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[2021] ZAWCHC 168
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Du Toit and Others v Azari Wind Proprietary Limited and Others (8825/2021) [2021] ZAWCHC 168; 2022 (2) SA 510 (WCC) (4 August 2021)
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE HIGH COURT, CAPE TOWN)
Case No:
8825/2021
In
the matter between:
JOHAN
DU TOIT
FIRST APPLICANT
(in
his capacity as the duly appointed business rescue
practitioner
of Tsoma Trading CC (in business rescue)
IAN
FLEMING
N.O
SECOND APPLICANT
in
his capacity as the duly appointed business rescue
practitioner
of Tsoma Trading CC (in business rescue)
TSOMA
TRADING CC (IN BUSINESS RESCUE)
TRADING
AS CC
CRANES
THIRD APPLICANT
(Registration
Number: 2009/178451/23)
and
AZARI
WIND PROPRIETARY LIMITED
FIRST RESPONDENT
(Registration
Number: 2011/002624/07)
NORDEX
ENERGY SOUTH AFRICA PROPRIETARY
LIMITED
SECOND RESPONDENT
(Registration
Number: 2011/148529/07)
VESTAS
SOUTHERN AFRICA PROPRIETARY
LIMITED
THIRD RESPONDENT
(Registration
Number: 2010/008330/07)
ALL
THE KNOWN AFFECTED PERSONS OF THE
SECOND
APPLICANT
FOURTH RESPONDENT
(As
more fully described in Annexure “X” to the notice of
motion)
Coram:
The Honourable Mr Justice M Francis
Date
of Hearing: 28
July 2021
Date
of Judgment: 4 august 2021
(handed down electronically)
JUDGMENT
INTRODUCTION
[1]
This is an application brought on an urgent basis for relief within
the context of
a business rescue process. I have already provided an
ex tempore
judgment together with brief reasons. I now provide
the full judgment.
[2]
The first and second applicants are the joint business rescue
practitioners of the
third applicant, Tsoma Trading CC (In Business
Rescue) t/a CC Cranes (“Tsoma”). Depending on the
context, the business
rescue practitioners will be referred to as the
“BRPs” or as “the applicants” when referred
together with
Tsoma.
[3]
The first respondent is Azari Wind Proprietary Limited (“Azari”),
a creditor
of Tsoma. Azari engaged Tsoma to provide sub-contracting
services on two windfarm projects in which Azari, in turn, was
engaged
as contractor by the second respondent (“Nordex”)
and the third respondent (“Vestas”).
[4]
The fourth respondent refers to all the known affected persons of
Tsoma, namely the
creditors, employees, trade unions representing the
employees, and the members of Tsoma.
[5]
The application was two-fold. In Part A, the applicant sought
directions from the
court on the service of the application on all
the affected persons. Directions for service were duly authorised and
the papers
were served on the affected persons. In Part B, the
applicants brought an application in terms of section 136(2)(b) of
the Companies
Act 71 of 2008 (“the
Companies Act&rdquo
;) for
the cancellation of any and all of Tsoma’s obligations in terms
of the sub-contracts concluded between Tsoma and Azari
in relation to
the Oyster Bay project and the Copperton project. In addition, the
applicants sought payment from Azari of the amount
of R13 857 836
in respect of the Oyster Bay sub-contract and the amount of
R2 392 862.50 in respect of the
Copperton sub-contract.
[6]
The Copperton and Oyster Bay sub-contracts arise out of windfarm
projects in the Northern
Cape and the Eastern Cape. Azari was
employed as a contractor by Nordex on the Copperton project and by
Vestas on the Oyster Bay
project.
[7]
As contractor, Azari was involved in various windfarms projects
forming part of the
government’s Renewable Energy Independent
Power Producer Programme. The projects included both the mechanical
and electrical
assembly of wind turbine generators. These generators
were supplied by Nordex and Vestas in terms of an engineering and
procurement
contract or a turbine supply contract with the project
companies controlling the projects. Nordex and Vestas, in turn,
contracted
Azari to erect and install the wind turbine generators.
[8]
Azari sub-contracted Tsoma as a specialist sub-contractor to provide
cranage services
on both the Oyster Bay and Copperton projects. The
services rendered by Tsoma were limited to the erection of cranes
operated by
its employees which were used to hoist various portions
of the towers and the turbine propellors. After the services were
rendered,
the cranes were dismantled and Tsoma left the site. Azari
remained responsible for the overall installation and erection of the
wind turbine generators.
[9]
The contractual relationship between Azari and Tsoma commenced during
2020 and continued
until the Copperton main agreement was cancelled
between Nordex and Azari, and the sub-contract between Azari and
Tsoma was subsequently
cancelled on 14 May 2021. The Oyster Bay
project was completed on 31 March 2021 and, as a consequence, the
Oyster Bay sub-contract
also came to an end.
[10]
It is common cause that Tsoma performed the services it was
contracted to perform and that no
further services are required to be
rendered by Tsoma in terms of either of the sub-contracts.
[11]
Having performed the services in terms of its sub-contracts, Tsoma
issued invoices to Azari.
However, Azari has not paid certain of
these invoices despite Azari having been paid by Nordex and Vestas.
[12]
Tsoma is financially distressed and commenced the business rescue
process by virtue of a Members
Resolution on 24 February 2021, and
the first and second applicants were appointed as BRPs on 25 February
2021.
DISCUSSION OF
LEGAL PRINCIPLES AND SUBMISSIONS
[13]
As noted, the BRPs seek orders for the urgent cancellation of Tsoma’s
business rescue obligations
in relation to the Oyster Bay and
Copperton projects as contemplated by
section 136(2)(b)
of the
Companies Act, and
for the immediate payment by Azari of Tsoma’s
unpaid invoices relating to the crane services provided on the
projects.
[14]
In terms of
section 136(2)
of the
Companies Act, business
rescue
practitioners may apply to court on an urgent basis for the
cancellation of pre-business rescue obligations. The opportunity
to
cancel contractual obligations allows the practitioner to extricate
the company, whether temporarily or permanently, from onerous
contractual provisions that may prevent the company from becoming a
successful concern (see, Delport
et al
Henochsberg on
the
Companies Act 71 of 2008
478 (14) – 478 (15)
.
[15]
Section 136(2)
of the
Companies Act provides
that despite any
provision of an agreement to the contrary, during business rescue
proceedings, the practitioner may:
“
(a)
entirely, partially or conditionally suspend, for the duration of the
business rescue proceedings,
any obligation of the company that –
(i)
arises
under
an agreement to which the company was a party
at
the commencement of the business rescue proceedings
;
and
(ii)
would otherwise
become
due during those proceedings
; or
(b)
apply
urgently
to a court to entirely, partially or conditionally cancel, on any
terms that are
just and reasonable in
the circumstances
, any obligation of
the company contemplated in paragraph (a)
”
(my
underlining).
[16]
It seems to me that in order to succeed, a business rescue
practitioner who approaches a court
in terms of
section 136(2)(b)
of
the
Companies Act will
have to provide a legal and/or factual basis
that:
[16.1] the
application is indeed urgent;
[16.2] the
contract giving rise to the obligation that is sought to be cancelled
was in existence at the commencement of the
business rescue
proceedings;
[16.3] the
obligations sought to be cancelled would become due during the
business rescue proceedings; and
[16.4] it
would be just and reasonable in the circumstances that the obligation
be cancelled, whether entirely, partially
or conditionally.
[17]
I now turn to deal with each issue in turn having regard to the
pleadings and evidence (as set
out in the affidavits) and the
arguments proffered during the hearing.
Urgency
[18]
Section 136(2)(b)
of the
Companies Act creates
a statutory right on
the part of the business rescue practitioner to approach the court on
an urgent basis to cancel an agreement.
However, in my view, the
business rescue practitioner is not precluded, or exempted, from
following the normal procedure for getting
applications into court.
The normal court rules apply. In respect of an urgent application,
this means that regard must be had
to rule 6(12) of the Uniform Rules
of Court (the “Rules”).
[19]
The effect of rule 6(12) of the Rules is that applicants are, in a
certain sense and taking into
the account the exigencies of the
circumstances of the case, permitted to make their own rules but must
do so “as far as
practicable” in accordance with the
existing rules of court (see,
Republikeinse Publikasies (Edms)
Bpk v Afrikaanse Pers Publikasies (Edms)
1972 (1) SA 773
(A)
). If an applicant informs the respondent that the application
is regarded as urgent, the respondent is obliged to provisionally
accept the rules which the applicant has adopted. When the matter
comes to court, the respondent could object but, in the meantime,
cannot ignore the rules which the applicant has made for the further
conduct of the application proceedings.
[20]
Having regard to the nature of the business rescue process and the
requirement that the process
be completed expeditiously (within three
months unless extended with the leave of the court
[1]
),
a court would be loathe to insist on a strict adherence to even the
more relaxed procedural requirements in terms of rule 6(12)
of the
Rules. Thus, for example, whether the applicant could achieve the
same result in the ordinary course would not necessarily
apply. On
the other hand, the interests of justice dictates that respondents be
afforded an opportunity to oppose any relief or
to make their views
known on the application. The degree of relaxation of the rules would
depend on the particular facts of the
matter (cf.
Luna
Meubel Vervaardigers (Edms) Bpk v Makin and Another (t/a Makins
Furniture Manufacturers)
1977
(4) SA 135
(W) 136C-137G
).
[21]
In the matter at hand, the applicants set this matter down on an
urgent basis to be heard on
8 June 2021. In summary, the applicants
submitted that the matter was urgent because of the dire financial
position of Tsoma and
averred that if appropriate relief was not
granted, the business rescue process would be doomed to failure. The
respondents, on
the other hand, disputed the urgency of the matter,
especially the claim for payment which, it was submitted, could be
obtained
in the ordinary course given the contested nature of the
relief sought.
[22]
Azari filed its answering affidavit and the parties thereafter agreed
to approach the Judge President
to allocate a preferential hearing
date on the semi-urgent roll, with Azari reserving its right to
challenge the urgency of the
application. The matter was,
accordingly, postponed to 28 July 2021 for hearing. After the matter
was adjourned, the applicants
filed a replying affidavit on 28 June
2021. Azari did not deem it necessary to file a supplementary
affidavit.
[23]
It is indeed so that the application was brought on highly truncated
time periods which must
have placed Azari under considerable pressure
to perform. Given the practice in this division, in light of the
complexity of this
matter, the issues to be traversed, and the extent
of the record, the matter ought to have initially been placed on the
semi-urgent
roll after a request to the Judge President for an
expedited date. As it turns out, this is what in fact subsequently
transpired.
The matter was placed on the semi-urgent roll and a
time-table was agreed by the parties on the further conduct of this
matter.
[24]
The parties have now canvassed the issues and ventilated their views
fairly extensively in the
papers, prepared comprehensive heads of
argument, and the court has had an opportunity to peruse the papers.
Thus, while not ideal,
there cannot be said to be prejudice to any of
the parties of the sort that would vitiate the fairness of the
litigation process
(cf.
IL & B Marcow Caterers (Pty) Ltd v
Greatermans SA Ltd and another; Aroma Inn (Pty) Ltd v Hypermarkets
(Pty) Ltd and another
1981 (4) SA 108
(C)
at 112H-113A). I
am, accordingly, of the view that, in the context of business rescue
proceedings, there is no merit in the contention
that the matter was
not urgent.
Was the
agreement in existence at the commencement of the business rescue
proceeedings
[25]
It is common cause that both the Oyster Bay contracts and the
Copperton contracts were in existence
when business rescue
proceedings commenced.
Did the
obligations sought to be cancelled otherwise become due during the
business rescue proceedings
[26]
In Part B of the Notice of Motion, the applicants seek an order
inter
alia
:
“
4.
That any and all of (Tsoma’s) obligations to (Azari) in terms
of the Oysterbay
Subcontract dated 11 June 2020 (the “Oysterbay
Subcontract), as read together with the Oysterbay Main Agreement
dated 12
December 2019 (the “Oysterbay Main Agreement”)
concluded between (Tsoma) and (Azari) and all other obligations
emanating
therefrom, be cancelled as contemplated by the provisions
of
section 136(2)(b)
of the
Companies Act 71 of 2008
, with immediate
effect, including but not limited to:
4.1
(Tsoma’s) obligations in relation to claims for stoppages,
delay, disruption, and
cost of additional main build teams
(“stoppages claims”) in as much as Azari has and may have
and/or may assert such
claims in relation to the Oysterbay Project.
4.2
(Tsoma’s) indemnification obligations as contemplated by the
provisions of clause
18.4 of the Oysterbay Main Agreement read
together with clause 7 of Oysterbay Subcontract.
4.3
(Tsoma’s) defects obligations as contemplated by the provisions
of clause 9 of the
Oysterbay Main Agreement read together with clause
7 of the Oysterbay Subcontract.
4.4
(Tsoma’s) performance bond obligations as contemplated by the
provisions of clause
15 of the Oysterbay Main Agreement read together
with clause 7.7 of Oysterbay Subcontract.
4.5
(Tsoma’s) insurance obligations as contemplated by the
provisions of clause 19 of
the Oysterbay Main Agreement read together
with clause 7 of Oysterbay Subcontract.
4.6
That any and all of the (Tsoma’s) obligations to (Azari) in
terms of the Copperton
Subcontract Agreement concluded between the
(Tsoma) and (Azari) on 16 July 2020 “(the Copperton
Subcontract”) and all
other obligations emanating therefrom, be
cancelled, in terms of
section 136(2)(b)
of the
Companies Act 71 of
2008
, with immediate effect including but not limited to:
4.6.1
(Tsoma’s) obligations in relation to claims for stoppages,
delay, disruption, and cost of additional main
build teams
(“stoppages claims”) inasmuch as Azari has and may have
and/or may assert such claims in relation to the
Copperton Project.
4.6.2
(Tsoma’s) indemnification obligations as contemplated by clause
17 of the Copperton Main Agreement read
together with clause 7 of the
Copperton Sub-contract.
4.6.3
(Tsoma’s) warranty obligations, performance bond obligations
and warranty bond obligations as contemplated
by the provisions of
clause 5 of the Copperton Main Agreement read together with clause 7
of Copperton Subcontract.
4.6.4
(Tsoma’s) insurance obligations as contemplated by the
provisions of clause 7.4 of the Copperton Subcontract.
”
[27]
The overarching purpose of
section 136(2)(b)
of the
Companies Act is
to empower a business rescue practitioner, through the court, to
cancel onerous contractual obligations which could provide some
breathing space for the company so as to allow a business rescue
practitioner to attempt to rescue the company’s affairs
without
the overbearing operational financial obligations emanating from such
a contract. The cancellation of a contract is very
drastic remedy
that is placed at the disposal of business rescue practitioners and
considerably waters down the principle of the
sanctity of contracts.
Also, the cancellation of an obligation in terms of
section 136(2)(b)
of the
Companies Act is
a court sanctioned cancellation and this
obligation cannot be revived in the ordinary course if the business
rescue process does
not succeed. It is, thus, incumbent on an
applicant to identify precisely which obligations ought to be
cancelled and provide
a proper explanation why such a drastic measure
is necessary.
[28]
It was submitted by the applicants that it is important for Tsoma’s
obligations to Azari to be
cancelled so that the limited cash
available to Tsoma can be applied to critical expenses of Tsoma for
the benefit of all the affected
parties, rather than exposing these
funds for the benefit of Azari only. In addition, it was necessary
that the remaining obligations
under the Copperton sub-contract (read
with the main contract) be cancelled since it would be too onerous
for Tsoma to be bound
by two contracts in relation to the same
project if it wished to conclude an agreement directly with Nordex.
[29]
In so far as the cancellation of obligations are concerned, it was
imperative for the BRPs to show
that all the obligations to be
cancelled would otherwise become due during the business rescue
process. Therefore, the BRPs would
have had to sift through all the
contracts, ascertain any extant obligations, and determine whether
any of these obligations would
become due during the course of the
business rescue proceedings. Because business rescue proceedings are
intended to be of short
duration - not more than three months in the
first instance - the BRPs would have had a definite time period as a
frame of reference
when deciding which obligations would become due
and ought to be cancelled in order to assist the financial rescue of
the business.
[30]
In their founding affidavit, the applicants outlined in some detail
the provisions of the respective
contracts and sub-contracts which
were deemed to be relevant to these proceedings. The applicants also
referred this court to the
balance of the terms of the sub-contract
which they requested to be read as specifically incorporated in their
papers
[2]
. The obligations
sought to be cancelled in respect of both the Oyster Bay and
Copperton contracts include obligations relating
to stoppages, delay,
disruption, the cost of additional main build teams, indemnification
obligations, warranty obligations, performance
bond obligations,
warranty bond obligations, and insurance obligations.
[31]
The principal difficulty which this court has with the applicants’
case is that they have failed
to demonstrate that the obligations
sought to be cancelled would fall due during the business rescue
proceedings. For example,
the claims for stoppages, delays,
disruptions, and the cost of additional main build teams (“stoppages
claims”), would
all have arisen during the course of the
contract period when Tsoma was still providing services to Azari. In
this regard, Azari
submitted that these obligations do not fall
within
section 136(2)(b)
of the
Companies Act because
those claims
arose prior to the business rescue process even though all the claims
had not necessarily been quantified.
[32]
It was the applicants’ contention, on the other hand, that even
though the claims may have arisen
during the period when both the
main and sub-contracts were still in existence, these obligations
were not due because any amounts
to be paid in respect of the
stoppages claims have yet to be determined. The applicants submitted
that an “obligation”
for the purposes of
section
136(2)(b)
of the
Companies Act should
be construed as the same as a
“debt”. If so interpreted, a debt is due when it is
immediately claimable by the creditor
and, as its correlative, it is
immediately payable by the debtor. In other words, the debt must be
one in respect of which the
debtor is under an obligation to pay
immediately (see,
Umgeni Water & Others v Mshengu
[2010]
2 All SA 505
(SCA)
at 505). It was argued by the applicants that
the debt or obligation becomes due when a creditor acquires a
complete cause of action
for the recovery of the debt or when the
entire set of facts upon which the creditor relies to prove its claim
was in place (see,
Truter & Another Deysel
2006
(4) SA168 (SCA)
paras 11 and 16).
[33]
On the applicants’ version, then, the stoppages claims are yet
to be determined. The applicants,
however, have not indicated if
these obligations would become
due
during the business rescue
proceedings. Indeed, these claims are unresolved and, according to
the applicants, “
remain the subject of the complex
construction adjudication processes and are incapable of speedy
resolution
”. The applicants go further on to state
that
“there is no way that the court could determine the quantum of
the unliquidated claims even if it was asked (to which
it is not
)”.
In any event, the applicants submit that all the stoppages claims are
invalid because Azari has failed to comply with
the 90-day time
period for the notification of claims as stipulated in the contract.
This was disputed by Azari.
[34]
Azari did assert a stoppages claim in the sum of R4 833 685
but the applicants submit that
this amount is disputed and is merely
a claim that still has to be properly assessed and quantified The
fact of the matter, though,
is that the stoppages claims are disputed
and, on the applicants’ version, are not due. If Tsoma is not
liable for the stoppages
claims and/or the stoppages claims are not
yet due and/or there is no indication that these claims will become
due during the business
rescue proceedings, it begs the question: is
there then a legal basis for this court to cancel these obligations?
The answer, with
respect, is self-evident.
[35]
The failure by the applicants to demonstrate that the obligations in
respect of the stoppages claims
become otherwise due during the
business rescue proceedings applies equally in respect of the other
obligations sought to be cancelled,
namely the indemnification
obligations, warranty obligations, performance bond obligations,
warranty bond obligations, and insurance
obligations. No indication
was provided whatsoever by the applicants that any of the
aforementioned obligations would become due
during the business
rescue process. The nature of the events that might give rise to the
performance of these obligations is such
that they may have already
occurred, may not occur at all, or may occur at some future date.
This, together with the limited time-frame
which the BRPs had to work
with, meant that the obligations that would fall due during the
business rescue proceedings were reasonably
ascertainable.
[36]
In summary, the obligations to be cancelled must be discreet and
identified in order to provide the
court with some certainty on what
is to be cancelled. However, apart from identifying in general terms
the obligations to be cancelled,
the applicants have failed to
discharge the onus of demonstrating that the obligations sought to be
cancelled would otherwise become
due during the business rescue
proceedings.
PAYMENT FOR
WORK DONE
[37]
It is not disputed that Tsoma has completed the work in respect of
the Oyster Bay
and Copperton projects. It is also not disputed that
payment in the amount of R13 857 636 (and interest) is
outstanding
in respect of the Oyster Bay invoices and that the sum of
R2 392 862.50 (and interest) is outstanding on the
Copperton
invoices.
[38]
According to Azari, as with many construction-related agreements, a
mechanism is
built into the agreements in terms of which claims may
be submitted by either party (and against Azari’s employer) for
liquidated
damages caused by, amongst other things, stoppages on the
project which are attributable to any particular party. These take
the
form both of direct costs associated with stoppages (for example,
workmen being unable to work on the site for several hours for
whatever reason) and a knock-on effect of further delays caused by
the stoppages and claims for an extension of time, which operate
to
extend the time permitted to a party to complete the works against an
agreed time schedule.
[39]
The effect of these liquidated damages claims is that amounts
claimed, and accepted
by the party against whom they had claimed, are
expressly permitted in terms of the contract to be set-off against
other amounts
which may be due by the claiming party. Azari has
submitted several hundred stoppages claims against Tsoma which are in
the process
of being resolved by a committee of representatives
appointed by each party. Both the Oyster Bay sub-contract and the
Copperton
sub-contract provide agreed dispute resolution mechanisms
which are to be followed. These entail that the parties first
amicably
try to resolve the dispute and thereafter if that fails, to
refer the dispute to arbitration. According to Azari, many of these
claims have in fact been informally admitted and resolved by that
committee.
[40]
Payment is being withheld by Azari who asserts that although the
services
were rendered in respect of which the invoices were issued,
by virtue of its claims for liquidated damages, no amount is due in
terms of the invoices. Azari submits that its entitlement to withhold
payment is a contractual right in terms of which payment
would be
made only once there is a reconciliation of the amounts due to and by
the respective parties. This process has not been
completed and,
therefore, according to Azari, it is not obliged to pay over the
amounts claimed by the applicants in respect of
the outstanding
invoices.
[41]
According to Azari, what the applicants seek, under the guise of a
cancellation of
obligations, is to have the dispute around the
stoppages claims – which operate as a form of pre-estimated
damages - determined
on an urgent basis by wiping out these claims in
their entirety, without any reference to the merits of such claims.
In other words,
the applicants are attempting to extinguish claims
that have already accrued, rather than obligations that are still to
be fulfilled
in terms of the relevant agreements. It is only upon
that basis that the applicants are able to claim payment of the
amounts invoiced
by Tsoma.
[42]
Tsoma has disputed that any stoppages claims have been validly lodged
(because they
are time-barred) and/or are due. Accordingly, Tsoma
submits that Azari cannot apply set-off against its (Tsoma’s)
undisputed
debt. The applicants submit further that claims for
payment of the aforementioned invoices or balances thereof are not
the
only claims Tsoma has against Azari. They aver that Tsoma has, by
way of example, delay and disruption claims against Azari on the
Oyster Bay project exceeding R30 million, as well as claims against
Azari for payments for work done on the Roggeveld project.
In this
regard, Azari’s response is that the bulk of any claims on the
Oyster Bay project would in any event be for the account
of the main
contractor, Vestas, by virtue of the “pass-through”
provisions in the sub-contract agreement. These claims,
which were
for wind and weather claims, have, according to Azari, been rejected
by Vestas as the relevant agreement does not allow
for such claims.
[43]
Whatever the respective merits of the parties’ cases are, one
thing is clear:
there is a dispute on whether monies are owed by
Azari to Tsoma and vice versa. In this regard, the applicants state
as follows
in their replying affidavit: “A
s Azari correctly
says, the completing claims are complex and not easily resoluble. The
parties have asserted hundreds of claims
against each other. They are
so complex that Azari utilises a special computer programme and a
third party moderation mechanism
to quantify its claims. The
complexity warranted the establishment of a by-partisan committee to
attempt to resolve them. To date,
it has not succeeded
”
.
[44]
If the issue of the payment of the invoices is uncoupled from the
request for the
order to cancel the stoppages claims in terms of
section 136(2)(b)
of the
Companies Act, then
the claim for payment is
simply a request for final relief for a money judgment on an urgent
basis in motion proceedings and in
circumstances where the respondent
contends that it has a contractual defence to the order sought for
payment of a disputed amount.
[45]
In
Wrightman t/a JW Construction v Headfour (Pty) Ltd &
Another
[2008] ZASCA 6
;
2008 (3) SA 371
(SCA)
at para
[12]
, the
Supreme Court of Appeal confirmed the well-established rule in
dealing with factual disputes in applications where the applicants
seek final relief:
“
[12]
Recognising that the truth almost always lies beyond mere linguistic
determination the courts have said that
an applicant who seeks final
relief on motion must, in the event of conflict, accept the version
set up by his opponent unless
the latter’s allegations are, in
the opinion of the court, not such as to raise a real, genuine or
bona fide
dispute of
fact or are so far-fetched or clearly untenable that the court is
justified in rejecting them merely on the papers…
[13]
A real, genuine and bona fide dispute of fact can exist only where
the court is satisfied that
the party who purports to raise the
dispute has in his affidavit seriously and unambiguously addressed
the fact, said to be disputed.”
In its answering
affidavit, Azari has put up a robust and spirited defence against
Tsoma’s claim for payment. Certainly, it
cannot be said that
the claims by Azari are so untenable as to be rejected merely on the
papers.
[46]
It is indeed so that the business rescue proceedings may well have
been assisted
if payment was ordered as sought by the applicants
However, in the circumstances, the dispute over payment is purely a
commercial
issue between the parties and does not fall to be resolved
within the business rescue process on the case presented by the
applicants.
[47]
In the circumstances, the applicants have failed to make out a case
for the grant
of an order for payment.
ORDER
[1]
The application is dismissed.
[2]
The applicants are directed to pay the costs of the application,
including the costs
consequent upon the employment of two counsel.
FRANCIS J
APPEARANCES
:
Applicant’s
Counsel:
Adv. G Wickins (SC) (JHB)
Adv.
D Watson
Applicant’s
Attorney:
Mr Alex Eliott
Respondent’s
Counsel:
Adv. G Woodland (SC)
Adv.
S Fergus
Respondent’s
Attorney:
Mr Nico Walters
[1]
Section 132(3)
of the
Companies Act deals
with the duration of
business rescue proceedings and provides as follows:
“
If
a company’s business rescue proceedings have not ended within
three months after the star of those proceedings, or such
longer
time as the court, on application by the practitioner, may allow,
the practitioner must –
(a)
prepare a report on the progress of the business rescue
proceedings, and update it at the end of each subsequent month until
the
end of those proceedings; and
(b)
deliver the report and each update in the prescribed manner
to each affected person, and to the –
(i)
court, if the proceedings have been subject of a court order;
or
(ii)
[Companies and Intellectual Property Commission], in any
other case.”
[2]
In this regard, it should be noted that affidavits must identify the
issues and contain the factual averments relevant to those
issues.
After all, affidavits constitute both the pleadings and the evidence
in motion proceedings (see,
Minister
of Land Affairs and Agriculture v D & F Wevell Trust
2008
(2) SA 184
(SCA)
at
para [43]). Where a party relies on a document, the passages in the
document must be identified and the conclusions based on
the
passages must be set out. It is not the duty of the court to search
through documents to establish the facts required to
support the
averments made by parties in their affidavits.