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[2014] ZAGPJHC 333
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Cecil N.O and Others v Bertulis and Another (04024/2014) [2014] ZAGPJHC 333 (11 March 2014)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
and
SAFLII
Policy
REPUBLIC OF SOUTH
AFRICA
IN THE HIGH COURT
OF SOUTH AFRICA
GAUTENG LOCAL
DIVISION, JOHANNESBURG
CASE
NO: 04024/2014
DATE:
11 MARCH 2014
In the matter
between:
GAINSFORD, GAVIN
CECIL
N.O
..........................................................
First
Applicant
KAJEE, ZEENATH
N.O
......................................................................
Second
Applicant
MONYELA,
CHRISTOPHER KGASHANE N.O
..................................
Third
Applicant
FISHER, JACQUES
ANDRE N.O
......................................................
Fourth
Applicant
MCKENZIE, SANDRA
JOAN N.O
.......................................................
Fifth
Applicant
MOTIMELE,
MMABATHO SHIRLEY N.O
.........................................
Sixth
Applicant
[In their
capacities as the appointed liquidators of
FIRST STRUT (RF)
LIMITED (in liquidation)]
ANDRIS DZINTARS
BERTULIS
....................................................
First
Respondent
CAPITEC BANK
LIMITED
......................................................
Second
Respondent
J U
D G M E N T
MAKUME, J:
[1] In this
application the applicants who are the duly appointed liquidators of
a company known as First Strut (RF) (In Liquidation)
(“the
company”) seek an order setting aside the payment of certain
premiums on policy number 01……….
by the company
to Momentum Life.
[2] This application
served in the urgent court before Tshabalala J on the 7th day of
February 2014 when a draft order was granted
affording the
respondent’s time to file answering affidavits. The
application was postponed for hearing in the urgent court
on the 11th
February 2014.
[3] Of importance is
clause 4 of the draft order which reads as follows:
“4. Without
prejudice and without any admission the First Respondent undertakes
that pending the adjudication of this application
in the Motion Court
week commencing 10 February 2014 the First Respondent will not cede,
Pledge, Alienate, Dispose of, use or in
any way encumber the monies
standing to the credit of bank account number 13……. at
Second Respondent and agrees also
without prejudice or any admissions
to his rights against the Second Respondent that the hold on the
above account be maintained
pending the adjudication of this
application in the Motion Week of 10 February 2014 as aforesaid.”
[4] The application
was argued before me on the 13th February 2014. I reserved judgment
and once more by agreement between the parties
prayer 4 of the order
of the 7th February 2014 was extended until judgment is delivered.
BACKGROUND FACTS
[5] The facts
leading to this application are to a large extent common cause and
not disputed.
[6] The first
respondent together with the late Jeffrey Mark Wiggil (“Wiggil”)
were the directors of the company and
controlled its affairs.
[7] On the 18th
September 2013 the company was placed in final liquidation, shortly
thereafter on the 22nd November 2013 the Master
of the High Court
appointed the applicants as liquidators of the company.
[8] In carrying out
their duties as liquidators and investigating the financial affairs
of the company the liquidators discovered
that the company had paid
out of its bank account held at First National Bank premiums
totalling R1 740 000,00 (One Million Seven
Hundred and Forty Thousand
Rand Only) in respect of a policy held at Momentum Life being policy
number 01……. The
investigations further revealed that
payments were made between the period 1st December 2011 to July 2013.
[9] On the 6th
February 2014 Mr Raquel Peter a legal administrator at Momentum Life
informed the applicants that proceeds of policy
number 01………
in the amount of R1 935 270,00 were paid into a bank account held in
the name of the first respondent
at Capitec Bank (second respondent)
that payment had been made on the 5th February 2014.
[10] The applicants
on receiving this information concluded that the proceeds of the
policy are impeachable and recoverable as contemplated
in
sections 26
to
31
of the
Insolvency Act 24 of 1936
alternatively in terms of the
common law. Having so concluded and acting in the best interest of
creditors the applicants approached
court by way of urgency in
accordance with
Rule 6(12)(a)
at the earliest possible time being the
7th February 2014.
URGENCY
[11] The facts
deposed to on urgency speak for themselves. The applicants could not
have done anything on the 20th January 2014
which is the day they
became aware of the existence of the policy because at that time the
proceeds of that policy had not as yet
been paid out. This they got
to know only on the 6th February 2014. They wasted no time and
launched the application.
[12] More than three
decades ago in the now well-known case of Luna Meubelvervaardigers v
Making and Another
1977 (4) SA 135
Coetzee J stated what a court has
to bear in mind when considering urgency. He said the following:
“(i) The
question is whether there must be a departure at all from the times
prescribed in
Rule 6(5)(b).
Usually this involves a departure from
the time of seven days which must elapse from the date of service of
the papers until the
stated day for hearing. Once that is so, this
requirement may be ignored and the application may be set down for
hearing on the
first available motion day but regard must still be
had to the necessity of filing the papers with the Registrar by the
preceding
Thursday so that it can come onto the following week’s
motion roll by the motion court judge on duty for that week.
(ii) Only if the
matter is so urgent that the application cannot wait for the next
motion day from the point of view of his obligation
to file the
papers by the preceding Thursday, can he consider placing it on the
roll for the next Tuesday without having filed
his papers on the
previous Thursday.
(iii) Only if the
urgency be such that the applicant dare not wait even for the next
Tuesday may he set the matter down for hearing
on the next court day
at the normal time of 10:00 or for the same day if the court has not
as yet adjourned.”
[13] What Coetzee J
says in (iii) above is exactly what the applicants did in this
matter. Having come to know of the payments of
the money on the 5th
or 6th of February 2014, Friday the 7th February 2014 was the first
motion court day available for them to
be heard. Had they waited
until the following Tuesday a possibility existed that the first
respondent would by then have withdrawn
the money and dissipated it
to the detriment of the creditors.
[14] Accordingly I
find that the applicants have satisfied the requirements for urgency.
MERITS
[15] It is common
cause that within two months of being placed under business rescue
the company was placed under provisional liquidation
and subsequently
finally liquidated.
[16] In paragraphs
26 and 29 of the founding affidavit the applicants say Momentum
confirmed that the premiums in respect of the
policy were paid from
the bank account held in the name of the company (First Strut). In
his answering affidavit the first respondent
does not dispute this.
What he says is that this was payments for his pension fund as an
employee of First Strut. If this is indeed
so the first respondent
will raise this as a defence in the envisaged action that the
applicants will be instituting. At this stage
what is of importance
is that the payments of the premiums were made from the bank account
of a company that was experiencing financial
problems and could have
been trading under insolvent conditions.
[17] It is not in
dispute that the company First Strut’s assets are less than its
liabilities. What the trial court will
have to determine is whether
at the time that First Strut paid premiums to Momentum whether such
payments were made under circumstances
that fall to be protected in
terms of
sections 26
up to 31 of the Insolvency Act No 24 of 1936
(“the Act”).
[18] Section 26(1)
of the Act captures the crux of what the trial court will have to
concern itself with. The section reads as follows:
“Disposition
without value
(i)Every disposition
of property not made for value may be set aside by the court if such
disposition was made by an insolvent –
(a)More than two
years before the sequestration of his estate and it is proved that
immediately after the disposition was made the
liabilities of the
insolvent exceeded his assets.
(b) Within two years
of the sequestration of his estate and the person claiming under or
benefited by the disposition is unable
to prove that immediately
after the disposition was made the assets of the insolvent exceeded
his liabilities.”
[19] In Mars Law of
Insolvency in South Africa 9th Edition at page 285 paragraphs 13.28
the learned writer says that:
“When
proceedings are contemplated for the recovery of property alleged to
have been alienated fraudulently or by way of undue
preferences or
gratuitously, or in contravention of section 34 by the insolvent the
court may grant an interdict restraining the
person in possession of
the property from parting with the same pending action for its
recovery. If the property sought to be
recovered is in the
possession of the person to whom it was originally delivered the
court will interdict it being parted with
even though neither mala
fides, collusion, feared irreparable loss nor intention to dissipate
the property is alleged. It may
also even before sequestration of a
debtor’s estate restrain him from parting with his assets to
the detriment of his creditors.”
[20] The learned
writer refers to the matter of Stern v Ruskin N.O. v Appleson
1951
(3) SA 800
(W). In that the court held that where in an application
for an interdict pendente lite the claims under consideration are
neither
vindicatory nor quasi-vindicatory an applicant cannot obtain
an interdict unless he proves in addition to a prima facie case an
actual or well-grounded apprehension of irreparable loss.
[21] In the present
case the respondent has not provided any proof of an employment
contract to support his contention that the
proceeds of the policy
with Momentum belong to him by way of it being pension benefits.
There is evidence that he opened the bank
account on the 28th January
2014 a mere 9 days before the policy paid out. This in the court’s
view is suspicious conduct
by a director of a company in financial
difficulties.
[22] This Court has
reasonable belief that the amount once released to the first
respondent will be dissipated and if it is proved
in the envisaged
action that the proceeds belong to the company then the creditors
would have been prejudiced.
[23] The application
is upheld and I make the following order:
1. The first
respondent is hereby interdicted from ceding, pledging, alienating,
disposing, using or in any way encumbering the
monies standing to the
credit of bank account number 13…….. (The bank account)
held in his name with the second respondent
pending the final
determination of an action to be instituted by the applicant within
45 days from date of this order.
2. The second
respondent is interdicted from permitting the withdrawal, disposal or
use in any manner whatsoever of the funds standing
to the credit of
the bank account.
3. The applicant is
ordered to institute action against the first respondent to set aside
the payment of the premiums on policy
number 01………
by First Strut to Momentum Life and/or the appropriation of the
proceeds thereof by the first
respondent and/or for similar
alternative and/or ancillary relief.
4. The costs of this
application shall be costs in the action to be instituted save that
if the action is not instituted within
the 45 day period or within
such extended period as the court on good cause may allow then the
order granted in 1 and 2 above will
lapse in which event the
applicants shall pay the first respondent’s costs of the
application.
M A MAKUME
JUDGE OF THE HIGH
COURT OF SOUTH AFRICA
GAUTENG LOCAL
DIVISION, JOHANNESBURG
COUNSEL FOR
APPLICANTS IVAN MILTZ SC
INSTRUCTED BY E N
S AFRICA INC
150 WEST STREET
SANDTON
JOHANNESBURG
REF: G
OERTEL/0349371
TEL: (011) 269
7600
COUNSEL FOR FIRST
RESPONDENT G I
HOFFMAN SC
INSTRUCTED BY IAN
LEVITT ATTORNEYS
19TH FLOOR
SANDTON OFFICE
TOWER
CNR 5TH STREET &
RIVONIA ROAD
SANDTON
REF: MR LEVITT
TEL: (011) 784 3310
DATE OF HEARING 28
FEBRUARY 2014
DATE OF JUDGMENT 11
MARCH 2014