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[2017] ZAGPPHC 28
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Brits Vleis (Pty) Ltd v Soft & Gentle Supply & Projects CC (34139/14) [2017] ZAGPPHC 28 (3 February 2017)
IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG DIVISION,
PRETORIA
CASE NUMBER: 34139/14
DATE:
3 February 2017
Reportable:
No
Of
interest to other judges: No
Revised.
BRITS
VLEIS (PTY)
LTD Applicant
v
SOFT & GENTLE SUPPLY
& PROJECTS
CC Respondent
JUDGMENT
MABUSE
J:
[1]
This is an application for the winding-up of the respondent. The
application is brought in terms of the provisions of s 69 of
the
Close Corporations Act 69 of 1984 ("the Close Corporations
Act"), as read with subsection 344(f) and 346(1)(2)(3)
and 4A of
the Old Companies Act 61 of 1973 ("the Old Companies Act"),
read with item 9 of Schedule 5 of the Companies
Act 71 of 2008 ("the
Companies Act"
;).
[2]
The applicant, Brits Vleis (Pty) Ltd ("Brits Vleis") seeks
an order in terms of which the respondent, Soft & Gentle
Supply
and Project CC, a Close Corporation registered as such in terms of
the Close Corporation Act and which conducts business
at shop number
4, 265 Botha Street, Northam, Limpopo Province is wound-up.
[3]
THE FACTUAL BACKGROUND
It
is contended by the applicant that it has
locus standi to
launch
this application by reason of the fact that the applicant is the
creditor of the respondent as envisaged by s 346 of the
Old
Companies
Act, which
applies to the Close Corporations by reason of the
provisions of schedule 5 of the
Companies Act. Section
346(1)(a) of the
Companies Act provides
that:
"An application
to the Court for the winding-up of a company may, subject to the
provisions of this section, be made:
(b) by one or more of
the creditors (including contingent or prospective creditors).”
Section
68 of the Close Corporations Act provides that:
"A corporation
may be wound up by a Court, if-
(c) the corporation is
unable to pay its debts; or
(d) it appears on
application to the Court that it is just and equitable that the
corporation be
wound up."
Section
69 of the Close Corporations Act provides that:
(1) For the purposes
of section 68(c) a corporation shall be deemed to be unable to pay
its debts, if-
(a) a creditor, by
cession or otherwise, to whom the corporation is indebted in a sum of
not less than two hundred rand then due
has served on the
corporation, by delivering it at its registered office, a demand
requiring the corporation to pay the
sum
so due, and the corporation has for 21 days thereafter neglected to
pay the sum or to secure or compound for it to the reasonable
satisfaction of the creditor;
(c) it is proved to
the satisfaction of the Court that the corporation is unable to pay
its debts."
The
applicant's case is predicated on the contention that the respondent
is indebted to it in the sum of R200,000.00 together with
interest
thereon and costs: that the respondent be deemed to be unable to pay
its debts by reason of its failure to respond to
the notice in terms
of s 69 of the Close Corporations Act, within a period of 21 days
after delivery thereof.
[4]
On 7 December 2013, the respondent drew a cheque for R200,000.00 in
favour of the applicant. This fact is not in dispute. On
9 December
2013, the applicant deposited the said cheque into its bank account
at Standard Bank of South Africa. The said cheque
was dishonoured by
the bank due to non-payment.
[5]
The amount of R200,000.00 represented the indebtedness of a legal
entity by the name of Roots Butchery owned by the same members
as the
respondent and the amount of the cheque on which the applicant's
claim is founded represented payment to the applicants
for the
reduction of the debts of Roots Butchery to the applicant. The
applicant held no security for the debt of R200,000.00.
[6]
During January 2014, the applicant took a decision to claim payment
of the respondent's indebtedness. This was done in terms
of the
provisions of s 69 of the Close Corporations Act. Notice in terms of
the said section was sent to the respondent and its
sister companies.
On 3 February 2014, a notice in terms of s 69 of the Close
Corporations Act in respect of the sum of the dishonoured
cheque was
sent to the respondent. The said notice was sent by the applicant's
attorneys. It states in paragraph 2:
''Dit
is ons instruksies dat u aan ons kliënte die bedrag van
R200,000.00 (twee honderd duisend rand) plus rente daarop verskuldig
is ten opsigte van 'n tjek gedatteer 7 Desember 2013 wat u aan ons
kliënt gelewer het vir betaling, welke tjek deur u finansiële
instelling terug veis as ("refer to drawer").
U
word hiermee aangemaan in terme van die bepalings van Artikel 69 van
die Wet op Beslote Korporasies, Wet 69 van 1984 om hierdie
bedrag
binne een en twintig dae (21 dae) aan ons kantore te betaal.
"
The
aforegoing notices were delivered on behalf of the applicant by the
Sheriff of the High Court on 12 February 2014 at Roots Butchery,
Shop
4, 265 Botha Street, Northam. Such service of the said notice by the
Sheriff as set out in the Sheriff's return of service
and as
testified in the founding affidavit is not in dispute. This
application was launched by the applicant following the respondent's
failure to respond to the said notice within a 21 day period set out
in the said notice.
[7]
The applicant contends that the respondent is either insolvent or may
be deemed as such as it failed to respond to the section
69 notice
within 21 days after it had been served on it. This is because of the
provisions of s 69(1)(a) of the Close Corporation
Act.
[8]
The application is opposed by the respondent. For that purpose the
respondent relies on the affidavit of one, Gabriel de Sousa
("de
Sousa"), its main member. In his testimony de Sousa states that
the respondent traded as supplier of toilet papers
to the mines in
the North-West district. During the years 2013 and 2014, due to
strikes at Northern Platz, which lasted from 2013
to 2014 and also at
Anglo American which lasted from January 2014 to July 2014, the
respondent suffered losses and had reduced
monthly turnover.
As a consequence of the abovementioned two factors, it stopped
to trade completely. According to
de Sousa's further testimony, as at
8 December 2014, the respondent was not conducting any business at
all.
[9]
Of paramount importance de Sousa contends that as at 8 December 2014,
save for an overdraft of R44,166.67, with its bankers,
the respondent
had no creditors and therefore did not owe even the applicant. It
is important to point out that notwithstanding
its contention that it
had no creditors, as at 8 December 2014, in its replying affidavit
the applicant was persistent that the
respondent, which had not
generated income for a period of a year on 8 August 2014, was
indebted to it.
[10]
The respondent has raised several defences against the application.
Firstly the respondent denied that it had any dealings
with the
applicant; secondly it denied vehemently that it was in any way
indebted to the applicant; thirdly it contended that there
existed no
underlying contractual relationship or liability to the applicant at
all; and fourthly and finally it contended that
as the amount of the
dishonoured cheque was made good by subsequent payments, the
applicant could not bring an application for
its liquidation based on
the said dishonoured cheque.
[11]
With regard to the cheque of R200,000.00 de Sousa admitted that a
cheque in the sum of R200,000.00 issued on the respondent's
bank
account was indeed given to the applicant on 7 December 2013 and that
the said cheque was dishonoured. The said cheque was
merely given to
a certain Cobus, a representative of the applicant. The reason for
doing so was that Aspigon 175 CC had run out
of cheques. Even if the
said cheque was dishonoured, Aspigon 175 CC made the said cheque good
by making the following payments
to liquidate the amount for which
the cheque was issued:
11.1 R10,000.00 on
12/12/2013;
11.2 R160,000.00 on
12/12/2013;
11.3 R51,050.00 on
13/12/2013: Total:R 221,050.00
It
is accordingly contended by de Sousa that any debt with regards to
the said cheque was therefore extinguished. For this reason
the
respondent was never indebted to the applicant and therefore no
reason existed for the liquidation of the respondent. According
to de
Sousa, the amount of the dishonoured cheque was the very debt upon
which the applicant relied in its application, was extinguished
long
before the applicant brought this application in April 2014.
[12]
THE ISSUES TO BE DECIDED
The
Court was called upon to decide the following three issues:
12.1.
whether the respondent was indebted to the
applicant in the amount claimed as at April 2014;
12.2.
whether or not the respondent was or is unable to
pay its debts; and
12.3.
whether the respondent should be wound-up.
[13]
THE LAW
The
applicant's
locus standi
is predicated on it being the
creditor of the respondent for the sum of R200,000.00. This disputed
amount which was confirmed and
admitted by the respondent,
represented the amount due in favour of the applicant. That the
applicant's application is grounded
on such amount of R 200,000.00 is
proved by the second paragraph of the notice in terms of s 69 of the
Close Corporations Act.
It is also supported by paragraphs 5 and 6 of
the founding affidavit. This application was launched on 19 May 2014.
The applicant
was in law obliged to satisfy the Court that as at 19
May 2014 it had
locus standi to
bring this application.
[14]
The applicant contended that the respondent was indebted to it in the
sum of R200,000.00. Quite clearly the said indebtedness
arose from a
debt of Roots Butchery, a business owned by the same member as the
respondent. No further details relating to the
said legal entity nor
the debt were forthcoming. No proof of the Indebtedness of Roots
Butchery was placed before the Court. It
will be recalled that the
respondent admitted having given the cheque which was subsequently
dishonoured, to the applicant. It
was the respondent's case that the
said cheque was given to settle the debt of Aspigon175 CC. It is of
paramount importance to
point out that according to the evidence of
the respondent, within days after the said cheque was dishonoured
Aspigon 175 CC, In
any event, made payment to the applicant in excess
of R200,000.00. That this is correct is clear from the manner in
which the applicant
pleaded its case with regard to the respondent's
case that the dishonoured cheque was made good by the respondent's
subsequent
payments.
[15]
In paragraph 8.5 of its answering affidavit De Sousa states as
follows:
"8.5 Aspigon 175
CC in any event made payment of R10,000.00 and R160,000.00 on 12
December 2013 and R51,050.00 on 13 December
2013
...
…
7.1
I
once again confirm the facts as set out in the founding affidavit and
deny the content of theparagraphs and the reply.
7.2
The respondent admits giving the applicant the
cheque which was in order to effect payment to the applicant, which
cheque was dishonoured.
The respondent knew that there were no funds
in its account.
7.3
It cannot be said that three payments
extinguished the debt Aspigon owes the applicant far more than the
amount of the cheque.
7.4
Despite all these payments, the account
remained in arrears."
[16]
From the above it is as clear as crystal that:
16.1.
The applicant did not deny that the respondent
made three payments that are referred to in paragraph 8.5 of the
answering affidavit;
16.2.
secondly, the applicant was unable to deny or has
not denied that these three payments were intended to make good the
amount of
the respondent's cheque;
16.3.
if anything by using such words as
"it
cannot be said that the three payments extinguished the debt'
and
" despite all these payments'
it
is clear that indirectly the applicant admits that the respondent
made payment as set out in paragraph 8.5 of the answering affidavit.
16.4.
Aspigon 175 CC, and not the Respondent, was
indebted to the applicant.
[17]
It is, in my view, not sufficient to base the application on a
dishonoured cheque. It behoves the applicant to satisfy the
Court
that not only was the cheque dishonoured but that the amount of the
cheque still has not been settled by the respondent.
The applicant
must still satisfy the Court that apart from the dishonoured cheque
the underlying liability between the applicant
and the respondent for
which the cheque payment was designed to cover has not been paid.
[18]
The liability of the respondent on the said sum of R200,000.00 is, in
my view, disputed on
bona fide
and reasonable grounds. It is
clear that on the Plascon Evans Rule, the applicant has not succeeded
to prove its
locus standi.
Counsel for the applicant referred,
in his heads of argument, to LAWSA Vol.4 AD 3 paragraph 113 which
dealt with the meaning of
"bona fide
dispute" on
reasonable grounds. In this book it was stated that:
"A
debt is not bona fide disputed simply because the respondent company
says that it is in dispute. The dispute must not only
be bona fide or
genuine but must be on good, reasonable or substantial grounds.
The expression "genuine dispute:
connotes a plausible
contention requiring the same sort of consideration as a 'serious
question to be tried'. It is not sufficient
for the company merely to
establish that there is a serious question to be tried as to whether
the dispute over the debt is genuine
in that the debt is disputed on
the basis of an honestly held belief that it is not payable and is
not disputed merely for the
purposes of delay or obstruction.
'Genuine' in this context means not fabricated for the purposes of
the proceedings or not just
thought up or brought forward without
genuine belief. There can be no genuine dispute if there are not
substantial grounds for
disputing the debt "
[19]
In casu
on evidence before Court it is clear that the debt is
not simply disputed because the respondent claims so. The dispute is
not only
bona fide
but, in my view, good and reasonable and
founded on substantial grounds.
[20]
Finally, counsel for the applicant, relying on a paragraph cited from
Kalil v Decotex (Pty) Ltd 1988(1) SA 943 A argues that
the respondent
has failed to establish the existence of a
bona fide
dispute
in relation to the applicant's claim. The said paragraph states that:
'Where
the respondent shows on a balance of probability that its
indebtedness to the applicant was disputed on bona fide and
reasonable
grounds, the Court will refuse the winding-up order.
The onus on the respondent is not to show that it is not indebted to
the applicant;·it is merely to show that the indebtedness is
disputed on bona fide and reasonable grounds.”
In
my view the respondent has succeeded to show that its dispute for its
indebtedness is based on good and reasonable grounds.
[21]
I am satisfied that de Sousa has tendered evidence that has
established that the respondent was never indebted to the applicant
at all and furthermore that there was never any underlying liability
between the applicant and the respondent. The target of this
winding-up application is Soft & Gentle Supply & Projects CC.
In paragraph 6 of the founding affidavit Tjaart Johannes
Janse van
Ransburg ("van Ransburg") stated it clearly that:
"Hierdie
R200,000.00 verteenwoordig 'n verskuldigheid van 'n regsentiteit by
name van Roots Butchery, besit deur dieselfde
lede as die van die
respondent en is die tjek waarop die applikant steun gegee aan die
applikant ter vermindering van die skuld
van Roots Butchery
teenoor die applikant
"
Quite clearly the respondent has nothing to do with the amount of
R200,000.00. The applicant itself has placed evidence before
the
Court to show that Roots Butchery was the legal
persona
and that the amount so tendered by way of a
cheque was for the debts of Roots Butchery and not of the respondent.
Accordingly I
accept De Sousa's evidence that the respondent was
never indebted to the applicant and that this application should not
have been
launched against the respondent.
[22]
There seems to be a veiled attempt by the applicant to seek the
liquidation of the respondent on grounds not set out in the
notice in
terms of s 69 of the Close Corporations Act. This is done in the
replying affidavit, something which is not permissible.
The
implication by the applicant is that
"it cannot be said that
the three payments extinguished the debt. Aspigon owed the applicant
tar more than the amount of the
cheque.”
Van
Ransburg proceeded with his evidence and stated the following in
paragraph 7.4 of his replying affidavit:
"Despite
all three payments the account remained in arrears."
In
other words, despite the fact that Aspigon had made payments in
respect of the dishonoured cheque, there remained a balance
outstanding and payable by the respondent. It was argued by counsel
for the applicant that if it should be found that the amount
of the
dishonoured cheque was fully paid, the Court could still grant the
liquidation order against the respondent if it can be
found that the
respondent was indebted to the applicant in another amount and was
unable to pay its debts.
[23]
The normal rule is that an applicant must stand or fall by its
founding affidavit. See in this regard Director of Hospital
Services
v. Mistery 1979(4) SA 626 (A). The applicant may therefore not apply
for the liquidation of the respondent on grounds
not raised in both
its s 69 notice or in the founding affidavit. The only issue raised
in the s 69 notice was the amount of R200,000.00
of the dishonoured
cheque. As set out in the afore going the applicant
"could
not extend the issue by making fresh a/legations in the replying
affidavit "
"When,
as in this case, the proceedings are launched by way of notice of
motion, it is to the founding affidavit which the
Judge will look to
determine what the complaint is. As was pointed out by Krause J in
Pounta's Trustee and Lehanas 1924 WLDat 68
and has been said in many
other cases:
"An
applicant must stand or fall by its petiUon and the facts alleged
therein as that although someUmes it is permissible to
supplement the
a/legations contained in the petition, still the main foundation of
the application is the a/legation or tacts stated
therein because
those are the facts which the respondent is called upon either to
confirm or deny."
The
applicant was obviously in possession of these facts when it launched
the current application. No reason has been furnished
by the
applicant why it failed to disclose these facts or to include as its
grounds for the liquidation of the respondent the fact
that the
respondent, apart from the amount of R200,000.00, was indebted to it
in a certain amount and was unable to liquidate the
said debt.
[24]
It is correct that all that is required of the applicant is to show
that the respondent is unable to pay its debt and as and
when they
fall due. In this regard reliance can be placed on Rosebach & Co.
Pty Ltd v Slngh's Bauars Pty Ltd 1962(4) SA 593
at page 597 C-D where
the Court had the following to say:
''lf
it is established that a company is unable to pay its debts, in the
sense of being unable to meet the current demands upon
it its day to
day liabilities in the ordinary course of its business, it is in a
state of commercial insolvency.
"
The
facts stated by the respondent and admitted by the applicant show
quite convincingly that the respondent did not owe the applicant;
that it was Roots Butchery, a separate legal entity that owed the
applicant; that the dishonoured cheque was made good; there was
no
evidence that either the respondent was unable to pay its debts. In
my view, on the evidence before the Court on the application
for the
liquidation of the respondent cannot succeed.
[25]
CONDONATION FOR THE LATE FILING OF THE ANSWERING AFFIDAVIT
The
respondent has applied for condonation of the late filing of the
answering affidavit. This is an indulgence that the Court,
after
consideration of all the relevant factors, may exercise either in
favour or against the respondent. The respondent has furnished
three
reasons why this application should be granted. The first of such
given reasons is that its attorneys of record, without
admitting
liability, tried to settle the matter with the applicant's attorneys.
The said attempts were unsuccessful but it was
not for want of
trying. The second reason was that even during the negotiations for
settlement Aspigon 175 CC continued to make
payments of its debts to
the applicant. It is also contended that the application should be
granted by reason of the fact that
the respondent has an unassailable
bona fide
defence. This is one of the considerations the Court
must look into in deciding whether to grant the application for the
late filing
of the answering affidavit. I am satisfied that the
respondent has satisfied these requirements and that the affidavit
should
be allowed. The respondent's application for the condonation
for the late filing of its answering affidavit is hereby granted.
[26]
Finally, the respondent delivered a supplementary answering affidavit
in terms of Rule 6(5)(e) of the Uniform Rules of Court.
The said Rule
provides that the Court may, in its discretion permit the filing of
further affidavits. The Court will only permit
the filing of further
affidavits if there is an explanation for doing so. A Court may also
exercise its discretion in favour of
the respondent if there is a
point raised in the replying affidavit like is the case in this
matter. It is clear, in my view, that
the respondent wanted to
address an issue raised by the applicant in the replying affidavit.
That issue was the persistence by
the applicant that the respondent
was indebted to it. Furthermore, the respondent's intention was to
place proof before the Court
of the payments it had made to
contradict the statement by the applicant that it was still indebted
to it. The supplementary affidavit
was therefore made
bona fide
and was accompanied by an acceptable explanation. Accordingly
leave to file the supplementary affidavit is hereby granted to the
respondent.
1.
In
the result the application for liquidation of the respondent is
hereby dismissed with costs.
___________________
P. M. MABUSE
JUDGE OF THE HIGH COURT
Appearances:
Counsel
for the applicant:
Adv. Z Schoeman
Instructed
by:
Strydom Bredenkamp Inc
Counsel
for the first respondent:
Adv. D Meyer
Instructed
by:
Gemeke
&
Potgieter
Date
Heard:
23 August 2016
Date
of Judgment:
3 February 2017