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[2021] ZAGPJHC 589
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Soweto Community Television NPC v Hlalukana and Others (2021/25200) [2021] ZAGPJHC 589 (21 June 2021)
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IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NUMBER: 2021/25200
REPORTABLE:
NO
OF
INTEREST TO OTHER JUDGES: NO
REVISED:
NO
21
June 2021
In
the matter between: -
SOWETO
COMMUNITY TELEVISION NPC
Applicant
and
HLALUKANA,
MZIMKHULU
First respondent
KENANA,
MAHLOMOULA
Second respondent
MLAMBO,
NKOSINATHI
Third respondent
NKOSI,
DUDUZILE
Fourth respondent
TSHEKEDI,
JOHN
Fifth respondent
JUDGMENT
GEORGIADES
AJ
:
[1]
The applicant seeks to declare a meeting where the respondents were
purportedly
elected as directors of the applicant, null and void. The
meeting was apparently held by members of the Soweto community on
12 May 2021.
[2]
The applicant seeks to interdict the respondents from the following
acts: -
[a]
Misrepresenting themselves to be the directors or officers of the
applicant;
[b]
Giving unlawful land unauthorized instructions to the staff of the
applicant;
[c]
Unlawfully engaging the stakeholders of the applicant;
[d]
Using the intellectual property of the applicant and/or any resources
of the
applicant, including the applicant’s logo;
[e]
Making any public announcements concerning the applicant;
[f]
Interfering with the legitimate process of the applicant to recruit
members and the board nomination process for the planned special
annual general meeting (“
AGM”
); and
[g]
Disrupting the planned AGM of the applicant.
[3]
Central to the determination of this matter is the outcome of the
complaint
laid in October 2020 with the Complaints and
Compliance Committee of ICASA in October 2020. The complaint, at
its heart,
was against the board of directors. It alleged that the
board was not properly constituted.
[4]
The CCC found that the board was not properly appointed. This was
because the
then sole director, Mr Nkutha, did not hold a
special meeting to elect the directors. Instead, he co opted the
current
directors. The company had no members to hold an election, it
held and therefore, Mr Nkutha had no choice but to co opt
directors. Mr Nkutha is no longer a director. The current
directors removed him. The CCC held that,
inter alia
, a
special meeting of members for the election of directors be held
within 60 days.
[5]
The applicant says it is still within the 60-day period but is
prevented from
holding this election or special meeting to elect the
directors because its attention lay elsewhere. Also, the Covid
regulations
prevented it from doing so. In a note to the Court, the
applicant indicated that the Covid restriction has been lifted,
although
they did not state when the special general meeting would be
held.
[6]
There are currently four directors and a company secretary on the
board of the
applicant. Two of the directors were appointed in 2019
while the other two were appointed in 2021. The latter were appointed
after
the complaint was lodged with the CCC.
[7]
The applicant has not taken any steps to implement the judgment of
the CCC.
There was nothing preventing it from recruiting members from
the broader Soweto community. During the week of the hearing of this
matter, the Covid restrictions were lifted. I called for further
submissions on urgency given that this had occurred. However,
there
was no indication that the CCC judgment was in the process of being
implemented. It maybe that this is in process.
[8]
The respondents are all residents of Soweto and are community
members. Frustrated
by the lack of transparency and other factors
that included no elections or registration of membership, they called
the applicant’s
directors to a meeting on 12 May 2021.
[9]
They also pointed to certain irregularities which included: -
[a]
A salary advice purportedly issued by the applicant in favour of the
company
secretary and attorney of record, Mr Gcayi, for a
monthly salary in the net amount of R80,000.00;
[b]
In October 2020 Mr Gcayi issued an invoice in his capacity as
attorney
of Soweto TV in the amount of R140,000.00, which includes a
monthly retainer of R40,000.00. In addition, a tax invoice issued by
the law firm of Mr Gcayi for professional services rendered, in
October 2020, in the amount of R240,000.00 did not describe
the
nature of the professional services;
[c]
On 10 October 2019 MVM House, one of the service providers of Soweto
TV,
rendered an invoice to Soweto TV in the amount of R115,000.00.
The director of MVM is one Mr T Molefe, currently also
a
director of Soweto TV since 3 March 2021;
[d]
An undated broadcasting partnership agreement concluded between
Soweto TV and
Touch HD provides at clause 5.2 of the appointment
of an external supplier, MVM Multimedia (Pty) Ltd. The profit sharing
is
provided for in clause 6.1. Production costs and 16.5 %
commission would be payable to MVM House firstly, and then only
the
surplus would be shared between Soweto TV and Touch HD on a 50/50
basis. Mr Molefe is also a director of MVM, as well
as Touch HD.
[10]
The respondents allege that the interests of the applicant are not
being served by the current
board of directors and the company
secretary. In this regard they also pointed to the fact that there
were no audited financial
statements for the past few years. They
allege further that it was in the financial interests of the
applicant that an interim
board of directors be appointed, pending a
special members’ meeting to manage the financial affairs of the
applicant.
[11]
On the other hand, the applicants allege that the respondents have
been purporting to act as
the directors of Soweto TV and have to this
extent terminated the contract of MVM. They did not want the
respondents to continue
interfering with the workings or the business
of Soweto TV.
[12]
The applicant’s directors indicated that they were not
available to attend the meeting
on the 12
th
of May 2021.
The meeting went on and the respondents were elected as directors.
They informed the applicant’s current
directors that they were
elected as the new directors of Soweto TV.
[13]
This is a case of an improperly constituted board of directors, as
found by the CCC, calling
into question and wanting to nullify the
subsequent election of directors, i.e. the respondents.
[14]
I agree with the finding of the CCC. The current board is improperly
constituted. Hence the CCC’s
recommendations need to be
implemented. These had not been implemented, resulting in the meeting
of the 12
th
of May 2021.
[15]
Similarly, that election wasn’t proper and stands to be
nullified. The respondents did
not inform the current board of
directors that they intended holding an election.
[16]
During the hearing the Court proposed to Ms Bezuidenhout and to
Mr Moela that the proverbial
baby be cut in half and that each
of the contestants serve on an interim board.
[17]
In my judgment this seems to be the best way of resolving the matter
pending the special meeting
of members.
[18]
In the result, I make the following order: -
1.
Pending the election of a board of directors at a special meeting
to
be convened as contemplated in this order, and interim board of
directors is hereby appointed and shall consist of a total of
4
directors, appointed as follows (“
the interim board”
): -
1.1
two directors to be nominated and appointed by the respondents’
attorney,
namely Ms Ndileka Ngoqo;
1.2
two directors to be nominated and appointed by Mr Gcayi;
1.3
one director to be nominated and appointed by the Chairperson of the
Johannesburg
Society of Advocates.
2.
The interim board shall be elected and constituted by no later
than
close of business on Wednesday, 30 June 2021.
3.
All decisions relating to the management and financial affairs
of the
applicant will be taken by the interim board by way of majority vote.
4.
The interim board shall sign a resolution for the operation
of the
bank account/s of the applicant, including but not limited to the
bank account held with Absa Bank Limited with account
number: [....]
and furnish it to the applicant’s bankers by no later than
Friday, 2 July 2021.
5.
The interim board shall from Monday, 5 July 2021, between
the
hours of 07:00 – 08:00 and 18:00 - 20:00, advertise on
television and on its website that persons of 18 and older who
live
within the broadcasting range (as per its licence) of Soweto
Television may apply for membership of the applicant so that
they may
elect a board of directors at a Special meeting of the applicant to
be held by no later than Saturday the 28
th
of August 2021
between the hours of 14:00 and 19:00 at a specified readily
accessible place within the broadcasting range.
6.
The advertisement must include that an application form must
be
filled in as set out on the station’s website or as obtained
from the office of the radio station (with station’s
street
address) or per e mail (with station’s e mail
address).
7.
The interim board must, if an applicant for membership lives
at a
place as aforementioned, issue the said membership by notifying the
applicant per e mail or postal service and stating
that he or
she must at the meeting, as set out hereunder, be in possession of
the said proof of membership to enter the meeting
place and vote.
8.
As main item a board of directors, including a chair and deputy
chair, of 8 be elected from the members by a majority vote at such a
meeting for a term of 3 years.
9.
The election shall be chaired by a Senior Counsel (SC) nominated
by
the Chairperson of the Johannesburg Society of Advocates, with a
director nominated by the interim board acting as secretary.
10.
A representative of the ICASA shall be invited to the said meeting
within 21
working days’ notice.
11.
Paragraphs 2.1 and 2.2 of the
rule nisi
order granted by this
court on 14 April 2021 is substituted with this order.
12.
Each party shall pay their own costs.
C
GEORGIADES
ACTING
JUDGE OF
THE
HIGH COURT
GAUTENG
LOCAL DIVISION,
JOHANNESBURG
Date
of Hearing:
3 June 2021
Judgment
Delivered:
21 June
2021
APPEARANCES: -
On
behalf of applicant:
Mr Moela
Instructed
By:
SGA Law Africa Attorneys
Pretoria
On
behalf of respondents:
Ms F Bezuidenhout
Instructed
By:
Ngoqo Sithole Incorporated
Johannesburg