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Taljaard and Another v Land and Agricultural Development Bank of South Africa and Others (1094/2022; 963/2021; 964/2021; N557/2021; 2436/2021;) [2025] ZANCHC 5 (24 January 2025)

75 Reportability
Insolvency Law
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Brief Summary

Appeal — Leave to appeal — Locus standi and validity of cession of rights — Applicants sought leave to appeal against dismissal of their application to interdict liquidation proceedings against Project Multiply (Pty) Ltd and Velvet Cream 15 (Pty) Ltd — Court found applicants failed to establish locus standi as creditors — Dispute arose regarding validity of cession of rights from Unigro to Land Bank — Court granted leave to appeal due to conflicting judgments on the issue, emphasizing the need for legal certainty.

Comprehensive Summary

Case Note


Shanie Taljaard and Curro Consultancy (Pty) Ltd v The Land and Agricultural Development Bank of South Africa and Others

[2025] ZANCHC 1

Date heard: 22 May 2024

Date delivered: 24 January 2025


Reportability


This case is reportable due to its implications for the interpretation of locus standi in liquidation proceedings and the validity of cessions in creditor claims. The court's findings regarding these fundamental principles are significant not only for the parties involved but also for future cases where the rights of creditors within the context of insolvency are in question. Moreover, the ruling addresses conflicting decisions in prior case law, thus providing clarity and legal certainty in the application of such laws.


Cases Cited



  • O'Connell Manthe & Partners v Vryheid Minerale 1979 (1) SA 553 (TPD)

  • Trakman N.O and Others v The Master of the High Court of South Africa and Others 2020/12432 [2012] ZAGP JHC 168

  • Waldeck NO and Others v Land and Agricultural Development Bank of South Africa; Mpumalanga Division; Middelburg; 4013/18


Legislation Cited



  • Companies Act 71 of 2008

  • Insolvency Act 24 of 1936


Rules of Court Cited



  • Uniform Rules of Court


HEADNOTE


Summary


The High Court addressed the matter concerning a leave to appeal regarding a previous order dismissing applicants' attempts to interdict liquidation proceedings of Project Multiply (Pty) Ltd and Velvet Cream 15 (Pty) Ltd. The applicants contended that they had established locus standi as creditors and questions arose regarding the validity of certain cessions affecting rights to claims.


Key Issues


The case primarily focused on two key issues: whether the applicants had established locus standi to appeal the dismissal of their interdict applications and whether prior judgments regarding cessions created conflict that warranted appellate review.


Held


The court ultimately granted leave to appeal, emphasizing the necessity for legal clarity and consistency in cases where conflicting judgments exist pertaining to the status of cessions and the rights of creditors.


THE FACTS


The matter arose from an application for leave to appeal against a high court judgment dismissing a plea to interdict liquidation proceedings involving multiple companies and trusts. The first applicant, Shanie Taljaard, contended that she, along with the second applicant, Curro Consultancy, had valid standing as creditors of the insolvent entities. Central to the arguments were claims surrounding the cession of rights from Unigro to the Land Bank, which was contested on the basis of competing judgments regarding the validity and establishment of such cessions.


The applicants faced challenges in proving their creditor status as the liquidators denied their claims in their answering affidavits, which complicated the locus standi issue. The court had to analyze specifically the legal ramifications of previous case law that had addressed similar problems around locus standi and the essential elements required to establish valid cessions.


THE ISSUES


The court needed to resolve two significant questions: first, whether the applicants, having alleged their rights as creditors, adequately demonstrated locus standi in relation to the liquidation proceedings. Secondly, the court had to address the validity of prior cession agreements and whether the diverging judgments created a need for clarification from a higher court.


ANALYSIS


In its analysis, the court reiterated the principles governing locus standi, emphasizing that the assertion of creditor status has to meet specific legal thresholds. The first applicant's claim of holdirectorship did not, without sufficient supporting documentation, bestow automatic standing within the litigation framework, especially since such claims were inadequately raised in their initial filings.


Equally significant was the court's undertaking to scrutinize the validity of cessions. The court pointed to previous judgments which highlighted the inadequacies in how proof of cessions had been handled, stressing the need for concrete evidence of the transfer to establish locus standi in subsequent actions. The conflicting nature of judicial findings regarding the same issues prompted the court to grant leave for appeal, recognizing that further clarification from the Supreme Court of Appeal would advance the consensus on these legal interpretations.


REMEDY


The court granted leave to appeal to the Supreme Court of Appeal and ordered that the costs of the application would follow the outcome of the appeal. This resolution ensures that further discussion and legal examination at a higher level can take place, underscoring the importance of resolving ambiguities surrounding creditor rights in insolvency cases.


LEGAL PRINCIPLES


Key legal principles emerging from the judgment include the reaffirmation of the necessity for solid proof in asserting locus standi within creditor claims and the requirement for clarity regarding cessions of rights attached to such claims. The court's decision underlines the impact of conflicting judgments on legal certainty, reinforcing the need for coherent legal standards in the realm of insolvency and cession of claims.

Reportable:

Yes/No

Circulate to Judges:

Yes /No

Circulate to Magistrates:

Yes No

## IN THE HIGH COURT OF SOUTH AFRICA (NORTHERN CAPE DIVISION, KIMBERLEY)

CASE NO. : 1094/2022

Date heard: 22-05-2024

Date delivered:

24-01-2025

In the matter between:

SHANIE TALJAARD

1st Applicant

CURRO CONSULTANCY (PTY) LIMITED

2nd Applicant

And

THE LAND AND AGRICULTURAL DEVELOPMENT BANK OF SOUTH AFRICA

1st Respondent

MINISTER OF TRADE AND INDUSTRY

2nd Respondent

MINISTER OF JUSTICE AND CONSTITUTIONAL DEVELOPMENT

3rd Respondent

COMPANIES AND INTELLECTUAL PROPERTY COMMISSION (CIPC)

4t Respondent

JOCHEN ECKHOFF N.O.

5th Respondent

DEON MARIUS BOTHA N.O

6th Respondent

JOHANNES ZACHARIAS HUMAN MULLER N.O.

7t Respondent

REFILWE TLHABANYANE N.O

8th Respondent

VIMBI ANGELA TSOPOTSA N.O.

9th Respondent

ANGELINE POOLE N.O.

1Ot Respondent

PHILEMON MAWIRE N.O.

Respondent 11th

AGRI SOUTH AFRICA NPC

12t Respondent

MASTER OF THE HIGH COURT, KIMBERLEY

Respondent 13th

MASTER OF THE HIGH COURT, CAPE TOWN

14th Respondent

AFFECTED PARTIES OF PROJECT MULTIPLY (PTY) LTD

15th Respondent

AFFECTED PARTIES OF VELVETCREAM 15 (PTY) LTD

16th Respondent

AFFECTED PARTIES OF THE MERWEDE TRUST AS PER

17th Respondent

AFFECTED PARTIES OF CAREL ARON VAN DER MERWE

18t Respondent

NATIONAL REAL ESTATE

19TH Respondent

PIETER BURGER

20th Respondent

PIET STEENKAMP

21st Respondent

NARDUS SCHEEPERS

22ND Respondent

INRE;

CASE NO: 963/2021

In the matter between:

THE LAND AND AGRICULTURAL DEVELOPMENT BANK OF SOUTH AFRICA

And

JACQUES DU TOIT N.O.

PROJECT MULTIPLY (PTY) LIMITED

COMPANIES AND INTELLECTUAL PROPERTY COMMISSION (CIPC)

ALL AFFECTED PARTIES

AND

Applicant

1st Respondent

2nd Respondent

3rd Respondent

4t Respondent

CASE NO: 964/2021

In the matter between:

THE LAND AND AGRICULTURAL DEVELOPMENT BANK OF SOUTH AFRICA

Applicant

And

JACQUES DU TOIT N.O.

1st Respondent

VELVET CREAM 15 (PTY) LTD (In Liquidation)

2nd Respondent

THE COMPANIES AND INTELLECTUAL PROPERTY COMMISSION (CIPC)

3rd Respondent

ALL AFFECTED PARTIES

4th Respondent

AND

MAHIKENG CASE NUMBER: N55712021

KIMBERLEY CASE NUMBER: 2436/2021

In the matter between:

THE LAND AND AGRICULTURAL DEVELOPMENT BANK OF SOUTH AFRICA

Applicant

AND

CAREL ARON VAN DER MERWE (SNR) N.O

CATHARINA SUSANNA VAN DER MERWE N.O

CAREL ARON VAN DER MERWE (JNR)

CORAM: WILLIAMS J:

## JUDGMENT

## WILLIAMS J:

- 1 This is an application for leave to appeal against the judgment and order of 1 December 2023 in which dismissed the applicants' application to interdict the liquidation and sequestration proceedings

1st Respondent

2nd Respondent

3rd Respondent against Project Multiply 9Pty) Ltd (in liquidation), Velvet Cream 15 (Pty) Ltd (in liquidation) and the Merwede Trust; pending an application for the rescission of the liquidation and sequestration orders

- 2 Various grounds of appeal have been raised which in the main can be summarized as follows:
- 2.1 That erred in finding that the applicants lacked locus standi to the application; and bring
- 2.2 That my finding as to the validity of the cession of rights by Unigro to Land Bank is in conflict with two other judgments.

## Locus standi of the applicants

- 3 have found that the applicants have failed to prove claims as creditors and by inference failed to establish locus standi as creditors. The liquidators in their answering affidavit have however not specifically denied that the applicants are creditors of the insolvent companies and as such a court of appeal could reasonably find that the applicants have established locus standi as creditors .
- 4 As far as the 1st applicant's locus standi as a result of alleged directorship of the insolvent companies is concerned; Mr Maritz SC who appeared with Mr Janse Van Rensburg for the applicants; argued that if directors of a company can appeal on behalf of the company against a winding-up order (see 0 Connell Manthe & Partners v Vryheid Minerale 1979 (1) SA 553 (TPD) ), there could be no bar against directors bringing an application for the rescission of a winding-up order. The difficulty with this argument, besides the

fact that the allegation of directorship was not made in the founding affidavit, is that such an application should be mounted by the company at the instance of its board not as single director (O'Connell Manthe supra at 557 H) There is no merit in the argument that the 1st applicant's directorship of the insolvent companies clothes her with the necessary locus standi.

## Validity of the cession of rights

- 5 have found in paragraph 14 and 15 of the main judgment that the suite of agreements entered into between Unigro and Land Bank and the confirmation by the officials of Land Bank and Unigro of the transfer of rights, title and interest of Unigro to Land Bank of the loan agreements entered into between Unigro and the insolvent entities were admissible and sufficient to establish a valid cession of such rights to Land Bank.
- 6 In Trakman N.O and Others v The Master of the High Court of South Africa and Others 2020/12432 [2012] ZAGP JHC 168, where Land Bank relied for its locus standi on a similar suite of agreements and confirmation or recordal thereof; the Court rejected this argument and held at paragraph 43 thereof that:
- "For reasons already provided, the mere ipse dixit of Land Bank and Grocap is insufficient to establish Land Bank's locus standi as creditor or the sale of the Trademark debt to Land Bank A proper consideration of the underpinning agreements is required to clarify what the agreements achieved; rather than simply accepting what the parties thought achieved. all they
- 7 It is clear that my judgment in this regard is in direct contradiction to the judgment in Trakman. In Waldeck NO and Others v Land and

Agricultural Development Bank of South Africa; Mpumalanga Division; Middelburg; 4013/18, Land Bank failed to discover in terms of Rule 35(12) certain documents underpinning an alleged cession of rights on the basis of confidentiality and sought to rely solely on a recordal or confirmation between inter alia Unigro and Land Bank as proof of the existence of a cession and the validity thereof. The Court held inter alia that "The recordal is no proof of the fact that valid cessions were entered into between Unigro (the applicant's initial creditor) and the respondent" (at paragraph 26).

- 8 It is in the public interest that legal certainty be obtained in circumstances where conflicting judgments exist. Leave to appeal should be granted on this basis as well.

In the circumstances the following orders are made:

- a) Leave to appeal to the Supreme Court of Appeal is granted.
- b) The costs of this application are to be costs in the appeal.

C C WILLIAMS JUDGE

For Applicants:

Adv. NGD Maritz SC with Adv FG Janse Van Rensburg Schutte Attorneys clo Haarhoffs Inc

For 1st Respondent:

Adv. J G Cilliers SC Strydom & Bredendamp Inc clo Van de Wall Inc

For 5th to 11t Respondents:

Adv HR Fourie SC JL Van Niekerk Inc clo Majiedt Swart Attorneys Inc

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