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Security Warning: Property Sale Cybercrime Surges, and a New AI Danger

“The infectiousness of crime is like that of the plague” (Napoleon Bonaparte)

This October marks the 20th anniversary of the globally observed “Cyber Security Awareness Month”, and with cybercrime continuing to surge, here’s a cautionary tale to bear in mind.

You buy your dream house and pay the purchase price to the transferring attorneys (the conveyancers). Excitement builds as you wait eagerly for transfer and call the family together to plan your move. Then comes a call from the attorneys – why haven’t you paid yet? Your heart sinks, and panic sets in as it becomes clear that you just paid into a fraudster’s bank account. You contact the bank but your money has gone, along with the fraudsters.

That’s a nightmare scenario to which an ever-increasing number of property buyers and sellers around the world are being subjected. Property transactions are a natural focus for these cybercriminals because of the large amounts involved, but more and more personal and commercial transactions are also being targeted.

A recent High Court fight over yet another email interception fraud reinforces the need to remain alert in every situation and at all times…

R2.94m stolen – buyers, banks and conveyancers all at risk from email interception fraud

  • A couple bought a house and paid R2.94m into the bank account specified in an email which appeared to come from the conveyancers. It was however a classic case of “email interception and compromise” – somehow the criminals had obtained sufficient information about the sale transaction to enable them to email the buyers, pretending to be the conveyancing firm, and convince them that their payment was being made into a legitimate trust account.
  • As soon as it emerged that the account was in fact a fraudster’s, the buyers contacted the bank which promised to immediately freeze the account. Nevertheless, the R2.94m was transferred out to the fraudsters, and the couple sued the bank in the High Court for negligently allowing that to happen.
  • The bank replied that, if it were indeed found to be negligent, it would allege contributory negligence on the part of both the buyers and the conveyancers.
  • Its application to “join” the conveyancers into the court action failed, the Court holding that the buyers could choose who to sue and who not to, but the practical point of interest to most of us is the clear indication that in a case such as this, everyone stands to lose – property buyers (sellers are equally at risk), banks and conveyancers.


How to stay safe

“Forewarned is forearmed”, so follow these procedures strictly –

  • Never fully trust anything you access or receive electronically. Everything electronic is potentially unsafe – think emails, SMSs, WhatsApp messages, websites, social media pages, online forms and anything similar. Don’t click on links without checking first for suspicious URLs and even then, be careful if asked to submit information, don’t download attachments unless you are certain they are safe, never disclose login details, passwords or other sensitive or personal information. Keep reminding yourself, your family and your staff of the ever-present dangers.
  • Secure all your email, network and online systems against viruses, malware, breaches, hacking and compromise. Make sure all devices, servers, domains etc are protected. A good start is to install strong anti-malware software and firewalls, to ensure that all software and browsers are constantly updated with the latest security patches, and to use data encryption where you can. Use strong passwords and change them regularly.
  • Use an online resource like the South African Fraud Prevention Service’s YIMA to security check websites. Download the U.S. Cybersecurity and Infrastructure Security Agency’s “Tip Cards” on its “Stop.Think.Connect. Toolkit” webpage.
  • Pay particular attention to all banking and investing channels, and under no circumstances trust any email, SMS or other communication purporting to advise banking details or (a particular risk area) a change of banking details.
  • If you are a business that regularly requests payments from customers or clients, add a suitable warning to every communication and a disclaimer against liability if a loss occurs (legal advice specific to your circumstances is essential here). Consider using a secure payment portal with 2FA (2 factor authentication) protection. If you email invoices with banking details, secure them from alteration (don’t put all your faith in PDFs, it’s a myth that they can’t be changed).
  • Perhaps most importantly – always check directly with the account holder before paying anything. Contact the account holder only on its real and confirmed contact details – fraudsters are adept at creating look-alike emails and email addresses, telephone numbers, WhatsApp and cell numbers, and website addresses. Which brings us to …


A new and substantial danger – AI voice cloning

As AI explodes into every aspect of our lives, an increasing number of reports are made of “voice cloning” frauds.

Perhaps you get a call from “your attorney”, or your attorney gets a call from “you”.  Or your “boss” or your “HR department” phone you. Perhaps the call is to ask for sensitive information or perhaps it is to ask for money. A particularly successful fraud here, because of its emotional content, could be a variation on “Hi Mum and Dad, I have a problem, can you send me R10k urgently please? Send it to…”.

You know the voice so you trust the call, but the reality of course is that a criminal has fed a sample of someone’s voice into an AI program and duplicated it perfectly (or at least perfectly enough to fool you in the heat of the moment). No doubt cloned video calls and other AI powered scams will proliferate soon if they aren’t already doing so.

Once again, constant awareness is the key to protecting yourself from this sort of scam. Never let your guard down!

Dementia: Understanding Your Legal Options

“Dementia is the plague of our time, the disease of the century” (Unattributed)

Dementia is a widespread medical condition that affects people of all ages but particularly the elderly, and includes conditions like Alzheimer’s. One of the most significant challenges of dementia is the loss of mental capacity, making it difficult for individuals to make crucial decisions, including those related to their legal affairs, finances and care. This can be particularly problematic when family members are unprepared or unaware of the practical and legal implications.


Beware the Power of Attorney myth

One common misconception is that a signed Power of Attorney (PoA) can authorise a family member to take control of the individual’s financial affairs in perpetuity. In fact, a PoA is only valid as long as the person who granted it maintains “legal capacity”, in other words an understanding of its implications. If and when dementia kicks in, the PoA automatically becomes invalid.

Enduring Powers of Attorney, which continue even after someone loses legal capacity, are valid in some countries but are unfortunately not yet recognised in South Africa.


So, what are your legal alternatives for dealing with dementia?

You will typically have three legal options available –

  1. Curatorship: This involves appointing a curator bonis through a High Court order to manage the financial affairs of the person with dementia (a curator ad personam may in rare cases also be needed to manage the person’s personal affairs). This process can be complex and expensive, but in some cases it may be the only viable option available.
  2. Administration: Similar to curatorship but less complex, less expensive, and quicker, this involves an application to the Master of the High Court for the appointment of an Administrator.It is only available when your family member is a “mentally ill person or person with severe or profound intellectual disability”, which excludes cases of purely physical frailty or disability, and suggests that in cases of mild dementia or mild cognitive impairment only curatorship is an option – but take legal advice on your specific circumstances. An extra element of cost and delay applies in larger estates, in that the Master must commission an investigation into any application where the assets involved are over R200,000 and the annual income is over R24,000 p.a.
  3. Special Trust: An alternative option is to consider a trust or special trust, which can be established if your family member suffers from an early onset of dementia but is still lucid and has legal capacity. All trusts have advantages in that they allow individuals the freedom to choose upfront who the trustees will be and what powers and duties they will have, whilst special trusts come with significant tax benefits over ordinary trusts. Individualised professional advice is essential here.

Understanding the available legal avenues can help you navigate this difficult journey, and with proper planning, personalised legal advice and early action, you can ensure that your family member’s legal and financial well-being is protected at all times.

Suing for a Supermarket “Slip ‘n Trip” – What Must You Prove?

“The path is smooth that leadeth on to danger” (William Shakespeare)

Tripping over aisle blockages or slipping on floors made slick by spillages can happen in even the best-managed supermarkets, and injured shoppers regularly turn to our courts to claim damages from shopkeepers and building owners.

It’s no surprise therefore that this sort of claim has its own (informal) name – the “slip ‘n trip” case. A recent High Court judgment provides some clarity on what you will need to prove should you be one of the unfortunate shoppers who are injured in this way.


A shopper slips, and sues

  • A shopper slipped on an unidentified spillage, injuring herself and needing hospitalisation and further treatment for unspecified orthopaedic injuries.
  • Supermarket employees initially undertook to cover her medical expenses but later the supermarket denied liability.
  • It admitted that it had a “general duty of care to customers visiting its store to ensure that it afforded them a safe environment within in which to shop”, but claimed the shopper’s fall was “due to her sole negligence in that she failed to keep a proper lookout, failed to take reasonable steps to prevent her fall and failed to avoid injury to herself.” In the alternative it alleged contributory negligence on her part. It also sought to blame its cleaning service contractors and/or an independent merchandiser who had been working in the aisle in question.
  • The shopper took her claim for damages to the High Court, which confirmed that what you will have to prove is that the shop –
    • Should have foreseen the reasonable possibility of its conduct causing your injury and monetary loss; and
    • Should have taken reasonable steps to avoid that loss; and
    • Didn’t do so.
  • The Court held that, on the evidence presented, the shopper had proved that “she took proper care for her own safety on the morning in question. The fact that she may have moved down aisle 5 at more than a leisurely dawdle did not occasion her fall: she did not slip or trip because of haste or inattention but because she stepped in some spillage of unknown origin.” (i.e., you need to prove you weren’t negligent)
  • And even if the spillage was a small one (supposedly the size of a R2 coin in this case) “it really matters not what the extent thereof was as its mere presence on the supermarket floor presented a risk to any unassuming shopper, who would be expected to spend her morning looking at the merchandise on the shelves and not peering down at the floor ahead of her.” (i.e., keeping a proper lookout doesn’t necessarily mean peering down at the floor ahead of you all the time)
  • In principle, once a shopper has “testified to the circumstances in which he fell, and the apparent cause of the fall, and has shown that he was taking proper care for his own safety, he has ordinarily done as much as it is possible to do to prove that the cause of the fall was negligence on the part of the [supermarket] who, as a matter of law, has the duty to take reasonable steps to keep his premises reasonably safe at all times when members of the public may be using them.”
  • The shopper in this case had done all that, raising a rebuttable presumption of negligence by the supermarket so that, in the absence of an explanation from it, it was inferred that a negligent failure on its part to perform its duty must have been the cause of the fall. In this case it provided no evidence of how long the spillage had been on the floor or how long it was reasonably necessary for it to discover the spillage and clean it up. (i.e., once you prove what happened and that you took proper care for your own safety, it’s for the supermarket to prove that it wasn’t negligent)
  • The shopper is entitled to whatever level of damages she can prove.

Can a Video Call be a Valid Will?

“Death is not the end. There remains the litigation over the estate.” (Ambrose Bierce)

It may well be that in the future, we will be able to make a perfectly valid will (“Last Will and Testament”) by way of a video recording or other electronic means, but that day has not yet arrived.

For now, it is essential that your will be properly drawn, not only to clearly reflect your last wishes, but also to comply with all the formalities laid out in our Wills Act.

In summary (ask your lawyer to explain the finer points, they are important), wills must be in writing and signed by you on all pages, in the presence at the same time of two competent witnesses who must sign the end page (preferably all pages, but that’s not a formal requirement). Note that neither witnesses nor their spouses can inherit or be appointed as executor, trustee or guardian.


Video wills – are they valid?

Bearing in mind those required formalities, and the fact that an attempt to rely on a video recording as a will was abandoned in the case discussed below, it would be rash to assume that a “video will” ever be accepted as valid even though the concept has not to date been directly tested in our courts.

Rather observe all the formalities listed above, and think of using a video recording just as an adjunct to your formal will. For example, recording the will-signing process itself could help avoid any future dispute over your written will’s validity, whilst an informal video message to your family explaining to them why you have drawn your will the way you have could provide clarity and comfort to them when the time comes.


Non-compliance with formalities – there are “escape hatches”, but …

There are “escape hatches” in that our Wills Act provides that a document not complying with all formalities can be accepted as a valid will if it was drafted or executed by the deceased and if it was intended to be their will. You can also be authorised to both inherit and act as an executor, even if you or your spouse signed as a witness, if you can prove that there was no fraud or undue influence over the deceased. You can also be taken to have revoked a previous will in various ways.

But as we shall see from the two recent High Court cases discussed below, relying on any of those escape hatches is extremely unwise. At worst, your last wishes won’t be honoured, and at best you will be exposing your loved ones to the risk of prolonged and bitter litigation at the very worst time.


Case 1: A Covid-19 video-call attempt to replace a will fails

  • A father had left everything to his children in a 2018 will. But, dying in hospital of Covid-19 in 2021, he made a video call to his farm manager indicating his wish to revoke the will and saying that his final instructions were that everything be left to his farming trust.
  • As requested, the farm manager had a will to that effect drawn by attorneys and delivered it to the hospital (he was unable to deliver it personally due to Covid-19 restrictions then in place), but the father died before it could be given to him for confirmation and signature.
  • The trust asked the High Court for an order declaring the 2018 will revoked and the 2021 unsigned will accepted as valid (it seems to have abandoned an argument that the video call itself was a will). The disinherited children opposed this application vigorously. 
  • The Court declined to validate the unsigned 2021 document, pointing out that the Wills Act’s provisions in this regard must be interpreted and applied strictly and narrowly. It’s analysis of the trust’s argument that the “impossibility principle” applied will be of great interest to lawyers, but the practical point of issue to most of us is that although it seems clear that the father wanted to make a whole new will, on the facts of this case only his written and signed 2018 will could be accepted as valid.


Case 2: Brothers at war, and a non-compliant will accepted as valid

  • Another tragic case of a dying father trying to change his will, this time to disinherit one son (“JP”) in favour of the other (“SG”).
  • The new will did not comply with the Wills Act’s formalities. Three witnesses signed it but not in each other’s presence, whilst the fact that one of the witnesses was SG’s wife formally disqualified him from inheriting or acting as executor.
  • JP asked the Court to declare the will invalid so he could inherit under the laws of intestacy, whilst SG asked the Court to accept the will despite the non-compliance, and to allow him to inherit and to act as executor.
  • On the particular facts of this case, including undisputed evidence of a major rift between JP and his father (in contrast to an extremely close relationship between SG and the father), the Court exercised its discretion in favour of SG. 
  • Firstly, it held that the will, despite the failure to comply with formalities, was indeed drawn by the father and intended by him to be his will. It was therefore accepted as valid. 
  • Secondly, it held that SG could both inherit and act as executor because he had proved a lack of fraud or undue influence over his father.

Different outcomes but a clear principle – failure to comply with all formalities risks your last wishes not being implemented and exposes your loved ones to dispute and litigation.

Legal Speak Made Easy

“Rei vindicatio”

Literally “vindication of things” and often referred to simply as a “vindicatory action”, this will be an important legal remedy for you if, as legal owner of something, you are trying to recover it from someone else who possesses it unlawfully and without your consent. The action originated in ancient Roman law but is still much used today for recovery of both movable and immovable property – in the latter case it would normally take the form of an application for eviction.

Debt Collection – Two Recovery Options

“Creditors have better memories than debtors” (Benjamin Franklin)

How well you manage your debtors’ book, and how successful you are in actually collecting monies due to you, should always be a management priority. It can spell the difference between a successful, profitable business and a failed one.

If you are new to the game (the owner of a new start up perhaps), the debt collection process might seem confusing and a bit intimidating, but it needn’t be.

If you need to understand the basic principles and terminology, have a look at our simple overview below of a pretty “standard” debt collection process. We follow that with an alternative suggestion, which even established businesses with a long track record of debt collection will find useful.

Of course, some debts are easily collected – a gentle reminder and a few courtesy calls often do the trick. But when a debtor turns recalcitrant – dodging calls, ducking and diving, delaying, hiding assets – it’s time to bring out the big guns and go the legal route.

Let’s discuss two possible avenues of recovery –

  1. Recovery Avenue One: The “standard” debt collection process

Let’s start off with a brief (and simplified) overview of a fairly typical sequence of debt collection events –

  • A courtesy call: This is most effective coming from your attorney – there’s nothing like an official legal communication to convey that you mean business. In most cases it will be a polite but firm communication (think “iron fist in velvet glove”) – perhaps via a voice call, perhaps in writing, perhaps both – telling the debtor that the matter has now been handed over for collection. Warnings of the legal process about to be unleashed, and mention of the extra costs and the credit rating implications for the debtor, might be all that’s needed to extract payment, or at least an offer of payment and an Acknowledgment of Debt. If not, on we move…
  • Letter of demand: This is a formal notification (you’ll hear it called a “Section 129 Notice” where the National Credit Act applies) officially demanding payment within a specified deadline period. It’s the last step before the actual legal process starts…
  • Summons: A summons is now issued at the appropriate court, and served on the debtor, who now has an opportunity to defend the action. Expect an experienced debtor to enter an “appearance to defend” as a delaying tactic, but if the debtor just ignores the summons or takes no further steps to defend the matter, the next step is… 
  • Judgment: Your attorney now asks the court to issue a “default judgment”, which entitles you to proceed to the enforcement/collection stage…
  • Execution: Depending on what assets or income the debtor has, this could be a warrant of execution against movable property, a financial enquiry or an emoluments attachment or garnishee order. A debtor who knows the ropes will be experienced in dodging and/or frustrating these attempts, and if the debt still remains unsatisfied you can move on to another form of execution…
  • Application to sell immovable property: You can now apply to the court for leave to execute against any immovable property (a house, land or the like) owned by the debtor. This may or may not be easy to obtain, given everyone’s constitutional rights to housing.

The above is just an overview of general principles, and it is essential to have legal assistance at every stage to make sure that your process complies with all the rules and regulations involved.

2. Recovery Avenue Two: Apply for liquidation or sequestration

This may not be the best option for every debt collection scenario, but in the right circumstances it can be dynamite!

Before we get going, a quick note on terminology – if your debtor is a company, you apply for “liquidation” (“winding-up”) of the company, and the appointment of a liquidator. If your debtor is an individual, you apply for “sequestration” of the debtor’s estate, and appointment of a trustee.

Either way, the pressure you bring to bear on the debtor is the threat of imminent loss of control of all assets. Company directors must suddenly focus on the looming risk of losing all control over their businesses, an individual on losing all their personal assets, house etc – whatever they have.

As a side note, if your debtor is a company, a particularly useful section of the Companies Act allows you to serve on the company’s registered office a “section 345 letter of demand”. The company is then “deemed” to be unable to pay its debts if the debt isn’t paid or secured within three weeks. That makes your liquidation application a lot easier to support and increases pressure on the debtor to pay up.

Just be aware of two factors in particular –

  • You may be in for substantial cost. A recalcitrant director or debtor can still delay the process by defending your application, and whilst our courts do not look kindly on delaying actions and other “abuses of process” calculated to postpone the inevitable, getting to that stage in opposed matters can be expensive. And if you do eventually succeed in getting an order, not only could you end up recovering nothing (or perhaps only a part of the debt) but you might even have to pay into the estate, so ask your attorney beforehand about the “danger of contribution” aspect.
  • You cannot use a liquidation/sequestration application as a way to short-circuit any genuine dispute over liability, and with individuals you will also have to show that sequestration will benefit creditors generally. Unless you have good grounds for the application you risk having to pay a large adverse costs order for “abuse of process.” Legal advice specific to your case is essential!

A Dishonest “I’m Too Sick to Come to Work” Excuse is a Firing Offence

“…an employment relationship is predicated on trust” (Extract from judgment below)

Our courts have once again confirmed that dismissal is justified when employees lie about their state of health in order to get sick leave.

A recent Labour Court case provides a perfect example.


Too sick to work, but caught on TV at a protest march

  • An employee called in sick for a few days, and to support his claim of illness produced a medical certificate of sorts (albeit a meaningless one, certifying the nature of illness as being “Absence due to medical condition”).
  • Unluckily for the employee, his supervisor happened to be watching the evening news on TV and what did he see on the screen but his “too ill to work” subordinate participating in a protest march, singing and clapping his hands.
  • Long story short, the Labour Court upheld his dismissal for “gross dishonesty” in breach of the trust relationship that underlies all employer/employee interactions.
  • In doing so the Court found on the facts that the employee had clearly been malingering in order to attend the protest, noting that an employee claiming to be too ill to work must prove it. In that regard the supposed medical certificate just didn’t cut it without being confirmed on affidavit.


Important takeaways for employees (and their employers)

  • Falsely claiming sick leave fundamentally breaches the employer/employee trust relationship and in appropriate cases our courts will not hesitate to uphold dismissal even for a first offence.
  • If queried, it is for the employee to prove that an illness genuinely prevented attendance at work.
  • A sick note or medical certificate should be meaningful as to the nature of that illness and the issuing medical practitioner may have to confirm its contents in an affidavit or under oath.

Landlords: You Cannot Cut a Defaulting Tenant’s Water and Electricity

“A fundamental principle in issue here is that nobody may take the law into their own hands. In order to preserve order and peace in society the court will summarily grant an order for restoration of the status quo where such deprivation has occurred, and it will do so without going into the merits of the dispute.” (Excerpt from judgment below)

Many a landlord is tempted to go the “self-help” route when non-paying tenants refuse to pay up and also refuse to leave. Holding costs mount with not a cent in rental income to show for it, the landlord gets desperate and locks are changed, access codes blocked, electricity and water cut off.

But what if, instead of meekly packing up and vacating, the tenant rushes off to court? As we shall see from our discussion of a recent High Court decision below, now the landlord has a real problem, regardless of whether or not the tenant has lost its legal right of occupation.


You cannot take the law into your own hands

  • A tenant under a verbal lease dating back some 27 years, and in terms of which the rental included payment for water and electricity, stopped paying rental in January 2021.
  • The landlord, citing both failure to pay rental and allegations of unlawful sub-letting and overcrowding, gave the tenant notice of eviction. The tenant refused to vacate, and had her attorney warn the landlord against evicting or cutting services without a court order.
  • When the landlord nevertheless went ahead and cut the electricity and water supplies, claiming this to be a lawful attempt to reduce its losses since the (unpaid) rental included the supply of electricity and water, the tenant asked the High Court to (among other things) grant it a “spoliation order” (an order giving possession back to someone deprived of it without due legal process) restoring services immediately to the premises. 
  • The case didn’t go well for the landlord, and it is now back to square one after eighteen months of no rental income, with the added costs of two sets of legal bills to pay. Landlords, said the Court, must pursue the remedies at their disposal to enforce payment of rental in accordance with the law. “Landlords are not entitled to take the law into their own hands.”
  • A vitally important factor to bear in mind here is that at this stage of proceedings a court will not enquire into whether or not the tenant has a legal right to be in possession: “Irrespective of the lawfulness or otherwise of the occupation, a landlord may not disconnect water and electricity without the intervention of a court.” (Emphasis supplied).
  • Relevant to the Court’s decision was the fact that on the facts of this case, supply of services was not a “personal right” between the parties but part of the tenant’s possession of the property: “To my mind, the supply of electricity and water is not merely contractual, but an incident of the possession of the property.” That can be a fine distinction, so specific legal advice is essential if you are a landlord (or a tenant) embroiled in a dispute of this nature.
  • The end result – the landlord was ordered to restore electricity and water immediately to the tenant and must pay the tenant’s legal costs.


Lessons for landlords

  1. You are playing with fire if you take matters into your own hands when dealing with problematic tenants. No matter how intransigent they may be and no matter how unlawful their occupation, the only safe route is to follow the appropriate legal channels with specific legal advice and assistance – 
    • All a tenant needs to prove to get a spoliation order against you (with costs) is that they were in “peaceful and undisturbed” possession, and that you unlawfully deprived them of that possession. Nothing more.
    • And that’s by no means your only risk – you could also be charged criminally in terms of the Rental Housing Act, which provides that anyone who “unlawfully locks out a tenant or shuts off the utilities to the rental housing property” faces a fine and/or two years’ imprisonment.
  2. Secondly, it is clear that one of the landlord’s practical problems in this matter was the fact that (amazingly after 27 years) it had no written lease in place. That made it difficult to prove the terms of the lease, the parties’ rights and duties, duration, grounds for termination, and notice periods. Although a verbal lease is valid in law (for now anyway; change is in the wind on that one), a properly drawn written lease is vital to protect your rights!

How to Protect Your Children’s Inheritances from Ending Up in the Guardian’s Fund

“Live each day as if it were your last… because one day, you’ll be right.” (Benny Hill)

It’s always tempting to procrastinate about decisions that force us to address the inevitability of our own mortality. But we have no choice when it comes to protecting our loved ones after we are gone, because to protect them a will (“Last Will and Testament”) is not a nice-to-have, it’s a necessity. And it’s urgent. No one – young or old, healthy or ill, wealthy or of limited means – can guarantee that they’ll be alive tomorrow.

How to structure your will? One potential risk area when it comes to your children’s inheritances is the Guardian’s Fund. The Fund serves a vital purpose, but it has featured regularly in the media over the past few years for all the wrong reasons – ongoing losses to cybercriminals and fraudsters (the last reported loss was R17m), SIU (Special Investigating Unit) probes into allegations of misconduct and corruption, and the like.

How is that relevant to you? Well, if you have minor children, it confirms once again that your will should be professionally drawn to avoid any chance of your children’s money ending up in the Guardian’s Fund.


Dying “intestate” means trusting a State-run entity with your children’s money

Without a will, you die “intestate”, which means that the law makes your decisions for you. You have lost the right to choose a trusted executor, you have lost the right to specify how your estate is distributed to your loved ones, you have lost the right to nominate a guardian for your children. Perhaps most importantly of all, you have lost the right to protect your minor children’s inheritances as you see fit.

That’s a problem because, unless you leave a will structured to provide a mechanism for looking after your children’s inheritances until they reach majority (i.e. turn 18), those moneys might well end up in the Guardian’s Fund.


What is the Guardian’s Fund?

  • The thought behind the Guardian’s Fund is a laudable one – it was created to hold and protect money (including inheritances) for minors and other people who are legally incapable of managing their own affairs. For those vulnerable people whose money it safeguards, it performs a most valuable service.
  • All money is invested with the PIC (Public Investment Commission) and earns interest at a rate set from time to time by the Minister of Finance.
  • The Fund is audited annually and is managed by the Master of the High Court (actually by one of several Masters around the country, each of whom runs a separate Fund), without charge.
  • A child’s guardian can approach the local Master to pay over accrued interest (and in need up to R250,000 of the capital) for maintenance needs.


So, what’s the problem?

Knowing that your children’s money is to be held in an audited, managed-for-free fund administered by independent and senior government officials is certainly a lot less alarming than many of the possible alternatives, but it is by no means ideal –

  • The media reports of hacking, theft, fraud, police probes into allegations of misconduct and corruption etc that we mentioned above hardly inspire confidence in the Fund’s ability to manage and protect your children’s inheritances, even if only one or two “bad egg” employees are involved.
  • Your children’s guardian must jump through all sorts of administrative hoops to draw money for maintenance, education, clothing, medical costs and so on. The delays and dysfunction which reportedly still plague many Master’s Offices won’t help.
  • As mentioned above, Fund monies are paid a government-fixed rate of interest, currently 4.25% p.a. That’s both below inflation and an unattractive alternative to the earnings potentially available to discretionary funds.
  • When your children turn eighteen, they are again faced with red tape and bureaucracy before they can access whatever is left of their money.


The best protection?

The good news is that you can easily protect your vulnerable minor children from all those risks and negatives. These are the two essentials –

  1. Leave a valid will, professionally drawn to protect all your loved ones and in particular those most vulnerable such as your minor children, and
  2. Make sure that your will nominates a guardian for your children and includes a mechanism to protect their inheritances so as to avoid any risk of their money having to be paid into the Guardian’s Fund.

    The most commonly advised protection mechanism to avoid that unhappy scenario is a trust – either an existing trust (if fit for purpose), or a new “testamentary trust” which will come into existence when you die. The alternative is to provide for the children’s guardians to administer their inheritances for them, but a trust is almost always the better, safer, and more practical option. Either way, make sure that your will’s provisions correctly and clearly set out your wishes in that regard.

    Bear in mind that anything to do with trusts of any kind calls for specific professional advice – there are complex legal, financial and tax considerations involved.

Bottom line – have your attorney draw your will (or update your existing will) to ensure that your children’s inheritances are properly protected and don’t end up in the Guardian’s Fund!

How to Stop Someone Damaging Your Good Name on Social Media

“He that filches from me my good name robs me of that which not enriches him and makes me poor indeed.” (Shakespeare)

As our lives move increasingly online, more and more of us will be subjected to the distress and damage of online attacks. Whether they are aimed at hurting us personally or at harming our businesses, they can take a substantial toll both materially and psychologically.

What can you do if you (or your business) falls victim? The good news is that in appropriate cases our courts will come to your rescue robustly and with speed, as evidenced by a recent High Court decision.

Your legal protections

Before we discuss the facts and outcome of that case, let’s make a general note that as a victim of any defamation you have a choice of legal weapons available to you. A claim for damages can be highly effective but it is, as the Court here put it, a backward-looking remedy essentially suitable for redressing past defamation.

Where on the other hand you are being subjected to, or fear being subjected to, ongoing defamatory attacks, ask your lawyer about applying urgently for an interdict. As in the case we discuss below, it can provide powerful, quick and effective protection.

You could also try laying a criminal charge of crimen injuria (criminal impairment of another’s dignity) but perhaps don’t hold your breath on that one.


A property developer’s reputation vindicated, and an extortion attempt punished

  • A company undertaking a large property development employed a roofing contractor which, after a fall out, started publishing defamatory statements about the developer on a local WhatsApp group and Facebook.
  • Amongst other things the posts accused the developer of acting unlawfully for financial gain, creating a potentially life-threatening situation, dishonesty, not carrying out necessary remedial actions, defrauding the Municipality, exploiting elderly clients, selling uninspected and potentially dangerous homes, not following proper safety standards – the list goes on.
  • The Court found no truth at all in any of these allegations and rejected for lack of proof the roofing contractor’s defence of “truth and the public benefit”.
  • Particularly damningly perhaps, it held that the contractor had tried to extort payment of its outstanding invoices in return for its silence.
  • The Court accordingly interdicted the contractor from continuing with the defamatory posts (online or otherwise), directed it to publish a copy of the court order on the online channels in question, and ordered it to pay legal costs on the punitive attorney and client scale.

The end result, which is a vindication of the developer’s position and an expensive lesson in the law for the roofing contractor, will give much heart to other victims of this sort of harassment.

Bottom line for victims – don’t take social media defamation lying down!