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[2019] ZAGPPHC 2
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Emvest Agricultural Corporation (Mauritius) Ltd v Superior Macadamias (Pty) Ltd and Others (43756/2016, 43734/2016, 43755/2016, 43757/2016) [2019] ZAGPPHC 2 (29 January 2019)
IN THE HIGH COURT
OF SOUTH AFRICA
GAUTENG DIVISION,
PRETORIA
CASE NO’S.:
43756/2016; 43734/2016
43755/2016; 43757/2016
In the
matter between:
EMVEST AGRICULTURAL CORPORATION (MAURITIUS) LTD
Applicant
and
SUPERIOR MACADAMIAS (PTY) LTD
(Registration number: 2010/001094/07)
EMVEST EVERGREEN (PTY) LYD
(Case no.: 43734/2016)
EMVEST FOODS (PTY) LTD
(Case no.: 43755/2016)
EMVEST BARVALE (PTY) LTD
(Case no,: 43757/2016)
Respondent
Respondent
Respondent
Respondent
JUDGMENT
VAN DER WESTHUIZEN, J
[1] The
applicant applies for a provisional liquidation order against each of
the respondents
under separate case numbers. The respondents oppose
the relief sought on the premises that a
bona
fide
dispute exists in respect of each
of the alleged debts on reasonable grounds. In that regard, the
respondents bear the onus.
[1]
The respondents filed initial answering affidavits and in terms of an
order by Khumalo, J., the respondents were allowed
to file
supplementary answering affidavits. The applicant responded by
filing an initial replying affidavit and consequently
a supplementary
replying affidavit in each matter.
[2] The applicant and the
respondents were previously companies within the same group.
During 2013, the respondents were sold off to a Canadian Company.
[3] For the sake of
convenience, the parties agreed that one case be argued and the order
to be granted would be in respect of each of the other matters. The
parties agree that the same issues arise in each of the matters
thereby obviating the necessity of arguing each matter separately.
The matters are similar if not identical with minor factual
differences in each matter, however, the principles applicable are
identical in each matter. The material facts are identical in
each
matter.
[4] The parties agreed that
a consolidated judgment be delivered.
[5] In
the founding affidavits, the applicant sets out the claim it has
against the respective
respondents. In that regard, the written
contract between the applicant on the one part and the relevant
respondent on the other,
is attached. It is further explained that
services were rendered by the applicant to the respective respondent
and the relevant
invoices are
attached.
Furthermore, the applicant stated that incomplete payment of the
invoices was received from each of the respondents.
[6] The applicant addressed
letters of demand in each case in terms of the provisions
of section
345(1)(a)(i) of the Companies Act, 1973, which provisions still apply
in terms of the new
Companies Act, 71 of 2008
. Receipt of the
said letters of demand are admitted. However, no response thereto was
forthcoming from any of the respondents.
The alleged debts
remain unpaid. The applicant holds no security in respect of each of
the respondents’ debts to the applicant.
[7] It is to be noted that
the deponent to the applicant’s founding affidavits,
Ms Payne,
was at all times prior to the selling off of the respective
respondents, a director of each of the respondents.
She is
presently a director of the applicant. On the other hand, the
deponent to the respective answering affidavits, only came
on board
after the respective selling off of the respondents.
[8] It is stated that the
applicant’s deponent has personal knowledge of the relevant
facts pertaining to the alleged debts of the respective respondents
and the underlying factual issues in respect of the debts.
[9] In
Legh v Nungu Trading 353 (Pty) Ltd
[2]
the general principle was confirmed that an unpaid creditor has a
right
ex debito iustitiiae
to a winding up order against a company that is unable to pay its
debts. However, the court retains a narrow discretion to
refuse
the relief sought.
[3]
[10] In the present
instances the respondents have merely denied the existence of the
debt.
I shall refer to the basis of this denial later. It
is
further to be noted that none of the
respondents have alleged that the relevant respondent is otherwise
solvent and is in fact still
trading. The
absence
of such statement is not to be ignored.
[4]
From the return of service at the principle place of business, it
appears that the respondents have closed down and no business
is
conducted therefrom.
[11] The respondents raise two
defences. The first defence is a special defence of prescription.
This defence can summarily be dealt with. The respondents allege that
should it be found that the debt claimed in fact exists,
a large part
thereof has prescribed. It is implicit in that statement that a
certain portion of the debt is still owing. The respondents
thus
admit to an amount being owed to the applicant. In the absence of a
claim of solvency,
caedit quastio
. The applicant would be
entitled to a provisional winding up order.
[12] The main
defence put forward by each of the respondents amounts to a reliance
on the so-called
Badenhorst-rule.
[5]
That rule entails that a winding-up order should not be granted to
enforce payment of a debt which existence is
bona
fide
disputed on reasonable grounds.
[13] In respect of the existence of the
debt, the respondents allege:
(a) That no service level agreement was entered into. The said
agreement was not disclosed prior to the applications and
the books
and records of the respondents do not indicate the conclusion of such
agreement;
(b) The invoice attached to the founding papers is not an
invoice in the proper sense;
(c) No services were rendered to the respondents and hence no
amount is owing to the applicant;
(d) The financial statements of the respondents for the year
ending March 2012 do not reflect the debt;
[14] The respondents contend that the
foregoing allegations constitute a
bona fide
dispute on
reasonable grounds.
[15] The aforementioned allegations are
to be considered against the following:
(a) The applicant’s deponent was a director of each of
the respondents. This is common cause;
(b) It is also common cause that the applicant’s deponent
would have personal knowledge of the businesses of the respective
respondents;
(c) A Due Diligence of each respondent was undertaken prior to
the acquisition of the respondents. Such Due Diligence
would in
all probability have included an investigation into all the books and
records of the respective respondent and in particular
to its
financial history since its inception;
(d) When the relevant invoice was received, there appears to
have been no protestation by any of the respondents in that
regard;
(e) Similarly, when the demand in terms of
section 345
was
received, none of the respondents appear to have contested that
demand;
(f) The financial statements of the respective
respondents for the year 2011, attached to the respective replying
affidavits, do reflect the
existence of the respective debts owing to the applicant as explained
by Ms Payne. No gainsaying evidence is proffered by
the
respondents;
(g) The invoice relied upon in each instance indicates part
payment of the amounts due and owing. The allegation of
incomplete payment of the respective debts is simply not dealt with
by the respondents.
[16] I would assume that in all
probability, had the Due Diligence revealed none of the said
agreements
or any debts to the applicant and the part payment
thereof, the respondents would most certainly have stated that in no
uncertain
terms. They do not. A mere denial of the existence of
the said agreements and the debts is proffered. The denial is
made by a deponent who was not part of the respective respondent in
the face of the direct evidence by Ms Payne in that regard.
[17] It being common cause that the
applicant’s deponent was a director of each of the respondents
and that she would have personal knowledge of the businesses of the
respective respondents. The absence of any facts to indicate
that Ms
Payne is mistaken or untruthful in that regard, her statements under
oath to the existence of the respective agreements
and the debts
owing to the applicant in that respect is to be accepted. Further in
that regard, Ms Payne’s uncontested evidence,
but for a bare
denial, that the services under the agreements were in fact rendered,
is to be accepted.
[18] In respect of the respondents’
statements, having regard to the string of emails relied
upon, and in
view of the financial statements for the 2012 year, there is no
indication of the existence of the alleged debts.
To this Ms Payne
has replied that the string of emails relied upon only reflect the
initial figures available that were supplied
during the initial
stages of negotiations. Subsequently, further figures were made
available and also the financial statements
for the 2012 year. In the
latter regard, Ms Payne states unequivocally that those financial
statements do contain the debts to
the applicant and has explained
where in the financial statements it so appears. That evidence by Ms
Payne is not disputed.
It is submitted on behalf of the
respondents that Ms Payne’s evidence is unconvincing. In the
absence of any gainsaying factual
statements, Ms Payne’s
evidence is to be accepted.
[19] In my view, the respondents have
not shown that a
bona fide
dispute exists in respect of the
debt on reasonable grounds. The Badenhorst-rule thus cannot avail the
respondents.
[20] It follows that the applicant has,
in each matter, on a balance of probability proven a
prima facie
case of unpaid debts and consequently is entitled to a provisional
liquidation order.
I grant the following orders;
In case no.: 43756/2016
(a) That the respondent be placed under provisional winding-up
and that a rule
nisi
with return date 6 March 2019 be issued
calling on all interested parties to show cause why the respondent
shall not be place under
final winding-up;
(b) That a copy of this order be forthwith served on the
respondent at its registered office and be published once in the
Government Gazette and in the daily newspaper, The Citizen;
(c) That the costs of the application be costs in the
liquidation.
In case no.: 43734/2016
(a) That the respondent be placed under provisional winding-up
and that a rule
nisi
with return date 6 March 2019 be issued
calling on all interested parties to show cause why the respondent
shall not be place under
final winding-up;
(b) That a copy of this order be forthwith served on the
respondent at its registered office and be published once in the
Government Gazette and in the daily newspaper, The Citizen;
(c) That the costs of the application be costs in the
liquidation.
In case
no.; 43755/2016
(a) That the respondent be placed under provisional winding-up
and that a rule
nisi
with return date 6 March 2019 be issued
calling on all interested parties to show cause why the respondent
shall not be place under
final winding-up;
(b) That a copy of this order be forthwith served on the
respondent at its registered office and be published once in the
Government Gazette and in the daily newspaper, The Citizen;
(c) That the costs of the application be costs in the
liquidation.
In case
no.: 43757/2016
(a) That the respondent be placed under provisional winding-up
and that a rule
nisi
with return date 6 March 2019 be issued
calling on all interested parties to show cause why the respondent
shall not be place under
final winding-up;
(b) That a copy of this order be forthwith served on the
respondent at its registered office and be published once in the
Government Gazette and in the daily newspaper, The Citizen;
(c) That the costs of the application be costs in the
liquidation.
C J VAN DER WESTHUIZEN
JUDGE OF THE HIGH COURT
On behalf of
Applicant: S D Wagner
SC
Instructed
by:
Weavind & Weavind Inc.
On behalf of
Respondent: A J Louw SC
CB Ellis
Instructed by:
Bernadt Vukic Potash & Getz Inc.
[1]
Hülse-Reutter et al v HEG Consulting Enterprises (Pty) Ltd
(Lane and Fey NNO (Intervening)
1998(2) SA 208 (C) at 218D-219C
[2]
2008(2) SA 1 (SCA) at [18]
[3]
Service Trade Supplies (Pty) Ltd v Dasco & Sons (Pty) Ltd
1962(3) SA 424 (T) at 428D-G; see also
ABSA Bank Ltd v
Rhebokskloof (Pty) Ltd et al
1993(4) SA 436 (C) at 440J-441A
[4]
Afgri Operations Limited v Hamba Fleet (Pty) Ltd
(542/2016)
[2007] ZSCA 24 (24 March 2017) at [4]
[5]
Badenhorst v Northern Construction Enterprises (Pty) Ltd
1956(2) SA 346 (T) at 347H-348C