About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: North Gauteng High Court, Pretoria
SAFLII
>>
Databases
>>
South Africa: North Gauteng High Court, Pretoria
>>
2015
>>
[2015] ZAGPPHC 326
|
|
Jacobs v PC Undigo Joint Venture (Pty) Ltd (5548/2015) [2015] ZAGPPHC 326 (9 April 2015)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
and
SAFLII
Policy
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
CASE
NO: 5548/2015
DATE:
9 APRIL 2015
NOT
REPORTABLE
NOT
OF INTEREST TO OTHER JUDGES
In
the matter between:
PHILLIP
JACOBS
............................................................................................................................
Applicant
and
PC
UDINGO JOINT VENTURE (PTY)
LTD
.............................................................................
Respondent
(ID
.[...])
JUDGMENT
RAULINGA
J
[1]
The applicant launched an urgent application asking for the following
relief:
(a)
That the respondent be placed under provisional liquidation;
(b)
That a
rule nisi
be issued calling upon all persons interested
to show cause, if any, on a date fixed by this Court, why the
respondent should not
be placed under final liquidation and why the
costs of this application should not be costs in the cause.
(c)
That the service of the order be effected as indicated in paragraph 4
of the notice of motion.
[2]
The synoptic facts leading to this urgent application are that the
applicant, his daughter, Ms Fodia Marco and Kutloano Leballo
are
shareholders in the respondent. The applicant and Mr Leballo hold
45%’shares each in the respondent, whereas Mrs Marco
holds only
10%. On the 20 December 2014 the applicant's name was removed from
the respondent's account -and as a result he is unable
to view any
transactions on the respondent's account. On the 8 January 2015, Mr
Leballo and Mrs Mono, at a meeting of directors,
removed the
applicant as a director of the respondent in his absence. The
applicant also claims that Mrs Leballo is depleting the
funds of the
respondent's company's bank account. He also claims that the
respondent is dysfunctional as a result.
[3]
On the contrary, the respondent avers that the respondent is
functional in that it is in the process of completing a number
of
building projects. Further that- there is no deadlock between the
members or the directors of the respondent, as applicant is
a
minority shareholder who is merely disgruntled and wants to "hijack"
a substantial part of the business of the respondent.
[4]
I accept the applicant's submission that given the circumstances of
the case and the fact that he could only consult with his
attorneys
on the 15 January 2015, the matter must be treated as urgent. In
essence, the urgency arose on the 20 December 2014 when
his name was
removed from the bank account of the respondent and finally on the 8
January 2015 when he was removed from the directorship
of the
company. He had no opportunity before that to launch an urgent
application than do so at the earliest opportunity in January
2015.
[5]
Applicant contends that he has a right to apply for provisional
liquidation of the respondent in terms of section 81(l)(d) of
Act 71
of 2008 (New Companies Act)("the Act") which provides for a
company, one or more of its directors, or one or more
of its
shareholders to apply to a court for an order to wind up a solvent
company. He further argues that in
Muller v Hilly Valley (PTY)
Lt
d
(2012) All SA 187
(GSJ)
as confirmed in
Budge
and Others v Midnight Storm Investments and Another 2012(2) SA
28 (GSJ
).
the court rejected a proposed interpretation
of section 89(l)(d) of the Act based on .the Uesdem Gemeris Rule
(which put forward
a meaning of the just and equitable ground for
winding-up) which was limited to the circumstances referred to in
sections 81 (l)(c),
81(l)(d)(i) and 81(l)(d)(ii), and held that the
legal basis for the winding up under section 81(l)(d)(iii) of the New
Act is the
same as that under section 344(H) of the Old Act.
[6]
In companies having a few members the court looks at the persona
relationship between the members in deciding whether or not
to
liquidate the company and, as long as there is proof of a dispute
which upsets this personal relationship, there need not even
be a
deadlock which makes it impossible to carry on the business of the
company.
Moosa v
Maujee Bhawan (PTY) Ltd
1967(3} 5A 131 (T) at 138.
However, these arguments cannot be
considered in isolation, one must take a step back and consider other
factors.
[7]
The respondent correctly submits that the substratum of the
respondent has not fallen away, as the respondent continues to trade
and is in the process of completing a number of building contracts.
Further that the applicant has an alternative in that he can
use the
rights afforded to him in terms of sections 163 and 164 of the Act,
which provide ample protection for minority shareholders
such as the
applicant.
[8]
As already intimated in paragraph 6 above, a court hearing an
application for the winding-up of a company on the grounds that
it is
just and equitable is required to exercise a judgment in arriving at
the required conclusion of law to be derived from the
facts placed
before it - as submitted by the respondent. To arrive at that
conclusion, the Court is obliged to examine all facts
placed before
it and to determine which of them is relevant to the formation of an
opinion on the question of justice and equity;
and, as difficult as
"justice and equity are to define, they have to be seen as
setting an objective standard that will be
the same in every Court in
the land" -
Tjospomie Boerdery (PTY) Ltd v Drakensberg
Bottler's
(PTY) Ltd
1989 (4) SA31Ta 41 -42.
[9]
Much as I am convinced that the relationship between the shareholders
or directors has deadlocked, based on the reasons given
above, I am
of the view that it is fair and reasonable not to wind-up the
company.
[10]
It is evident
ex-facie
the record that the applicant has
failed to comply with the peremptory provisions of sections
346(4A)(a) and (b) of the old Companies
Act 61 of 1963, which applies
by virtue of section 9 of Schedule 5 of the new Companies Act, as its
provisions are necessary to
give "full effect" to Part G of
the new Companies Act. A winding-up order is defined to section 1 of
the old Companies
Act to mean "any order of court whereby a
company is wound-up and includes any order of court whereby a company
is placed
under provisional winding-up for so long as the order is in
force.
[11]
It has been held by our courts that the words used in the preamble of
section 346 (4A)(a) are to the effect that "when
a petition is
presented to Court" entail service of the application when the
papers are lodged at Court, i.e filed with the
Registrar - P. W
Roberts v The Taylor of Bunkingham CC Case No. 2008 / 21864 (WLD) at
paras [6] - [7] Corporate Money Managers (PTY)
Ltd and Others v
Panamo Properties 49 (PTY) Ltd 2013(1) SA 522 (GNP).
The words
"before or during the hearing" in section 346 (4A)(b) mean
that such affidavit "must" be filed before
or during the
hearing. The respondent is correct in submitting that since the
hearing in
casu
is over the opportunity to file such an
affidavit has passed.
[12]
In Corporate
Money Managers (PTY) Ltd and Others (Supra)
it
was held that, on a proper interpretation of section 346(4A)(a)(iii)
and 4A(b) of the Companies Act 61 of 1973, the furnishing
of a copy
of an application for a winding-up of a company to the South African
Revenue Service at the time when the application
is lodged with the
registrar of the court is peremptory. Proof of such furnishing by
means of an affidavit in this manner prescribed
by section 346
(4A)(b) is also peremptory - (paragraph [10] at 524 D). In
Ivor
Charles Stratford and Others v Investec Bank Limited
[2014J
ZACC38,
the Court intimated that in terms of
Section 38(1)
of the
Insolvency Act No.24 of 1936
a sequestration order granted against a
debtor has the effect of suspending contracts of service of the
debtor's employee with
immediate effect. In
EB Steam Company
(PTY) Ltd v Eskom Holdings Soc Ltd
[2013] ZASCA 167
;
2014
(1) All SA 294
(SCA)
the Supreme Court of Appeal dealt with
section 346
(4A) of the old Companies Act - a section identical to
section 9(4A) of the Insolvency Act. There it held that compliance
with
section 346 (4A) is peremptory whilst the method in which a
creditor furnishes the application to the employee is directory. One
must be mindful of the fact that there was no attempt of service at
all on the employees of the respondent.
[13]
This therefore takes me to question whether I may postpone the matter
in order to allow the applicant to rectify the non-compliance.
As in
Corporate Money Managers (PTY)
Ltd and Others
(supra)
the difficulty in this case is that the arguments have
been closed on both sides. All the aspects concerning the case were
fully
canvassed. Moreover, the employees have been deprived of their
right to adequate notice and such prejudice could not be cared at
this stage.
[14]
I am also minded to mention that the confirmatory affidavit to the
replying affidavit is not commissioned. This renders the
replying
affidavit a nullity.
[15]
I accordingly would dismiss the application with costs.
T
J RAULINGA
JUDGE:
GAUTENG DIVISION, PRETORIA