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[2021] ZAECELLC 2
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Mfazwe v A N Gadi Property Investments (Pty) Ltd and Others (EL 604/2020) [2021] ZAECELLC 2 (23 February 2021)
IN
THE HIGH COURT OF SOUTH AFRICA
(EAST
LONDON CIRCUIT LOCAL DIVISION)
Reportable
yes
CASE
NO: EL 604/2020
Date
heard: 28 January 2021
Date
delivered: 23 February 2021
In
the matter between:
BENJAMIN
MZUVUKILE MFAZWE
Applicant
and
A
N GADI PROPERTY INVESTMENTS (PTY) LTD
First Respondent
G
M VOIGT NO
Second Respondent
IDEC
FINANCIAL SERVICES (PTY) LTD
Third
Respondent
JUDGMENT
NOTYESI,
AJ:
Introduction
[1]
The applicant, Benjamin Mzuvukile
Mfazwe, seeks an order that an enquiry relating to two entities
namely, mnandi Fast Foods and
Mpeto Attorneys be conducted in terms
of sections 417 and 418 of the Companies Act 61 of 1973. He has
alleged that they have
received or are holding funds in the sum of R4
200 935, which sum is due to AN Gadi Property Investments (Pty) Ltd
(in liquidation),
the first respondent.
[2]
Mr Mfazwe believes that the funds were
in the trust account of Mpeto Attorneys at the instance of the two
entities. His contentions
are that once this court has authorised an
enquiry, the entities would account for the funds and also disclose
their whereabouts.
According to him, the enquiry would result in the
recovery of the funds. He rejects the view held by the liquidators
that, on the
available evidence, no such funds exist in any
attorney's trust account.
[3]
In opposing the application, the
respondents have challenged Mr Mfazwe's
locus
standi
to institute these
proceedings. They also contended that the proposed enquiry would
serve no purpose as the alleged funds had, in
previous litigation
involving the first respondent , the applicant or his wife, Nontende
Stella Mfazwe, been found by this court,
to be non-existent. The
liquidators contended that they have also investigated the
allegations of funds being held in the trust
accounts of the
entities, and found no evidence supporting the allegations. According
to the respondents, the proposed enquiry
would be an abuse of the
process of this Court and there is no valid ground for this
application.
[4]
The respondents have also been aggrieved
by some allegations made in the applicant's replying affidavit. They
have accordingly made
an application for the striking out of the
impugned allegations. There are accordingly two applications before
this Court, the
application to strike out and the main application.
The
Parties
[5]
For the sake of convenience, the
protagonists in these proceedings are referred to simply as
"Mr
Mfazwe" , "Mr Voigf'
and
N Gadi Property Investments
(Pty) Ltd'.
Mr Mfazwe is the
applicant. Mr Voigt, the second respondent, is cited in his capacity
as one of the liquidators of A N Gadi Property
Investments (Pty) Ltd
and a director of IDEC Financial Services (Pty) Ltd, the third
respondent.
The
issues
[6]
I now turn to deal with the issues
falling to be determined in these proceedings. I interpose here to
mention that, although the
issue in paragraph 6(b) is dispositive of
the application, the remaining issues will nevertheless be
dealt with so as to
do justice to the submissions made by the
parties, respectively. The issues for determination are-
(a)
whether or not the applicant has the
necessary
locus standi
to
institute these proceedings;
(b)
whether or not the courts have
previously pronounced on the funds alleged to be either held or
received into the trust accounts
of Mpeto Attorneys and Mnandi Fast
Foods totaling to R4 200 935;
(c)
whether or not reasonable grounds exist
for the authorization of an enquiry in terms of sections 417 and 418
of the Companies Act;
(d)
whether or not the application is an
abuse of the process of court;
(e)
the application to strike in terms of
rule 6(15); and
(f)
the appropriate costs order.
Background
[7]
In their answering affidavit the
respondents have disclosed a long history of litigation involving the
parties. It is appropriate
to set out that litigation
background before dealing with the above issues.
[8]
Litigation involving these parties has a
long and troubled history. In September 2010, ASSA obtained a default
judgment against
A N Gadi Property Investments (Pty) Ltd in the
amount of R3 051 196.33 plus interest. That judgment remains
unsatisfied. On 24
May 2011, Mr Mfazwe brought an application before
the Grahamstown High Court under case number 1769/2011 for A N Gadi
Property
Investments (Pty) Ltd to be placed in business rescue. ASSA
intervened in those proceedings and opposed the relief sought by Mr
Mfazwe and also brought a counter -application for the winding-up of
A N Gadi Property Investments (Pty) Ltd.
[9]
Pursuant to those proceedings, a
judgment was delivered on 13 December 2013 dismissing Mr Mfazwe's
application. A provisional winding-up
order was granted against A N
Gadi Property Investments (Pty) Ltd. Mr Mfazwe sought and was granted
leave to appeal against the
refusal of the application for
business rescue.
[10]
The matter was heard by a Full Bench of this Court on 30 March
2015. On 7 April 2015, the Full Bench
dismissed the
appeal. Thereafter, Mr Mfazwe, petitioned the Supreme Court of Appeal
for leave to appeal, but the petition was dismissed
on 6 July 2015.
An application to the Constitutional Court was similarly dismissed.
The provisional winding-up was eventually confirmed
by order of this
Court on
8
September 2015.
[11]
During April 2018, Mr Mfazwe again
launched an application before this Court for A N Gadi Property
Investments (Pty) Ltd to be placed
under business rescue. In
that application, the respondents raised
res
judicata
based on the previous
dismissal of the application for business rescue. Mr Mfazwe withdrew
that application and tendered costs.
[12]
A subsequent business rescue application
was launched by Nothende Stella Mfazwe, Mr Mfazwe's wife. She was a
shareholder of A N
Gadi Property Investments (Pty) Ltd. That
application was dismissed on 3 September 2019.
Mrs
Mfazwe's applicatio·n for leave to appeal against that
judgment was dismissed on 24 March 2020.
[13]
On 1O March 2020, Mr Mfazwe launched an
application in the Grahamstown High Court against the above
respondents and ASSA wherein
he sought an order, in the main, that
the provisional and final orders of liquidation be declared null and
void, and be rescinded.
The respondents opposed that application and
filed a counter-application in which they sought an order in terms of
section 2(1)(b)
of the Vexatious Proceedings Act 3 of 1956
prohibiting Mr Mfazwe from instituting legal proceedings against any
person without
the leave of the court.
[14]
At the hearing of this application,
counsel advised the court that the last application and contest
between the parties is still
pending. In these proceedings, I will
make reference to the judgments handed down pursuant to those court
proceedings since the
provisional winding-up of A N Gadi Property
Investments (Pty) Ltd. The alleged funds held or being received by
Mpeto Attorneys
and Mnandi Fast Foods are central in those previous
judgments.
The
present application
[15]
These proceedings were launched on 24
June 2020. The gravamen of Mr Mfazwe's case is that an examination
must be authorised
by this Court in terms of sections 417 and 418 of
the Companies Act. He has urged the Court to order Mnandi Fast Foods
and Mpeto
Attorneys to provide full and detailed disclosures as to
the whereabouts of the funds and their willingness to pay the funds
to
the liquidators of AN Gadi Property Investments (Pty) Ltd.
[16]
Mnandi Fast Foods is alleged to hold an
amount of R1 854 480, whilst Mpeto Attorneys is said to have in their
trust account an amount
of R2 346 455. The respondents dispute the
existence of these funds in any trust account. They allege that Mr
Mfazwe has not furnished
any evidence to the liquidators, despite
several requests for such evidence having been made. Mnandi Fast
Foods no longer exists.
They alleged that Mr Mfazwe made no
allegations in relation to when funds were transferred to Mpeto
Attorneys, by whom the transfers
were made, and who the directors who
would have had knowledge of those funds are.
Applicable
Law and Findings
[17]
The respondents contend that Mr Mfazwe is not a creditor of A N Gadi
Property Investments (Pty)
Ltd and that, therefore, he lacks the
necessary
locus standi
to launch this application.
[18]
Mr Mfazwe, who appeared in person, countered the
submission on
locus standi
by submitting that these
proceedings are by their nature akin to an
ex parte
application.
He claimed that the purpose of these proceedings is to inform the
Court that there is information which may assist
and empower the
liquidators to wind-up a company in liquidation. He further
contended that the liquidators
should support
rather than oppose the application, since the object is to empower
them. This brings me to the provisions of the
Act.
[19]
Section 417(1) of the Companies Act
reads:
"In
any winding-up of a company unable to pay its debts, the Master or
the Court may, at any time after a winding-up order
has been made,
summon before him or it any director or officer of the company or
person known or suspected to have in his possession
any property of
the company or believed to be indebted to the company, or any person
whom the Master or the Court deems capable
of giving information
concerning the trade, dealings, affairs or property of the company."
[20]
In his founding affidavit Mr Mfazwe has
alleged that, as a creditor, he is an interested party. He predicated
his
locus standi
on
the fact that he is a creditor of A N Gadi Property Investments (Pty)
Ltd. Whether or not he is a creditor must be
determined
with reference to the wording, object and purport of sections 417 and
418. The Court must also consider Mr Mfazwe's
pleaded case.
The question relating to who qualifies to bring a section 417
application has previously been discussed
by our Courts.
[21]
In
Miller
and Others v Nafcoc Investment Holding Ltd
Co
and
Others
[1]
the
court held that the section does not envisage an application, much
less an application from a limited category of persons -
which
eminently is sensible, for otherwise the Master would be unable to
act unless he was given information from specified
persons.
[22]
In
this regard Friedman J had the following to say in
Venter
v Williams and Another
[2]
:
"For
this reason the Court will generally require an application to be
made to it for the constitution of such a commission
by a person
having an interest in the matter and will decline to exercise its
discretion to convene such an enquiry unless such
an application is
made. But that does not mean that, if in fact the person who brings
the irregularities or alleged irregularities
to the Court's attention
and asks for an enquiry is not a creditor or person with financial
interest, the Court is obliged to decline
to make an order in the
matter."
[3]
[23]
The
procedure provided by sections 417 and 418 is aimed at assisting
officers of the court in the performance of their duties to
the
creditors of the company in liquidation, the Master and the court.
The central purpose of an enquiry is to discover facts beneficial
to
creditors and uncover activities detrimental to wrongdoers.
[4]
[24]
According to Mr Mfazwe there were
unaccounted funds held by certain entities in trust accounts. That
information, if well made,
would assist the liquidators in the
winding-up of A N Gadi Property Investments (Pty) Ltd. The
information would benefit the creditors,
if such funds were
recovered.
[25]
The wording of the sections makes it
open to any person to request an enquiry in terms of sections 417 and
418, since the court
must be given sufficient and relevant
information before authorizing an enquiry. The Act (the
Companies
Act)
makes it abundantly clear that
not only creditors, but also contingent and prospective creditors of
a company, may apply for its
liquidation.
[26]
For the above reasons, I am satisfied
that Mr Mfazwe, irrespective of whether he is a creditor or not, does
have the necessary legal
standing in terms of the Act to apply for an
enquiry. There is no merit to the contrary submission. The objection
based on legal
standing can accordingly not be sustained. Whether
this court has previously pronounced on the funds alleged to be
either held
or received into the trust accounts of Mpeto attorneys
and Mnandi Fast Foods
[27]
The respondents submitted that the issue
of the alleged monies in the trust accounts has been dealt with and
adjudicated upon in
various judgments. In pursuit of that submission,
they furnished this Court with the copies of the relevant judgments.
The findings
in those judgments must be considered to determine
whether there is merit to the respondents' submission.
[28]
In
Mzuvukile
Benjamin Mfazwe v A N Gadi Properties
&
Absa
Bank Limited,
[5]
Sandi
J said:
"Save
for the applicant's say so, there is no evidence of whatever
nature or form from the attorneys who are holding
the rentals in
their trust account that the funds are indeed available in their
trust account. Nowhere is it stated that
such attorneys are willing
and able to pay those funds to the respondents once legal proceedings
have been finalized."
These
remarks were made in respect of allegations by the applicant in
a business rescue and provisional liquidation application.
In that
case it had been alleged:
"That
there was an amount of R3 996 906 held in an attorney's trust
account; and that there were amounts of rentals due to
the applicant
in the sum of R193 853".
[29]
In
Nothende
Stella Mfazwe v A N Gadi Investments (Pty) Ltd
[6]
Griffiths J observed:
"The
sum so diverted has been variously stated, but according to the
applicant amounts presently to R4 200 935.. .".
There is
little doubt that the applicant intended to rely on the availability
of the sum in excess of R4 000 000 allegedly being
held in the
attorney's trust accounts in a quest to establish a reasonable
prospect for the rescue of the company.
Despite
this, in her replying affidavit she conceded that such monies no
longer exist."
[30]
Mrs Mfazwe was a director of A N Gadi
Property Investments (Pty) Ltd. In the various applications involving
the parties, Mrs Mfazwe
stated in one affidavit that
"the
rental amounts for the extended period in total R4 200 000.00 were
paid to Nhlangulela Attorneys and Mpeto Attorneys."
Again,
Mrs Mfazwe, in an affidavit in her application for business rescue,
stated that "i
accept that the
monies were withdrawn or utilized".
In
that application it was conceded that the monies do not exist.
[31]
In this application, the applicant
persisted with the previous allegations made in the cases to which
reference has been made
and that ASSA has refused to claim R4
200 935 in trust funds.
[32]
I
am convinced that the Courts have dealt with the allegations about
the existence, or rather the absence, of money in certain attorneys'
trust accounts. The objective facts do not lead to a conclusion that
such monies exist. The only allegation in that regard is Mr
Mfazwe's
mere say so. In
Benjamin
Mzuvukile Mfazwe v A N Gadi Property Investments,
[7]
Pickering
J writing for the Full Bench, held-
"The
immediate problem with this submission is that, as was submitted by
Mr. de la Harpe, who appeared for ASSA, there was
quite simply no
evidence before the Court a quo to the effect that any attempt at
exercising its rights as cessionary would have
resulted in ASSA
effectively recovering the monies due to them. There is no
evidence as to when, if ever, before ASSA obtained
judgment, it was
advised of the first respondent's problems relating to the division
of the rentals."
[33]
Needless to emphasize that in Mrs
Mfazwe's application, a concession was made that such monies no
longer existed. In these
previous matters, a petition to appeal was
dismissed by the SCA on 01 March 2017. The application to the
Constitutional Court was
dismissed on 15 June 2017.
[34]
In view of the findings made in the
court judgments since 2013, I am satisfied that the issue of
the alleged monies totalling
R4 200 935, being held in the attorneys'
trust accounts, has been sufficiently adjudicated and concluded. I
therefore conclude
there is no evidence to supporting the contention
that these monies exists. Whether or not reasonable grounds exist for
the authorization
of an enquiry in terms of sections 417 and 418 of
the Companies
[35]
In order to decide whether it would be
appropriate to order an enquiry under the Companies Act. the Court
must again consider the
facts of the application and the section.
[36]
It
seems that the section provides that only a natural person, and not a
juristic entity, may be summoned to such an interrogation
[8]
.
The applicant is asking for the examination of two entities,
namely Mnandi Fast Foods and Mpeto Attorneys. In respect of
Mnandi
Fast Foods, this entity no longer exists. The applicant fails
to identify the person(s) from Mnandi Fast Foods who
would be the
subject of the enquiry. He does not make any allegation of the names
and identities of the person(s) that are in possession
of or have
knowledge of the alleged amounts. There is paucity of information
regarding the purpose and object of what is to be
achieved pursuant
to the authorization of the enquiry. All what the applicant is
[37]
Regarding Mpeto Attorneys, no
allegations are made in the founding affidavit other than the
allegations that there is an amount
of R2 346 455 held in the trust
account. There is no evidence about the directors of Mpeto Attorneys
or where that company's registered
or physical address is, if at all
it exists. There is also no evidence to show at what stage
Mpeto Attorneys received the
alleged money. This court must also have
regard to the views of the liquidators.
[38]
It has been held:
"The
Court will be largely guided by the attitude of the liquidator.
Whether or not he is correctly designated an officer of
the Court, he
performs certain statutory functions and the Court would in my view
be right to assume that he was acting responsibly
and fairly. The
difficulties with which his task confronts him need hardly be
emphasized. In the nature of things, the affairs
of a company which
has been placed in liquidation are often not readily diagnosed. The
liquidator must strike a balance between
on the one hand a cautious
approach to the further expenditure of company funds and on the other
a proper exercise of his function
to recover in the interest of
creditors monies due to the company."
[9]
[39]
Section
417 does not give the liquidator or any creditor or person the right
to apply for the enquiry and it is the Court who orders
the enquiry
at its own discretion on information brought to it by an interested
person.
[10]
An enquiry can
have serious and far-reaching consequences and an application for an
enquiry ought not to be readily granted. In
particular a Court must
be satisfied that these powers will not be used in a way that would
be unjustifiably oppressive or vexatious.
[11]
[40]
In the answering affidavit, Mr Voigt, the liquidator, avers:
"On
28 July 2017, I emailed the Applicant, which email I attach as
"GV16", in which I requested books and records
of Gadi
Properties. To date no books or records as requested have been
provided. On 20 November 2017 I met with the Applicant and
Mr Kevin
Kaschula, who the Applicant introduced as his consultant. The purpose
of the meeting was to discuss the alleged monies
held in trust by
attorneys and which was allegedly owed to Gadi Properties. The
Applicant provided bound copies of the record of
appeal (referred to
above) in which he had flagged a summons issued by Gadi Properties
against Mnandi Fast Foods (Pty) Ltd. No
other proof or evidence
relating to monies in trust accounts was provided at the meeting or
thereafter."
[41]
The liquidator further made these averments in the answering
affidavit:
"...
that the summons that were drafted by Attorneys Bate Chubb &
Dickson against Mnandi Fast Foods (Pty) Ltd, were never
served and
the applicant instructed the attorneys to close the file. In any
event, Mnandi Fast Foods is no longer trading and is
dormant."
[42]
On the facts presented by both the applicant and the respondents,
there are no grounds to authorize
an enquiry in terms of section 417
read with section 418 of the Companies Act. The proposed
enquiry would serve no
purpose in view of the allegations made by the
respondents that these claims were investigated and no evidence found
to support
the claim of the existence of monies.
[43]
To summarise, on the evidence adduced by the parties, there
exists no reasonable grounds for this Court to authorize
an enquiry in terms of sections 417 and 418. The applicant failed to
adduce evidence or information upon which this Court must
exercise
its discretion in terms of section 417.
Whether
the application is an abuse
[44]
Courts are empowered and obliged to curtail what would be an
abuse of an enquiry or use of the enquiry for ulterior
motives. The
applicant has been given an audience by the liquidators to place
evidence about the existence of the alleged monies
in the trust
accounts. The liquidators have investigated the information furnished
by the applicant. I find it bizarre that the
liquidators, as is
suggested by the applicant, would refuse to follow up on monies that
can easily be recovered. It would be to
the advantage of the
liquidators to collect more monies for the company in liquidation. It
had been confirmed to the liquidators
that there are no monies due to
A N Gadi Property Investments (Pty) Ltd from any trust account of
attorneys or Mnandi Fast Foods.
[45]
The scathing and gratuitous allegations
in the applicant's replying affidavit justify the respondents in
contending that the application
has been launched with an ulterior
motive to harass the liquidators. The egregiously unsubstantiated
statements in the replying
affidavit should be seen as revealing of
the motive in respect of the requested enquiry. Unprovoked statements
such as
"the liquidators
should be ashamed of themselves because of the bias, fraud,
incompetence, failure in their fiduciary duties,
lack of fairness and
many other elementary wrongs they made in administering the
liquidation of Gadi Properties"
should
be telling of the obvious intent and motive for the enquiry.
[46]
At the hearing of this matter, counsel
for the respondents informed the court that the applicant has also
launched another separate
application in the Grahamstown High
Court in which he seeks to set aside the liquidation and distribution
account. "I
find it incongruous of the applicant; in this case,
to be calling for an enquiry pursuant to the liquidation of
A
N
Gadi Property Investments (Pty)
Ltd, whilst in another case, he is seeking an order
inter
alia,
that the provisional and final
orders of liquidation be declared null and void or rescinded."
The provisional and final orders of
liquidation be declared null and void or rescinded.
[47]
I
am aware of the caution in
Roering
NO and another v Mahlangu and Others
[12]
the
essence of which is the fact that the issues canvassed in a section
417 enquiry may overlap with issues in pending or contemplated
civil
litigation and that should not be a ground for inferring abuse. The
distinguishing factor in this case is that the applicant,
in the
Grahamstown case, has launched an application to set aside the entire
liquidation. Bearing in mind that A N Gadi Property
Investments (Pty)
Ltd was placed in provisional liquidation in 2013, it should be
obvious that the purpose of this application
is to frustrate the
finalization of the liquidation. On that conduct alone, abuse should
be inferred. The attitude exhibited by
the use of language in this
application should lead to an irresistible inference that abuse is
intended.
[48]
The respondents have contended that the
application is harassment by the applicant against them. There is no
factual basis to support
the application which means that it was
instituted only for an ulterior purpose. There is merit to this
submission having regard
to the totality of the circumstances in this
case.
[49]
In
Kebble
v Gainsford
[13]
the
court held that the question whether an enquiry is an abuse must, in
all instances, depend on the particular circumstances of
the case. In
evaluating whether there is an abuse, the court is required to
cumulatively weigh up all the factors, both for and
against the
holding of an enquiry, and
"it
is the obligation of the party wishing to stop the enquiry to
demonstrate
a
clear
abuse".
[50]
In
Roering
[14]
the
court held:
"Once
it is accepted that a permissible purpose in causing a witness to be
summoned to an inquiry is to enable the liquidator
to make an
informed assessment of the merits of a potential claim or defence to
a claim, it must follow that the fact that the
individual concerned
is a potential witness in other civil litigation, actual or
contemplated, is neutral in determining whether
the summons is an
abuse. Something more must be identified as constituting an abuse."
[51]
In
Ferreira
v Levin
[15]
in
considering whether interim relief staying an enquiry should have
been granted pending the outcome of the determination of a
constitutional issue, the court held that such relief (i.e stopping
an enquiry) must be
"absolutely
necessary" .
[52]
The liquidators took all reasonable
steps to secure evidence from the applicant about the existence of
the alleged monies totalling
to the sum of R4 200 935.00. The
applicant produced no evidence to support the allegation of the
existence of the alleged monies.
Even in the present proceedings, the
applicant is only content with bald and bare allegations about the
existence of these monies.
There is no evidence that would reasonably
enable the court to order an enquiry.
[53]
For the reasons set out above, the
application must fail.
The
application to strike out in terms of rule 6(15)
[54]
The respondents also brought an
application to strike out two paragraphs from the applicant's
replying affidavit.
[55]
The basis of the application is that the
allegations contained therein are scandalous, defamatory, vexatious
and irrelevant.
Paragraph
25 reads:
"The
Liquidators should be ashamed of themselves because of the Bias,
fraud, incompetence, failure in their fiduciary duties,
lack of
fairness and many other elementary wrong doings they made in
administering the liquidation of Gadi Properties "
[56]
Paragraph 51 reads:
"All
the claims by white owned entities were proved (i) without being
verified to the company's books, records and contractual
agreements
(ii) on different criteria than that of Black Claimants. Ultimately,
claims by Black Claimants were disputed and disallowed
"
[57]
An application to strike out any matter
from an affidavit is regulated by rule 6(15) of the Uniform Rules of
Court, which reads
as follows:
"The
court may on application order to be struck out from any affidavit
any matter which is scandalous, vexatious or irrelevant,
with an
appropriate order as to costs, including costs as between attorney
and client. The court may not grant the application
unless it is
satisfied that the applicant will be prejudiced in his case if it be
not granted."
[58]
An applicant for the striking out of any
matter from an affidavit has to satisfy two requirements: firstly,
that the matter to be
struck out is scandalous, vexatious or
irrelevant; and, secondly, that he or she will be prejudiced if the
matter is not struck
out.
In
this regard, Mahomed CJ had the following to say in
Beinash
v Wixley
[16]
"What
is clear from this Rule is that two requirements must be satisfied
before an application to strike out matter from any
affidavit can
succeed. First, the matter sought to be struck out must indeed be
scandalous, vexatious or irrelevant. In the second
place, the Court
must be satisfied that if such matter was not struck out the parties
seeking such relief would be prejudiced."
[59]
The
rationale behind the power of the court to strike out is that it
promotes orderly ventilation of the issues before it,
promotes focus
on the real issues, presents proliferation of issues, unnecessary
prolix and irrelevancies that unduly burden records
in application
proceedings.
[17]
[60]
The central submission of the respondent
is that the averments contained in the above paragraphs are abusive,
defamatory and can
only be made to harass and annoy the respondents
in circumstances in which they are without merit or any form of
provocation. The
allegations in paragraphs 25 and 51 do not support
nor assist the applicant in the relief sought and the issues which
need to be
determined.
[61]
The allegations in paragraph 25
contain far reaching conclusions which should be based on facts.
These allegations
impugn the integrity of the liquidators. They
attack the credibility of the liquidators. There is no factual
foundation for those
conclusions. The liquidators are clearly
prejudiced by those untested conclusions contained in the applicant's
replying affidavit.
[62]
I find the allegations in paragraph 51
to be irrelevant to the issues to be determined and prejudicial to
the liquidators. I
therefore, uphold the application to strike
out paragraphs 25 and 51 of the replying affidavit.
Appropriate
costs order
[63]
The applicant appeared in person. I am
aware that this is a matter that involves his family business and his
emotions are understandable.
The family lost a business. There
has been no end in the litigation involving these parties since the
first application that
culminated in the judgment by Sandi J in 2013.
Account has been taken of the applicant's conduct in these
proceedings. I
have found that the application is an
abuse of process of this court. The allegations gratuitously made
against the liquidators
fall egregiously short of innocent
litigation. I am unable to find any justification for impugning
the integrity of the
liquidators
. This court takes a dim view of this meritless litigation. This
court must mark its displeasure against any conduct
that seeks to
undermine the dignity and integrity of other litigants.
Conclusions
[64]
I am satisfied that costs should be on a
punitive scale in respect of both the main application and the
application to strike out.
Such costs should be on an attorney and
client scale. Accordingly, costs must follow the results in the
absence of any reason for
departing from the general principle on
costs.
Order
[65]
In the result, it is ordered that:
1.
Paragraphs 25 and 51 of the applicant's
replying affidavit are hereby struck out from that affidavit;
2.
The applicant's application is
dismissed;
3.
The applicant shall pay the costs of the
application to strike out and the main application on an attorney and
client scale.
M
NOTYESI
ACTING
JUDGE OF THE HIGH COURT
Appearances:
Applicant
In person
Counsel
for the Respondents
Adv
KL Watt
Instructed
by
McWILLIAMS
& ELLIOTT
Clo
Bax Kaplan Russell Inc
Clevedon
House 2 Clevedon
Road
Selborne
East
London
[1]
2010 (6) SA 390 (SCA)
[2]
1982 (2) SA 310
(N) at 313 H - G
[3]
See also Absa Bank Limited and Others v Wolpe and Others; In Re:
Wolpe v Absa Bank Limited and Others (9450/14, 20672/15) (2016]
ZAWCHC 114 (31 August 2016) by Salie-Hlophe J.
[4]
See also Lynn NO and Another v Kruger and Ors
1995 (2) SA 940
(N) at
944 F and Pre torius and Others v Marais & Ot hers 198 1 (1)
1051 (A) at 1062 H- 1064 B.
[5]
Unreported judgment of the Eastern Cape Division by Sand i J - Case
Number 1 769/ 201 2 delivered on 13 December 2013
[6]
Unreported judgment of the Eastern Cape Division - Case Number
1338/2018 delivered on 3 September 2019 by Griffi hs J para 8
and 20
of the judgment
[7]
Benjamin Mzuvukile Mfazwe v A N Gadi Property Investments (Pty) Ltd
and Absa Bank Limited - Case number CA19 2/ 2014 delivered
on 07
April 2015 by Pickering J (Full Bench Appeal).
[8]
Simmons NO vs Gilbert Hamer & Co Ltd
1963 (1) SA 897
(N) at 913
– 916 content with is that a total amount of R4 200 935 is
allegedly held in the trust account of attorneys
or at the instance
of these entities.
[9]
Merchant Shi pp ers SA (Pt y) Lt d vs M illm an
1986 (1) SA 413
(C)
at 417 - 418
[10]
Trust Bank van Afrika Bpk vs Van der Westhuizen 199
1 (1) SA 867
(W)
at 871 and Venter vs Williams
1982 (2) SA 310
(N) at 313 - 314
[11]
Bernstein supra at 767 - 768 and Cooper NNO vs SA Mutual life
Assurance Society
[2000] ZASCA 153
;
2001 (1) SA 967
(SCA) at 974
[12]
2016 (5) 455 (SCA) at para 41- 47.
[13]
2010 (1) SA 561 (GSJ)
[14]
Above n 12 at par 38
[15]
1996 (1) SA 98
4 (CC)
[16]
Bein ash v Wixley
[1997] ZASCA 32
;
1997 (3) SA 721
(SCA) at 733 A-B
[17]
Gold Fields Ltd and Others v M ot ley Ric e LCC
2015 (4) SA 200
(GJ), See also Absa Bank Ltd v Chr isto Jacobu s Smith and Others
supr a at para 53