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[2015] ZAGPJHC 97
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Mia v Deacon (34269/2014) [2015] ZAGPJHC 97 (4 June 2015)
REPUBLIC
OF
SOUTH AFRICA
IN THE
HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO: 34269/2014
DATE:
04 JUNE 2015
In the matter
between:
MOHSIN
MAHMOOD
MIA
...................................................................................................
Applicant
And
DAVID
FREDERICK
DEACON
..........................................................................................
Respondent
J
U D G M E N T
WEINER
J
:
[1]
The applicant applies for an order sequestrating the estate of the
respondent. The respondent admits that he is indebted
to the
applicant in an amount of R585 000,00 arising out of a judgment
obtained by the applicant under case number 2008/22398.
He,
however, denies that he has committed an act of insolvency or that he
is factually insolvent.
[2]
In terms of section 8(a) of the Insolvency Act
[1]
,
the applicant contends that the sheriff attempted to serve the writ
on three occasions, but there was never anyone at the respondent’s
premises. Accordingly, the Applicant submitted that the respondent
has ‘departed from his dwelling or otherwise absented
himself
for the purpose of evading and delaying the payment of his debts’.
The respondent confirms that he resides
at the given address together
with his wife and two children and that there is also a permanent
domestic worker at the premises.
The respondent cannot state
what his whereabouts were on the occasions when the deputy sheriff
attempted to serve the writ, but
he denies that he was absenting
himself for the purpose of evading and delaying the payment of his
debts. In my view, the
applicant has not established sufficient
facts to rely on an act of insolvency as defined by section 8(a) of
the Act.
[3]
In terms of section 8(b) of the Act, the applicant relies on a return
of service issued by the deputy sheriff on the 29
th
August 2013. Such return of
nulla bona
was furnished over a year prior to the launching of these
proceedings. The applicant in such circumstances is obliged to set
out
allegations supported by facts that the debtor’s position
is unchanged. See
Abell v Strauss
1973 (2) SA 611
(W).
[4]
In addition the respondent disputes what transpired upon the service
of the writ of execution. He states that the sheriff did
not enquire
as to whether he had any other disposable assets but merely whether
he had any movable assets which could be attached
at the premises.
The sheriff’s return appears to have been executed at No. 1
Fifth Avenue, Northwold “
the
defendant’s residential address
”.
However at the foot of the return of service, it is recorded that the
address is occupied by Junto Radio. The sheriff
has not provided a
confirmatory affidavit in relation to the service of the
nulla
bona
return.
[5]
Accordingly the applicant has failed to establish that the
respondent has committed an act of insolvency in terms of either
section 8(a) or section 8(b) of the Act.
[6]
The applicant relies on actual insolvency as an alternative to the
acts of insolvency committed by the respondent. In terms
of the Act,
the applicant is required to establish that the respondent is in fact
insolvent; that his liabilities factually exceed
his assets. The fact
that a debtor has not paid his debts does not necessarily lead to an
inference that he is insolvent. See
Corner
Shop (Pty) Ltd v Moodley
1950 (4) SA 55
at 60.
[7]
In the founding affidavit, the applicant alleges that the respondent
owns three immovable properties that is two shares being
No. 6 and
No. 7 in the Sectional Title Scheme Machindi Lodge and a Sectional
Title Unit being Unit 4 in the Sectional Title Scheme
Lukwela
Terrace.
[8]
In addition the applicant alleges that the respondent holds an
interest in a number of companies and close corporations and
is also
an income and capital beneficiary of the Kamada Trust. The respondent
holds an interest in a number of other entities and
own assets
including a marine vessel.
[9]
It appears from the applicant’s own version in the founding
affidavit that the respondent’s disposable assets would
exceed
his liabilities and accordingly he would not be factually insolvent.
[10]
It is only in the replying affidavit that the applicant seeks to rely
on the question of factual insolvency. Even though it
might appear
from the respondent’s affidavits that he is factually
insolvent, it is insufficient for the applicant to rely
on this in
seeking the sequestration of the respondent’s estate on the
basis of factually insolvency. See
Bishop
v Baker
1962 (2) SA 679
(N) where it
was held that the creditor who wishes to rely on the debtor’s
actual insolvency must allege and show this in
his founding
affidavit.
[11]
In
Standard
Bank of SA Ltd v Sewpersadh and Another
[2]
Dlodlo J applied the principles espoused in
Bishop
and
held that:
“
The
applicant bears the onus, to be discharged on a balance of
probabilities, of showing the respondent to be factually insolvent.
Strangely in the instant matter the
applicant does not allege in his founding affidavit that either or
both of the respondents are
factually insolvent. Neither has
the applicant made an attempt to show that the respondent’s
liabilities exceed their
assets (jointly or severally). It is only in
the replying affidavit that the applicant seems to bring forth facts
from which insolvency
can possibly be inferred. The fact of the
matter is that the applicant failed to rely exclusively or
alternatively on the debtor’s
insolvency in its founding
affidavit. Reliance on the contents of the replying affidavit
which were not contained in the
founding affidavits amounts to
reliance on new matters which the respondents have had no opportunity
to reply to. The applicant’s
failure to allege in the founding
affidavits that the respondents are de facto insolvent clearly
militates against the applicant’s
contention in submissions
before the court that the respondents are de facto insolvent.
”
[12]
In view of the aforegoing the applicant has failed to show that the
respondent has either committed an act of insolvency upon
which the
court can rely nor that the applicant is factually insolvent.
According the following order is issued:
1.
The
application is dismissed with costs.
WEINER
J
JUDGE
OF THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
Appearances:
For the Applicant: A. W. Harcourt SC
Instructed By: Maharaj Attorneys
For The Respondent: N Redman SC
Instructed By: M.R Harty Attorneys
Date of Hearing: 20 April 2015
Date
of Judgment: 4 June 2015
[1]
Act 24
of 1936
[2]
2004
(5) SA 148
(C) at [19]