Mouton v Park 2000 Development 11 (Pty) Ltd and Others; In Re Stewart NO v Mouton and Others (1070/19; 8488/16; 2535/19) [2019] ZAWCHC 90; [2019] 4 All SA 133 (WCC) ; 2019 (6) SA 105 (WCC) (23 July 2019)

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[2019] ZAWCHC 90
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Mouton v Park 2000 Development 11 (Pty) Ltd and Others; In Re Stewart NO v Mouton and Others (1070/19; 8488/16; 2535/19) [2019] ZAWCHC 90; [2019] 4 All SA 133 (WCC) ; 2019 (6) SA 105 (WCC) (23 July 2019)

IN
THE HIGH COURT OF SOUTH AFRICA
[WESTERN
CAPE DIVISION, CAPE TOWN]
[REPORTABLE]
Case
nos.
1070/19; 8488/16; 2535/19
In the matter between:
JOHAN
MOUTON
Applicant
and
PARK
2000 DEVELOPMENT 11 (PTY)
LTD
First
Respondent
COMPANIES
AND INTELLECTUAL PROPERTY
COMMISSION
Second
Respondent
SMOKEN
CONSULTING (PTY)
LTD
Third
Respondent
KENNETH
LOGAN STEWART
N.O.
Fourth
Respondent
and
In
the matter between:
KENNETH
LOGAN STEWART
N.O.
Applicant
and
JOHAN
MOUTON
First
Respondent
THE
SHERIFF OF THE HIGH COURT,
RIVERSDALE
Second
Respondent
WH
VAN SCHALKWYK VERVOER
CC
Third
Respondent
CHRISTIAN
ERNST
OLIVIER
Fourth
Respondent
THE
REGISTRAR OF DEEDS, CAPE
TOWN
Fifth
Respondent
and
In
the matter between:
PETRUS
JURGENS
HANEKOM
First
Intervening Party
WILLEM
ADRIAAN
HANEKOM
Second
Intervening Party
In re: The Application of
Stewart NO v Mouton & Ors (case no. 8488/19)
JUDGMENT
DELIVERED ON 23 JULY 2019
SHER, J:
1.
I
have before me 3 related applications. In the main application (the
‘Mouton’ application), which precipitated the
other two,
an Order is principally sought
[1]
declaring that a resolution which was adopted on 11 December 2018 by
the first respondent company (‘Park 2000’) to
commence
business rescue proceedings, is invalid, and consequently that such
resolution and the proceedings which followed it,
including the
appointment of fourth respondent (‘Stewart’) as the
business rescue practitioner, should be set aside.
In the alternative
an Order is sought declaring that the resolution was null and void
from the outset.
2.
In the remaining applications an interim
interdict is sought by Stewart and certain intervening parties
whereby the transfer of
two immovable properties (which are
registered in the name of Park 2000) to certain of the respondents,
pursuant to an auction
sale in execution at which they were
purchased, is to be restrained pending the outcome of the main
application.
3.
The principal questions which arise for
determination are whether or not the business rescue proceedings are
defective because they
were launched at a time when liquidation
proceedings had already been ‘initiated’ against Park
2000, or whether the
resolution by means of which the business rescue
proceedings were launched is null and void because it was not taken
by the requisite
majority.
4.
The first of these questions requires a
careful interpretation of s 129(2)(a) and related provisions of the
Companies Act 71 of 2008
.
The facts and the
issues
(i)
The background
5.
Park 2000 is a property development
company. It was formerly the owner of two pieces of land, to wit Erf
541 in Riversdale and Erf
4513 in Stilbaai West, the latter being the
remainder of portion 60 of the Plattebosch farm, on which certain
developments were
earmarked to take place. For the purpose of raising
finance for the Stilbaai development from about 2006 onwards the
company offered
debentures which were linked to proposed erven. One
of the subscribers for the debentures was the applicant, Mouton.
6.
In terms of the debenture agreement the
debentures were redeemable by a certain date from the net proceeds
which were to be realized
from the sales of erven, unless the
requisite rezoning of the remainder of portion 60 had not occurred by
1 December 2009, in which
event the directors could extend the
redemption date. Such an extension was allegedly effected on a number
of occasions, the last
of which supposedly occurred in November 2017.
Whether these extensions were validly effected is not clear.
7.
In 2016 Mouton sought to redeem the
debentures he held but was unable to do so. Consequently, he issued
summons and in July 2016
he obtained default judgment against the
company after it failed to file a plea.
8.
Three months later the company made
application for rescission of the judgment, which was acceded to in
February 2017. However,
it failed yet again to file a plea and as a
result Mouton took default judgment against it for a second time on
11 October 2017,
in an amount of R 400 000 (being in respect of 2
debenture certificates which he held of R 200 000 in value each),
together with
interest and costs.
9.
As the company failed to satisfy the
judgment on demand Mouton obtained a writ of execution against its
movables in January 2018,
which resulted in a
nulla
bona
return. In this regard the Sheriff
was informed by Renier Van Rooyen senior, who together with his son
is one of the two directors
of the company, that it had no movable
assets as these were owned by a Trust.
10.
Consequently, in July 2018 Mouton obtained
a writ of execution which authorised the attachment and sale of the
company’s immovable
properties and in due course his attorneys
advertised their intended disposal by way of public auction on 12
December 2018.
11.
At about 15h44 on the afternoon of the day
before the auction was to be held,  Mouton’s attorneys
received notification
by email from attorneys Lucas Dysel Crouse Inc
that an entity known as Meiprops Twee en Twintig (Pty) Ltd
(‘Meiprops’),
of which the Van Rooyens are also
directors, had launched an application for the liquidation and
winding-up of Park 2000, which
application was enrolled for hearing
on 14 December 2018. Lucas Dysel Crouse Inc currently represent not
only Park 2000, but also
the business rescue practitioner Stewart as
well as the intervening parties. As far as all these entities are
concerned there is
therefore a commonality of interests.
12.
About 15 mins after receiving notification
of the intended liquidation of Park 2000 Mouton’s attorneys
received email correspondence
from an entity known as Smoken
Consulting (Pty) Ltd (through which Stewart offers consulting and
‘business rescue’
services), in which they were also
informed that Park 2000 had made application that same day to be
placed under business rescue,
and two days later the Companies and
Intellectual Property Commission (the ‘CIPC’) duly
appointed Stewart as the business
rescue practitioner. In the
meantime, the liquidation application was withdrawn the day after it
was launched.
13.
Notwithstanding that Park 2000 had sought
to place itself in business rescue on 11 December 2018 and despite a
demand which was
made by Stewart that the auction was to be cancelled
as a result thereof, it went ahead on the instructions of Mouton’s
attorneys,
as they were of the view that the business rescue
proceedings were irregular and Park 2000 had not legitimately and
validly been
placed in business rescue, whereupon the two properties
were sold at the auction: the Riversdale property was sold for R 135
000
and the Stilbaai property was sold for R 3.89 mil.
14.
In both the liquidation application as well
as the business rescue application Van Rooyen senior deposed to the
motivating affidavits
on 11 December 2018. In the liquidation
application he deposed to the founding affidavit on behalf of the
creditor Meiprops. In
that affidavit he claimed that Park 2000 was
indebted to Meiprops in an amount of R 2 359 642 in respect of monies
which had been
loaned and advanced to it in 2017 in order to finance
the completion of the Stilbaai development, which monies had
allegedly become
repayable in September 2018.
15.
Van Rooyen said that Park 2000 was unable
to pay the amount owing to Meiprops because of the negative economic
climate, which had
resulted in slower sales of erven in the Stilbaai
development than was expected and cash flow problems. As a result,
Park 2000
was struggling to pay its creditors and due to the
‘intimate knowledge’ which he had of the company’s
affairs
he said it had ‘no hope of being able to do so in the
foreseeable future’. According to him it was wholly unable to

meet its monthly overheads and had no further ‘funding’
available to it, as it was unable to secure finance from any

financial institution. And as was evident from its management
accounts, which he enclosed, as at 31 October 2018 its liabilities

exceeded its assets by an amount of R 5.8 mil. Consequently, he said
the company was both commercially as well as factually insolvent
and
it was just and equitable that it be wound up for the benefit of its
creditors.
16.
In
contrast to these averments, in the sworn affidavit which he filed
with the CIPC in support of the business rescue application
Van
Rooyen alleged that Park 2000 was financially distressed to the
extent that it was ‘reasonably unlikely’ that it
would be
able to pay its debts within the ensuing 6 months, but although it
was ‘reasonably likely’ that it would ‘become’

insolvent within that period, based on ‘current sales volumes,
cash flows and costs structure’ (sic) it could ‘in
all
probability’ trade profitably, provided it obtained the
protection of the moratorium on legal proceedings which the
Companies
Act afforded
a company in business rescue.
[2]
17.
It will be obvious that the averments which
were made by Van Rooyen in the two affidavits were mutually
contradictory and they clearly
could not both be true. In one of
them, at least, he was being mendacious. Either Park 2000 was
hopelessly insolvent as at 11 December
2018 or it was not. And if it
was, it could hardly then trade profitably, and it could clearly not
be rescued, even with a moratorium
in place.
18.
What further demonstrates Van Rooyen’s
glib ability to be expedient with the truth  is that in the
sworn affidavit which
he lodged as part of the business rescue
application he declared not only that Park 2000 was at that time not
involved in any (other)
legal proceedings, but also that it was not
in receipt of or aware of any application to liquidate it. That too
was an obvious
untruth, given that he deposed to the founding
affidavit in the liquidation application which had been launched on
behalf of Meiprops,
earlier the same day.
19.
One of the crucial questions which requires
determination and which can be dispositive of the outcome of the main
application is
which of the business rescue and liquidation
applications preceded the other.
20.
This
is both a factual issue ie a matter of when chronologically in time
the applications commenced, as well as a legal issue ie
when as a
matter of law the applications are to be considered to have
commenced. These are not necessarily one and the same moment
in time.
In this regard the provisions of both the previous and the current
Companies Acts
[3]
refer
variously to the ‘commencement’, ‘beginning’
and ‘initiation’ of liquidation and/or business
rescue
proceedings, and as I will attempt to illustrate in this judgment
these terms have different meanings attached to them,
depending on
the context in which they are used.
21.
It is important to note that the principal
affidavits which were filed in the applications which are before me
ie the answering
affidavit in the Mouton application and the founding
affidavit that was filed in the Stewart application, were deposed to
by Stewart
and not by Van Rooyen senior. This is a further factor
which impacts on the cogency of the versions which were put up in the
various
applications, as Stewart obviously had no first-hand
knowledge of the events that transpired on 11 December 2018 and was
clearly
reliant on Van Rooyen’s versions thereof. And, as I
have already pointed out, there is a large question mark behind the
veracity
of Van Rooyen’s affidavits, which must of necessity
impact upon his credibility. In addition, as will become apparent
later,
there is a marked divergence between the version which was
first put up by Stewart in his founding affidavit in the interdict
application,
which he deposed to on 7 February 2019, and that put up
by him in his answering affidavit in the Mouton application, which
was
deposed to on 14 March 2019.
22.
In the circumstances, when computing as
chronologically accurate a timeline of events as possible I sought to
arrive at factual
findings on the basis of information which was
objectively verifiable, without relying on the contents of the
affidavits of either
Stewart or Van Rooyen or which, if taken from
their affidavits, was common cause and uncontested.
23.
In the second place, it is important to
point out that from the respondents’ perspective the principal
focus in the affidavits
in the applications before me was directed at
dealing with the launch of the business rescue proceedings and very
little was said
by the principal deponent Stewart about the
liquidation application, or the launch thereof, and one has to sift
through the papers
in order to find the relevant information which is
pertinent thereto.
24.
The
explanation for the approach which was adopted by Stewart is
evidently that he was advised that for purposes of considering
which
application preceded the other the liquidation proceedings were to be
considered as having been ‘initiated’
on the date
and at the time when that application was issued out of the High
Court.  As I will attempt to explain below, this
was based on
the assumption that the provisions of
ss 348
and
352
of the previous
Companies Act,
[4
]
which refer to
the ‘commencement’ of liquidation proceedings, were
applicable. In this regard the respondents seek
to rely on the
decision in
FirstRand
Bank Ltd v Imperial Crown Trading (Pty) Ltd
[5]
in which it was held that the word ‘initiated’ in
subsection 129(2)(a) of the current Act, in relation to the launching

of liquidation proceedings, must have been intended to have the same
meaning as the word ‘commenced’ in
ss 348
and
352
of the
previous Act.
25.
As a result, the explanations which were
put forward by Stewart, particularly in the answering affidavit in
the Mouton application,
are directed at showing that the business
rescue proceedings began by way of the adoption of the necessary
resolution, before the
liquidation proceedings ‘commenced’
ie before the issue of the papers in the liquidation application, and
therefore
cannot be set aside on the grounds of a failure to
comply with the provisions of
s 129(2)(a).
(ii)
The liquidation application
26.
As far as the liquidation application is
concerned the Registrar’s stamp on the first page of the notice
of motion confirms
that it was issued on 11 December 2018 and a
time/date stamp on page 4 thereof indicates that a copy was received
by the Master’s
office at 10h48 that morning. There is also a
date stamp which indicates that it was served on SARS on the same
day. This means
that the application itself, as a whole, had to have
been issued sometime before this on the morning of 11 December.
27.
In
the answering affidavit which he made in the Mouton application
Stewart said that the papers in the liquidation application were

drafted the day before they were issued (ie on 10 December 2018) and
were then settled with Van Rooyen by 09h30 the following morning
11
December 2018,
[6]
who thereafter
signed the founding affidavit and the resolution between 09h30 and
09h45 at the office of a commissioner of oaths
close to the offices
of his attorneys, in  Durbanville.
[7]
However, at another point in his affidavit
[8]
Stewart averred that the founding affidavit was deposed to and signed
between 09h15 and 09h30.
28.
Thereafter, copies of the papers (for
service and issue) were made at the offices of his attorneys before
they proceeded to the
High Court in Cape Town, which is a distance of
approximately 30 kms away, for the application to be issued.
According to Stewart
issue occurred at ‘around’ 10h30
that day.
29.
Given the distance between Durbanville and
the High Court in Cape Town, and the distance in turn from there to
the Master’s
office, anyone who has any experience of working
at the High Court in Cape Town and travelling between these various
locations
will realise that even on the best of days, when traffic
conditions are optimal and office queues are non-existent (and 11
December
is certainly not one of those days), and even were one to be
conveyed from one location to the other (or even if one were
travelling
on a motorcycle), the chance of being able to have papers
that were despatched from Durbanville at 09h45-10h00 at the earliest,

issued by 10h30 at the High Court and stamped as received at the
Master’s office some 18 mins after that, is well-nigh
impossible.
On the best of days it is a 45 mins drive to Cape Town
central from Durbanville, and in my view to allow even 30 mins for
queueing,
issuing and travelling time between the office of the
Registrar of the High Court and that of the Master is wildly
optimistic,
and extremely unlikely.
30.
In the circumstances I do not believe that
one can set much store by the averments which are made by Stewart in
the answering affidavit
in the main application as far as times are
concerned, save insofar as these are confirmed by objective evidence.
And in this regard
the only time which is confirmed by objective
evidence is the time of receipt by the Master’s office ie
10h48. Thus, at best,
it could probably be said that the liquidation
application could not have been issued out of the Registrar’s
office later
than somewhere between 10h00 and 10h15 that morning in
order for it to be stamped as having been received by the Master at
10h48.
This means, of necessity, that it is highly unlikely that the
founding affidavit was deposed to and signed in Durbanville by 09h30,

or even 09h15, given that Van Rooyen had to return to his attorneys’
offices in order that copies of the papers could be
made for service
and issue purposes before they could be despatched. Thus, once again,
in all likelihood the settling, deposition,
signature and copying of
the papers in the application must have occurred earlier than was
alleged.
31.
And, given that Van Rooyen made reference
in his founding affidavit in the liquidation application to the
(prior) resolution that
the directors of Meiprops had taken in terms
of which they had resolved that Park 2000 should be wound up, a copy
of which was
annexed to his affidavit, and a draft of the papers were
prepared by his attorneys the day before ie on the 10
th
of December, that resolution had necessarily to have been taken
before the founding affidavit was settled, deposed to and signed.

This means that it probably had to have been taken before, or on, the
10
th
of December, even though it was only signed the following day. But,
even if the Van Rooyens left it to the last minute, given the
times
referred to by Stewart the resolution most likely could not have been
taken after 08h30-09h00 on the morning of 11 December
2018, in order
for it to have been signed by 09h15. I note in this regard that in
all of Stewart’s affidavits there is only
a reference to one of
the Van Rooyens ie Van Rooyen senior, attending at the offices of his
attorneys and the commissioner to sign
the papers. Of necessity, this
must mean that the signature of his son was appended to the
resolution elsewhere before it was signed
by Van Rooyen senior
between 09h15 and 09h30 on 11 December 2018. This too supports the
contention that the resolution must have
been taken by the Van
Rooyens before this.
(iii)
The business rescue application
32.
That then as far as the liquidation
application is concerned. As far as the business rescue application
is concerned, the following
factual picture emerges.
33.
Firstly, the document embodying the
resolution which was taken in order to launch the business rescue
proceedings proclaims that
it was a ‘director’s’
(singular) resolution which was taken at a ‘directors’
(no apostrophe) meeting
which was held  at
09h30
on
11 December
2018, whereby ‘the director’ (singular) resolved to begin
business rescue proceedings and to place the company under

supervision. And consonant with what it proclaimed ie that it was a
resolution taken by only one of the directors of Park 2000,
it was
only signed by one of the Van Rooyens, and not by both. Thus,
objectively, given the time recorded on the document, on the
face of
it the business rescue resolution had to have been taken
after
the liquidation resolution had already been adopted, and not before.
34.
In
the founding affidavit
[9]
which
he deposed to on 7 February 2019 in his interdict application (which
was a month or so before the answering affidavit which
he deposed to
in the Mouton application on 14 March 2019), Stewart simply said that
the business rescue proceedings had been ‘initiated’
by
the taking of the business rescue resolution ‘in the early part
of the morning’ of
11
December
2018 whereafter, according to him,  the ‘authorised’
director (ie Van Rooyen senior) who was under the misconception
that
he could launch both business rescue and liquidation proceedings
simultaneously had proceeded to depose to his founding affidavit
on
behalf of Meiprops in the liquidation application. This assertion is
not necessarily inconsistent with the objective facts as
set out
above in regard to the liquidation proceedings (ie that the
resolution to commence such proceedings was taken before the
founding
affidavit was signed and deposed to ie before 09h15-09h30 on 11
December).
35.
However,
notwithstanding the initially vague assertion in his founding
affidavit as to when the business rescue resolution was taken,
in his
replying affidavit Stewart pertinently alleged that it
preceded
the resolution which was taken to launch the liquidation
proceedings.
[10]
As will
immediately be evident, given the objective facts and the inferences
which one can draw from them in relation to the times
relevant to the
liquidation application, as set out above, the resolution to launch
the liquidation proceedings could not have
been taken
after
09h30 that morning. How the business rescue resolution could
therefore possibly have been taken before that which was taken in
the
liquidation proceedings, in the light of the times and allegations
set out above in regard to when the draft of the liquidation

application was prepared and when it was settled, signed, copied,
issued and then served is not evident, and seems to be impossible.
36.
This
is supported by the fact that contrary to this assertion, in a number
of places in the replying affidavit
[11]
which he deposed to in the interdict application (about a week after
the founding affidavit) Stewart repeatedly and expressly confirmed

that the business rescue resolution was taken at
09h30
on
11
December
,
which he said was also evident from the face of the document which
embodied the resolution, a copy of which he annexed to his
founding
affidavit. Thus, once again, this means that the business rescue
resolution had to have been taken after that which was
taken for the
liquidation application.
37.
I point out that Van Rooyen senior filed a
confirmatory affidavit in respect of the founding affidavit which was
made by Stewart,
in his interdict application. By doing so Van Rooyen
therefore also confirmed that the business rescue resolution had been
taken
on
11 December
2018.
38.
At the time when Stewart deposed to the
founding and replying affidavits in his application to interdict the
transfer of the properties
both he and Van Rooyen were therefore
adamant and clear that the resolution to commence business rescue
proceedings had been taken
on
11
December
2019.
39.
Once again, I emphasise that in the light
of the objective facts and the inferences which one can draw from
them in relation to
the times pertaining to the liquidation
application (ie when the draft of the liquidation application was
prepared and when it
was settled, signed, copied, issued and then
served), as set out above, it must follow that the resolution to
launch the liquidation
proceedings could not have been taken
after
09h30 on the morning of 11 December 2018. As was previously pointed
out, according to Stewart the affidavit in the liquidation

application in terms of which Van Rooyen confirmed that he was
proceeding on the authority of a resolution which had been taken
by
the board of Meiprops and a copy of which was attached to his
affidavit as an annexure, was deposed to and signed before a
commissioner of oaths between 09h15 and 09h30 at the latest.  This
means that the resolution in the liquidation application
must have
been taken before the resolution to commence business rescue could
have been taken at 09h30.
40.
However, in contrast to this, in his
answering affidavit in the Mouton application (which was filed on 14
March 2019) a very different
version was put forward by Stewart.
Clearly, as a result of Mouton’s founding affidavits in the
principal application he
had been alerted to the anomalies with the
times which he put forward in his affidavits in the interdict
application, and he was
alive to the fact that as a result thereof
the business rescue proceedings could possibly be impeached.
41.
In
order to meet these difficulties, he now alleged
[12]
that the business rescue resolution had in fact been taken
telephonically by both directors on
8
December
2018 (a Saturday) but was minuted and signed by Van Rooyen senior, as
the ‘authorised’ director, on 11 December. This,
he
claimed, Van Rooyen’s secretary  recalled had occurred
between 09h00 and 09h05 (!) that morning and the reference
to 09h30
on the resolution was an error, as she had made use of a
pro
forma
wherein that time had previously appeared, when she typed up the
resolution at 07h30 on 11 December, at the company’s offices
in
Bellville.
[13]
According to
this version after the business rescue resolution had been signed by
Van Rooyen in Bellville he then proceeded to
his attorneys’
offices in Durbanville where he settled the founding affidavit in the
liquidation application, before deposing
to it before a commissioner
of oaths.
42.
Of course, the obvious question which
arises in respect of this version is why the document which Van
Rooyen’s secretary typed
up incorrectly reflected that the
resolution had been adopted on
11
December
, when it was allegedly adopted
on
8 December
2018. In this respect it was then still incorrect, yet no explanation
for this error was provided, either by Stewart or Van Rooyen
or his
secretary, and no attempt was made to correct it. Given the time when
it was allegedly typed up (07h30) and that it allegedly
preceded the
resolution which was taken subsequently to launch liquidation
proceedings, this error cannot be ascribed to the use
of an earlier
precedent.  Furthermore, that Van Rooyen’s secretary could
somehow recall that he had signed the business
rescue resolution
between 09h00 and 09h05 on 11 December 2018, is to my mind just too
convenient to be at all plausible. It smacks
of a contrived attempt
to make the story fit the objectively incontrovertible facts ie that
the liquidation papers were signed
and commissioned in Durbanville
and thereafter copied and despatched to the High Court for issue, in
time for service on the Master
at 10h48. I think that Mouton’s
senior counsel is correct when she says that the new version which
was provided by Stewart
viz that the business rescue resolution was
adopted on 8 December, was one contrived in order to deal with the
difficulties posed
by the facts surrounding the signature and issue
of the liquidation papers early in the morning of 11 December 2018.
43.
It was a necessary adjustment which had to
be made in order to deal with the travelling and time issues that
arose from the fact
that Van Rooyen had to proceed from his offices
in Bellville where he supposedly signed the business rescue
resolution before thereafter
attending at his attorneys’
offices, which are in Durbanville, and then to the office of the
commissioner of oaths in order
to settle and sign his founding
affidavit in the liquidation, whereafter he returned the liquidation
papers to his attorneys’
offices for copying before they were
taken to Cape Town in order that they could be issued at the High
Court and served on the
Master by 10h48. I will revert to these
various versions in due course.
44.
Before turning to discuss the relevant
legal provisions and how these impact on the facts I may point out
that the sworn statement
of Van Rooyen which was submitted as part of
the business rescue application (which was transmitted to the CIPC by
Steward’s
PA at 15h45 on 11 December 2018), was only deposed to
and signed by him before an attorney in High Street, Bellville at
approximately
14h00 that day.
45.
It will therefore be apparent to the reader
that Van Rooyen did an extraordinary amount of travelling that day,
if these various
versions are to be believed, from his home/office in
Bellville, then to his attorney and a commissioner of oaths in
Durbanville
in the morning before returning later that day to depose
to the business rescue affidavit before another commissioner of oaths
in Bellville.
The law
(i)
The issues
46.
As has been pointed out, the respondents’
case is predicated on the assumption that the liquidation proceedings
were ‘initiated’
when the papers in the application were
issued out of the High Court at 10h30 on 11 December 2018. For
reasons which I set out
previously, in my view the application had to
have been issued earlier than 10h30, and whilst this probably
occurred closer to
10h00 the very latest it could have happened was
10h15.
47.
Be
that as it may, the respondents contend that inasmuch as the business
rescue proceedings commenced prior to this, with the adoption
of the
necessary resolution on Saturday 8 December 2018, they cannot be
assailed for wont of compliance with
s 129
of the
Companies Act of
2008
.
[14]
48.
In this regard
s 129(1)
provides that the
voluntary placement of a company under business rescue ‘begins’
when its board takes a resolution
to such effect, if it has
reasonable grounds to believe that the company is financially
distressed and there appears to be a reasonable
prospect of rescuing
it. But in terms of
s 129(2)(a)
such a resolution may not be adopted
if liquidation proceedings have (already) been ‘initiated’.
49.
If the liquidation proceedings were
‘initiated’ at the time, and by way of, the adoption of
the necessary resolution
to wind-up the company then it would follow,
given what is set out above, that the ‘beginning’ of the
business rescue
by the subsequent adoption of a resolution to this
effect occurred in breach of this provision.
(ii)
The interpretation adopted in
FirstRand
Bank Ltd
50.
In
support of their contentions the respondents rely on the decision in
FirstRand
Bank Ltd v Imperial Crown Trading (Pty) Ltd
[15]
in which it was held that the word ‘initiated’ in
s
129(2)(a)
must have been intended to have the same meaning as the
word ‘commenced’ in
ss 348
and
352
of the previous
Companies Act of 1973.
51.
In
this regard s 348 provided that the compulsory winding-up of a
company at the instance of a creditor shall be deemed to have

‘commenced’ at the time of the presentation of the
application ie at the time when the application was lodged with
the
Court. S 352 in turn provided that the voluntary winding-up of a
company at its own instance (or that of its creditors)
[16]
‘commenced’ at the time of the registration
[17]
of a special resolution which it had taken to such effect.
52.
In
FirstRand
Bank Ltd
a provisional order for the
compulsory winding-up and liquidation of the respondent was sought by
the Bank on the grounds that it
had defaulted on a commercial loan
facility which had been granted to it, and was both factually as well
as commercially insolvent.
The respondent opposed the grant of a
provisional order on the grounds that it needed time to consider
whether or not an application
for business rescue should be launched
by it and it accordingly requested a postponement for this purpose.
The Bank was not amenable
to the suggestion. It averred that in terms
of s 131(6) of the Act even if liquidation proceedings had
‘commenced’
this would not subsequently preclude the
institution of business rescue proceedings, and these would have the
effect of suspending
the liquidation proceedings until the Court had
pronounced upon the merits of the business rescue application, or the
business
rescue had otherwise come to an end. In response the
respondent pointed out that in terms of s 129(2)(a) once a
liquidation had
been ‘initiated’ the company was
precluded from adopting a resolution to place itself under business
rescue.
53.
Swain
J (as he then was) was of the view
[18]
that no valid ground existed for the refusal of a provisional order
of liquidation, or for an adjournment of the application as
sought by
the respondent, and he accordingly granted an Order in the terms
sought. In light thereof it seems as if the comments
which he made in
regard to the interpretation and comparison of the meaning of the
words ‘commenced’ (as utilised in
s 348 and 352 of the
previous Companies Act) and ‘initiated’ in s129(2)(a) of
the current Act, were not part of the
ratio
of
his decision, which was more concerned with an interpretation of the
ambit and effect of s 131(6).
[19]
In any event, he held
[20]
that
the injunction which was present in s 129(2)(a) did not preclude a
shareholder or any other affected party from launching
an application
to place the respondent under business rescue.
[21]
54.
In affording a meaning to the provisions of
s 129(2)(a), he held that the reference therein to liquidation
proceedings which were
launched ‘by or against’ a
company, was clearly intended to be a reference to either the
voluntary winding-up of a
company in terms of s 352 of Act 61 of
1973, or to its compulsory winding-up in terms of s 348 thereof.
55.
He
pointed out that the authors
[22]
of the work
Companies
and other Business Structures in South Africa
[23]
have
remarked that it is unclear whether the word ‘initiated’,
which is not defined in the current Act, was intended
to have the
same meaning as the word ‘commenced’ in the previous Act.
He came to the conclusion
[24]
that it would be anomalous if what was meant by liquidation
proceedings being ‘initiated’ by or against a company for

the purposes of s 129(2)(a), differed from what was meant by such
proceedings having ‘commenced’ for the purposes of
s
131(6). In his view, inasmuch as the ‘provisions’ of the
previous Act expressly continued to be applicable to the
winding-up
of companies, the word ‘initiated’ consequently must have
been intended to bear the same meaning as the
word ‘commenced’
in the ‘applicable’ sections of the previous Act. He was
of the view that to conclude
otherwise would be to introduce
uncertainty where none was justified.
(iii)
The applicable principles of
interpretation
56.
I
respectfully differ with the learned judge’s interpretation of
the provisions in question. In seeking to arrive at the proper

meaning to be afforded to them I remind myself, as a start, of the
seminal approach to the interpretation of legislation, as set
out by
Wallis JA in
Endumeni
:
[25]
“
Interpretation
is the process of attributing meaning to the words used in a
document, be it legislation, some other statutory instrument,
or
contract, having regard to the context provided by reading the
particular provision or provisions in the light of the document
as a
whole and the circumstances attendant upon its coming into existence.
Whatever the nature of the document, consideration must
be given to
the language used in the light of the ordinary rules of grammar and
syntax; the context in which the provision appears;
the apparent
purpose to which it is directed …. Where more than one meaning
is possible each possibility must be weighed
in the light of all
these factors
.
The
process is objective, not subjective.
A
sensible meaning is to be preferred to one that leads to insensible
or unbusiness-like results or undermines the apparent purpose
of the
document.
”
57.
In essence therefore I am required to
arrive at a contextual, purposive and commercially sensible
interpretation of the subsection
concerned, having regard for the
language which was used therein. This cannot be done without having
regard for the relevant legislative
instruments which were referred
to as a whole ie both the previous as well as the current Companies
Acts, and not just the provisions
which have been referred to, which
only deal with certain winding-up and business rescue proceedings. In
order to do this one must
necessarily also contextualize and
distinguish between winding-up and business rescue proceedings, which
are directed at achieving
opposite purposes. The former is aimed at
putting an end to a company’s life, the latter at saving it.
58.
Secondly,
it is important to note that whereas the current Act provides
[26]
that the provisions of Chapter XIV of the previous Act will continue
to apply in regard to the winding-up and liquidation of companies,

this is only to be a temporary arrangement,
[27]
and in addition the provisions of the previous Act are only
applicable to the winding-up of insolvent companies.
[28]
The winding-up of solvent companies occurs in terms of the relevant
provisions
[29]
of the current
Act. It will immediately be noted that the Court in
FirstRand
Ltd
did
not take this into account, and only had regard for the applicable
provisions which it referred to, in the previous Act. In
its defence,
it did so presumably because it was dealing with the winding-up of an
insolvent company and not a solvent one. But,
nonetheless, when one
adopts a contextual, global interpretation one should, in my view,
also consider the language which has been
adopted in the relevant
provisions in the current Act, which deal with winding-up
proceedings.
59.
It is further important to note that in
providing that the winding-up provisions of Chapter XIV of the
previous Act are to continue
to apply to the winding-up of companies
in terms of the current Act, a number of the provisions of the
Chapter have been expressly
excluded, including the sections which
were referred to by the Court in
FirstRand
Ltd
ie ss 348 and 352, insofar as these
pertain to solvent companies. In my view, by failing to take account
of the distinction between
the different treatment to be afforded to
the winding-up of insolvent v solvent companies, the Court in
FirstRand Ltd
did
not arrive at an interpretation of the relevant provisions which was
harmonious ie which could apply equally in the case of
both solvent
as well as insolvent companies, and its reference to and use of ss
348 and 352 only and not to the relevant provisions
in the current
Act, was risky.
(iv)
Winding-up in terms of Act 61 of 1973
60.
In
Chapter XIV of the previous Act there is no reference to the
‘initiation’ of liquidation proceedings, only the
‘commencement’
thereof. As in the case of the current Act
the previous Act made provision
[30]
for the winding-up of companies either on a voluntary basis (usually
at the instance of the company itself
[31]
)
by means of a special resolution of its Board, or on a compulsory
basis ie in terms of a court order. The latter would usually
be at
the instance of a creditor, or a disaffected shareholder or director.
61.
Consonant
with the source of the winding-up ie internally via the company or
externally via a disaffected party or creditor, the
previous Act
provided that a voluntary winding-up ‘commenced’
[32]
at the time of the registration of a special resolution which the
company had taken to such effect, whilst a compulsory winding
up was
‘deemed’
[33]
to
have ‘commenced’ at the time of the presentation of the
application ie at the time when the application was lodged
with the
Court.
62.
As
is pointed out in the commentary in
Henochsberg
[34]
the effect of the deeming provision in the previous Act in regard to
the compulsory winding-up of companies was to make the commencement

thereof retrospective to the time when the application was filed with
the Registrar, provided that a winding-up order was granted

thereafter,
[35]
and the
purpose of such retrospectivity was to prevent any attempt by a
dishonest company or its creditors, or a third party, to
‘snatch
some advantage’ in the intervening period between the filing of
papers and the grant of a provisional or final
order.
[36]
(v)
Winding-up in terms of Act 71 of 2008
63.
That
then as far as winding-up in terms of the previous Act is concerned.
In terms of the current act
[37]
the winding-up of solvent companies may similarly be affected
voluntarily by means of a resolution which is taken by the company

itself
[38]
or compulsorily
[39]
by means of a court order.
64.
What
is immediately noticeable is that the empowering provisions
[40]
which give effect to these modes of winding-up are now omnibus
provisions which deal not only with the determination of the moment

when the winding-up ‘commences’ but also seek to set out
the circumstances, mechanisms and processes in terms of which
the
winding-ups may be obtained. A further distinction is that whereas
the provisions of the previous Act speak of the ‘commencement’

of proceedings the current provisions
[41]
speak of the ‘beginning’ thereof. And, in this regard
there are further notable differences between the provisions
of the
previous Act and those in the current Act.
65.
Whereas
the voluntary winding-up of a (solvent) company is also considered to
‘begin’ ie ‘commence’ when
a resolution to
this effect is filed
[42]
a
compulsory winding-up ‘begins’ either at the time when
application is made to the court
[43]
(as in the case of the winding-up of insolvent companies in terms of
the previous Act) or, at the time when the court has granted
an
order,
[44]
depending on the
circumstances. The former will be the case in regard to applications
by the company itself
[45]
whereas the latter  will be applicable  to winding-up
applications which are brought by creditors
[46]
or  to those brought on the grounds of deadlock between
directors or shareholders,
[47]
or on the grounds that the directors or other persons in control of
the company have acted in a fraudulent  or illegal manner
or
failed to comply with a compliance notice from the CIPC.
[48]
In the circumstances the use of the word ‘begin’ in
relation to the winding-up provisions of the current Act seems
also,
but not always, to be analogous in meaning to the use of the word
‘commenced’ in regard to similar provisions
in the
previous Act ie it denotes the moment when, as a matter of law, the
proceedings are considered to have formally commenced.
But there are
instances where it is used only to denote the time when the
proceedings commenced, factually.
(vi)
Business rescue
66.
If
one then turns to consider the relevant provisions of the current Act
pertaining to business rescue proceedings
[49]
one notes similarly that these may be brought about either
voluntarily by means of a company resolution to place itself under
supervision
[50]
or
compulsorily by means of a court order.
[51]
However, although these provisions also refer to when proceedings
‘begin’, there appears to be a similar lack of uniformity

in relation to the use of the word.
67.
In
the case of voluntary proceedings, although the empowering
provision
[52]
provides that
these ‘begin’ when the special resolution by the company
is taken, the resolution has no force and effect
until it is
filed
[53]
and another
provision
[54]
expressly
stipulates that the proceedings (only) ‘begin’ when the
company has filed the resolution it has taken.
In the circumstances,
it seems that although voluntary business rescue proceedings may
start ie ‘begin’ in the factual
sense with the adoption
of the necessary resolution, the moment when they are deemed to
‘commence’ ie to ‘begin’
in the formal, legal
sense, just as in the case of a voluntary winding-up, is when the
resolution is filed. Thus, the use of the
word ‘begin’ in
relation to voluntary business rescue proceedings in terms of the
current Act, is also not always analogous
to the use of the word
‘commence’ in relation to winding-up proceedings.
68.
Similarly,
in the case of compulsory business rescue there are also seemingly
contradictory provisions. The relevant subsections
[55]
of the empowering provision
[56]
(which in its heading refers to the ‘beginning’ of
proceedings) state that the proceedings ‘commence’ when

the court makes an order placing the company under supervision,
whereas s 132 provides that voluntary business rescue proceedings

‘begin’ either when the company files a resolution to
place itself under supervision,
[57]
or when the company applies to the court for permission to file such
a resolution
[58]
or an
affected person applies for such an order.
[59]
In addition, inasmuch as the Act provides that a court may at any
stage whilst a company is in liquidation convert the winding-up

process to a business rescue, the (rescue) proceedings in such a case
will ‘begin’ when the court makes an order to
such
effect.
[60]
69.
Thus, and by way of summary, it is apparent
that in relation to business rescue proceedings in terms of the
current Act the word
‘begin’ may, depending on the
context and the subsection in which it is used, similarly either be
intended to refer
to the factual moment in time when the rescue is
considered to have started, or the moment when, as a matter of law,
the proceedings
formally ‘commenced’.
(vii)
A re-interpretation of ss 131(6) and
129(2)(a)
70.
I
now turn to discuss the provisions which were considered in
FirstRand
Bank Ltd
[61]
ie
s 131(6) and s 129(2)(a). The former provides that if liquidation
proceedings have already been ‘commenced’ by or
against a
company at the time when an application to place it under business
rescue is made,
[62]
such
proceedings will be suspended until the business rescue application
is adjudicated upon or the business rescue otherwise comes
to an end.
71.
Given that, when considering whether the
bar in s 129(2)(a) applies we are dealing with the prior
‘commencement’ of
winding-up proceedings, if one
applies a similar meaning to the word ‘commenced’ in the
context of this subsection
as that which applies in the case of the
use of the word in the relevant winding-up provisions of the previous
Act, as was done
in
FirstRand Bank Ltd
(ie that it means that either a company has
voluntarily resolved to place itself under liquidation and has filed
a resolution to
that effect or application has been made for its
compulsory winding-up), it will not be inconsistent with the purpose
of the subsection
and will give effect to it, as the subsection aims
to suspend liquidation proceedings only where these have publicly
and
formally ‘commenced’ ie where these have begun
by means of the filing of the necessary resolution with the CIPC or
the filing of court papers with the Registrar of the High Court. The
same holds true if we are to apply the meaning which is attributed
to
the word ‘commenced’ in the relevant provisions of the
current Act, in terms of which in addition to the two possibilities

referred to in
FirstRand Bank Ltd
we
must add, as a third possibility, the time or moment when a court
makes an order, granting a liquidation. On this ground too,
in my
respectful view the decision which was arrived at in
FirstRand
Bank Ltd
is unsound as it did not take
account of this third meaning of the word, in the context of the
current Act.
72.
Furthermore, because the word ‘commenced’
in s 131(6) might bear the same meaning which the word has in the
relevant
winding-up provisions of either the previous or the current
Act, it does not necessarily follow that it should have the same
meaning
as the word ‘initiated’ in s 129(2)(a), nor in my
view would it be anomalous if it didn’t.
73.
If one notes the pervasive use of the word
‘commenced’ in the winding-up provisions of both the
previous and the current
Act and the use of its occasional synonym
‘begin’ in the winding-up provisions of the current Act,
as well as the contradictory
use of the word ‘begin’ in
relation to business rescue proceedings in the current Act,  as
illustrated in the
preceding passages, it cannot be a linguistic
accident that the legislature chose to use the word ‘initiated’
in s
129(2)(a), rather than either the word ‘commenced’
or the word ‘begin’.
74.
In
this regard I note that the only other place where the word
‘initiated’ is used in the current Act, in relation
either to winding-up or business rescue proceedings, is s 79(1)(a)
which provides that a solvent company may be dissolved either

voluntarily by means of a winding-up which is ‘initiated by the
company as
contemplated
in s 80’  ie by the adoption of a special resolution to
such effect, or compulsorily by way of a winding-up
and liquidation
order.
[63]
75.
The
ordinary, grammatical meaning of the verb to ‘initiate’
is to cause a process or action to begin.
[64]
As such, in the context in which the word is used in s 79(1)(a) it is
intended to refer to some act which precedes the publicly
formal
beginning or ‘commencement’ of the legal process referred
to therein (liquidation proceedings) ie it refers
to a preceding act
or conduct which sets the process in motion. Such an interpretation
is supported, in the context of s 79(1)(a),
by the phrase in which it
appears, which qualifies what that preceding act or conduct is to be
and how it is to be effected ie
the adoption of the necessary
resolution. It provides, in essence, that the legal process of
voluntarily winding-up a company is
put into motion by means of the
adoption of a resolution to such effect. However, as we have seen
from the preceding discussion
the formal ‘commencement’
of the liquidation process, as a matter of law, only occurs at the
moment when the resolution
is filed.
76.
Thus, whereas as in the case of the use of
the word  ‘commence‘ the word begin’ when
viewed in the context
of the various provisions of the previous and
the current Acts which I have referred to, may either be a synonymous
legal term
which is used to denote the formal commencement, as a
matter of law, of the proceedings in question (or simply the start,
in a
factual sense, thereof), the word ‘initiate’ is used
to denote the factual, causative action by means of which the legal

process which gives rise to the proceedings concerned is put into
motion.
77.
The word ‘initiated’ in s
129(2)(a) is therefore intended to refer to a preceding act or
conduct by which liquidation
proceedings are set in motion and is not
intended to signify the moment in time when the proceedings are
deemed to have formally
‘commenced’. In my view therefore
the word ‘initiated’ does not bear the same meaning as
the word ‘commenced’
in ss 348 and 352 of the previous
Act, and it was never intended that it should have the same meaning.
78.
It
is important to note that, from its wording it is apparent that s
129(2)(a) was intended to be of application not only where

liquidation proceedings have been ‘initiated’
against
a
company ie in the case of a compulsory winding-up by a creditor but
also where they have been ‘initiated’
by
the
company itself. In this regard it has been held
[65]
that the legislative purpose of subsection (b), which provides that a
business rescue resolution shall have no force and effect
until it
has been filed, is to prevent a company from thwarting an application
to liquidate it, simply by adopting a business rescue
resolution,
without intending ever to file it or to take any real steps to place
the company under supervision. In order to avoid
such a stratagem the
resolution will only have legal force and effect if it is filed ie
formally lodged with the CIPC, together
with the necessary
documentation required.
[66]
I am of the view that the legislature must have had a similar
intention in mind in relation to subsection 129(2)(a),
when it
provided that a company may not begin business rescue proceedings by
adopting a resolution to this effect, if liquidation
proceedings have
already been ‘initiated’ ie put into motion. The object
of the provision would be defeated if a company
could simply thwart
impending liquidation proceedings which it was aware had been
launched, but had not yet formally ‘commenced’
by means
of the filing of the winding-up resolution, or (in the case of a
compulsory liquidation) of the necessary application,
or the grant of
a court order, as the case may be, simply by adopting a resolution to
place the company under supervision.
79.
The
salient facts of the matters which are before me illustrate why it
could never have been intended that a company could only
be barred
from resolving to place itself under business rescue, even if it knew
that winding-up and liquidation proceedings were
imminent, or had
already ‘initiated’ such proceedings itself, after those
proceedings had formally ‘commenced’
ie after the papers
in respect of such proceedings had been filed. The Van Rooyens, who
were directors of both the creditor Meiprops
as well as of Park 2000
resolved that Park 2000 should be wound up, as it was hopelessly
insolvent, both commercially and factually.
By doing so they surely
‘initiated’ the liquidation proceedings which followed ie
they set those proceedings in motion.
It is no coincidence that those
proceedings were formally launched on the day before the auction was
to be held, at which Park
2000’s properties were due to be sold
in satisfaction of the judgment which Mouton had obtained a year
earlier.  Once
the papers in respect of such proceedings had
been filed by 10h00-1015 at the latest on 11 December 2018, they were
deemed, as
a matter of law, to have ‘commenced’.
Thereafter the Van Rooyens also launched business rescue proceedings,
primarily
because (according to Stewart who is the only person who
has provided an explanation in this regard), once their company was
placed
under business rescue it would be afforded protection from any
legal action by the statutory moratorium
[67]
which came into effect, and could thereby prevent Mouton from
enforcing and executing the judgment he had obtained against the

company. However, once they realized that the business rescue
proceedings which they had launched were open to challenge on the

basis that they had been launched after the liquidation proceedings,
they cynically withdrew the liquidation application the following

day.
80.
In the same way as it is unacceptable for
directors of a company to attempt to frustrate a liquidation
application simply by adopting
a resolution to place the company
under business rescue without ever filing it, so too it seems to me
it must be unacceptable for
them to frustrate a liquidation by
adopting a resolution to place the company under business rescue
before the papers in the liquidation
application have been filed, but
after such an application has already been set into motion by them.
(viii)
The meaning of ‘initiation’
in s 129(2)(a)
81.
In summary therefore I am of the view that
when referring to the ‘initiation’ of liquidation
proceedings in s 129(2)(a)
the legislature intended to refer to the
preceding causative act or conduct whereby the legal process in
relation to such proceedings
was set in motion. What that act or
conduct may be will depend on the facts and circumstances of each
matter. In most instances
where corporate entities, trusts or
voluntary associations are involved it will surely be constituted by
the adoption of the necessary
resolution in order to launch such
proceedings. Where other entities or natural persons are involved it
may be more difficult to
determine what qualifies as such an act, and
if and when it was taken. Fortunately, this is not something which I
need to decide
in this case (which concerns a liquidation application
by a corporate entity), nor would it in my view be appropriate, or
even
possible to formulate a general rule or principle in this
regard. Unlike in the case of corporate entities, trusts or voluntary

associations, something more than a conscious and deliberate taking
of a decision to launch liquidation proceedings may be required,

otherwise there would be no way to controvert or challenge an
averment that is made in this regard, on the simple say-so of a
party. Perhaps the courts may decide that in such matters the
providing of instructions to a legal representative to launch
winding-up
proceedings, or the drafting of papers for the application
will constitute the necessary ‘initiation’ of such
proceedings.
But in my view any difficulties which may ensue in
this regard are not insurmountable, and the law can be developed
incrementally
on a case-by-case basis. The fact of the matter is that
by deliberately referring in s 129(2)(a) to the ‘initiation’

of proceedings rather than either the ‘beginning’ or the
‘commencement’ thereof the legislature clearly
had
something else in mind than what is meant by the use of either of the
latter terms in the provisions I have referred to.
82.
I
derive support for the interpretation and reasoning I have adopted in
relation to  s 129(2)(a), from s 131(8), which provides
that a
company that has been placed under supervision may not thereafter
adopt a resolution placing itself under liquidation until
the
business rescue proceedings have ended.
[68]
It will be noted that it is the
adoption
of the resolution
which
precipitates the statutory injunction. By providing in a similar
fashion that the adoption of a resolution to launch liquidation

proceedings will ‘initiate’ such proceedings and that a
company that has taken such a step may not thereafter adopt
a
resolution to commence business rescue proceedings I believe we will
ensure parity in treatment between the two regimes.
The law applied
83.
In the circumstances, I am of the view that
the liquidation proceedings against Park 2000 were ‘initiated’
when the
resolution to launch them was taken, and not when the
liquidation application was filed with the Court. As I set out above,
that
occurred before 09h30 on 11 December 2018 and before the
subsequent resolution which was adopted (at 09h30 or thereafter), to
place
the company under business rescue.
84.
In
arriving at these findings, I am mindful of the long-established
principle
[69]
that in opposed
motions where there is a dispute of fact on the affidavits, an
applicant is only entitled to succeed if the facts
which are stated
by the respondent, together with the admitted facts, justify an Order
in its favour. In such circumstances an
applicant is therefore bound
to accept the version which has been put forward by its opponent.
[70]
85.
At
the same time, it is equally well established that where a dispute of
fact is not a ‘real, genuine or
bona
fide
’
one
the Court will be justified in ignoring it and may proceed to find on
the applicant’s version thereof.
[71]
So too, where the respondent’s version is clearly or palpably
far-fetched or untenable, the Court may take a robust approach
and
decide the matter on the basis of the applicant’s version.
[72]
As always, in evaluating the contents of the affidavits the Court
must have due regard for the treatment which the respondent has
given
to the averments under reply. In this respect a respondent has a duty
to engage with the facts which are put up by the applicant,
and to
deal with them fully and comprehensively.
[73]
Any ‘skimpiness’
[74]
and improbabilities in his version may thus count against him. It is
also well-established that when a party deposes to an affidavit
(be
it an answering or a founding affidavit) he commits himself to its
contents, and only in exceptional circumstances will he
be permitted
to disavow them.
[75]
86.
I
have already pointed out
[76]
the difficulties which I have with the various contradictory and
generally unsatisfactory versions of the material events which
were
put forward by Park 2000 via Stewart (who was not the primary source
of the facts and did not have first-hand knowledge thereof)
as
‘confirmed’ by Van Rooyen senior (who filed confirmatory
affidavits only). These difficulties do not only pertain
to when the
business rescue resolution was allegedly adopted, which Stewart
originally (in his affidavits in his interdict application)
expressly
and repeatedly contended occurred at 09h30 on the morning of 11
December 2018, but then alleged (in his answering affidavit
in the
Mouton application) occurred 3 days earlier, on the morning of 8
December 2018. They also pertain to the circumstances under
which,
and the alleged times when, the resolution and the papers in the
liquidation proceedings were settled, signed and issued,
which for
the reasons I previously set out must have occurred earlier on 11
December 2018 than was suggested by him. In this respect
too, the
affidavits of Stewart are highly unsatisfactory.
87.
Not only did Stewart not have any
first-hand, direct knowledge of the alleged facts which underpinned
the various versions which
he deposed to but in addition there are
other important reasons why the Court must be wary of accepting what
he puts forward in
those versions.
88.
Stewart is not a disinterested party, who
is before the Court merely in order to discharge his duties in the
interests of Park 2000
as its duly appointed business rescue
practitioner. He has taken an active and leading role in all three
applications. Not only
did he oppose the principal application (ie
the Mouton application), which was launched in March 2019, in
circumstances where many
other business rescue practitioners would
have abided and let the main protagonists (ie Mouton and the Van
Rooyens) fight it out.
A month prior to this he launched an interdict
application in which he actively sought to restrain the passing of
transfer of the
properties which had been bought on auction. In this
application he too deposed to the principal affidavit, on behalf of
the company.
For the purposes thereof he must of necessity have
obtained the relevant information which was required, from the Van
Rooyens.
And in that application, as I have previously pointed out he
stoutly and repeatedly declared, under oath, at a number of places
in
his affidavits, that the business rescue resolution had been adopted
on 11 December 2018. Van Rooyen confirmed his averments
in this
regard, under oath, by way of a confirmatory affidavit. This version,
which is supported objectively by the time and date
which was
recorded on the document which embodied the resolution, was
contradicted a month later, when Stewart alleged in his answering

affidavit in the Mouton application that the business rescue
resolution had in fact been taken 3 days earlier, on 8 December 2018.

Once again, the source of this version must have been Van Rooyen.
89.
One would have expected that a
disinterested and impartial business rescue practitioner would have
been embarrassed by the fact
that he was required to put up a
contradictory version, under oath, to that which he had previously
given, and would have distanced
himself from what was alleged to be a
false, prior version, and would accordingly have let the Van Rooyens
do the explaining. But
in this instance too, all we have are
confirmatory affidavits from them, supposedly also confirming the
second version, which stands
in direct contrast to the first. No
attempt was made to obtain a proper, comprehensive explanation for
the discrepancies and inconsistences
from the Van Rooyens, or their
volte face
.
The best that counsel for Stewart could do to explain this state of
affairs was to suggest, somewhat nonchalantly, that Stewart
must have
‘obviously’ based his first affidavits on the contents of
the document which embodied the business rescue
resolution. But of
course this is not an explanation which washes nor is it one which
has been put forward by the Van Rooyens,
who simply made confirmatory
affidavits in which they confirmed the contents of the original
affidavits and the version set out
therein, only to file a second set
of confirmatory affidavits in which they confirmed a contrary
version, which was clearly designed
to meet the difficulties they had
with the first. The overwhelming impression which one is therefore
left with, from the papers,
is that Stewart was happy to say whatever
was required in order to defeat the applicant’s case, even if
that meant coming
up with a version which was contrived to meet the
case which was put up. And the obvious question which one must ask
oneself in
the circumstances is whether or not the explanation for
Stewart’s behaviour is that he is motivated primarily by his
own
personal, financial interest in earning fees in the matter rather
than by his obligation to act in the best interests of Park 2000
as
business rescue practitioner.
90.
From the papers it appears that prior to
his appointment by the company on 11 December 2018 (as officially
confirmed by the CIPC
two days later) he was approached by one
Muller, who is associated with an entity which is referred to in the
papers as ‘Problembond’
(and which may be a debenture
holder of Park 2000) to advise as to whether or not, in the
circumstances where Park 2000 was facing
the imminent sale in
execution of the immovable properties it owned, at the instance of a
judgment creditor, it could avoid this
by placing itself under
business rescue, and by his own admission Stewart advised that it
could and that he would be willing to
assist it in this regard, both
in respect of the preparation and submission of the necessary
application to the CIPC as well as
in regard to the appointment of
himself as business rescue practitioner.
91.
Not only did Stewart advise Park 2000 that
it should place itself under business rescue, but his office
thereafter assisted in processing
its application to the CIPC. After
Van Rooyen had completed the necessary forms and documents required,
these were sent to Muller,
who then forwarded them on to Stewart’s
PA at his offices at Smoken Consulting in Kwazulu-Natal, from which
she transmitted
the application to the offices of the CIPC at 15h45
on the afternoon of 11 December 2018.
92.
Thus, Stewart not only had an interest in
the matter even before he was appointed, but was intimately involved
in processing the
application to place the company under business
rescue and to appoint him as its business rescue practitioner. There
is a clear
conflict of interest visible in all of this.
93.
His conduct after his appointment also
raises a number of questions. He does not appear to have been
particularly fussed about the
deadlines which are set out in the Act
for the proper discharge of his duties and statutory obligations, nor
does he appear to
have attended to them with any sense of urgency, if
at all.
94.
He was required in terms of s 147(1) to
convene and preside
over a first meeting of creditors, within 10 days of his appointment.
In breach of this requirement he gave notice on 18 December
that such
a meeting would be held more than a month later, on 24 January 2019
‘because of the holiday period between 15 December
and 15
January 2019 and the
dies non
’
(sic).
The
dies non
do
not, as far as I am aware, apply in relation to the provisions in
question, and the Act does not stipulate that the period between
15
December of one year and 15 January of the following year is a
‘holiday period’ which excuses a business rescue

practitioner from carrying out his duty to meet with creditors.
Clearly therefore, the date was set with reference to what suited
and
was convenient to Stewart, with no regard for what what was required
in terms of the law ie the expeditious rescue of the company.
95.
It further appears that, also contrary to
his duties in this regard, he failed to give the debenture holders
notice of the first
meeting of creditors. The only explanation for
this extraordinary state of affairs, such as it is, is apparently
that he considered
that this was not necessary as they were only
‘contingent’ creditors.
96.
A so-called ‘supplementary’
first meeting was convened, for 15 February 2019. But this was not
because he had a change
of mind in relation to his statutory
obligations. He convened a meeting on 15 February because the day
before this his interdict
application had been struck from the roll
on the grounds that the alleged urgency for it had been self-created,
given that the
auction had taken place some 2 months earlier and the
application had only been launched when transfer of the properties
which
had been bought at the auction was imminent. But once again it
appears that notwithstanding the legislative requirements in this

regard not all the creditors, contingent or otherwise, were given
notice of the meeting. Mouton claimed he did not receive notice,
and
by Stewart’s own admission some of the debenture holders were
also left out.
97.
His
explanation for this was that he was still (some 2 months after his
appointment) in the ‘process’ of establishing
who all the
debenture holders were, an extraordinary state of affairs, given that
the debenture holders essentially were persons
who had loaned the
company substantial sums of money in order to finance a development
which, more than 14 years later, had still
not been completed, for
reasons which are not clear from the papers. Notably, in providing
this explanation Stewart did not claim
that the reason why he had not
been able to ascertain the identity of all the debenture holders was
because of circumstances beyond
his control, such as that the
company’s books and records were in utter disarray.
[77]
In the absence of a proper explanation for what exactly he was doing
for more than 2-3 months the impression that one has is that
he was
simply not bothered to find out who all the debenture holders were.
Again, one must ask what the likely explanation for
this must be if
Stewart was truly acting in the due and proper discharge of his
duties as business rescue practitioner.
98.
In
terms of the Act
[78]
he was
required as soon as was ‘practicable’ after his
appointment to investigate the company’s ‘affairs,

business, property and financial situation’ with a view to
considering whether there was any reasonable prospect that it
could
be rescued. Clearly, as at the date of the filing of his last
affidavits, in March he had not properly discharged his duties
in
this regard, for no apparent or good reason. But, even without
carrying out his duties and ascertaining what the company’s

actual financial situation was, he was able to inform the creditors
that there were reasonable prospects of rescuing it.
99.
Insofar
as he adopted the view that there were reasonable prospects of the
company being rescued he was required
[79]
to prepare and publish a business rescue plan within 25 days from the
date of his appointment (ie by 22 January 2019 at the latest

according to my reckoning (excluding public holidays)), or such
longer period as might be allowed by the Court, on application
to it,
or as might be agreed upon between the holders of a majority of the
creditors’ voting interests. Within 10 days from
such date the
plan was to be put forward for consideration and possible adoption at
a meeting of creditors.
[80]
To
date hereof neither of these obligations have been complied with and
no attempt was ever made to obtain an extension of the
date from the
Court. I note, from the minutes of the ‘supplementary’
first meeting which was held on 15 February, that
no indication was
given that a business plan had been prepared, or even that it was
under preparation. Instead, Stewart simply
decided, unilaterally,
that because of the various legal matters which were before the Court
publication of a plan would ‘of
necessity’ have to be
postponed ‘
sine
die’
.
Once again, on what basis he decided unilaterally to ignore the very
clear statutory provisions concerned and to decide that he
could
postpone, indefinitely, the production and presentation of a business
plan, which lies at the very heart of business rescue
proceedings, is
not apparent. The delay in coming up with even a hint of a viable
business plan gives cause for suspicion that
the real purpose of the
process of which he is in control is not to rescue the company, but
simply to buy time in order to obtain
shelter and protection for as
long as possible from creditors, and in particular from enforcement
of the judgment which Mouton
obtained.
100.
Added to all of this is the fact that the
sole source of the information which is contained in Stewart’s
various affidavits,
in relation particularly to when and how the
liquidation and the business rescue proceedings were launched is Van
Rooyen senior,
a man whose credibility as I pointed out above is
clearly in issue, given that he has been quite happy to make a number
of mutually
contradictory statements, under oath. On one and the same
day he swore that Park 2000 was hopelessly insolvent without any hope

of paying its creditors or staying afloat, only to declare, hours
later, that it was not yet insolvent and based on current cash
flow
and sales figures it was quite capable of trading itself into a
profitable state, and of being rescued.
101.
In like vein, he initially confirmed in a
supporting affidavit that the business rescue resolution had been
taken on 11 December,
only to later confirm under oath that it had
allegedly been taken 3 days earlier on 8 December 2018. When one
notes that the document
which he signed, which embodies the
resolution, reflects that it was supposedly taken at 09h30 on 11
December 2018 than it appears
that even on his own version he paid no
regard for whether or not the contents of papers which he was signing
for official purposes
were true and correct.  One or other of
the versions he ‘confirmed’ was palpably false and
untenable. All of this
amounts to mendacious conduct, such as to make
it impossible to believe or rely on anything which he ‘confirmed’
which
is not substantiated by way of objective, extraneous evidence,
of which there is very little one can rely on, other than a
date-stamp
on the notice of motion in the liquidation application.
There is therefore no real, genuine or
bona
fide
dispute of fact present, and in my
view, this is not a matter where the respondents’ version can
and must prevail. When properly
weighed in the scale the respondent’s
version is worthless, as it is based on information provided by an
outright liar, which
is not substantiated or corroborated.
102.
In
a last-ditch attempt to persuade me that, on the basis of the
principle in
Plascon-Evans
I
was nonetheless bound to accept Stewart’s second version as to
when the business rescue resolution was adopted, his counsel
pointed
out that Van Rooyen’s secretary Ms Conradie had filed a
confirmatory affidavit in support thereof. But when one considers

exactly what she confirmed in her affidavit then it does not appear
that it is of any real value in relation to the cardinal issue
ie
when the business rescue resolution was
adopted
,
as opposed to when it was
signed
.
In this regard Stewart said in his answering affidavit
[81]
in the Mouton application that ‘the director’ ie Van
Rooyen senior had ‘confirmed’ to him that the resolution

was taken, not on 11 December (as Stewart and Van Rooyen had
originally claimed in their affidavits in the interdict application),

but that it was (allegedly) taken telephonically on 8 December 2018.
It was then typed up by Van Rooyen’s secretary early
on the
morning of 11 December, and she ‘recalled’ that Van
Rooyen had thereafter signed it between 09h00 and 09h05
before
leaving to go to his attorneys’ offices to settle, sign and
depose to the papers in the liquidation application.
[82]
103.
In her confirmatory affidavit Ms Conradie
confirmed the correctness of Stewart’s affidavit, insofar as it
pertained to her.
Thus, she simply confirmed the averment that she
typed up the resolution early in the morning and that Van Rooyen had
signed it
thereafter, sometime between 09h00 and 09h05. She could
not, and did not, confirm that the resolution was in fact taken on
the
Saturday (three days earlier) instead of at 09h30 that day. The
only source of this allegation was Van Rooyen, and as I have
previously
pointed out his credibility is so shot that one cannot
accept anything which he says, which is not supported by extraneous
evidence
or which is not common cause, and the time and date when the
business rescue resolution was signed was not common cause, and the

objective evidence ie the document in which it is embodied reflects
that it was taken on
11 December
and not 8 December 2018. On this aspect it is notable that nothing
was said by Stewart, and by Conradie, in this regard (thus only
the
time on the document and not the date was wrong according to her),
and in the circumstances the evidence, and the probabilities

therefore indicate, in my view, that the resolution was indeed taken
on 11 December and not on 8 December 2018.
Conclusion
104.
For
the aforegoing reasons I came to the conclusion that the resolution
to launch business rescue proceedings must have been taken
after
the
resolution to launch liquidation proceedings, and not before. Given
that I also found that the liquidation proceedings were
‘initiated’
by the adoption of the necessary resolution in this regard, it
follows that the business rescue resolution
was adopted in breach of
the provisions of s 129(2)(a) of the Act. Consequently, the applicant
in the principal application (Mouton)
is entitled,
[83]
in my view, to an Order setting the resolution aside. It follows from
this that the business rescue will come to an end and Stewart’s

appointment as business rescue practitioner must fall away.
105.
I
may add there is no doubt that the resolution to place the company in
business rescue was not passed in good faith in that, as
in the
Alderbaran
[84]
and
Griesse
l
[85]
matters there was no genuine intention to attain the objectives of
the Act in regard to business rescue. The application was not
one
genuinely brought to try and save Park 2000 from a parlous financial
state, and to place it on the road to recovery. This much
is clearly
evident from the fact that it was launched the day before the auction
sale in execution of the judgment which Mouton
had obtained a year or
more before, was due to take place. The property developments which
Park 2000 had been engaged in commenced
many years ago, and the
company had been able to continue therewith notwithstanding various
downturns in the property market, which
had occurred since 2008 and
which had affected the entire sector. Nothing in the financial
picture which was sketched by Van Rooyen
senior, limited as it was in
respect of detail, suggests that there was any sudden, significant
change in the company’s financial
circumstances, if at all, in
the months or days before the application was brought, which
precipitated a need to be ‘rescued’
(or for that matter
to be placed in liquidation). The application was simply brought as a
deliberate stratagem to frustrate the
enforcement of the judgment
Mouton was seeking to execute.
[86]
As in
Alderbaran
[87]
it
appears that the company aims to hold onto the immovable properties,
particularly the Stilbaai property, with a view to continuing
with
the subdivision and sale of plots, in order that it might continue to
make substantial profits. In this regard Stewart’s
remarks are
telling. He says that the Stilbaai erf is a large 54 hectare plot
which can be subdivided into some 340 individual
erven, which could
sell for between R 300 000 and R 500 000 each, depending on their
location and views. After taking account of
the costs of installing
services and the expected capital contributions which will be levied
in this regard by the municipality,
he envisages that the sale of
these erven could generate a gross profit of approximately R 85
million.
[88]
106.
In
the circumstances, and given non-compliance with the provisions of s
129(2)(a), I believe that an Order setting aside the resolution
will
be just and equitable.
[89]
107.
In
the alternative, I would have upheld the application on the grounds
that even if the resolution could not be set aside for wont
of
compliance with subsection 129(2)(a), it should be declared to be a
nullity. In this regard, on the basis that the (second)
version which
was put forward by Stewart as to when the resolution was adopted,
cannot be accepted, for all the reasons I have
set out above, the
ineluctable conclusion to which one must arrive is that the
resolution was taken at 09h30 on 11 December 2018,
as the document
stating it declares, by Van Rooyen senior only, and not by both
directors, as required. In this regard
Stewart
confirmed in the minute of his supplementary first meeting of
creditors
[90]
(which Van
Rooyen attended), that ‘the director’ (
singular
)
ie Van Rooyen senior, had resolved to commence business rescue
proceedings.
The
parties were
ad
idem
that
both of the two directors were required to approve and be party to
the resolution, and it could not have been taken by only
one of them.
108.
In
Panamo
Properties
[91]
the
Supreme Court of Appeal held
[92]
that where a resolution to launch business rescue proceedings is not
taken by a properly constituted board of directors it is a
nullity,
and as such, ineffective for the purposes of commencing business
rescue proceedings.
109.
That brings me to the remaining
applications, which are for interdictory relief by Stewart and for
leave to intervene therein by
the Hanekoms, as intervening parties,
following the Order which was made on 14 February, striking the
interdict application from
the roll for lack of urgency. Inasmuch as
the interdict which was sought was to be an interim one (restraining
transfer of the
properties which were bought on auction) pending the
outcome of the principal application, the parties were
ad
idem
that on determination of the
principal application the relief sought would be rendered moot, and
as such both the other applications
should be dismissed.
110.
Before doing so I need to make a few
remarks in regard to these applications. I find it disconcerting that
even though this Court
struck the interdict application from the roll
on the grounds that it lacked urgency, instead of allowing it to be
heard in due
course it was immediately re-enrolled on an urgent
basis. This constitutes an abuse of the rules and process of this
Court and
is contemptuous of the Order which this Court made. It
appears that an attempt was made to justify this conduct on the
grounds
that a group of creditors (not all the creditors were invited
and Mouton was also excluded), had been called to a meeting which
was
convened by and under Stewart’s direction the day after the
Order which was made in regard to the interdict application,
at which
it was resolved that two of the creditors, Hanekom senior and his
son, would make application for leave to intervene.
Clearly, inasmuch
as the Order which was made was not appealable, re-enrolling the
interdict application under the guise of an
application to intervene
was a deliberate stratagem which was adopted in order to achieve what
could not originally be achieved
by means of the interdict ie a way
to prevent transfer from going through. And once again it appears
Stewart was an active participant
and not, as one would have expected
to be the case, a mere spectator from the sidelines. In this regard
he went so far as to provide
an indemnity to the Hanekoms, on behalf
of the company, in respect of their legal costs in relation to the
intervention application.
He was accordingly happy to use the
supposedly paltry kitty which the company has to cover the costs of
litigation against it.
111.
To my mind, this is yet another instance of
behaviour which appears to run counter to the proper discharge of his
obligations as
business rescue practitioner and shows a lack of
impartiality and objectivity. In my view, given these circumstances
not only should
there be an Order for costs against the applicants in
those matters, including Stewart, but this is also a situation where
fairness
dictates that the respondents should not be out of pocket
for any legal expenses which they incurred ie they should have an
attorney-client
Order in their favour. In regard to the principal
application, given the active stance which Stewart adopted in that
matter, in
which he opposed the relief which was sought even after he
was made aware of the possible falsity of the version(s) which he was

to advance, I see no reason why he should not be ordered to be
jointly liable for the costs of suit, together with the other
respondents,
including the company though which his services were
offered and enlisted.
112.
Finally,
inasmuch as the status and validity of the sales in execution of the
properties was challenged (on the grounds that the
company was under
business rescue at the time) and is therefore dependent on the
outcome of the principal application, the Order
which I hand down
should deal with this aspect, failing which it will leave uncertainty
for both parties. In my view, given the
decision to which I have
come, in terms of s 130(5)(c) it is necessary and appropriate to
confirm the validity of the sales in
execution and to authorise and
direct finalization of transfer of the properties concerned
[93]
in order to avoid any further unwarranted and unjustified delay.
113.
In the result, I make the following Order:
(a)
Ad the application under case no.
1070/19:
113.1
In terms of ss 130(1)(a)(iii) and
130(5)(a)(i)-(ii), read with ss 130(5)(c), 132(2)(a)(i) and
s
129(2)(a)
of the
Companies Act 71 of 2008
, the resolution which was
adopted in terms of which the first respondent (Park 2000 Development
11 (Pty) Ltd) was placed under
business rescue is declared to be
invalid and is set aside, and the company is discharged from business
rescue on the grounds that
it has come to an end, and insofar as may
be necessary the appointment of fourth respondent as business rescue
practitioner is
discharged.
113.2
The sale in execution on 12 December 2018
of the immovable property known as Erf 541, being a portion of Erf
539, The Fisheries,
Hessequa Municipality, Division Riversdale
(Western Cape), held by virtue of deed of transfer T39566/2005, is
declared to be valid
and enforceable.
113.3
The sale in execution on 12 December 2018
of the immovable property known as Erf 4513, Stilbaai West being
portion 60 (remaining
extent) of Farm Plattebosch 485, in the
Hessequa Municipality (Western Cape), held by virtue of deed of
transfer T19355/1977, is
declared to be valid and enforceable.
113.4
Transfer of the properties referred to in
the two preceding subparagraphs shall be effected as soon as
possible, as against due
payment of any amounts which may be owing in
respect thereof (including any fees, disbursements charges and taxes)
and/or the discharge
of any obligation(s) which may be outstanding in
lieu of such payment.
113.5
First, third and fourth respondents shall
be liable for the costs of the application (including the costs of
two counsel where so
employed), jointly and severally, the one paying
the other to be absolved.
(b)
Ad the applications under case nos.
8488/16 and 2535/19
113.6
The applications are dismissed.
113.7
The applicants shall be liable for the
costs of the application on the scale as between attorney and client
(including the costs
of two counsel where so employed), jointly and
severally, the one paying the other to be absolved.
M
SHER
Judge
of the High Court
Attendances
:
(Heard on 13 May 2019)
(a)
In case no. 1070/19:
Applicants’
counsel: Advs T Dicker SC and M McChesney
Applicants’
attorneys: Madeleyn Inc (Durbanville)
Respondents’
counsel: Advs P Van Eeden SC and R Appoles
Respondents’
attorneys: Lucas Dysel Crouse Inc (Durbanville)
(b)
In case no. 8488/16:
Applicants’
counsel: Advs P Van Eeden SC and R Appoles
Applicants’
attorneys:  Lucas Dysel Crouse Inc (Durbanville)
Respondents’
counsel: Advs T Dicker SC and M McChesney
Respondents’
attorneys: Madeleyn Inc (Durbanville)
(c)
In case no.2535/19:
Applicants’
counsel: Adv L Zazeraj
Applicants’
attorneys: Lucas Dysel Crouse Inc (Durbanville)
Respondents’
counsel: Advs T Dicker SC and M McChesney
Respondents’
attorneys: Madeleyn Inc (Durbanville)
[1]
In terms of
s 130(1)(a)(iii)
read together with s 130(5)(a)(i) and
(ii) of the Companies Act 71 of 2008 (‘the Act’).
[2]
In terms of s 133.
[3]
Acts
61 of 1973 and 71 of 2008.
[4]
Act
61 of 1973.
[5]
2012 (4) SA 266 (KZN).
[6]
P
ara
[141].
[7]
Para
[46] rtw para [20].
[8]
Para
[137].
[9]
At paras [26]-[27].
[10]
Paras [35], [70] and [72].
[11]
Paras [20], [23], [38], [65], [70] and [72]. In para [65] he was
particularly adamant: ‘
I
must emphasize that the resolution for the business rescue
proceedings was taken in the morning of 11 December 2018 at 09h30.

This fact has been conveniently ignored by the respondents
.’
[12]
At para [18].
[13]
Para [19].
[14]
Act 71 of 2008.
[15]
Note
5
.
[16]
In terms of s 351 of Act 61 of 1973.
[17]
With the CIPC, within 1 month of the passing thereof, as per s 200
of Act 61 of 1973.
[18]
Para [24].
[19]
See the extensive discussion in this regard at paras [16],
[18]-[22].
[20]
At para [22].
[21]
In terms of s 128(1)(a).
[22]
Davis
et
al
.
[23]
2
nd
Ed at 229 fn 6.
[24]
At para [17].
[25]
Natal
Joint Municipal Pension Fund v Endumeni Municipality
2012 (4) SA 593 (SCA).
[26]
By way of Item 9(1) of Schedule 5.
[27]
Until
the Minister otherwise determines by notice in the Gazette.
[28]
In terms of Item 9(2) of Schedule 5.
[29]
Ss 79-81.
[30]
S 343.
[31]
Voluntary winding-up at the instance of creditors is also possible
vide
s 343(2)(a) rtw s 351 of the previous Act and s 79(1)(a)(ii) of the
current Act.
[32]
S 352.
[33]
In terms of s 348.
[34]
Henochsberg
on the Companies Act 71 of 2008
(
Delport
et al
)
Vol 2 at APPI-94(16).
[35]
Id;
Kalil v
Decotex (Pty) Ltd
1988
(1) SA 943
(A) 961-962.
[36]
Henochsberg
n
36 at APPI-94(17);
Lief
NO v Western Credit (Africa) (Pty) Ltd
1966 (3) SA 344
(W) at 347.
[37]
S
79.
[38]
S
79 (1)(a) rtw s 80.
[39]
S
79 (1)(b) rtw s 81.
[40]
Ss
80 and 81.
[41]
Ss
80 (6) and 81 (4).
[42]
S
80 (6).
[43]
S
81(4)(a).
[44]
S 81(4)(b).
[45]
In
terms of ss 81(1)(a) and (b).
[46]
S
81(1)(c).
[47]
S
81(1)(d).
[48]
Ss
81(1)(e) and (f).
[49]
Which
are set out in Chapter 6.
[50]
In
terms of s 129.
[51]
In
terms of s 131.
[52]
S 129-
the
heading of which expressly states that the proceedings ‘begin’
when the resolution is adopted
.
[53]
S
129(2)(b).
[54]
S 132(1)(a).
Regulation
123 and Form CoR 123.1 also clearly state that in the case of
voluntary placement under business rescue the proceedings
only
‘commence’ when the resolution is filed.
[55]
Ss 131(1) and 131(4).
[56]
S 131.
[57]
This
will
be the case in a voluntary business rescue, in terms of ss 129(1)
and 129(3).
[58]
This will be the case where the company has previously taken a
resolution within the preceding 3 months, which became a nullity

because it failed thereafter to publish it, or to appoint a business
rescue practitioner within 5 days of taking the resolution
(ss
132(1)(a)(ii) rtw ss 129(3) and (4)).
[59]
S 132(1)(b).
[60]
In terms of s 131(7).
[61]
Note 5.
[62]
That is the time when the application is filed with the court.
[63]
In
terms of s 81.
[64]
Concise
Oxford Dictionary
10th ed.
[65]
Sulzer
Pumps (SA) (Pty) Ltd v O & M Engineering CC
2016 (1) SA 503
(KZP) at para [8].
[66]
Regulation
123 provides that the resolution must be filed together with a
Notice of Commencement of Business Rescue Proceedings
in terms of
Form CoR 123.1.
[67]
In terms of
s 133
of the
Companies Act, 2008
.
[68]
In terms of
s 132.
[69]
Plascon-Evans
Paints (Pty) Ltd v Van Riebeeck Paints (Pty) Ltd
1984 (3) SA 623 (A).
[70]
Id
at 634E.
[71]
Room
Hire Co (Pty) Ltd v Jeppe Street Mansions (Pty) Ltd
1949 (3) SA 1155
(T) at 1163
et
seq
.
[72]
Plascon-Evans
n 69
at 635B-C.
[73]
Wightman
t/a JW Construction v Headfour (Pty) Ltd & Ano
[2008] ZASCA 6
;
2008 (3) SA 371
(SCA) at para
[13]
.
[74]
Per
the dissenting judgment of Bozalek J a
quo
in
Wightman
t/a JW Construction v Headfour (Pty) Ltd & Ano
2007 (2) SA 128
(C) at para [14].
[75]
Wightman
n 73
at para [13].
[76]
At
paras
[21]-[43] above.
[77]
There was only some reference to problems with the ‘register’.
[78]
S
141(1).
[79]
In terms of
s 150(5).
[80]
S 151.
[81]
Para [18].
[82]
Para [19] of the answering affidavit.
[83]
In terms of
s 130(1)(a)(iii).
[84]
Alderbaran
(Pty) Ltd & Ano v Bouwer &Ors
2018 (5) SA 215 (WCC).
[85]
Griessel
& Ano v Lizemore & Ors
2016 (6) SA 236 (GJ).
[86]
Stewart says, in para [76] of his answering affidavit, that Van
Rooyen launched the application in order to obtain protection
from
legal action, by way of the statutory moratorium and in para [40] of
his minute of the supplementary first meeting of creditors,
which
was held on 15 February 2019, he recorded that the resolution to
commence business rescue proceedings was taken ‘as
a result’
of Mouton ‘instigating’ (sic) action against the company
for the refund of R 400 000 he had advanced
the company, by way of
debentures.
[87]
Note 84 at para [48.3].
[88]
This calculation surely gives the lie to the allegation which was
made that the company’s liabilities exceeded its assets.
[89]
S
130(5)(a)(ii).
See
Alderbaran
n
84 at paras [48]-[49]. In
Panamo
Properties v Nel
&
Ors NNO
2015 (5) SA 63
(SCA) the SCA held that a resolution cannot simply be
set aside, in terms of s
130(5)(a)(ii)
,
on the grounds that it is just and equitable
-
at least one of the grounds set out in
s 130(1)(a)
, which includes
non-compliance with
s 129
, also needs to be present.
[90]
N
ote
86.
[91]
Panamo
Properties v Nel
2015 (5) SA 63 (SCA).
[92]
At para [22].
[93]
As
was done in
Alderbaran
n
84 at paras [50]-[57].