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[2013] ZAGPJHC 391
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Leigh v Rasleigh Properties (38090/2012) [2013] ZAGPJHC 391 (6 December 2013)
REPUBLIC
OF SOUTH AFRICA
IN THE SOUTH GAUTENG
HIGH COURT
JOHANNESBURG
CASE NO: 38090/2012
In the matter between:
STEPHEN
LEIGH
Applicant
and
RASLEIGH
PROPERTIES
Respondent
JUDGMENT
KATHREE-SETILOANE
J:
[1] The Applicant,
Mr Stephen Leigh seeks a final winding up against the Respondent,
Rasleigh Properties CC, which conducts
business as an owner of
immovable property and a property developer. The Applicant’s
father, Mr Roy Leigh (“Roy Leigh”)
is the managing member
of the Respondent. Roy Leigh holds a 50 per cent members interest in
the Respondent. The remaining interest
in the Respondent is held by
Mr Andre Erasmus (“Erasmus”).
[2] The provisional
winding up order was made by Jordaan AJ on 23 May 2013. Jordaan AJ
concluded that the balance of probabilities
overwhelmingly favoured
the Applicant, but did not provide reasons for arriving at that
conclusion. For a final order to be granted,
the Court must be
satisfied that there is a balance of probabilities in favour of the
Applicant. Only Roy Leigh, opposes the final
order sought by the
Applicant. In doing so he has, on behalf of the Respondent, filed a
further affidavit to which is annexed a
“CK2” form which
is purportedly signed by himself, the Applicant, Erasmus and Bruce
Rice, the accountant. The “CK2”
document purportedly
shows that the Applicant’s effective date of membership in the
Respondent was to be 28 February 2011.
[3] The “CK2”
form is of particular significance to this dispute, because the
Respondent contends that the amount
of R3 371 600, 00, which it owes
to the Applicant is not due and payable because the amounts advanced
by the Applicant to the Respondent
were pursuant to an oral agreement
that the Applicant would become an investor and a member of the
Respondent, on the basis that
the Applicant’s membership
interest in the Respondent would be determined from time to time by
the amount owing to the Applicant.
The Respondent accordingly
contends that the Applicant is precluded by the terms of the
membership agreement from claiming payment
of his loan account.
[4] The Applicant
contends that the Respondent’s version is irreconcilable with
correspondence between the Applicant
and the Respondent and/or his
father, Roy Leigh who deposed to the Respondent’s answering and
supplementary affidavits, in
particular the Annexures listed below:
(a)
Annexure
“SL3”, which is an email from Roy Leigh to the Applicant,
dated 5 July 2011, in which the Applicant is requested
to make a
further loan of R500 000, 00 to the Respondent, and advised that he
will receive R2000 000, 00 against registration of
the Rivonia
property. Significantly, there is no mention made, in this email, of
the alleged investment as a member of the Respondent
or of any
membership interest in the Respondent that would accrue to the
Applicant or of any decision made that the debt due to
the Applicant
will be repaid. In addition, there is no mention that such debt will
be repaid pro-rata to the repayment of the other
loan accounts.
(b)
Annexure
“SL4” which is the email response of the Applicant to
Annexure “SL3”, dated 5 July 2011, in which
the Applicant
states that he is not prepared to advance a further R500 000, 00
because the R3170 000, 00 already owed to him is
not going to be paid
to him by the end of the year. Again, there is no mention made of any
of the conditions for repayment contended
for by the Respondent. Nor
does the Respondent respond to this letter to say that the amount of
R3170 000, 00 is not repayable
because of such conditions applying to
the Applicant’s loan account.
(c)
Annexure
“SL5”, which is an email, dated 5 July 2011, from
Roy Leigh to the Applicant in which he makes an offer
to pay the
Applicant the whole amount received from the sale of the Rivonia
property, if he advanced a further R150 000,00 to the
Respondent.
Again there is no reference to the conditions for repayment contended
for by the Respondent, and the offer is irreconcilable
with the
Respondent’s version.
(d)
Annexure
“SL7”, which is an email from Roy Leigh to the Applicant,
dated 27 January 2012, in which he proposed that
the advances to be
made by the Applicant will be in the role of bridging finance, that
the Applicant will receive 2.5 per cent
interest per month, and that
the full amount advanced would be paid against registration of
transfer pursuant to guarantees held
by the attorneys attending to
the transfer of the properties. This proposal, in my view, is also
patently irreconcilable with the
version contended for by the
Respondent. I agree with the contention of the Applicant that if an
agreement, as alleged by Mr Roy
Leigh on behalf of the Respondent,
was in place at the time, then there would have been no need for Roy
Leigh to make the proposals,
which he made in Annexure “SL7”.
(e)
Annexure
“SL9” which is an email, dated 18 July 2012, from the
Applicant to Roy Leigh and Erasmus in which the Applicant
demands
repayment of the full amount of the loans, which he made to the
Respondent. The Applicant states in this letter that if
the
Respondent or its members are unable to repay the full amount as
demanded, they must sign over their shares and loan accounts
in the
Respondent to the Applicant. This is coupled with an offer to return
the shares and loan accounts once the monies owed are
repaid in full.
This letter is again irreconcilable with the version of the
Respondent. It is also notable that the Respondent
does not respond
to this demand stating that the loans are not repayable because of
the conditions to which the loan account are
allegedly subject.
(f)
Annexure
“SL10” which is Roy Leigh’s response to annexure
“SL9”, dated 18 July 2012, in which Roy
Leigh refers to
an invitation to participate in the Respondent so that the Applicant
could share in a good investment. As contended
for by the Applicant,
the letter refers only to an invitation to participate in the
Respondent, and does not constitute proof that
an agreement to this
effect was “firmly” concluded.
(g)
Annexure
“RL5” which is an email from the Applicant to his father,
dated 30 July 2012, in which the Applicant refers
his father to a
conversation which they had, in which the Applicant asked his father
whether he considered the money which he had
lent him as “a way
of helping him out”, or whether he wanted the Applicant to be
part of the Respondent. The Applicant’s
father replied by
saying that he considered the loans “as a way of helping
him out”, and the Applicant then said
that, in that case, he
did not want any part of the Respondent and merely wanted to be
repaid the loan. It was then agreed that
the Applicant would be
repaid the first amounts of any property sales including the Rivonia
and Kayalami properties, until the
debt had been repaid in full.
Significantly, Roy Leigh did not attempt to set the record straight
by responding that this was,
in fact, not the case.
[5] The Respondent,
however, contends that Annexure “RL4”, which is a
purported minute of a shareholders’
meeting which was held on
22 February 2011, supports its version. The Respondent alleges that
the meeting was requested by the
Applicant in order to summarise (at
that point in time), the extent of the membership in the Respondent
to which the Applicant,
Roy Leigh and Erasmus were entitled; the
extent of the loan accounts in the Respondent relating to each of the
parties; and to
discuss the question of interest relating to the loan
accounts. It furthermore alleges that the oral agreement, in terms of
which
the Applicant was obliged to take up membership in the
Respondent, and that his membership interest in the Respondent would
be
determined from time to time by the amount owing to him, was
confirmed. The Respondent contends further that the Applicant
prepared
Annexure “RL4”, and then forwarded it to both
himself and Erasmus. In addition, the Respondent points out, in a
supplementary
affidavit with reference to Annexure “D”
thereto (which is supposed to be a copy of “Annexure “RL4”),
that the Applicant’s initials are appended to the foot of the
first page, of the minute.
[6] The Applicant,
however, denies that:
(i)
he
ever attended the alleged meeting of shareholders either on 22
February 2011 or at all;
(ii) he prepared the said
minute; and
(iii) he signed or
initialled the minute.
He
does, however, accept that the initials on the first page of Annexure
“RL4” do look like his. He points out, in this
regard,
that his attorney, on his instructions, obtained the original of
Annexure “RL4” from the Respondent’s
attorneys and
the additional signatures/initials of Erasmus and Roy Leigh that
appear on Annexures “RL4” and “D”
do not
appear on the original. He also points out that the initials that
look like his, do not appear on the second page of Annexures
“D”
and “RL4”, although they appear on the second page of the
original.
[7] On perusal of
the original of Annexures “RL4” and “D”,
which is Annexure “S1” to the
Applicant’s reply to
the Respondent’s supplementary affidavit, it is indeed correct
that although an initial, which
looks like that of the Applicant, is
appended to the first page of Annexures “SL4” and “D”,
this initial
does not appear on the second page of either of these
annexures. The additional initials of Erasmus and Roy Leigh also do
not appear
on the original of Annexures “RL4” and “D”,
respectively. Nor for that matter does the heading “Minutes
of
RasLeigh Shareholders meeting of 22 February 2011” which
appears on the original, appear on either Annexures “RL4”
or “D”. In addition, the date “22 February 2011”
which is written in manuscript on the second page of the
original
does not appear on either Annexures “RL4” or “D”.
[8] These glaring
discrepancies between the original minute, and the copies which
appear at Annexures “RL4” and
“D”
respectively, certainly bring the authenticity and legitimacy of the
alleged minute into question. Which version
is the true version? Why
the discrepancies? In the absence of an explanation from Roy Leigh as
to:
(i)
the
reason for the discrepancies between the original minute, and the
versions attached to the Respondent’s answering and
supplementary affidavits;
(ii)
whether
he was present when the Applicant initialled the minute;
(iii)
when
and where the said initials were attached;
I consider the alleged
meeting and the minute (Annexures “RL4” and “D”)
to be a fabrication, and accordingly
reject the Respondent’s
version on this score. I reject the Respondent’s version in
respect of Annexure “RL4”
for the further reason that
although Annexure “RL4” predates annexures “SL3”,
“SL4”, SL5”,
“SL7”, “SL9”,
“SL10” and “SL11” as referred to above, it is
irreconcilable with
such correspondence, as these annexures make it
abundantly clear that the “agreement” contended for by
the Respondent
was simply never concluded between the Respondent and
the Applicant. Accordingly, I remain fortified in my view that the
Respondent’s
version, that the amounts advanced by the
Applicant to the Respondent are not due and payable because they were
pursuant to an
oral agreement as contended for, is irreconcilable
with the correspondence between the Applicant and the Respondent
and/or his
father, Roy Leigh.
[9] As
alluded to above, however, the Respondent has filed an additional
affidavit resisting the final winding-up order.
The only new point
raised in the additional affidavit filed on behalf of the Respondent
is the Amended Founding Statement or CK2
form of the Respondent,
which the Respondent alleges was found after the provisional order
was granted. The purported CK2 form
indicates that the Applicant’s
effective date of membership in the Respondent was to be 28 February
2011. The contention
thus advanced by the Respondent is that its
version that the Applicant would become involved as an investor and
member of the Respondent,
must be accepted by the Court as
true, and that the Applicant’s version that he was merely a
creditor who could demand
immediate repayment must be rejected as
being false.
[10] The
Respondent, however, provides no explanation in the additional
affidavit, filed on its behalf, why no mention was
made of the CK2
form in its answering affidavit and its supplementary affidavits. As
contended for by the Applicant, even if the
CK2 form could not be
found, the deponent to these affidavits must have been made aware of
its existence, and should have referred
to it in the affidavits. Roy
Leigh, who deposed to the additional affidavit, on behalf of the
Respondent, merely alleges that the
CK2 form was signed by him,
Erasmus and the Applicant. He does not say that the CK2 form was
signed by the Applicant in his presence,
and to the extent that the
CK2 form may have been signed in the presence of someone other than
himself, no affidavit from such
person is annexed to the Respondent’s
additional affidavit.
[11] The Applicant
denies that the signature on the form is his. He contends that it is
apparent, even to a layman, on comparison
of the signature on the CK2
form (which purports to be that of the Applicant) to that of his on
the four affidavits before court,
that the signature on the CK2 form
differs drastically from his signature as appears on the four
separate affidavits. The Respondent,
however, contends that I am
disallowed from carrying out such an exercise in motion proceedings,
and must therefore find on the
strength of the CK2 document (which it
submits is conclusive proof of the agreement contended for) that
the application is
disputed by the Respondent on bona fide and
reasonable grounds, thus warranting its dismissal.
[12] In
S v
Boesak
[2000] ZASCA 112
;
2000 (3) SA 381
(SCA) at paras 56-58, the Supreme Court of
Appeal held that the rule that a court is allowed to compare the
handwriting of a person
with other genuine specimens of his signature
is acknowledged in our law, as in several other legal systems, but
must be exercised
with caution. The Supreme Court of Appeal went on
to hold that even in cases where expert witnesses testify, it is the
Judge who
bears the final responsibility of making a final judgment.
[13] Turning then
to the exercise of comparing the Applicant’s purported
signature on the CK2 form (the original which
I requested), and his
signature as appears from the four separate affidavits filed of
record, I consider the signature on the CK2
to differ substantially
from the Applicant’s signature as appears from his four
affidavits. There is thus merit in the Applicant’s
contention
that the signature which purports to be his on the CK2 form is a
forgery, as this prima facie appears to me to be so,
as there is
nothing on the papers before court to gainsay this. I accordingly
consider the signature on the CK2 form not to be
that of the
Applicant, and therefore reject the Respondent’s version for
this reason as well.
[14] Furthermore,
on the Respondent’s own version it has taken no steps to
implement the so called oral agreement allegedly
concluded with the
Applicant. In addition, it is apparent from the papers that the
Respondent does not have a loan account in its
books for the
Applicant. It is furthermore clear on the Respondent’s own
version that the liabilities of the Respondent are
R18 127,124, 00
which far exceeds its assets. In addition, the amount of R1.8 million
reflected as an asset is probably irrecoverable
as the debtor is
unemployed and the property is bonded beyond its value. The
properties in Kayalami and Khamanga have been on the
market for a
considerable period of time, and no offers to purchase them have been
received by the Respondent. Their respective
values also appear to be
overstated. It is also not in dispute that the Respondent had
undertaken to pay the Applicant R 2 million
against the registration
of the Rivonia property. It is common cause that the property has
been sold and the transfer registered,
yet the Applicant has received
no portion of the proceeds of the sale, despite the undertaking
referred to above. I am satisfied
that the Respondent is unable to
repay the debt that it acknowledges is due to the Applicant, as it is
insolvent. Accordingly,
I am satisfied on a consideration of all the
affidavits that the balance of probabilities favours the Applicant,
and that a proper
case has been made for the provisional order to be
made final.
[15] In the result,
I make the following order:
(a)
The
Respondent is to be wound up in the hands of the Master of the High
Court.
(b)
The
costs of the application, which include the costs consequent upon the
employment of senior counsel, are to be costs in the winding-up
of
the Respondent.
F
KATHREE-SETILOANE
JUDGE
OF THE SOUTH GAUTENG HIGH COURT
Counsel for the
Applicant: JF Roos SC
Instructed by: JJS
Manton Attorneys
Counsel for the
Respondent: AD Wilson
Instructed by:
Spencer and Associates
Date of Judgment:
6 December 2013