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[2020] ZAGPPHC 43
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Ronhold Investments (Pty) Ltd v Miranda Coal (Pty) Ltd and Others (79954/2018) [2020] ZAGPPHC 43 (5 February 2020)
REPUBLIC OF SOUTH AFRICA
IN THE HIGH COURT OF SOUTH
AFRICA
GAUTENG DIVISION, PRETORIA
(1)
REPORTABLE:
NO
(2)
OF
INTEREST TO OTHER JUDGES: NO
(3)
REVISED:
YES
CASE
NO: 79954/2018
5/2/2020
In
the matter between:
RONHOLD
INVESTMENTS (PTY) LTD
APPLICANT
And
MIRANDA
COAL (PTY) LTD
FIRST RESPONDENT
SIAFA
RESOURCES (PTY) LTD
SECOND RESPONDENT
ALCHEMY
VENTURES (PTY) LTD
THIRD RESPONDENT
ABHOU
INVESTMENTS (PTY)
LTD
FOURTH RESPONDENT
ABDUL
SAMAD SHAIK EBRAHIM
FIFTH RESPONDENT
JUDGMENT
COLLIS
J:
[1]
In the present application the applicant
seeks relief in its notice of motion in two parts. In Part A the
relief sought is for an
interim interdict prohibiting the respondents
from
inter alia
alienating
a right of first refusal, in respect of the coal reserves at the
first respondent's mine.
[2]
Following the institution of the
application, the parties agreed to present a draft order to the
court.
[1]
This draft order was made an order of court and it disposed of Part A
of the application.
[3]
Part B of the application is the part
that this court is now seized with. In this part the applicant is
requesting that the first
and second respondents be ordered to issue
40 % shares in the first respondent to the applicant, alternatively
an order is sought
to place the first respondent under provisional
liquidation in the hands of the Master.
[2]
[4]
At the hearing of the application the
applicant requested that the court having regard to the nature of the
respondents' disputes,
should refer the matter for oral evidence in
respect of the following:
4.1
that oral evidence be heard on the issue
of the applicant's shareholding; and
4.2
pending the hearing of oral evidence,
that a suitably qualified independent third party be appointed (such
as a chartered accountant
or senior business practitioner) be
appointed as a director to Miranda Coal under
section 163(2)
(f) of the
Companies Act, 2008
to
ensure that there is no attempt to jeopardize the business or assets
of Miranda Coal in the intervening period.
[5]
The respondents oppose the request for
referral for oral evidence principally on three grounds:
5.1
there is an interim order that was
granted with without prejudice to the respondents' rights which is
severely prejudicial to the
commencement of the business by the first
respondent.
5.2
the applicant knew that there was a
material dispute of fact before having instituted the proceedings.
5.3
the applicant's should have applied for
a referral
in limine
as
soon as it received the answering affidavit instead of filing a
comprehensive replying affidavit and heads of argument. It is
on this
basis that the respondents opposes the request for a referral to oral
evidence and submitted that same should be refused.
[6]
In the present instance it would be
apposite to have a look at the provisions of Uniform
Rule 6(5)
(g),
which provides as follows:
"Where an application
cannot properly be decided
on
affidavit the
court may dismiss the application or make such an order as it deems
fit with
a
view
of
ensuring
a
just
and expeditious decision. In particular, but without affecting the
generality of the aforegoing, it may direct that oral evidence
be
heard on specified issues with
a
view to resolving
any dispute of fact and to that end may order any deponent to appear
personally or grant leave for such deponent
or
any other person
to be subpoenaed to appear and be examined and cross examined as
a witness or it may refer the matter to trial
with appropriate
directions as to pleadings or definition of issues, or
otherwise."
.
[7]
If material facts are in dispute and the
applicant did not request that a matter be referred for the hearing
of oral evidence, a
final order will only be granted on notice of
motion if the facts as stated by the respondent together with the
facts alleged by
the applicant that are admitted by the respondent,
justify such an order.
[8]
Furthermore, the Supreme Court of Appeal
has cautioned that a court should be astute to prevent an abuse of
its process in such
a situation by an unscrupulous litigant intent
only on delay or intent on a fishing expedition to ascertain whether
there might
be a defence without there being any credible reason to
believe that there is one.
[9]
In resolving to refer a matter for oral
evidence a court has a wide discretion ,
[3]
and the court will, to a large extent, be guided by the prospects of
viva voice
evidence
tipping the balance in favour of the applicant.
[10]
In every case the court must examine an alleged dispute of fact and
determine whether in truth
there is a real
[4]
dispute of fact which cannot be satisfactorily determined without the
aid of oral evidence; if this is not done a respondent might
be able
to raise fictitious issues of fact and thus delay the hearing of the
matter to the prejudice of the applicant.
[11]
In the present matter the principles
regarding referral for oral evidence as espoused in Metallurgical and
Commercial Consultants
(Pty) Ltd v Metal Sales Co. (Pty) Ltd
[5]
per Colman J are relevant, namely:
"My
conclusion rests upon my experience, and the experience of others
before me, that shows that an assertion or a denial which
seems very
probable or improbable on a reading of a set of affidavits often
takes on a different colour when the veracity of the
person which has
made it is tested by cross examination. There is the rare case
of course, in which a disputed statement made
on affidavit is so
manifestly untrue, or so grossly improbable and unconvincing that the
court is justified in disregarding it
without recourse to oral
evidence. But I cannot say that Mr. Rowe's assertions on the point in
dispute fall into one of those categories.
They fall rather into the
class of assertions which, although apparently improbable, might be
accepted after an oral hearing."
[12]
It is trite that the party seeking to
refer a matter for oral evidence or trial because of the presence of
a dispute of fact, must
do so
in
limine
having made his or her
election earlier on.
[6]
The reason is simple: litigants should not be mulcted in wasteful
costs of further papers and heads of arguments and a hearing,
only
for another litigant to request a referral for oral evidence in the
end.
[13]
In EP Property Projects (Pty) Ltd v
Registrar of Deeds, Cape Town and Another and Four Related
Applications
2014 (1) SA 141
(WCC) Lauw J held as follows:
"A court will, however
permit an applicant to apply in the alternative, in exceptional
circumstances for the matter to be referred
to oral evidence should
the main argument on the merits fall
,
which is what I understand the request to be in this case."
[14]
Now, at the heart of the matter is whether the applicant is entitled
to a transfer of 40% shares
in the first respondent. In this regard
the applicant relies on a Memorandum of Understanding ("MOU")
signed on 31 May
2017.
[7]
[15]
The material terms of the MOU relevant
to the application are the following:
"15.1 the shares
would have been bought for R8 million, which was to be paid by SIAFA.
15.2
Nel, in his personal capacity, or on
behalf of a legal entity, would acquire Holdings Loan account in
Miranda Coal in the amount
of R 60 million.
15.3
the shareholding in Miranda Coal was
recorded as follows, namely SIAFA would retain 51% of the shares, the
applicant would be issued
with 40% of the shares and Blue Chip
(Alchemy) would retain 9% of the shares."
[8]
[16]
The MOU was signed by Nel, Shaik and
Gani on behalf of the applicant, SIAFA and Blue Chip respectively.
[17]
The MOU had the following suspensive
conditions:
"1.
The sum of R 8 000 000.00 (Eight Million Rand) to be paid by SIAFA to
Miranda Mineral Holdings Limited attorneys
trust account.
2.
The attorneys will hold the funds
strictly for the account of SIAFA together with interest accrued.
3.
That the due diligence is completed and
accepted by the future shareholding of Miranda Coal Proprietary
Limited.
4.
The transfer of the shares into the
respective parties names as detailed in clause 1 above.
5.
By no later than 3 calendar months after
the Signature Date, the Parties conclude the Principal Agreements (as
defined in clause
4 below)."
[9]
[18]
The MOU expressly states that:
"The
conclusion of the proposed transaction is subject to the fulfillment
of the conditions precedent... "
[10]
[19]
Clause 4 of the MOU further provides
that:
"Pursuant to Condition
Precedent 5, the Parties shall in good faith cooperate and use their
commercially reasonable endeavours
to negotiate and execute the
following binding definitive agreement:
A shareholder's agreement or a
memorandum of understanding between shareholders to govern the
parties relationship as shareholders
in Miranda Coal Propriety
Limited and the repayment of shareholder loans and other provisions
usually incorporated in a shareholders'
agreement for such joint
venture company;
The above agreements together with
any other agreements required to implement the Proposed Transaction
shall collectively be referred
to herein as the
'Principal
Agreements'."
[20]
In answer to the allegations made by the
applicant, the first, second and fourth respondents specifically
admitted the allegations
insofar as they accord with the tripartite
agreement including the MOU.
[11]
[21]
The applicant in paragraph 7.18 further alleges the following:
'There were various addendums to
the agreement, altering the effective date. The main reason for this
was that Miranda Holdings
was in the process of cleaning up its
affairs and arranging for shareholders consent for the agreement of
sale. This consent, at
a general meeting of shareholders was obtained
on 14 August 2018 and when the approval was obtained the sale became
effective.
All other conditions precedent of the sale were compiled
with and the purchase consideration for the shares was duly paid by
SIAFA
to the seller and applicant also paid for the assignment of the
sale claim as referred to above.'
[12]
[22]
The above allegations made by the
applicant were admitted by the respondent.
[13]
[23]
Only once SIAFA became the lawful owner
of the shares in the first respondent, could SIAFA transfer 40%
thereof to the applicant
in accordance with the MOU.
[14]
[24]
In reply thereto, the respondents allege
that the structure as mentioned above was deliberate, and forms the
core contextual basis
for the interpretation of the MOU. If it was
contended that the applicant would acquire the 40% shareholding
unconditionally, it
would simply have been easier to transfer the
shares directly to Ronhold from Holdings.
[15]
[25]
On 5 September 2018, a management
meeting was convened in Miranda Coal. This meeting was recorded by
Shaik. He, at the outset, indicated
that he requested that Nel be
appointed as a director on the basis that he is a shareholder of at
least 40% of the shares. Nel
as representative of a shareholder in
Miranda Coal was entitled to nominate a director to that company
board.
[16]
The minutes of this meeting which was compiled by Mr. Shaik,
reflected that Shaik recognized the applicant as a
de
facto
shareholder of Miranda
Coal.
[17]
[26]
The respondents deny that the applicant
became a shareholder and their denial is premised on the tripartite
agreement having failed.
[18]
In addition to this the respondents further allege that these
agreements were put in place in anticipation that the suspensive
conditions would be fulfilled and the warranties honoured. None of
these materialized. These discussions were in any event in the
course
of settlement discussions, because, already at the outset there was a
dispute, Ronhold was claiming its shares unconditionally
whilst SIAFA
was unequivocally disputing that right.
[19]
[27]
In answer to this the applicant alleges
that there is simply no basis for the applicant to claim 40% shares
on any basis other than
an unconditional basis.
[20]
[28]
Considering what has been extrapolated
from the affidavits as set out above, it is clear that a material
dispute of fact between
the parties exists on the issue of the
applicant's shareholding and that a decision on this aspect will
first have to be determined
with the aid of oral evidence before any
other relief could be considered.
ORDER
[29]
Consequently, the following order is
made:
29.1
The application is postponed
sine
die.
29.2
The order granted on 20 November 2018 by
the Honourable Justice Khumalo will remain in force until the matter
has been finally determined,
alternatively until the Court orders
otherwise.
29.3
The application is referred for the
hearing of oral evidence, at a time and on a date to be allocated by
the Registrar, on the following
questions:
29.3.1
The
issue of the applicant's entitlement to shares in the first
respondent;
29.3.2
The
issue of the applicant's loan account in the first respondent;
29.4
Once this dispute has been resolved by
oral evidence, the case will be determined on the basis of that
finding together with the
affidavit evidence that is not in dispute.
29.5
Costs, of this application is reserved
and to be determined by the court hearing the oral evidence.
COLLIS
J
JUDGE
OF THE HIGH COURT OF
SOUTH
AFRICA
Appearances:
For
the Applicant: Adv. S.J. VAN RENSBURG SC
Attorney
of the Applicant: TINTINGERS INC
For
the Respondents: Adv. G.M. AMEER SC
Attorney
for the Respondent: ZAKARIYYA AREINGTON ATTORNEY
Date
of Hearing: 03 June 2019
Date
of Judgement: 05 February 2020
[1]
Court order Khumalo J dated 20 November 2018 p 233
[2]
Notice of Motion p 1-10
[3]
Lombaard v Droprop CC
2010 (5) SA 1
(SCA) at 10A -O
[4]
Plascon -EvansPaints Ltd v Van Riebeeck Paints ( Pty) Ltd
[1984] ZASCA 51
;
1984 (3)
SA 623
(A)at 6341
[5]
1971 (2) SA 388
(WLD) at p 390F-H
[6]
Kalil v Decotex (Pty) Ltd and Another
1988 (1) SA 943
(A) at 981; Du
Plessis and Another NNO v Rolfes ltd
[1996] ZASCA 45
;
1997 (2) SA 354
(A) at 366-367.
[7]
Answering Affidavit para 53 p 325
[8]
Founding Affidavit para 7.12 p21
[9]
MOU p93
[10]
MOU p 93 clause 2
[11]
Answering Affidavit para 53 p 325
[12]
Founding Affidavit
para
7.18 p 24
[13]
Answering Affidavit para 57 p 326
[14]
Founding Affidavit para 9.1 p 25
[15]
Answering Affidavit para 59 p 327
[16]
Founding Affidavit
para
9.3 p 27
[17]
Founding Affidavit pap 9.3 p 26 & Annexure "RN 9'"
[18]
Answering Affidavit para 61 p 328
[19]
Answering Affidavit para 64 p 329
[20]
Replying Affidavit para 11 p 380