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[2019] ZAGPPHC 413
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Mukhawana v Dinath and Others (85785/2017) [2019] ZAGPPHC 413 (22 July 2019)
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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: 85785/2017
NKATEKO
TREVOR MUKHAWANA
Applicant
(Identity
Number [….])
and
IMRAN
DINATH N.O
First Respondent
HELENA
JEANETHA N.O
Second Respondent
BRAHAM
VICTOR DAWSON N.O
Third Respondent
(In
their capacities as the appointed provisional
trustees
in the insolvent estate of
GERHARD
JACQUES
DU PLESSIS
Masters-ref:
T3317/17)
JUDGMENT
(APPLICATION FOR LEAVE TO APPEAL)
SKIBI
AJ
[1]
This is an application for leave to appeal against my judgement and
order handed down
on a March 2019, granting a final sequestration
order. The applicant seeks leave to appeal either to the Supreme
Court of Appeal
alternatively to the Full Court of this Division.
[2]
The
grounds upon which the application for leave to appeal is founded,
specifically the findings of fact/or rulings of law against
which
leave to appeal is sought are the following:
[2.1]
In the
founding affidavit the respondents rely thereon that the insolvent
and the applicant were accomplices in a fraudulent scheme
to defraud
the Madlbeng Local Municipality ("the Municipality");
[2.2]
The
respondents further rely thereon that the funds syphoned to the
applicant have to be restored the insolvent estate for distribution
to proven creditors of that estate in accordance with the provisions
of the Insolvency Act, Act 24 of 1936 (the Insolvency Act)
to provide
redress to the principal creditors of the applicant which includes
the insolvent estate;
[2.3]
Further
the respondents rely on transactions being impugnable (impeachable)
in terms of
section 26
,
29
,
30
and
31
of the
Insolvency Act, 1936
;
[2.4]
The
respondents submitted that approximately R11 million was received by
the applicant;
[2.5]
It is
thereon that the respondents
as
in their founding affidavit
argue that they are entitled to the alleged ill gained monies which
were allegedly obtained by both
the applicant and insolvent;
[2.6]
When
the respondents dealt with the statutory requirements for the
compulsory sequestration of the applicant's estate in the founding
affidavit they inter alia relied thereon that the transfer of funds
from the insolvent
to
the applicant, constitutes impugnable
transaction as contemplated in
Insolvency Act and
that the estate of
the insolvent is entitled to recover these monies and as
a
result
thereof the insolvent estate is
a
substantial creditor of the
applicant;
[2.7]
It is
further relied
on
that the applicant
is
insolvent and
that his propensity to liquidate assets constitutes a "discreet"
deed of insolvency;
[2.8]
In
order for
a
final sequestration
to
be granted
section
12
of the
Insolvency Act determines
that if at the hearing pursuant
to the aforesaid rule nisi the Court
is
satisfied that:
[2.8.1]
the petitioning creditor has established the debtor
a
claim
such
as
mentioned in sub section (1) of section
9
;
and
[2.8.2]
the debtor has committed an act of insolvency or is insolvency;
and
[2.8.3]
there
is
reason to believe that it will be
to
the
advantage of the creditor if the estate
is
sequestrated, it
may sequestrate the estate
of
the debtor.
[3]
The
applicant relies on six grounds for leave to appeal:
[3.1]
The contention by the applicant is that this court erred in relying
on a supplementary affidavit
when normally only three sets of
affidavit filed in a matter and that the court should have regarded
the supplementary affidavit
as
pro
non scripto
[1]
.
In this ground
the applicant argues that when I made a finding that the respondents
have succeeded in proving acts of insolvency
I relied on
supplementary affidavit by the respondents as reflected in paragraph
33 of the judgment. instead I should have made
a finding that no acts
of insolvency were committed by the applicant in particular
section
12
(1) (b) thereof has not been complied with by the respondents.
[3.2]
The applicant contends that this Court erred in its finding that
funds constitute stolen money
which was transferred from the
insolvent's trust account to an entity known as
Mukhawana and
Mukhawana Supply
&
Logistics (Pty) Ltd.
The
Applicant's contention is that the stolen money does not belong to
the insolvent and the insolvent has no claim against the
applicant as
contemplated in
section 9(1)
of the insolvency Act. In essence the
applicant contends that the Court should have made a finding that the
respondents are not
creditors of the applicant as contemplated in
section 9(1)
of the
Insolvency Act.
[3.3
]
The applicant's further contention is that the respondents failed to
demonstrate in the their founding
affidavit that there is a reason to
believe that the sequestration of the applicant will be to the
advantage of the creditors of
the applicant. This Court erred in
sequestrating the estate of the applicant for allegedly participating
in a fraudulent scheme
and receiving stolen funds when the said
stolen funds does not belong to the insolvent estate and the
insolvent is not a creditor
of the applicant.
[3.4]
The applicant further contends that the Court erred to make a finding
that the respondents have
demonstrated that the applicant has
committed “discreet” deeds of insolvency as there is no
provision in the
Insolvency Act for
“discreet” deed of
insolvency to satisfy requirements of either
section 8
or
section 12
of the
Insolvency Act.
[3.5
]
It Is further contended by the applicant that this Court erred in its
finding and interpreting the
provisions of
section 20(9)
of the new
Companies Act 71 of 2008
that there is reason to pierce the corporate
veil of the entity known as
Mukhawana
and Mukhawana Supply and Logistics (Pty) Ltd
in
order to sequestrate the applicant for monies received by his entity.
In support of his argument the applicant contends that
the court
should have found, taking into consideration the
Law
of
Insolvency
in South Africa
[2]
that
Mukhawana
&
Mukhawana
Supply Logistics (Pty) Ltd
is
a separate legal entity unrelated to the applicant.
[3.6]
The applicant's contention on the last ground is that this Court
erred in failing to take into
consideration the authorities referred
to herein.
[4]
The test whether to grant an application for leave to appeal is to be
found in section
17 of the Superior Courts Act
[3]
:
"(1) leave to
appeal may only be given where the Judge or Judges concerned are of
the opinion that-
(a)
(i) the appeal would have a
reasonable prospects of success;
or
(ii) there is some
other compelling reason why the appeal should be heard, including
conflicting judgments on the matter
under consideration;..."
[5] I
do not intend to deal with each and every ground of appeal In this
application.
[6]
The
effect of the final sequestration order granted against the applicant
negatively affects his status as an individual separate
from the
legal entity,
Mukhawana and Mukhawana
Supply and Logistics (Ply) Ltd
and
he should be allowed to exercise his constitutional right of appeal.
There
is a
reasonable
possibility that another court may reach a different conclusion based
on the law set out in MARS -
Law of
Insolvency in South Africa,
9th
edition, 2008, Juta & Co (Pty) Ltd at page 113-114
“
the mere
fact that the creditor alleges that the debtor had carried on his
business under the name of
a
company
and that his affairs had been inseparably intermingled to justify
such a
con
clusion
does not affect the legal position that the company is nevertheless
a
separate entity and not
a
mere alias of the debtor, and
consequently
a
debt
due by the company cannot be providing a ground for sequestration of
his estate".
[7]
There
is also a reasonable possibility that the Court of Appeal might find
that the court erred to invoke the provisions of section
20(9) of the
new
Companies Act 71 of 2008
when there was no formal application for
the Court to make such an order.
[8]
After considering submissions of counsel on behalf of the applicant
and the respondents
as well as papers filed I am persuaded that the
applicant has reasonable prospects of success on appeal.
Order
[9]
The following order is made:
[9.1] The
application for leave to appeal is granted to the Full Court of this
Division.
[9.2]
Costs to be costs in the appeal
SKIBI AJ
ACTING JUDGE OF THE HIGH COURT
GAUTENG DIVISION, PRETORIA
Heard
on
: 22 July
2019
Judgment
delivered
:
22 July
2019
APPEARANCES
For
the Applicant
: Adv. J
H Groenewald
Instructed
by BOK Attorneys
215
Orient Street
ARCADIA,
PRETORIA
Tell: 012 342 3311
Ref: RCK/MW/Mukhawana
Email address:
Rudi@bdk.co.za
For
the Respondents
: Adv. S G Gouws and
Adv. L W. de Beer
Instructing Attorneys,
Vezi & De Beer Incorporated
cnr Alphine & South Village
Road
LYNNWOOD, PRETORIA
Tell: 012 361 5640
Ref: NMohamed/ND/MAT48443
[1]
Standard Bank of South Africa v Swepersadh 2005(4) SA 148 (C) at
153H-154J; Hano Trading CC v JR 209 Investments & Another
2013(1) All SA142 (SCA) at 145
[2]
9
th
Edition, 2008. Juta & Co (pty) Ltd, at
page
113 -114
[3]
10 of 2013