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[2019] ZAGPPHC 232
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JJP Propco (Pty) Ltd and Another v Jacaranda Haven (Pty) Ltd (37063/2018) [2019] ZAGPPHC 232 (21 June 2019)
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
REPORTABLE
:
YES
/ NO
OF
INTEREST TO OTHER JUDGES:
YES
/NO
REVISED.
CASE NO:37063/2018
21/6/2019
In the matter between:
JJP PROPCO
(PTY)LTD
FIRST
APPLICANT
JJP PROPCO MEDICAL
(PTY)LTD
SECOND APPLICANT
And
JACARANDA HAVEN (PTY)
LTD
RESPONDENT
JUDGMENT
STRIJDOM AJ
INTRODUCTION
[1]
In this case the applicants applied that the respondent be placed
under provisional
winding up. The applicants relied upon two
alternative grounds for the application.
1.1
The first is that the respondent is factually insolvent in it cannot
pay “at least
R8,9 million to the applicants” and another
R9 million to the seller of a property registered in the name of the
respondent.
1.2
The second ground is that it is just an equitable for the respondent
to be wound up in terms
of either the Companies Act 1973
alternatively
section 81
of the
Companies Act of 2008
.
The
Factual disputes
[2]
The factual disputes between the parties on whether any amount is
owing by the respondent
to either of the applicants’ may be
summarised as follows:
2.1
The case of the applicants is that the applicants and others made
payments of fairly substantial
amounts in respect of the Jacaranda
property. However, it was submitted by counsel for the respondent
that these payments were
not made in terms of loan agreements, and
they cannot be recovered by any condictio or delictual cause of
action.
2.2
What is in dispute is whether those funds were spent as part of the
payment of the purchase
price of 90% shares in Jacaranda Haven
(respondent) or whether these were loans made to Jacaranda Haven.
2.2
The respondent denies that it owes any funds to the applicants.
The
correct approach to the evidence
[3]
The applicants are applying for the provisional winding up of the
respondent, as provided
for in
Kalil
v Decotex (Pty) Ltd
1988 (1) SA 93
(A) at 976 A-C.
[4]
It was submitted by counsel for the respondent that the so-called
Badenhorst
[1]
Principle
applies. In terms of this principle, liquidation proceedings
are designed to bring about a concursus creditorum
to ensure the
equal distribution between creditors and such proceedings are
unappropriate to resolve disputes as to the existence
or otherwise of
a debt. Consequently, where there is a genuine and bona fide
dispute as to whether a respondent in liquidation
proceedings is
indebted to the applicant, the court should as a general rule dismiss
the application.
[2]
[5]
The question is thus not whether the respondent has proven a defence
but only whether
the respondent has put up sufficient facts to
illustrate the existence of a genuine and bona fide dispute as to the
question whether
the respondent is indebted to the applicants at all.
The
Applicants’ locus standi as creditor
[6]
In terms of the provisions of section 34(6)(1)(b) of the Companies
Act, 1973, an application
for the winding- up of a company may be
brought by one or more of its creditors (including contingent or
prospective creditors).
6.1
A contingent creditor is a creditor in regard to a liability which,
by reason of an existing
vinculum juris between the creditor and the
company, may become an enforceable liability on the happening of some
future event.
6.2
A prospective creditor is a creditor in regard to liability which, by
reason of an existing
vinculum juris between the creditor and the
company, will become an enforceable liability on a future date or on
a date determinable
by reference to future events. Such a
creditor would include a creditor with a valid unliquidated claim for
damages for breach
of contract or a delictual claim.
The Facts
[7]
The case for the applicants is that the respondent is indebted to the
applicants in
the amount of R9 811 662.00 which the
applicants made available and paid over to various creditors of the
respondent
to the benefit of the respondent, and in return for which
the respondent, was to ensure the transfer of 90% of its shareholding
to the second applicant.
[3]
The respondent failed or refused to ensure the transfer of the shares
concerned to the second applicant.
[8]
The respondents’ version of the purported agreement regarding
the payment of
the amount of R 9811 662.00 entails the following:
8.1
The second applicant would purchase 90% of the issued shares of the
respondent from a company
called Via Viva Properties, at a price
equal to 90% of the municipal value of the property that the
respondent was at that time
purchasing, being about R 11,7 million.
8.2
The said purchase price would be payable by the time that the
respondent took transfer of
the property concerned.
8.3
Only once the full purchase price for the shares had been paid to the
seller (Via Viva Properties)
would the shares concerned be
transferred to the second applicant.
8.4
The purchase price of the shares (or at least a part thereof) would
then through a route
through the Via Viva Group be borrowed by the
respondent to enable it to pay the purchase price for the land and
other expenses
in developing the property.
[9]
It was submitted by counsel for the respondent that the present
application is one
for the provisional liquidation of the respondent
and as the claims of the applicants against the respondent are in
issue, the
“
Badenhorst
principle
”
applies in terms of which the sole question for the court to
determine at this stage is whether there is a genuine and bona
fide
dispute as to whether the respondent is indebted to the applicants.
In such a case the court should dismiss the application.
[10]
It was further submitted that apart from the fact that the applicants
claim are confusing and
do not have the benefit of any contract or
allegations found in claims in delict or enrichment, the respondent
has demonstrated
that the amounts that the applicants paid, were not
payments made to the respondent but were payments made in
satisfaction of the
purchase price of 90% of the shares in the
respondent that a company, Via Viva Properties (PTY) Ltd, sold to the
second applicant.
[11]
The following considerations show that there is no commercial sense
in the purported agreement
suggested by the respondent;
11.1
The respondent was at the material time an empty shell that had just
been created, without any assets or
trading history;
11.2
The respondent would immediately enter into a purchase agreement with
the owner of the land, for which purchase
price it had no money to
pay;
11.3
The respondent would also not obtain the purchase price of the land
from the second applicant, and the purchase
price would accrue to Via
Viva Properties;
11.4 At
the end of the purchase of land transaction concerned, the respondent
would thus hold the land as asset,
but owe the purchase price to the
owner of the land;
11.5 On
the respondents’ version the second applicant would thus
purchase a company that was an empty
shell with a huge debt
(the purchase price of the land) and no means whatsoever to pay the
debt, from an amount of approximately
R10 million;
11.6
The respondent would then allegedly borrow the amount of the purchase
price of the land from one of the companies
in the Via Viva Group
of Companies , thus ending up with the land and a debt equal to the
purchase price of the land-resulting
in the respondent having no net
value whatsoever. The respondent would then be obliged to
obtain money from somewhere to
develop the property to be able to
lease it to the Via Viva Group of Companies;
11.7
Thus, the second applicant (or some other company in the (JJP Propco
Group) would spend a huge amount of
money to redevelop the property
concerned all against the possible repayment of its investment from
the rentals to be paid
by the proposed operating company that was
similarly a shell.
The Respondents’
insolvency
[12]
Apart from being indebted to the applicant for the amount of R
9 811 662.00 the respondent
is also indebted as follows;
12.1
To the seller of the immovable property which is the respondents’
only asset – at least R9 million;
12.2
On the bond registered in favour of its new shareholders at least R12
million.
[4]
[13]
In the premises, the respondent is indebted in an amount of not less
than R30 million, whereas
its only asset is the immovable property
that was purchased about a year ago for only R12 million. The
respondent is thus
patently factually insolvent. The respondent
has also failed to show any other assets that would render the
respondent factually
solvent.
[14]
The fact that the respondent disputes a portion of the liability
concerned does not affect the
applicants’ locus standi in
iudicio.
[5]
[15]
The respondent has misrepresented to the Registrar of Deeds, Pretoria
that the deed of transfer
in terms of which it holds the immovable
property concerned was lost (whereas it was to the knowledge of the
respondent in the
lawful possession of the applicant). This
misrepresentation caused the Registrar of Deeds, Pretoria to issue a
new Deed for
Transfer, that the respondent then used to register a
mortgage bond for the amount of R12 million in favour of its new
shareholders.
[6]
Conclusion
[16]
Having considered the affidavits and submissions made by counsel for
the parties I am of the
view that the respondent failed to prove on a
balance of probabilities that it disputes the applicants’ locus
standi on bona
fide and reasonable grounds.
[7]
[17]I am further of the
view that the respondent is insolvent and that it is just and
equitable for the respondent to be wound up.
[18]
In the result the following order is made;
(a)
That the respondent company be and is hereby placed under provisional
winding up;
(b)
That all persons who have a legitimate interest are called upon to
put forward their reasons
why this Court should not order the final
winding up of the respondent company on______________ at 10h00.
(c)
That a copy of this order be forthwith served on the respondent
company at its registered
office and be published in the Government
Gazette and in a daily newspaper which circulates throughout Gauteng
Province.
(d)
That the costs of the application be costs in the liquidation.
JJ STRIJDOM
ACTING
JUDGE OF THE HIGH COURT
Matter
heard on:
2 May 2019
Judgment
delivered:
21 June 2019
Counsel
for Plaintiff:
ADV SD Wagenaar SC
Attorneys
for Plaintiff:
Coetzer
E Partners
Counsel
for Defendant:
ADV PF Louw SC
Attorneys
for Defendant:
Couzyn Hertzog & Horak
[1]
See Badenhorst v Northern Construction Enterprises Ltd 1956(2) 346
(T) at 347 H to 348C.
[2]
See Kalil v Decotex (Pty) Ltd 1988 (1) SA 943 (A).
[3]
Founding Affidavit, para 21 page 12 to paragraph 23 page 14, para
24, page 14 read with para 34 page 17
[4]
Founding affidavit , para 59.2, page 24
[5]
Prudential Shippers SA Ltd v Tempest Clothing CO (Pty) Ltd 1976(2)
SA 856 (W).
[6]
Founding Affidavit, para 58, page 23
[7]
Kalik v Decotex (Pty)Ltd and Another
1988 (1) SA 943
(A).