Johnson v Estate le Grange 1908 SC 283
Issue: Whether an executor has the power to bind the estate of the deceased by entering into a contract that is not authorized by the will.
Facts:
Mrs. le Grange died and left a will in which she appointed Mr. and Mrs. Johnson as her executors. The will did not authorize the executors to enter into any contracts on behalf of the estate.
After Mrs. le Grange's death, Mr. Johnson entered into a contract with a third party to sell a piece of land that was owned by the estate. Mr. Johnson did not have the authority to enter into this contract and the third party knew that Mr. Johnson did not have the authority.
The third party sued the estate of Mrs. le Grange for specific performance of the contract. The estate argued that it was not bound by the contract because Mr. Johnson did not have the authority to enter into the contract on behalf of the estate.
Held:
The Supreme Court of South Africa held that the estate of Mrs. le Grange was not bound by the contract. The Court reasoned that an executor does not have the power to bind the estate of the deceased by entering into a contract that is not authorized by the will.
The Court also held that the third party knew that Mr. Johnson did not have the authority to enter into the contract on behalf of the estate and therefore could not enforce the contract against the estate.
Key Facts:
- A woman died and left a will in which she appointed two executors.
- The will did not authorize the executors to enter into any contracts on behalf of the estate.
- One of the executors entered into a contract to sell a piece of land that was owned by the estate without the authority to do so.
- The third party knew that the executor did not have the authority to enter into the contract.
- The third party sued the estate for specific performance of the contract.
Reasons
The Court reasoned that an executor is a fiduciary who owes a duty of care to the estate. The Court also reasoned that the executor's power to bind the estate is limited to the powers that are granted to the executor by the will.
The Court also held that the third party could not enforce the contract against the estate because the third party knew that the executor did not have the authority to enter into the contract on behalf of the estate.
Conclusion
The Supreme Court of South Africa's decision in Johnson v Estate le Grange is a significant case because it clarifies the law relating to the power of executors to bind the estates of the deceased by entering into contracts. The decision also emphasizes the importance of executors acting within the scope of their authority.
