propriis
on
the basis that there was collusion between him and the purchaser.
[10]
Aggrieved
by the decision of the court a
quo
the three appellants each noted separate appeals attacking the
judgment essentially on the basis that it erred in failing to find
that the Master's decision was properly made after due compliance
with the Administration of Estates Act.
ISSUES
FOR DETERMINATION
[11]
An examination of the grounds of appeal shows that the single
thread that runs through the three appeals is the question of whether
or not the Master complied with the provisions of section 120 of the
Administration of Estates Act before issuing the “consent to sell”
the three farms.
SUBMISSIONS
BEFORE THIS COURT
[12]
Counsel
for the first appellant, Mr. Chinake,
argued
that the Master had no real interest in this case and was essentially
a passenger in the litigation. This was, so the argument went,
because once he had made a decision in respect of the sale of the
three farms, he became functus
officio.
He contended that the Master reached the decision to “consent to
the sales” after due consideration of the facts of the case as
placed before him by the executor. It was his submission that section
120 of the Administration of Estates Act does not place an obligation
on the Master to carry out a judicial investigation before issuing a
“consent to sell”. He asserted that the inquiry which must be
conducted by the Master merely related to whether or not there are
any restrictions to sell that may be contained in the will of the
deceased. He thus submitted that it was a very limited inquiry.
[13]
Mr Chinake
further asserted that there was nothing unlawful about issuing a
consent with a condition that the executor must inform beneficiaries
about the sale. He, however, conceded that the absence of consent to
sale at the time when the agreement of sale was executed in respect
of the third farm meant that the agreement was void as there was no
condition in the agreement stating that the agreement would only
become perfecta
once
the consent from the Master on the third farm had been obtained. In
the final analysis, he submitted that the decision by the Master was
not unreasonable or unfair in the circumstances because the
finalisation of the estate had been outstanding for a long time.
Further, that the order of costs made against the Master was
unwarranted and ought to be set aside as the decision was made in the
course of his administrative functions. He prayed for the appeal to
be allowed with costs.
[14]
Counsel for the executor, Mr.
Sithole,
argued that the Master correctly exercised his discretion in granting
the “consent to the sale” based on the documentation placed
before him. He asserted that there was nothing unreasonable or unfair
about the Master's decision to “consent to the sale” of the
three farms as he acted in accordance with the law. Counsel also
submitted that the phrase 'due inquiry' under section 120 of the
Administration of Estates Act is limited only to the question of the
mode of disposal of the property and not to any other issue. He
argued that the order of costs
de
bonis propriis
made
against the executor was improper because the order was not sought by
the applicants a
quo
but was imposed by the court without inquiry as required by law. He
therefore prayed for the appeal to succeed.
[15]
Counsel for the purchaser, Mr.
Nyamakura,
submitted that the beneficiaries could not challenge the sale of the
farms without surrendering the proceeds of sale that had been
transferred into their accounts. He argued that the due inquiry in
terms of section 120 of the Administration of Estates Act is
restricted only to the question of whether to sell by private treaty
or public auction. He asserted that the Master's decision was
lawful. He thus prayed for the appeal to be allowed.
[16]
Per
contra,
counsel for the beneficiaries, Ms Mahere,
submitted
that the
Master's
decision violated section 68 of the Constitution of Zimbabwe
Amendment (No.20) Act 2013 (hereinafter referred to as 'the
Constitution') and section 3 of the Administrative Justice Act. She
contended that the Master's decision to sell three farms for
USD$700,000 to settle estate liabilities totalling USD$14,047.00 when
other properties of less value could have been sold was grossly
unreasonable and unfair.
[17]
Counsel submitted that due inquiry, as interpreted in past
decisions of the courts, is not a superficial inquiry but meant an
informed independent inquiry that involves considering the
submissions of beneficiaries of the estate. She asserted that in this
case no due inquiry was done and thus both the Master and the
executor did not ultimately act in the best interests of the
beneficiaries of the estate as mandated by the law. She further
argued that the order of costs made against the Master and the
executor were justified because both acted unlawfully, unreasonably
and unfairly. In the result, she prayed for the appeal to be
dismissed.
ANALYSIS
[18]
An application made in terms of the Administrative Justice Act
seeking the setting aside of a decision of an administrative
authority must allege and prove that it has acted unlawfully,
unreasonably and in an unfair manner. Section 3 of the Administrative
Justice Act provides:
“3
Duty of administrative authority
An
administrative authority which has the responsibility or power to
take any administrative action which may affect the rights,
interests or legitimate expectations of any person shall —
(a)
act
lawfully, reasonably and in a fair manner;
and
(b)
act within the relevant period specified by law or, if there is no
such specified period, within a reasonable period after being
requested to take the action by the person concerned; and
(c)
where it has taken the action, supply written reasons therefor within
the relevant period specified by law or, if there is no such
specified period, within a reasonable period after being requested to
supply reasons by the person concerned.
(2)
In order for an administrative action to be taken in a fair manner as
required by paragraph (a)
of subsection (1), an administrative authority shall give a person
referred to in subsection (1) —
(a)
adequate
notice of the nature and purpose of the proposed action; and
(b)
a
reasonable opportunity to make adequate representations; and
(c)
adequate
notice of any right of review or appeal where applicable.
….”(emphasis
added)
Section
4(1) of the Administrative Justice Act, empowers a court to set aside
a decision that breaches its provisions.
[19]
The administrative action which was the subject of complaint by
the beneficiaries in this case was that the Master granted the
executor the right to sell by private treaty, three farms which were
bequeathed to them without conducting an inquiry as mandated by
section 120 of the Administration of Estates Act.
[20]
Section 120 of the Administration of Estates Act provides as
follows:
“120
Sale of property otherwise than by auction
If,
after
due inquiry,
the Master is of opinion that it would be to the advantage of persons
interested in the estate to sell any property belonging to such
estate otherwise than by public auction he may, if the will of the
deceased contains no provisions to the contrary, grant the necessary
authority to the executor so to act.”
[21]
It was not in dispute, as between the parties, that the Master is
an administrative authority as defined by the Administrative Justice
Act. Indeed that this is the correct position cannot be debated as
the Master carries out administrative functions that affect other
persons as defined in section 2(1)(d) of the Administrative Justice
Act. (See also
Logan
v Morris N.O. & Ors
1990
(2) ZLR 65 (S).
The
first issue for determination therefore, is whether the Master
conducted himself in a lawful, fair and reasonable manner when he
exercised his power under section 120 of the Administration of
Estates Act. CHITAKUNYE J (as he then was) in Madzingaidze
N.O v Katanga Service Station
HH256/13 at page 4-5 of the cyclostyled judgment, had occasion to
grapple with the issue of what should be considered by the Master
when presented with a request, by the executor, to sell estate
property by private treaty. He stated the following at p4:
“1.
The Master has to formulate his own opinion;
2.
The opinion has to be formulated after a due inquiry; and
3.
The opinion has to be in furtherance of the advantage of the persons
interested in the estate, in this case the beneficiaries.
The
section does not per
se
require that all the interested parties must agree. It is the opinion
of the Master, after due inquiry that is crucial. The fact of the
interested parties all agreeing may only be one of the considerations
to be taken into account by the Master as he carries out due inquiry.
A
due inquiry may be described as a fitting or appropriate
investigation or research on the subject matter before arriving at a
decision. This necessarily involves a consideration of submissions
made by all interested parties, including the beneficiaries, and an
assessment of what would be appropriate given the circumstances of
the matter. The Master will want to know the reason why the property
has to be sold and how the sale will be advantageous to the
beneficiaries.”
[22]
It appears to me, from the above, that in order for the Master to
lawfully grant a consent to sell in terms of section 120 of the
Administration of Estates Act, he must comply with the requirements
of the Administrative Justice Act. He must also consider the
requirements established by case law. A proper application of the
above requirements will lead the Master into making a decision which
is lawful, reasonable and fair. I therefore agree with the sentiments
expressed in the above judgment. Indeed, as stated in the above cited
case, it is critical that the Master formulates an independent
opinion after considering all the facts. That
this is the position can be gleaned from the case of Logan
v Morris N.O. & Ors
1990
(2) ZLR 65 (S) at p71D-72A, where this Court, while interpreting the
powers of the Master as provided for under section 117 of the
Administration
of Estates Act [Chapter
3:01]
(which was repealed and replaced by the current section 120 of the
Administration of Estates Act),
had this to say:
“The
power given to the Master under section 117 is not a power to compel
a sale by private treaty where the beneficiary does not want to sell
at all.
It is a power to allow a sale by private treaty where the beneficiary
wants the property sold (or it has to be sold to meet the cash
obligations of the estate). If he does not allow the sale by private
treaty then the normal procedure of sale by public auction has to be
followed.
Seen
in that light it is apparent that it is not the purpose of the 'due
inquiry' by the Master to ascertain whether or not the beneficiary
is legally bound to sell as a result of an alleged contractual
obligation, or whether that contract has or has not been induced by
fraud so as to entitle the beneficiary to resile. Such matters are
proper matters for a judicial inquiry. The Master is not empowered to
conduct judicial inquiries. Where matters of law arise he is enjoined
to refer the matter to a Judge or to the Court (see eg section 113).
The
'due
inquiry' envisaged by section 117 is no more than a practical,
financial inquiry. He must not authorise a private sale unless he is
of the opinion that such a sale will be more advantageous to the
beneficiary than a sale by public auction.
His inquiry therefore is limited to a consideration of the relative
advantages of the proposed private sale on the one hand and a sale by
public auction on the other. He will in such circumstances, after
making 'due inquiry' as to the realistic value of the property,
reach his decision. He will be influenced primarily by the price
offered as opposed to the price likely to be realised on an auction.
He may also be influenced by such matters as the uncertainty and
delay involved in a public auction, or by the wishes of the
beneficiary in a marginal case.
I
do not intend this to be regarded as an exclusive list of the
considerations which may influence the Master in coming to a
conclusion under section 117. The
point I am making is simply that the need for a decision by the
Master under the section arises only when he is asked to choose
between a sale by public auction and a sale by private
treaty.”(emphasis
added)
[23]
There can be no doubt that the Master is required to conduct a
basic inquiry before formulating his opinion on whether or not to
consent to a sale by private treaty.
[24]
Clearly,
this is not what the Master did in this case. The
Masters Report, which was filed in opposing the application before
the court a
quo,
gives
an insight on how the Master dealt with the request. The
Master stated as follows:
“The
Master's consent is required only where the executor intends to
sell by private treaty.
Our understanding is that the inquiry to be made by the Master is not
necessarily to establish the reasons for the sale or to determine
which assets should not be sold, but it is to establish whether it
would be advantageous to sell by public auction or by private treaty.
It can thus be inferred that the decision to sell and the
identification of assets for sale lies with the executor and not the
Master.
The Master is only approached if the executor intends to sell
otherwise than by public auction. We believe this is why there is no
provision which empowers the Master to be involved in the sale
modalities as that is the prerogative of the executor reposed with
authority to administer the estate. It is however expected that
before selling, the executor would have done his due diligence and
proper consultations with potential beneficiaries which justify the
need to sell.”
This
was not the correct approach to take and does not comply with the
requirements established by the Administration of Estates Act and the
authorities cited above. This is a very narrow interpretation of the
term 'due inquiry' and seeks to shift the onus of decision making
from the Master to the executor. This is wrong. As was stated in the
Madzingaidze
judgment
(supra)
it is the Master's opinion that must inform the process and not
that of the executor. From the approach taken by the Master it is
quite apparent that no inquiry was conducted at all.
[25]
In spite of the fact that in the letter dated 10 January 2018, by
the executor requesting the Master to “consent to the sale” of
the farms, it was indicated that the beneficiaries generally objected
to the sale of the farms, the Master issued two consents to sale on
the 25th
of January 2018 with the third consent being granted on the 18th
of October 2019. The Master made no effort to engage the
beneficiaries with regards to the sale of the farms. Had he done so
it would have been brought to his attention that there was a butchery
in Kwekwe which could be sold as an alternative to recover costs to
settle the estate liabilities.
[26]
The facts of this case clearly paint a picture of a situation
whereby the Master did not apply his mind to the facts before him. He
failed to formulate his own opinion and relied on the executor's
decision. In the exercise of his duties in terms of section 120 of
the Administration of Estates Act the Master ought to have carried
out an inquiry into all the circumstances of the case. The fact that
there was a buyer already in the wings offering to purchase the three
properties should have raised a red flag which warranted further
inquiry. So, too, the letter by the executor stating that the
beneficiaries were generally opposed to the sale. This decision was
particularly unreasonable when one takes into account that there was
another property in the estate which could have been sold to meet the
estate liabilities instead of disposing of the three farms.
[27]
It should be noted that in arriving at a decision of whether or
not to sell a property by private treaty the Master does not operate
in a vacuum. He must take into account various competing interests
the most important of which is that he must be satisfied that he is
acting in the best interests of the beneficiaries. Section 3 of the
Administrative Justice Act requires that he acts in a lawful,
reasonable and fair manner.
In this case the Master did not question whether or not it was in the
interest of the beneficiaries to sell three farms in order to pay
US$14,047 that was owed by the Estate. Indeed, had the Master applied
his mind to the facts he would have realised that selling three farms
in order to pay such a paltry amount was unreasonable and unfair on
the beneficiaries. It should be noted that the inquiry required by
section 120 of the Administration of Estates Act and the authorities
cited above, is not a judicial inquiry, but a simple inquiry merely
to ascertain the facts and for the Master to satisfy himself that he
is indeed acting in the best interest of the beneficiaries. Had the
Master acted in this manner he would have sought the views of the
beneficiaries. A simple letter asking for their views on the matter
would have been more than sufficient.
[28]
It is trite that the right to be heard is a basic tenet of our
law. Where the Master intends to make a decision affecting the rights
of beneficiaries it is incumbent upon him that he affords them an
opportunity to present their side of the matter. In my view, the
importance of this right is of particular import given that a sale by
private treaty does not have the protection and transparency
associated with a public auction. It is the objections or concerns
raised by the beneficiaries which lead the Master into making an
appropriate decision. In essence therefore, the Master, in carrying
out the inquiry must afford the beneficiaries a chance to be heard.
[29]
Section 69 of the Constitution provides for the right to be heard
for all citizens before a court of law, judicial body, quasi-judicial
body or administrative authority. The Master being a quasi-judicial
officer with an administrative role must allow beneficiaries the
right to be heard and the right to make objections or raise concerns
over the administration of the estate. This is also in line with the
statutory provision of section 3(2) of the Administrative Justice
Act.
[30]
In the case of Logan
v Morris N. O. and Ors (supra) at
p69E-G the court pertinently noted that:
“As
LORD DENNING MR, said in Breen
v Amalgamated Engineering Union (now Amalgamated Engineering and
Foundry Workers Union) & Ors
[1971]
2 QB 175; [1971] 1 All ER 1148 (CA) at 1153H-J:
'It
is now well settled that a statutory body, which is entrusted by a
statute with discretion, must act fairly. It does not matter whether
its functions are described as judicial or quasi-judicial on the one
hand, or as administrative on the other hand, or what you will.
Still, it must act fairly. It must, in a proper case, give a party a
chance to be heard.'”
In
the same case McNALLY JA raised the question at p69H:
“When
should a party be given a chance to be heard?
LORD
DENNING continued at 1154F-K:
'Not
always, but sometimes. It all depends on what is fair in the
circumstances …'”
[31]
It is accepted that it is not every case where the Master must
hear the beneficiaries before making a decision. However, the
particular circumstances of this case cried out for the Master to
hear the beneficiaries before making a decision. The amount which was
due by the estate, the fact that there was a ready buyer waiting to
purchase the three farms and the fact that not one, but all three
farms were to be sold to raise the small amount of USD14,047 should
have alerted the Master that there was a need to hear the
beneficiaries. The Master, as an administrative body and custodian of
the processing and finalization of deceased estates, is duty bound to
guard against the excesses of executors of estates by ensuring that
the interests of beneficiaries are protected. It could not have been
the intention of the legislature, in enacting section 120, to provide
for the Master to merely rubber stamp the decisions of an executor,
especially with regards to the disposal of estate property, without
being satisfied that the sale of such property is warranted and is
conducted in a fair and lawful manner. The
failure by the Master to conduct such a basic inquiry resulted in him
failing to act lawfully, reasonably and fairly as an administrative
authority. This failure in my view warrants the setting aside of the
“consents to sell”. The court a
quo's
finding that the Master had to formulate his opinion only after an
inquiry had been made cannot be faulted in this regard.
[32]
In my view sight must never be lost of the function of an executor
in the administration of an estate. It must always be borne in mind
that estate property bequeathed to beneficiaries in a will is their
property. Thus, any decision by the executor concerning estate
property must be made with the knowledge that, at law, the property
belongs to the beneficiaries. The executor's function is only to
step into the shoes of the deceased and ensure that the beneficiaries
receive their inheritance. It is noteworthy that in this instance the
executor took it upon himself to act as big brother and decided that
it was in the best interest of the beneficiaries that the farms be
sold as there was no activity on the farms. This was clearly not the
mandate of the executor. His function was to ensure that the
beneficiaries received their inheritance. What they thereafter did
with it was not his concern.
[33]
With regards to costs a
quo,
this Court finds that the actions of the Master were conducted in the
course of his duties. It has always been the practice of this Court
not to mulct administrative bodies with costs unless it is proved
that they were mala
fide.
As such, the order of costs awarded by the court a
quo
against
the Master
cannot be allowed to stand. I take the further view that it is trite
that a court may not make an award of costs de
bonis propriis
unless they have been sought and the person affected has been given
an opportunity to be heard. The executor was not heard on this point
a
quo.
This award cannot be upheld and warrants interference by this Court.
The purchaser was equally a victim of circumstances as his right to
purchase emanated from the decision of the Master. In our view, the
justice of the cases require that with respect to the costs a
quo,
each party should bear its own costs. The appeal will thus succeed in
this respect. In respect of costs on appeal the parties were agreed
that each party must bear their own costs.
DISPOSITION
[34]
The circumstances of this case bring to the fore the need for the
Master to conduct an inquiry before authorising any “consent to
sell” estate property. It is the Master who is mandated by the
Administration of Estates Act to conduct an inquiry. It is the Master
who must arrive at an opinion which is lawful, reasonable and fair.
The inquiry must be done before granting the consents to sale. This
may demand, as in this case, that the beneficiaries are heard so that
the Master makes an informed decision. It is not necessary for the
beneficiaries of the estate to “consent to the sale” but the
Master must be aware of their concerns before making his decision.
This function cannot be delegated to any other person including the
executor. As this was not done, the court a
quo
correctly set aside the “consents to sell” in this case. The
rights of the executor and the purchaser flow from the actions of the
Master. Once his actions are successfully impugned, they are left
with no leg to stand on.
[35]
In
the result, it is accordingly ordered as follows:
The
appeal be and is hereby allowed in part with no order as to costs.
Paragraph
6 of the order of the court a
quo
is set aside and substituted with the following:
“6.
Each party shall bear its own costs.”
KUDYA
JA: I
agree
MWAYERA
JA: I
agree
Kantor&
Immerman,
1st
appellant's legal practitioners
Danziger
& Partners,
2nd
appellant's legal practitioners
Mhishi
Nkomo Legal Practice,
3rd
appellant's legal practitioners
Henning
Lock,
1st
to 3rd
respondents legal practitioners
