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[2018] ZAKZDHC 5
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Dacomb v Green Heat (Pty) Ltd (8906/15) [2018] ZAKZDHC 5 (16 March 2018)
IN THE HIGH COURT OF SOUTH
AFRICA
KWAZULU-NATAL
LOCAL DIVISION, DURBAN
Case
No: 8906/15
In
the matter between:
STUART
CHARLES
DACOMB
APPLICANT
and
GREEN
HEAT (PTY)
LTD
RESPONDENT
JUDGMENT
Delivered
on:
16
March 2018
MNGADI AJ
[1]
The applicant seeks a final winding-up order on the basis that the
respondent was
unable to pay its debts within the meaning of s 345(1)
(a), read with s 344(f) of the Companies Act 61 of 1973 (the old
Act). The
application is opposed by the respondent. The applicant is
an adult male chartered accountant. The respondent is a company duly
registered and incorporated under the company laws of the Republic of
South Africa.
[2]
The applicant based its application on
four categories of debts. He claimed that
the respondent is indebted to him and
that due demand having been made pursuant to the provisions of s 345
of the old Act read with
the provisions of s 9 of Schedule 5 of the
Companies Act 71 of 2008 (the new Act) and there was no response to
the demand within
the prescribed time limits or at all.
The
positions of the parties
[3]
The
applicant states that the first category of indebtedness is unpaid
salary in the total sum of R170 000. He averred that he joined
the
respondent on the basis that he would receive 50% shareholding in the
respondent. His monthly salary was not paid in full,
it being agreed
that the arrears in his salary will be off-set against the purchase
price of the shares. He attended to prepare
the respondent's books of
accounts from 2008 and once he completed the accounts to 2014 he was
told that the offer of 50% shareholding
was no longer available and
he had to leave the respondent. On 12 January 2015 he sent to the
respondent an e-mail with schedules
indicating arrear salary and
refund of expenses due to
him.
[4]
The second category of indebtedness,
claims the applicant, relates to payment of expenses incurred by him
on behalf of the respondent
when he used his Nissan bakkie to effect
deliveries and they total R24 419-34. He avers that as a shareholder
he used his personal
vehicle to deliver goods. The costs of delivery
were to be off-set against the purchase price of the shares. In the
e-mail of 12
January 2015 (referred to above) he stated that 'my
bakkie was also used to deliver goods again I did not charge GH at
the time.because
of cash flow problems and it could be sorted when
the shares were valued'
[5]
The
applicant avers that the next category of indebtedness relates to
repayment of expenses made by him in
respect of cell phone debits on behalf
of the respondent in the total sum of R7 095-00. In the schedule
attached to the 12 January
2015 e-mail it is titled 'Floral Image
Costs, Costs incurred since 2012. It lists the following; Printing
paper for R300-00; Ink
cartridges in the sum of R2 190-00; use of
internet for R3 000- 00; and use of phone for R300-00. He states that
due to the respondent's
poor financial position he paid his own cell
phone costs. The costs were by agreement to be set off against
the purchase price
of the
shares.
[6]
The
applicant avers
that
the last category of
indebtedness
is
the
payment of monies due to him and retained by the respondent and the
balance is the sum of R6 388-28. He explains that Builders
Warehouse
paid to the respondent for flooring supplied by him.
He asked the respondent to pay the
monies received to various entities and the amount outstanding
not paid over is R6 388-28 that must
paid to him.
[7]
The
applicant states that in the e-mail of
13 January 2015 in response to his
e-mail of 12 January 2015 mentioned above, Mrs. Barret, respondent's
managing director, on behalf
of the respondent stated as follows (own
numbering:)
'1.
Firstly, I need
to check if you have taken the backups of all Green heat transactions
to Com. put 8, including what is in your PC.so
that I can follow what
you have done over the years relative to Green heat South Africa's
accounts.
2.
I
am needing the audit trail file for Feb 2014 accounts, plus your last
set of management accounts that you did (June 2014) I am
trying to
establish the discrepancies in the accounts that I submitted to
Merchant West. The ones I pulled off Pastel, which you
then
informed me were
totally incorrect.
3.
This is very urgent, as you are aware, I
am unable to do factoring of my Shoprite deliveries, leaving us with
no cash flow, as much
as I would like to pay catch up with your
salary and your expense claims, I am
in
no position to do so.
4.
Please,
therefore, send through the info urgently. If you have sent stuff to
me relative to these requests, please give me the dates,
so I can do
search'.
The
applicant avers that the statement in para 3 of the e-mail is a
statement which is clearly an act of insolvency in terms of
s 8(g)
of
the
Insolvency Act 24 of 1936
, as amended, as read with
s 344(h)
of
the old Act still applicable pursuant to the new Act.
Alternatively,
claims
the
applicant,
the e-mail
indicates that the
respondent is
unable
to
pay its debts pursuant to s 344 (f) and, in addition, it indicates
that it is just and equitable
that
the
respondent
should
be
wound-up
in
terms
of
s
344
(h)
of
the
old
Act.
[8]
In
addition, the
applicant
avers that a
s
345 demand having been
sent,
and three weeks
having
elapsed,
and
the
respondent having
failed to
respond
to
the
demand,
the respondent is
deemed to
be
unable
to
pay
its
debts
as
envisaged in
s
345
of
the
old
Act
read
with
the
provisions
of
the
new
Act.
[9]
The
respondent in opposing the application relies on the affidavit of
Adrianne Margaret
Barret,
its
shareholder
and
managing
director.
The
respondent
denies
that
it
is
either insolvent or in insolvent circumstances
It denies that it owes the applicant any
monies as alleged or at all. It denies that any monies whatever
remain due to the applicant
in respect of short-paid and/or unpaid
salaries and in respect of monies received from Builders
Warehouse.
It
denies
that
it is
liable
to
reimburse
the
applicant for delivery costs by the
Nissan bakkie, if any. Further, it denies that it is liable to
reimburse the applicant cellular
telephone costs, if any were
incurred.
It
denies that there
is
a
shortfall
in
respected
of
monies
received
from
Builders
Warehouse
that
ought
to be refunded to the applicant. It alleges that in fact in respect
of salaries and the Builders Warehouse the applicant was
over-paid.
[10]
Mrs. Barret stated that at the time she
sent the e-mail of 13 January 2015 she was under the mistaken but
bona fide belief that
monies were due to the applicant for short -
paid/unpaid salary and for certain repayments of monies by the
respondent. In the
past such monies had been owed to the applicant
and she was not without reconciliation to know whether there were
still monies
owed or not.
She
stated that now having done the reconciliation (schedule attached to
her affidavit) no monies were owed to the applicant, in
fact there
had been over payments in the total sum just over R19 000. In
December 2014 in respect of salaries there was an over
payment of R5
000 and an over-payment of R14155-70 in respect of monies received
from Builders Warehous
e
..
[11]
The
respondent denied that that the applicant was ever a shareholder of
the respondent. It denied that the applicant used his Nissan
bakkie
to make deliveries for the respondent and Mrs. Barret denied that she
confirmed in the 13 January 2015 e mail that
such reimbursement
of such expenses was due to the applicant. When she used 'expenses
claims' she did not mean any expenses relating
to the use of the
Nissan bakkie or in respect of cellular telephone usage. She was
referring to a claim for payment of monies received
from Builders
Warehouse. She stated that there was never any agreement to pay the
applicant for cellular telephone costs and it
was never agreed that
such costs would be set off against the purchase price of shares. She
stated that whilst the demand may have
been sent to the registered
office of the respondent, such communication never came to her
attention or that of her husband, and
that in any case the demand is
improper, and it cannot be relied upon because no monies were owed to
the
applicant.
[12]
Mrs. Barret stated the applicant's claim
of R24 419-34 for the use of the Nissan bakkie and
R7 095-00 for the cellular telephone
expense totals R31 514-34 whereas the total over-payment is R19
155-70. The difference is R12
358-64, the payment of which the
respondent secures by paying the said sum to its attorneys to be kept
in trust pending the action
instituted within ten days from date of
finalization of the winding up application or as ordered by the
court.
Mrs.
Barret concluded that the respondent is not insolvent. The applicant
has ulterior motives in seeking to liquidate the respondent.
He had
instituted an action against her and her
husband which they opposed.
[13]
The applicant in reply averred that the
respondent is factually insolvent as well as commercially insolvent.
He has no ulterior
motive.
The
respondent owes him the money as claimed. He has not claimed any
salaries for the months of October, November, December 2014
and
January 2015 because during that period he was assisting the
applicant on part-time basis. The salary reconciliation of the
respondent ignores his claims for salary from 1 March 2014 to 31
January 2015. The salaries for March 2014 to September 2014 at
R25
0000 per month adds up to R175 000. The applicant relying on various
communication, stated that he remained employed
full time
by the
respondent up
and
including September 2014.
[14]
The
applicant stated that he instituted the action against the Mrs.
Barret and her husband because they acknowledged their indebtedness
in an acknowledgement of debt and subsequently claimed duress. He
stated that reference to those proceedings is irrelevant for
purposes
of the applicatio
n
.
He disputed the respondent's reconciliation relating to the Builders
Warehouse stating that items that ought not to have been
included
have been
included
and
that
the respondent has conveniently ignored
previous reconciliatio
n
.
He agreed that he was never a shareholder of the respondent. He was
offered shares and the offer was subsequently withdrawn. The
unpaid
salaries accrued from November 2011
to
30
September
2014.
Applicable
legal principles
[15]
It is trite that winding-up proceedings
are not to be used to enforce payment of a debt that is disputed on
bona fide and reasonable
grounds. When a final winding-up order is
opposed, the applicant bears the onus of proving on a balance of
probabilities that he
is a creditor of
the respondent and that the respondent
is unable to
pay
its
debts.
In the case of disputes of fact, the
Plascon-Evans
rule applies.
See
Afgri
Operations Ltd v Hamba Fleet Management (Pty) Ltd
(542/16)
[2017] ZASCA 24
(24 March 2017);
Paarwater
v South Sahara Investments(Pty) Ltd
[2005]
ALLSA 185
(185 (SCA) at 186- 187;
Wackrill
v Sandton International Removals (Pty) Ltd
1984
(1) SA 282
(W) at 285- 286.
[16]
O
nce
the respondent's indebtedness to the applicant for a winding up order
has, prima facie, been established, the onus is on the
respondent to
show that indebtedness is disputed on bona fide and reasonable
grounds.
The
respondent is required to
allege
facts which, if proved at the trial, would constitute a defense to
the applicant's claim. See
Afgri
par
17;
Kalil v Decotex (Pty) Ltd
&
another
1988
(1) SA 943
at 980;
Payslip Investment
Holdings
CC
v
Y2K
Tee
Ltd
2001 (4) S 781 C at 788-78
9
.
Hulse-Reuter
v Heg Consulting Enterprises
(Pty) Ltd
1998 (2) SA 208
C at 219
-220.
[17]
The court has a discretion to grant a
winding up order, irrespective of the grounds on which such an order
is sought. The discretion
is a judicial discretion to be exercised on
judicial grounds. Generally, an unpaid creditor has a right,
ex
debito justitia,
to a winding up
order against the respondent that has not discharged its debt. The
discretion of a court to refuse to grant a winding
up order where an
unpaid creditor applies therefor is a very narrow one that is rarely
exercised and in special or unusual circumstances
only. See
Afgri
par12.
Did
the applicant put up a new case in reply?
[18]
The respondent argues that in the
replying affidavit, and for the first time, the applicant contends
that he is owed salary, not
for the period from November 2011 to
February 2014 as claimed in the founding affidavit, but for the
period from March 2014 to
September
2014. This constitutes an entirely new
claim. The respondent, it is argued, in
the reply is for the first time faced with a new claim. He did not
have the opportunity
to
deal
with the new claim in the answering affidavit.
The applicant is
bound by the claim he sought to make out
in the founding affidavit. The new claim should not be taken into
consideration at all.
[19]
The applicant responds that the
respondent raised in the answering affidavit a special defense of a
mistaken bona fide belief. It
could not have been expected of the
applicant to deal with the special defense in the founding affidavit
and the only route open
to the applicant is to deal with the issue
raised in reply.
[20]
The respondent is not correct that in
reply the applicant claimed to be owed salary from March to September
2014. The applicant
in reply par 7.2 stated 'My claim therefore is
for unpaid salaries from November 2011 up to and including 30
September 2014.
[21]
It is trite that the applicant must make
his case in the founding affidavit and not in reply. The relief
sought has to be supported
by averments set out in the founding
affidavit. If it becomes necessary to raise new facts, the applicant
may do so with the leave
of the court, by filling supplementary
affidavit which may entitle the respondent to respond to the new
averments made. In motion
proceeding the affidavits set out the cases
of the respective parties. It is part of the fairness of the hearing
that the rules
prescribed for the litigants are complied with. See
Hano Trading
CC
v JR 209 Investments (Pty) Ltd
&
another
2013
(1) SA 161
(SCA) ;
Khunou
&
others v M Fihrer
&
Son (Pty) Ltd
&
others
1982
(3) SA 353
(W) at 355G-356C.
[21]
Mrs. Barret in the answering affidavit
stated that when she sent the 13 January 2015 e-mail she was under
the mistaken but bona
fide belief that monies were due to the
applicant by the respondent for short-paid/unpaid salary and certain
expense claims. She
went on to attach a reconciliation schedule
covering the period from November 2011 to 13 December 2014. The
applicant had in his
e-mail of 12 January 2015 attached schedules
setting out the details of his claims. Therefore, at least, when
deposing to the founding
affidavit the applicant could not have known
that the details of his claims were disputed. When it was conveyed in
the answering
affidavit that they were disputed and the basis
thereof, the applicant was entitled in reply to deal with the issues
raised in
the answering affidavit. Although it is not eloquently set
out, the applicant in the replying affidavit, as I understand his
case,
is merely saying that the respondent falsely claims that
payments for salaries due after February 2014 were payments for
arrear
salaries accrued up to February 2014. He has not deviated from
the founding affidavit but has sought to clarify the response in
the answering affidavit.
[22]
The respondent if the applicant was
skewing the facts in relating to the reason for the monthly payments
made after February 2014
was entitled, with the leave of the court,
to·address the issue in a supplementary affidavit. In terms of
the
Plascon-Evans
rule
the issue would have been decided as set out by the respondent. The
court is entitled in deciding whether the issue raised
is a new issue
or not to consider actual and potential prejudice to the litigants.
It cannot lightly be ruled that the applicant
has raised a new issue
and therefore it should not be considered. The issue raised could be
a relevant issue that is important
for a proper consideration of the
applicant's case and to exclude consideration of the issue may result
in the applicant being
denied a proper hearing. In my view, the
applicant has not set out a new a case in
reply and the replying affidavit ought
to be taken into consideration.
Facts proved
[23]
The applicant claims refund of expenses
for use of the Nissan bakkie and the cellular phone. He avers that
the expenses were incurred
for the respondent and that he understood
that these expenses will be set-off against the purchase price of the
shares. The applicant
does not claim that before the expenses were
incurred there was an agreement with the respondent how he will be
reimbursed for
the expenses. The applicant seeks to rely on the 13
January 2015 e-mail as forming the basis that he is entitled to be
reimbursed
for these expenses. In his e-mail to the respondent of 12
January 2015 he was putting in claims for the use of the bakkie and
to
be refunded costs for cellular telephone use. The respondent had
never accepted liability for these costs. He put in claims and
without the respondent accepting the claims, they are not debts but'
remains claims. In my view, the 13 Jan e-mail neither accepts
liability nor denies liability for the expenses. The respondent was
not required to take a decision on the issue there and then.
Her explanation that she was still going
to investigate the issues raised is not of such a nature that it can
summarily be rejected
out of hand. In terms of the
Plascon
-Evans
rule the matter must be
decided on the version of the respondent. In my view, the applicant
has failed to prove on the balance of
probabilities that the
reimbursement for expenses constitute a debt and that in that regard
he is a creditor.
[24]
On the issue of Builders Warehouse, it
is disputed whether there
were
any monies still outstanding to be paid over to the applicant. In the
founding affidavit the applicant stated the issue as
if it had no
controversy around it. The arrangement was that the respondent
received monies from Builders Warehouse due to the
applicant. The
applicant instructed that the monies due to him be paid to certain
entities. The applicant avers that there is a
balance of these monies
that was not paid over to any entities and that balance must be paid
over to him. The respondent claims,
furnishing details, that in fact
it paid over more than the monies received from Builders Warehouse.
The applicant also sought
reliance on the 13 January 2015 e-mail. The
remarks made above to the issue of reimbursements equally applies to
this issue. Again,
in terms of the
Plascon-Evans
rule, the issue must be determined
as stated by the respondent. In my view, the applicant has failed to
prove on the balance of
probabilities that there were monies still
outstanding to be paid over to him.
He
has failed to prove a debt in this regard and therefore that he was a
creditor of the respondent.
[25]
The applicant set out in the founding
affidavit the claim for arrear salary. He furnished a schedule
indicating how the arrear salary
accrued. In the 13 January 2015
e-mail Mrs. Barret undertook to attend to the payment of arrear
salary once the cash flow problem
of the respondent has been sorted
out. Unlike the claim for reimbursement of expense claims, there was
no question of the applicant
being entitled to a salary. In the
schedule to the 12 Jan e-mail the applicant indicated that he was
claiming arrear salary accrued
during the period November 2011 to
February 2014. In his e-mail of 12 Jan the applicant stated clearly
that he was demanding payment
of accrued salary. In my view, at this
stage the unpaid salary for the period in question was a
debt.
[26]
The applicant having established that
the arrear salary was a debt, the
13
January 2015 e-mail confirmed liability for the debt and undertook to
settle it. The onus is then on the respondent to prove
on the balance
of probabilities that the debt was paid, compromised or settled, or
that the question of whether the debt was paid
constitute a dispute
of indebtedness which is bona fide and founded on reasonable grounds.
See
Gap
Merchant Recycling
CC
v
Goal Reach Trading
CC
2016 (1) SA
261
(WCC).
[27]
The respondent to show that the arrear
salary was settled in full provided a reconciliation schedule
recording monthly payments
after February 2014. In reply the
applicant stated that those payments were for salaries accrued after
February 2014. The respondent
had no response. In my view, the
respondent has failed to prove that the
arrear salary was settled or that the
issue of whether the arrear salary was settled is a dispute in regard
to which there is a
bona
fide dispute on reasonable grounds.
[28]
On 12 May 2015 the sheriff on behalf of
the applicant served a demand under s 345 of the old Act on the
respondent's registered
address. It is common cause that there has
been no payment or securing or compromising of the debt within the
prescribed period
or at all. Therefore, the respondent is deemed to
be unable to pay its debts. The inability to pay the debt shows that
the respondent
is insolvent. Having considered all the circumstances,
it does not appear to me that this is a matter wherein the court can
exercise
its discretion not to
grant
the winding-up order of the
respondent.
[29]
In
the
circumstances, the
provisional
winding-up order
issued
on
14
October
2016 and
amended
on
6
December
2016
falls
to
be
confirmed
with
costs.
Order
1.
The provisional winding-up of the
respondent issued on 14 October 2016 and amended on 6 December 2016
is confirmed with costs. The
respondent is finally wound-up.
2.
The costs are to be costs in liquidation
of the respondent and to include costs occasioned by the employment
of Senior counsel and
Junior
counsel
MNGADI,
AJ
APPEARANCES
Case
Number
:8906/2015
For
the Applicant
:Adv. GD Harpur SC with
D Tobias
Instructed
by Messrs. :Lindsay &
Lindsay Inc.
Cowies Hill
For
the respondents
:Adv. J C King SC
Instructed
by Messrs. :Edward
Nathan Sonnenbergs Inc.
:Umhlanga
Matter
argued on
:9 March 2018
Judgement
delivered on :16 March 2018