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[2016] ZAGPPHC 207
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Gravato N.O v Cloete (10136 / 2015) [2016] ZAGPPHC 207 (18 March 2016)
IN
THE NORTH GAUTENG HIGH COURT, PRETORIA
[REPUBLIC
OF SOUTH AFRICA]
CASE
NUMBER: 10136 / 2015
DATE:
18 MARCH 2016
In
the matter between:
VICTOR
MUEL FERREIRA GRAVATO
N.O
................................................................
APPLICANT
AND
GERT
NICOLAAS PETRUS
CLOETE
.......................................................
INTERVENING
PARTY
JUDGMENT
MAVUNDLA
J.
[1]
The applicant issued an ex parte
application for the voluntary surrender of his estate in this Court
in February 2015. The interviewing
party is a creditor of the
applicant, and became a party to the proceedings and was granted
leave to file an answering affidavit
by way of the Court order
granted by Malope -Sethosa J on the 11 August 2015.
[2]
The intervening party obtained judgment
against the applicant in the amount of R326 488. 44 plus interest and
costs on the 2 February
2015. The applicant's indebtedness to the
intervening party is common cause.
[3]
The intervening party opposed the
surrender of the applicant's estate, contending, inter alia, that the
application should be dismissed
for the reason that:
3.1
firstly there was noncompliance with
s4(3) of the Insolvency Act;
3.2
Secondly there was failure to fully
disclose material facts, if disclosed demonstrate that the
applicant's estate is solvent.
3.3
accordingly the surrender of the estate
is not brought bona fide but to avoid the applicant's creditors.
[4]
Whilst it was conceded on behalf of the
applicant that there was noncompliance with s4(3) of the Insolvency
Act, it was submitted
that the applicant has substantially complied
with the Act and the Court should exercise its discretion and condone
the relevant
noncompliance.
[5]
In so far as the non-disclosure is
concerned, it was submitted that the applicant has since disclosed
the relevant material facts
and the surrounding circumstances, and
some of the assets not disclosed were of insignificant value and
would not have made any
difference in the calculation of the value of
the applicant's assets. The court was urged to take into account the
fact that the
dividend calculated by the applicant is in the amount
of 47 cents in the rand and significant and to the benefit of the
creditors.
[6]
The applicant attached to his affidavit
as annexure "CVDB1" which is the statement of debtor's
affairs, reflecting:
6.1
his movables property, furniture,
stock-trade etc. total an amount of: R969, 500. 00
6.2
outstanding claims amount to deficiency
of an amount of: R563, 500. 00
6.3
totalling an amount of: R1533000. 00.
This
annexure"CVDBl" is in a form of an affidavit duly signed by
the applicant, save that it was, however, not deposed
to before a
commissioner.
[7]
Section
4(3) provides that: "The petitioner shall lodge at the office of
the Master a statement in duplicate of the debtor's
affairs, framed
in a form corresponding substantially with Form B in the First
Schedule to this Act. The statement shall contain
particulars for
which provision is made in the said Form, shall comply with any
requirements therein and shall be verified by affidavit
(which shall
be free from stamp duty) in the form set forth therein."
[1]
[8]
In
the matter of Commercial Union Assurance Co Ltd v Clarke
[2]
the Appellate Division held that: "The basic test, in deciding
as to the imperative nature of a provision, is whether the
Legislature expressly or impliedly visits non-compliance with
nullity. See Northern Assurance Co Ltd v Somdaka
1960 (1) SA 588
(AD)
at p. 594C; 5 v Khan
1963 (4) SA 897
(AD) at p.900B; Essack v
Pietermaritzburg City Council and Another
1971 (3) SA 946
(AD) at
962A- C. In applying that test, -
"each
case must be dealt with in the light of its own language, scope and
convenience of adopting one view rather than other."
[9]
The
word "shall" according to the South African Concise Oxford
Dictionary expresses a strong assertion or intention; or
an
instruction or command. The meanings referred to herein can, in my
view, either be peremptory or directory, depending in the
context the
word is used. In this regard it is apposite to cite the matter of
Blou v Lampert and Chipkin NN.O. and Others
[3]
where the Court held that:
"Fundamentally
it is essentially a question of intention whether or not the
Legislature intended non-compliance with the provisions
to render a
composition invalid. The use of the word "shall" is a
strong indication, in the absence of considerations
pointing to
another conclusion, that the Legislature intended disobedience to be
visited with nullity; Messenger of Magistrate's
Court, Durban v
Pillay
1952 (3) SA 678
(AD) at p682,683; Feinberg v Pietermaritzburg
Liquor Licensing Board
1953 (4) SA 415
at pp419, 420. A consideration
pointing to another conclusion would be present in the case where the
provision is couched in positive
language as opposed to negative form
and there is no sanction added in the case the requisites are not
carried out. There is then
a presumption in favour of an intention to
make the provision only directory according to the test supplied as
usefully guide."
[10]
In
the matter of Ex parte Henning
[4]
the Court held that the purpose of the requirements provided in s4
(3) is to provide the creditors and the public an opportunity
to be
aware of the position of the debtor's financial affairs and enable
them to take a decision as to how best they can protect
whatever
interest they might be having in the estate to be surrendered.
Non-compliance with the requisites in s4(3) serve an important
function as demonstrated, inter alia, by the fact that the
Legislature provided in terms of s8(f) that it would be an act of
insolvency
if the statement of affairs are in essential respects
incorrect or incomplete. Defective compliance of these provisions
would ordinarily
result in the failure of the surrender application,
unless the Court finds that such noncompliance is not material. The
conclusion
referred to herein above; demonstrate, in my view that the
relevant section, although couched in peremptory term, is however
directory,
affording the Court discretion to condone the
noncompliance, depending on the nature of noncompliance.
[5]
This conclusion is consistent with what was held in the matter of
Kritzinger v Moreletta v Motorhawe-Projek
[6]
that s4{l) et 4(2) of the Insolvent Act, although couched in
peremptory terms is directory; vide inter alia, the authorities
therein
cited, inter alia, Ex Parte Hetzler
[7]
It would be strange that a different conclusion would apply in
respect of s4(3) than in in respect of ss 4(1) and 4(2).
[11]
Section
4(3) requires that the statement of affairs must be per an affidavit.
This affidavit stands alone and independent from the
affidavit, as in
casu, upon which the application for the surrender is premised. An
affidavit is a written statement sworn to by
the deponent in the
presence and before a commissioner of oath who has authority to take
such oath. The commissioner must state
underneath his name that the
deponent has sworn before him that he or she understands the oath and
considers it binding upon his
conscience. In this regard vide
Goodwood Municipality v Rabie;
[8]
Swissborough Diamond Mines (Pty) Ltd v Government of the Republic of
South Africa
[9]
.
In casu, it is clear that the applicant did not depose before a
commissioner of oath and consequently the document can hardly
be
regarded as an affidavit, or substantially complying with the
requirements of an affidavit, as prescribed by Regulations Governing
the Administration of an Oath or Affirmation R1258 gg21 July 1972. In
my view, in circumstances as in casu, the Court cannot in
the
exercise of its discretion condone a defect which is materially
flawed. In casu, in my view, there is simply no affidavit and
there
is therefore nothing to condone. The application, in my view,
therefore stands to be dismissed on this noncompliance only.
[12]
The applicant, in casu, conceded that he
failed to disclose the fact that he owned immovable property situated
at Portion 2 of Erf
746, Melodi Extension 28, Madibeng Local
Municipality, North West as well as three firearms at the time of
launching the application.
The failure to disclose the immovable
property he ascribed it to having forgotten that the property was not
yet transferred to
the new owner.
[13]
It
is significant to note that the relevant immovable property was sold
for an amount of R875 000. 00 per deed of sale concluded
on 12 March
2015. The applicants founding affidavit was deposed to on the 5
February 2015. I find it improbable that the applicant
could have
forgotten that the property had not as yet been transferred to the
new owner, when he deposed to his affidavit earlier.
It is also
significant that at the launch of his application he failed to
disclose this property, nor file a supplementary affidavit
disclosing
the sale and the amount thereof. I am of the view that the applicant
has not been candid with this Court with the issue
of this immovable
property and the amount realised from the sale. Either way, the value
of the house or the amount realised from
the sale thereof, should
have been disclosed and would have significantly altered the sum
total of the value of his assets. This
would have shown that the
applicant is not insolvent. The firearms were not valued by an
expert. The assertion of the applicant
that the value of the firearms
is meagre is not persuasive because he is not an expert. The
immovable property as well as the firearms
ought to have been valued
by an expert valuator. The learned authors in Mars: The Law of
Insolvency in South Africa
[10]
,
stated, inter alia, that: "...Immovable property sold but not
yet transferred by the debtor must be included....No assets
should be
omitted merely because they are hypothecated, or regarded as
worthless. The surrender may be refused if assets are omitted
..."
Consequently this Court is not satisfied that a full and frank
disclosure has been made and therefore conclude that the
application
stands to be dismissed for this reason as well.
[14]
In the premises the application for the
surrender of the estate of the applicant is dismissed with costs.
N.M.
MAVUNDLA JUDGE OF THE HIGH COURT
HEARD
ON THE : 16/03/2016
DATE
OF JUDGMENT : 18/03/2016
APPLICANT'S
ADV : ADV D.R. DU TOIT
INSTRUCTED
BY : HARTZENBERG INC
INREVENING
PARTY'S ADV : ADV S. MENTZ INSTRUCTED BY : CHRISTO BEKKER INC
[1]Ex
Lombard 1921 CPD 422.
[2]
1972 (3) SA 508
(AD) at 517.
[3]
1970 (2) SA 185
(TPD) at 208GF-G.
[4]
1981(3)
SAS 843 (OPD) at 852E-G.
[5]
The judgment is in Afrikaans and this is my translation, as
understood the judgment.
[6]
1994 (2) SA 717 (T).
[7]
1969 (3) SA 90 (T).
[8]
1954 (2) SA 404
(C) at 406B-F
[9]
1999 (2) SA 279
(T) at 336A-B.
[10]
page 60.