Deputy Chief Justice and Judge President Petrus Damaseb on Tuesday gave separate victories to two warring parties in a lawsuit involving a trust supposed to be for the benefit of vulnerable children.
While he on the one hand set aside a High Court judgement that awarded millions of dollars to the former director of the Michelle McLean Children’s Trust, he also dismissed a counterclaim by McLean and three of the trustees for reimbursement of monies paid to him without authorisation.
Danie Botes took the trust to court after his contract was unilaterally terminated when it was discovered that he overpaid himself. The High Court found in his favour and ordered the trust to pay him for the remainder of his contract and pension monies owed to him for 19 years of service to the trust.
The trust then appealed that decision to the Supreme Court. On appeal, the Supreme Court found that the High Court erred when it concluded that Botes’ contract was unlawfully repudiated. According to Judge Damaseb, with Judges Appeal Sylvester Mainga and Elton Hoff concurring, the trustees established on a balance of probabilities that Botes received unauthorised payments and that this conduct justified the termination of his contract.
The appeal judges also set aside an order of the High Court for a pension from 2005 until 2010 for Botes as according to them, it was lodged outside the timeframe of three years. They, however, found that he is entitled to his pension for the period not extinguished by the prescription.
Judge Damaseb described the trustees’ role in the running of its affairs as lacklustre and lacking in diligence in the performance of their fiduciary duties. He said that it seemed that they had a lot of faith in him.
“The record amply and alarmingly demonstrates that they effectively left the running of the affairs of the trust to Mr Botes,” Judge Damaseb stated.
He further said that the evidence showed that they hardly scrutinised the books and that McLean who should have known better accepted all the reports Botes presented to her. Had they been more diligent, the judge remarked, they would have established earlier that Botes was helping himself to funds from the trust that he was not entitled to and upholding their plea for reimbursement of the funds would be in a way to reward them for the failure.
He made no order as to costs.
The trust and the trustees were represented by Jean Marais SC and Raymond Heatcote and Botes by Michael Fitzgerald SC.