SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document
in compliance with the law and SAFLII Policy
IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION, PRETORIA

CASE NO : 2024 -071301
(1) REPORTABLE: YES
(2) OF INTEREST TO OTHER JUDGES: YES
(3) REVISED.
Date 31 January 2025
K. La M Manamela

In the matter between:
HERMANUS JOHANNES VAUGHN VICTOR NO First Applicant

JOHANNA NINI MAHANYELE NO Second
Applicant

CAROLINE MMAKGOKOLO LEDWABA NO Third Applicant
(in their capacities as the duly ap pointed joint provisional liquidators
of Tario mix (Pty) Ltd t/a Forever Diamonds and Gold (in liquidation ))

and

LOUIS PETRUS LIEBENBERG Respondent
(Identity Number: 6[...])

DATE OF JUDGMENT : This judgment is issued by the Judge whose name is
reflected herein and is submitted electronically to the parties/their legal
representatives by email. The judgment is further uploaded to the electronic file of
this matter on Caselines by the Judge’s secretary . The date of the judgment is
deemed to be 31 January 2025.

SUMMARY : Compulsory s equestration – requirements for a liquidated claim in terms
of s 9(1) of the Insolvency Act 24 of 1936 restated – an untaxed bill of costs or costs
order may constitute a liquidated claim to afford an applicant locus standi to launch
sequestration proceedings , provided the bill of costs is taxed or agreed as at the
hearing of the application – statements or utterances , such as social media posts, by
a debtor regarding existence of assets , without more , cannot establish liability on the
part of the debtor and be deemed a liquidated claim to afford an applicant locus
standi to apply f or sequestration - completion of prescription of a debt may be
delayed in terms of s 13(1)(e) of the Prescription Act 68 of 1969 where the debtor is
a director of a company until joint provisional liquidators are appointed – restatement
of requirements for proof of advantage to creditors , where the value of assets are
overwhelmingly exceeded by the estimation of liabilities in a debtor’s estate -
requirements for sequestration met on a prima facie basis – provisional
sequestration granted .


JUDGMENT

Khashane Manamela , AJ
Introduction
[1] Mr Louis Petrus Liebenberg, the respondent, is one of the two director s1 of a
private company , now in liquidation , known as Tario mix (Pty) Ltd t/a Forever
Diamonds and Gold (‘Tariomix’). The applicants are the joint provisional liquidators
of Tariomix. Tariomix was placed in final liquidation on 12 April 2024. The applicants
contend that the respondent misappropriated funds of Tariomix and, thus, is
indebted to its estate now under their administration. They initially approached this
Court by way of an urgent application2 in July 2024 seeking provisional sequestrat ion
of the respondent’s estate on the basis of his alleged indebtedness to Tariomix in the
amount of R200 153 637, 04.

[2] The respondent opposes the application on multiple grounds. He disputes th e
alleged debt or claim in its nature and extent , and even considers part of it to have

1 Ms Magdalena Petronella Kleynhans is the other director of Tariomix (Pty) Ltd (in liquidation).
2 Par [ 19] below for more details on the order of the urgent court .
prescribed . In the main , he attributes the debt or part of it to have r esult ed from a
misunderstanding of the diamond -dealing industry or its practices. According to the
respondent , Tariomix conducted business as a facilitator and financier in the
diamond industry . Its core business , as explained by the respondent, was providing
finance for the purchase and beneficiation of diamonds by licensed individuals.3
Overall, the respondent is of the strong vi ew that this application has no merit and
forms part of the applicants ’ quest to hold him liable for the debts of Tariomix without
first, appropriately , piercing its corporate veil .

[3] The matter came before me in the third motion court on 13 November 2024 .
Mr J Hershensohn SC , together with Mr R de Leeuw , appeared for the applicants
and Mr A J Daniels S C, together with Ms L Acker , appeared for the respondent. This
judgment was reserved. The judgment, gratefully, benefitted from the comprehensive
heads of argument filed by counsel.

[4] The special enrolment of the matter in the third motion court, facilitated by a
directive of the Deputy Judge President of this Division (‘the DJP’) , follow ed an order
of the urgent court to this effect on 18 July 2024 .4 The matter did not proceed in the
urgent court, mainly, due to high volume of the paperwork. Although the order
granted by the urgent court allowed supplementation of the answering and replying
affidavit s, the parties and their legal representatives – with respect - seem to have
taken this to be a licence to file additional material , at will. Some of th e additional
material only served to upgrade earlier products with little or no additional value
added. Special allocations or enrolment of a matter in the third motion court is not a
licence for prolixity or cutting loose the checks and balances in the rules of practice
applicable to motion proceedings. It is purely a recognition that the varying interests
in and the complexities of the factual landscape in a matter may be better served by
a hearing outside of the normal rolls of the Court. Indeed volume of the paperwork in
a matter is the primary consideration, but to add more material to what would have
prompted the allocation in the first place defeats the objective.


3 Footnote 47 below for a full description of the business model of Tariomix courtesy of the
respondent.
4 Pars [ 19]-[20] below.
[5] I have been urged – tentatively it mostly appears - to pronounce on the
admittance of some of the additional affidavit s filed , but no purpose would be served
by this when both parties appear to have equally strayed beyond the restraints. I
have had regard to all material filed – despite my lamentations , above. The interests
of justice shall be served by this approach, given what is at stake here.

Respondent’s a pplication to strike out
[6] The applicants say that Tariomix was run like a ponzi5 scheme. The
respondent vehemently objects to th is description or insinuation that Tariomix was
involved in unlawful activities. He says that there is no such finding by any court of
law. He also finds objectionable the notion that he and, the other director of Tariomix,
Ms Magdalena Petronella Kleynhans (‘Ms Kleynhans’) siphoned off millions of rands
invested in Tariomix by third party investors .

[7] Some of the financial activities of Tariomix were investigated by Adams and
Adams Forensics (‘the Forensic Investigators’) at the instance of the applicants . The
Forensic Investigators partly relied on the ledgers and/or financial statements by Dr
Gert Cornelius ‘ Corrie ’ Cloete (‘Dr Cloete’). Dr Cloete was the auditor of Tariomix at
all material times . He also testified at an enquiry in terms of the section 417 of the
Companies Act 61 of 1973 (‘ the CA 1973’) convened at the instance of the
applicants. The respondent finds the inclusion of the material by the Forensic
Investigators and Dr Cloete prejudicial and, thus, objectionable. He launched a
strike-out application in respect of the impugned material.

[8] The respondent ’s application in terms of Uniform Rule 6(15)6 to strike out
some specified passages and paragraphs in the applicants’ founding affidavit ,
including the report by the Forensic Investigators and material relating to Dr Cloete,
formed part of the hearing of this matter . The grounds for the strik e-out are that ,

5 Prinsloo v S [2016] 1 All SA 390 (SCA); 2016 (2) SACR 25 (SCA) (4 December 2015) [1],
[11], [146] for the hallmarks of a ponzi scheme. See also footnote 7 below for more details on the
respondent’s strike -out application , including references to the business of Tariomix as a ponzi
scheme. The description of the business of Tariomix according to the respondent is reflected in
footnote 4 7 below.
6 Uniform Rule 6(15) reads as follows: ‘[t]he court may on application order to be struck out
from any affidavit any matter which is scandalous, vexatious or irrelevant, with an appropriate order
as to costs, including costs as between attorney and client. The court may not grant the application
unless it is satisfied that the applicant will be prejudiced if the application is not granted.’
primarily , the impugned material is scandalous, vexatious and constitut ed
inadmissible hearsay and/or irrelevant opinions .7

[9] At the hearing of this matter, Mr Daniels SC , appear ing for the respondent ,
explained upon an enquiry by the Court that his client w ould not be insisting of a full-
blown hearing of the strik e-out application. Instead, he suggested that the Court bear
in mind the arguments for and against the striking out of the impugned material when
determin ing the issues in the matter (i.e. the main application) . The approach was
found sensible and pursued in the absence of a contrary view by Mr Hershensohn
SC, for the applica nts.

[10] The approach intimated above will also be adopted in this judgment regarding
the objection relating to the report by the Forensic Investigators8 and the material
relating to Dr Cloete.9 But, for brief reasons appearing in parentheses, I immediately
strike out the following material from the founding affidavit , as I deem same to be
prejudicial to the respondent: (a) paragraphs 4.1, 4.3 and 4.4 (for being vexatious);
paragraph 8.8 in respect of the whole sentence with the word ‘ponzi’ with the rest of
the paragraph remaining intact (for being scandalous) ; paragraph 8.10 in respect of
only the specified part (for being vexatious); paragraph 8.11 (for being scandalous);
paragraph 9.11 and annexure ‘FA12’ (for being irrelevant) ; paragraph 16.3 (for being
inadmissible) , and paragraph 19.11 in respect of only the specified part (for being
vexatious). I also instantaneously dismiss all o ther ground s of the strik e-out
application not referred to above including the one relating to paragraph 8.9 for lack
of merit. I will rule on the issue of costs in the strike -out application towards the end
of this judgment .


7 The strike-out was directed at the following paragraphs and passages in the applicants ’
Founding Affidavit: ( 1) first sentence of paragraph 4.1; (2) the whole of paragraphs 4.3 and 4.4; (3)
the whole of paragraphs 8.8 and 8.9; (4) the following word in par 8.10: “ …true to Ponzi scheme
nature… ” (5) the whole of paragraph 8.11; (6) the whole of paragraph 9.11 and FA12; (7) the interim
forensic report compiled by Adams and Adams referred to in paragraph 13.5 and attached as
annexures FA19.1 and FA19.2; (8) the whole of paragraphs 14.1.5 and 14.1.6; (9) the whole of
paragraphs 14.1.8 and 14.1.10; (10) the following words in paragraph 15.1: “… as set out in the
Adams and Adams report attached as annexure 19.1… ”; (11) the whole of paragraph 16.3, and (12)
the following words in paragraph 19.11: “ …unlawful Ponzi scheme perpetrated by the respondent… ”.
8 Respondent’s objection against the inclusion of the report by the Forensic Investigators (i.e.
annexures ‘FA19.1’ and ‘FA19.2’ ) in the Founding Affidavit (‘FA’) at par 13.5 .
9 Respondent’s objection against the inclusion of Dr Cloete’s testimony at the insolvency
enquiry referred to in FA pars 14.1.5 and 14.1.6 .
Brief background
General
[11] The legal skirmishes between the parties have been raging in this Division
and elsewhere for some time already. Those battles involved other aspects which –
in most instances – do not have a bearing on these proceedings. But a brief
narration of the issues in the background including those relating to the liquidation of
Tariomix and the alleged indebtedness of the respondent to Tariomix, is necessary
to place some of the issues in proper context.

[12] I am grateful to the legal representatives of the parties for the joint chronology
of events filed. Most of the material appearing below, by way of background to the
matter , is derived from th at document and , therefore , is common cause between the
parties . I leaned more to the side of brevity, but there will still be more material
adding to the background under the parties’ respective cases and submissions later
in the discussion, below .

Liquidation of Tariomix
[13] On 23 February 2023 , Tariomix was placed in provisional liquidation by an
order of the High Court of South Africa North West (Mahikeng) D ivision , per Djaje
DJP (‘the provisional order ’). The application was at the instance of two investors of
Tariomix. Tariomix is said to have been found commercially and factually insolvent.

[14] On 8 March 2023, the applicants were appointed by the Master of th e North
West Division (‘the Master’) as joint provisional liquidators of Tariomix pursuant to
the provisional order . Their powers as provisional liquidators were extended by the
Master on 10 March 2023 . The extended powers include authority to bring legal
proceedings , such as the current application, on behalf of Tariomix.

[15] The provisional order was made final on 12 April 2024 , per Morgan AJ. The
learned judge - with respect - handed down a written comprehensive judgment .
Subsequent attempt by the respondent to obtain leave to appeal that outcome was
unsuccessful .10

[16] On 16 April 2024, the provisional liquidators requested the respondent to
submit a statement of affairs of Tariomix (i.e. ‘Form CM100 ’), envisaged in section
363 of the CA 1973 . The respondent had not yet acceded to the request by the date
of hearing of this application. The applicants accuse him of stalling, but the
respondent denies that . He does not see the relevan ce of the document to th is
provisional sequestration application . But, he also explained that he was prevented
from completing the form by his participation in the national or regional elections last
year. He wa s an independent candidate during those elections. He also blames the
delay on him having to fend of f warrant s of execution against his and his wife's
assets by the applicant s. Later on , in his supplementary answering affidavit he
blames the non -completion of the form on the complicat ion of Tariomix being under
curatorship.11

[17] On 5 M ay 2024 , the respondent post ed on his Facebook account that security
personnel had disappeared with approximately R50 million worth of his gold and
diamonds . This theft was reported to the police on 8 May 2024 . On 7 May 2024, the
respondent had made another Facebook post to the effect that gold and diamonds
were removed after the sheriff attended to remove the assets from the property in
Durbanville , Cape Town .

[18] On 28 June 2024, the applicants launched the current application for the
compulsory sequestration of the respondent ’s estate . On the same date , the
respondent lodged with the Master a complaint against the applicants in terms of
section 381 of the CA 1973 . The Master , on 9 July 2024 , requested the applicants to
respond to the complaint . In subsequent affidavits it is indicated that the Master had
received the applicants’ written representations and was engaging further with the
respondent, through legal representatives .


10 Application for leave to appeal was dismissed extemporaneously on 29 May 2024, followed
by written reasons for that outcome on 11 June 2024. However in terms of the chronology of events
supplied by counsel the leave to appeal was dismissed on 27 May 2024.
11 Supplementary Answering Affidavit (SAA’), par 100, CaseLines 27 -573.
[19] The urgent application came before my colleague Strydom AJ on 18 July
2024 . The hearing of the matter did not proceed on that date , as the Court – in terms
of an agreement reached between the parties – directed , that the matter is referred
to the DJP for allocation on the third motion court roll. In addition to setting out the
timeframes for exchange of further papers, the consensual order made by the Court
stated that no finding was made in respect of urgency and also reserved costs in
respect of that enrolment. The latter two issues would - to the extent necessary - get
the attention of this Court, below .

[20] Following a case management meeting before the DJP, the m atter was
allocated for hearing on 13 and 14 November 2024 in the third motion court. The
hearing , before me, was finalised in one day on 13 November 2024 .

Issues for determination
[21] As already stated above, this is a n application for the compulsory
sequestration of the estate of the respondent. The order currently sought is of a
provisional nature . The compulsory sequestration of the respondent’s estate was
initially sought only on the basis that t he respondent is factually insolvent in that his
assets are exceeded by his liabilities. But, this was later expanded to include that the
responde nt had committed an act of insolvency .

[22] The provisional sequestration order sought is couched in the form of a rule
nisi in terms of the provisions of the Insolvency Act 24 of 1936 . To grant such an
order this Court ought to be satisfied , on a prima facie basis, that: (a) the applicant is
a creditor who has against the respondent, as a debtor , a liquidated claim of not less
than R100;12 (b) the respondent -debtor is insolvent or has committed an act of
insolvency ,13 and (c) ther e is reason to believe that sequestration will be to the
advantage of creditors of the debtor.14 This is common cause between the parties .
These issues are the main or primary issues - potentially - dispositive of this matter.


12 Section 10(a), read with s 9(1) of the I nsolvency Act 1936, quoted in pars [ 28] and [ 26] above,
respectively.
13 Section 10(b), read with s 8 of the I nsolvency Act 1936, quoted in pars [ 28] and [ 73] above, respectively.
14 Section 10(c) of the I nsolvency Act 1936, quoted in par [ 28] above.
[23] There are more issues , of an ancillary nature, requiring determination in
addition to the main or primary issues, above . The respondent requires this Court to
determine the lack of urgen cy and alleged abuse of the process of this C ourt. These
two issues are labelled points in limine by the respondent. But, I consider the issue
of urgency to have lost its glow due to the events in the urgent court on 18 July 2024.
The applicants approached the Court on an urgent basis, mainly, on the alleged
apprehension of dissipation of assets by the respondent, whilst the respondent
asserted – in service to the interests of justice - for the hearing of the matter in the
ordinary course due to the complex nature of the allegations made against him and
the dire consequences of sequestration. The Court , as stated above, sanctioned an
agreement between the parties which included a term that no finding is made on the
issue of urgency and reservation of the argument on the issue of costs. I understand
this to mean that the issue of urgency was disposed of without a ruling by the court.
Should this not be the case I will also not make any ruling on same, as it is, clearly,
moot and constitute the proverbial water under the bridge . The other so -called
preliminary issue or objection , namely, abuse of the process of this Court is capable
of determination once the outcome of the matter is known, being after the
determination of the primary issues.

[24] Also, at the back of my mind is the remaining material attacked in terms of the
respondent ’s strike -out application : the Forensic Investigators’ report and the
material relating to Dr Cloete . As indicated , these issues will be ruled upon when
they surface in the discussion.15 But, first the legal principles applicable to the issues
in the discussion.

Applicable legal principles
[25] The primary legal principles in a sequestration application are those derived
from the Insolvency Act 24 of 1936 (‘ the IA 1936’) and the common law .16 There will ,
no doubt, be other legal principles – of a secondary nature, relevant to the issues to
be determined in this matter . Therefore, w hat follows does not pretend to be
codification of all applicable legal principles .

15 Par [10] above.
16 André Boraine, Jennifer A Kunst and David A Burdette (eds) , Meskin's Insolvency Law
(LexisNexis, November 2024 ) par 1.2.

[26] Section 9 (1)-(3) of the IA 1936 deals with a petition (i.e. application)17 to be
presented for sequestration and what is to be contained in such application,
including locus standi in judicio (i.e. ‘standing in court ’)18 of an applicant -creditor. It
reads as follows in the material part:

(1) A creditor (or his agent) who has a liquidated claim for not less
than fifty pounds, or two or more creditors (or their agent) who in the
aggregate have liquidated claims for not less than one hundred
pounds against a debtor who has committed an act of insolvency, or
is insolvent, may petition the court for the sequestration of the estate
of the debtor.
(2) A liquidated claim which has accrued but which is not yet due on
the date of hearing of the petition, shall be reckoned as a liquidated
claim for the purposes of subsection (1).
(3) (a) Such a petition shall, subject to the provisions of paragraph
(c), contain the following information, namely —
(i) the full names and date of birth of the debtor and, if an identity
number has been assigned to him, his identity number;
(ii) the marital status of the debtor and, if he is married, the full names
and date of birth of his spouse and, if an identity number has been
assigned to his spouse, the identity number of such spouse;
(iii) the amount, cause and nature of the claim in question;
(iv) whether the claim is or is not secured and, if it is, the nature and
value of the security; and
(v) the debtor’s act of insolvency upon which the petition is based or
otherwise allege that the debtor is in fact insolvent.
(b) …
(c) The particulars contemplated in paragraph ( a) (i) and (ii) shall also
be set out in the heading to the petition, and if the creditor is unable to

17 The petition procedure was abolished and replaced - as a mode to institute proceedings - with
notice of motion in terms of Petition Proceedings Replacement Act 35 of 1976 with effect from 1 July
1976. See DE van Loggerenberg, Erasmus: Superior Court Practice (Revision Service 24, 2024 ,
Jutastat e -publications October 2024) (‘ Erasmus: Superior Court Practice ’) RS 24, 2024, D1 Rule 6 -
60.
18 VG Hiemstra and HL Gonin, Trilingual Legal Dictionary (3rd edn, Juta 1992).
set out all such particulars he shall state the reason why he is unable
to do so …

[27] The gatekeeping provisions on standing or locus standi to bring an
application for sequestration are located in section 9(1) of the IA 1936 . Essentially,
these provi sions are to the effect that a creditor with a liquidated claim19 of at least
R100 against a debtor who is insolvent or has committed an act of insolvency (as
envisaged in section 820 of the IA 1936) may apply for sequestration of the estate of
such debtor. Locus standi is also availed in respect o f a contingent liquidated claim .
This is a liquidated claim which has accrued , but not yet due on the date of
hearing .21

[28] Section 10 of the IA 1936 sets out the requirements , more of a substantial
nature, to be met in an application for provisional sequestration . It reads in the
material part:

If the court to which the petition for the sequestration of the estate of a
debtor has been presented is of the opinion that prima facie
(a) the petitioning creditor has established against the debtor a claim
such as is mentioned in subsection (1) of section nine; and
(b) the debtor has committed an act of insolvency or is insolvent; and
(c) there is reason to believe that it will be to the advantage of
creditors of the debtor if his estate is sequestrated,
it may make an order sequestrating the estate of the debtor
provisionally.


19 In Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law (at par 2.1 ) a liquidated claim
is explained in the context of s 9(1) as ‘a claim for an amount which is fixed, either by agreement or by
an order of the Court or otherwise ’. See also Kleynhans v Van der Westhuizen NO [1970] 3 All SA
105 (A) 107-108, 1970 (2) SA 742 (AD) 748 -749, cited in Hassan and another v De Villiers Berrange
NO 2012 (6) SA 329 (SCA) [35] and Premier FMCG (Pty) Ltd v ABC Fire Projects Proprietary Limited
(4712/2021) [ 2021] ZAGPPHC 151 (12 March 2021) [ 30].
20 Par [ 73] below , for a reading of the material part of s 8 of the IA 1936.
21 Section 9(2) of the IA 1936, quoted in p ar [26] above. See also Investec Bank Ltd and another
v Mutemeri and another 2010 (1) SA 265 (GSJ) [31].
[29] To obtain a provisional sequestration order , the Court ought to be of the
opinion that, the material requirements have been met on a prima facie basis .22 A
durable holding of the Appellate Division (now the Supreme Court of Appeal, the
‘SCA’) in this regard in Kalil v Decotex (Pty) Ltd and another23 was to the effect that a
provisional order of sequestration does no lasting injustice to a respondent -debtor
as, on the return day, he or she would be afforded an opportunity to contest the
application for final relief.24 The granting or refusal of a final sequestration order is
governed by s ection 12 of the IA 1936, but this bears no direct relevance to the
current issues before the Court .

[30] The applicants emphatically and – with respect, correctly so - point out that,
for purposes of a provisional order, the onus - pegged at the prima facie level of
proof or satisfaction of the requirements for sequestration - is lower than when a final
sequestration order is sought as the latter is purely on a balance of probabilities .25

[31] Section 8 of the IA 1936 , as indicated above, provides for the acts of
insolvenc y which may be committed by a debtor to warrant sequestration of his or
her estate. The statutory provisions for the acts of insolvency relied upon by the
applicants are reflected in the discussion below.26 I now turn my attention to the
issues, identified above,27 as requiring determination by the Court .

Is Ta riomix or the applicants, a creditor with locus standi ?
General

22 Kalil v Decotex (Pty) Ltd and another 1988 (1) SA 943 (A) 979 where the court observed that
‘prima facie case ’ entails that the balance of probabilities on all affidavits favour the making of
provisional sequestration or liquidation order . See also Afgri Operations Limited v Hamba Fleet (Pty)
Limited (542/2016) [2017] ZASCA 24; 2022 (1) SA 91 (SCA) (24 March 2017) [9]; Valerio Engineering
CC v Designatech (Pty) Ltd (36816/2021) [2022] ZAGPPHC 706 (21 September 2022) [18]. See
further Bertelsmann and others , Mars: The Law of Insolvency 10th Ed, 2019, p 125 .
23 Kalil v Decotex (Pty) Ltd and another 1988 (1) SA 943 (A).
24 Kalil v Decotex 1988 (1) SA 943 (A) 979.
25 Braithwaite v Gilbert (Volkskas Bpk intervening) 1984 (4) SA 717 (W) 718B -C. See also
Bertelsmann and others, Mars: The Law of Insolvency 10th Ed, 2019, p 148 . In Mercantile Bank (A
Division of Capitec Bank Limited) v Ross (2020/19791) [2021] ZAGPJHC 149 (13 August 2021) [41]
the court pointed out the distinct standard of proof for a provisional sequestration order and a final
sequestration order.
26 Pars [ 73]-[75] above .
27 Pars [21]-[24] above .
[32] According to the applicants , as the joint provisional liquidators of Tariomix, the
respondent owes Tariomix, a total amount of R200 153 637, 04.28 This amount is
made up of the following individual debts : (a) R144 382 805, for Tariomix’s monies
allegedly gambled out by the respondent at various casinos ;29 (b) R5 034 231, 95,
for funds paid directly to the respondent or for his specific benefit;30 (c) R50 000 000,
for cash, diamonds and gold purportedly stolen whilst in the respondent ’s
possession ,31 and (d) R736 600, 09, for cost orders granted by the court against ,
among others, the respondent in favour of the applicants .32 These claims or debts
are discussed, individually, next.

[33] But it is important to also record here that t he applicants ’ alleged claim s or
debts against the respondent are disputed by the respondent. The respondent
disagr ees with the nature and extent of the applicants ’ claim s. I would reflect the
respondent ’s point s of dispute in the discussion of each of the claim s.

Gambling debt or claim
[34] The applicants a ccuse the respondent of gambl ing vast amounts of Tariomix ’s
money at various casinos .

[35] Proof of this debt is partially based on the testimony by Dr Cloete tendered at
the section 417 enquiry , referred to above . Dr Cloete , among others, confirmed that
the respondent used funds belonging to Tariomix to gambl e at casinos. Dr Cloete
confirmed that the respondent is indebted to Tariomix in the amount of R144
382 805, arising from gambling activities.33 Dr Cloete is or was, at all material times,
the auditor of Tariomix.

[36] The respondent ’s strike -out application also concerns the evidence given by
Dr Cloete at the enquiry . It is argued on behalf of the respondent that the evidence is

28 FA pars 18.1 -18.2, CaseLines 05 -43.
29 FA par 14.1.10.4.1, CaseLines 05 -38. See p ars [ 34]-[49] below, on this claim or
indebtedness.
30 FA par 15.5, CaseLines 05 -40. See p ar [50] below, on this claim or indebtedness.
31 FA par 16, CaseLines 05 -40 to 05 -42. See p ars [ 60]-[62] below, on this claim or
indebtedness.
32 FA par 17, CaseLines 05 -42 to 05 -43. See p ars [ 51]-[59] below, o n this claim or
indebtedness.
33 Testimony of Dr Cloete, FA, para 14.1.5 to 14.1.14.1.7, 05 -33 to 05 -35.
inadmissible in this application and ought to be struck out. The respondent heavily
relies – for his assertion - on the decision of the SCA in O’Shea NO v Van Zyl and
others .34 The observation in the decision was echoed by the SCA in its other
decision in Roering N O and another v Mahlangu and others35 including as follow s:

The second factor is that the evidence obtained from a witness at
an enquiry will, in many instances, be inadmissible in later civil
proceedings. That will not necessarily be so where those proceedings
are brought against the witness personally, as may be the case in a
claim against a former director, but, where those proceedings are
brought against an entity such as a company, a close corporation or a
trust, the evidence given at an enquiry will usually be inadmissible
against them. That is a considerable safeguard against abuse where
the use to which the evidence may be put is limited to assisting the
liquidator to form a picture of what occurred and investigating a
possible claim.36
[footnote omitted]

[37] No doubt, t he testimony of Dr Cloete at the enquiry is the type of evidence
envisaged in O’Shea v Van Zyl and Roering v Mahlangu , partly quoted above . I
agree with the respondent that same is inadmissible in these proceedings on the
basis of the se authorities. Consequently, the impugned material is hereby struck out
from the founding affidavit .

[38] But Dr Cloete ’s involvement in this matter is not limited to the impugned
activities at the insolvency enquiry. He also prepared financial documents and
deposed to affidavits , in which he confirmed the use of bank accounts of the
respondent and, his fellow director, Ms Kleynhans to receive some of the funds -
intended as investment in Tariomix - deposited by the investors .37 He was also
instrumental in finalising the financial statements of Tariomix , including those for the

34 O’Shea NO v Van Zyl and others NNO 2012 (1) SA 90 (SCA) [19]-[25].
35 Roering NO and another v Mahlangu and others 2016 (5) SA 455 (SCA)
36 Roering v Mahlangu 2016 (5) SA 455 (SCA) [40].
37 FA par 10.9 , CaseLines 05 -21; annexures ‘FA15’ and ‘FA16’, CaseLines 05 -172 to 05 -192
and 05 -193 to 05 -120, respectively.
year ending 28 February 2021. The respondent all -frontier attack is also directed at
these. I do not agree . There is nothing prejudicial from the inclusion of this evidence,
even if some of the material may have served before the enquiry. It is only the
testimony (which , in most instances is oral, but could be also in written form),
especially admissions made by a witness at such enquiry, which is inadmissible in
respect of the company, in this instance Tariomix. I have – on the facts of this matter
- applied the rule of law in this regard to exclude the testimony of Dr Cloete in
respect of the respondent, even though the respondent is not the company.

[39] From about the first quarter of 2021 , an online wallet system or facility called
All Encompassing Switching (Pty) Ltd (‘AE Switch’ ) was used for transactions in
respect of Tariomix . It appears, at this stage, the respondent and/or Tariomix may
have had problems in directly operating bank accounts. AE Switch was used to
receive and disburse money received as investments for Tariomix. According to the
respondent, this system was use d for financial transactions in terms of which clients
registered on the online platform and created e-wallets to participate in funding
diamond transactions. But, after the relationship between Tariomix and AE Switch
somewhat soured, the latter cut all ties and communication s with Tariomix. There
was even a lawsuit at the instance of Tariomix and another entity called Forever
Zircon (Pty) Ltd against AE Switch. Ultimately, AE Switch was placed in provisional
liquidat ion o n 17 May 2024 by an order of this Division at the instance of other
parties and for reasons irrelevant to th is matter .38

[40] The alleg ations regarding the gambling debt or claim were also investigated
by Adams and Adams Forensics (i.e. the Forensic Investigators ).39 The Forensic
Investigators reported on the flow of funds from Tariomix into the casinos and
ultimate use by the respondent . Their report also include s specific reference s to
video footage (depicted in photos in the report) relating to the alleged gambl ing
activities by the respondent . The Forensic Investigators , after calculation of th e
amount, arrive d at the conclusion that the respondent is indebted to the insolvent

38 SA Concerts (Pty) Ltd and others v All Encompassing Switching (Pty) Ltd (045881/2024)
[2024] ZAGPPHC 449 (17 May 2024).
39 FA, a nnexure ‘FA19.1 ’, CaseLines 05-235 to 05 -360.
estate of Tariomix in the amount of R144 382 805 in this regard .40 The report is also
compiled with information from AE Switch , financial statements and bank accounts.41

[41] The respondent’s strik e-out application , dealt with above, is also directed at
the Forensic Investigators’ report of June 2024 , attached to the founding affidavit.42
The respondent wants the entire report excluded from the material before the court
as, in his view, i t constituted inadmissible hearsay . He also complain s that the report
was compiled without his input and commissioned by and paid for by the applicants
and, thus, lacked independence. He merely , out of caution, felt compelled to consult
with his own forensic accountants to deal with the report .

[42] In fact, the respondent had hinted at the urgent court in July 2024 that he
would consider retain ing his own expert to assist in the response to the Forensic
Investigators’ report. He did not follow through with this, as he considered it a futile
exercise. The respondent criticises the forensic investigation report for, among
others, the following: (a) it is an ‘interim’ report subject to change; (b) it is based on
financial data as at 28 February 2021, being two years prior to liquidation of Tariomix
and, thus, inaccurate in reflecting a true financial position; (c) forensic investigators
strayed beyond their mandate, as they were not mandated to investigate the
respondent’s indebtedness instead of the flow of funds between Tariomix and the
respondent or Ms Kleynhans; (d) reliance in the report on the ‘unaudited’ financial
statements prepared by Dr Cloete for the year ending 28 February 2021 , despite the
Forensic Investigators identifying ‘various inaccuracies’ in the financial statements ;
(e) the methodology used and reasoning in the report for calculating the ‘gambling
debt’ owed by the respondent , and (f) personal expenses being based on ledgers by
Dr Cloete, potentially flawed data.43 The respondent for similar and additional
reasons criticised the prior reports by the Forensic Investigators to the one of June
2024.44 It is not necessary to delve deeper into the reasons, although it is important
to point out that the respondent relied on some of these reasons to criticise the other
debts or claims , discussed below. But I don’t think there is merit in these criticisms,

40 FA, annexure ‘FA19.1’, CaseLines 05-360.
41 FA par 13.7, CaseLines 05 -31.
42 FA, annexures FA19.1 and FA19.2; (8) dated 26 June 2024.
43 SAA pars 36 -72, CaseLines 27 -551 to 27 -565.
44 SAA pars 89 -92, CaseLines 27 -570 to 27 -571.
especially given that the material relied upon by the applicants ought to only tilt the
prima facie scales justifying a provisional order.45

[43] Back to the alleged gambling debt. The respondent denies that there is proof
or detail s of the gambling activities to establish the alleged claim of over R144
million. But, nevertheless, the respondent goes on to say that cash transactions are
the norm and large sums are frequently required in the diamond trading business.
This may seem unusual to those unfamiliar with the diamond trade, but the practice
served practical and entirely lawful solution to a real problem in the diamond
industry. He often met diamond sellers at casinos . He used casinos to meet the cash
requirements of diamond -dealing as traditional banks were unable to assist . He was
allowed to use casinos as ‘a high -volume ATM’ (i.e. ‘automated teller machine’)
without inc urring withdrawal fees provided he did ‘a certain amount of gambling
activity ’.46 He blame s the applicants for not approaching him for clarity on this to
avoid their misunderstanding of the industry and business model of Tariomix.47 But,
the respondent did not provide the details of the activities he alleges were lawful and
explain how they differed with ordinary gambling. I agree with the applicants that the
respondent failed to f urnish proof of his own assertions that the gambling activities
were legitimate for purposes of the business of Tariomix. There is also no proof of
the transactions and entries in the Tariomix’s financial statements . All these abound,
despite the respondent ’s assertions that all gambling transactions were recorded in
the books of Tariomix.

[44] Another point of dispute raised by the respondent against the alleged
gambling debt is that the gambling activities and monies alleged to have been

45 Pars [29] -[30] above , on proof at prima facie level.
46 Answering Affidavit (‘ AA’) par 81 , CaseLines 27 -27.
47 The respondent describes the business model of Tariomix, among others, as follows: ‘57.
Tariomix operated in the diamond industry, solely as a facilitator and financier. Its core business
involved providing finance for the lawful purchase and beneficiation of diamonds by licensed
individuals. Acting as a “middleman” or broker, Tariomix brought together buyers and sellers in
diamond transactions. Importantly, the company did not directly purchase or sell diamonds (of any
kind) but rather focused on facilitating these transactions. To be clear, despite being in possession of
diamonds, Tariomix did not, at any stage, o wn diamonds. 58.The business model of Tariomix relied
on a network of sellers, including independent mines, dealers and intermediaries. It provided financial
assistance to producers miners, effectively bridging the period between the mining of stones and their
eventual sale at tenders. Tariomix worked exclusively with sellers licensed under the Diamonds Act
56 of 1986. Tariomix concluded joint venture agreements with members of the public who wished to
participate in financing diamond purchases. Profits from these transactions were then shared between
Tariomix and the participating clients/investors. ’ See AA pars 57 -58, CaseLines 27 -21 to 27 -22.
disbursed from the coffers of Tariomix were prior to February 2021 .48 Any debt in this
regard has prescribed and , thus, incapable of enforce ment against him. It is further
pointed out that the applicants did not react to this in their reply to the effect that
there was interruption or delay of prescription . But, in my view, whilst this may be so,
before th e applicants join the fray the onus is clearly on the respondent to establish
the prescription defence raised.49

[45] As a point of departure, t he respondent is correct in his assertion that a
creditor can not apply for a sequestration order on a prescribed debt.50 The general
law governing extinction of debts by prescription is the Prescription Act 68 of 1969.
The periods of prescription in this legislation would generally apply where no period
is prescribed by other law.51 Periods of prescription of debts are set out in section 11
of the Prescription Act . Unless, the Prescription Act or another ‘Act of Parliament ’
provides otherwise, the period of prescription of debts is three years .52

[46] The Prescription Act appears applicable to the gambling debt for purposes of
the sequestration application.53 In terms of section 12 of the Prescription Act
prescription begins to run , barring the other provisions of this legislation ,54 ‘as soon
as the debt is due ’.55 Section 12(2) of the Prescription Act states that ‘[i] f the debtor
wilfully prevents the creditor from coming to know of the existence of the debt,
prescription shall not commence to run until the creditor becomes aware of the
existence of the debt ’. And section 12(3) of the Prescription Act provides that a ‘debt
shall not be deemed to be due until the creditor has knowledge of the identity of the
debtor and of the facts from which the debt arises: Provided that a creditor shall be
deemed to have such knowledge if he could have acquired it by exercising
reasonable care ’.


48 SAA pars 14.1.2 -14.1.3, CaseLines 27 -543.
49 Absa Bank Bpk v De Villiers 2001 (1) SA 481 (SCA) 486F -G.
50 Bertelsmann and others , Mars: The Law of Insolvency 5.3.5.
51 Section 10(1) of the Prescription Act.
52 Section 11(d) of the Prescription Act.
53 Bertelsmann and others, Mars: The Law of Insolvency 5.3.5.
54 Section 12(2) -(4) of the Prescription Act.
55 Section 12(1) of the Prescription Act.
[47] Completion of prescription may be delayed in certain circumstances , including
where ‘ the creditor is a juristic person and the debtor is a member of the governing
body of such juristic person ’.56 It is common cause that b efore the joint provisional
liquidators came on board on 23 February 2023 , pursuant to the provisional
liquidation order, the respondent and Ms Kleynhans were solely responsible for the
management or direction of the ‘business and affairs’ of Tariomix.57 They were
member s of the ‘governing body ’ of Tariomix, a juristic person , to adopt the parlance
in the Prescription Act .58 Therefore, the running of prescription would have been
impeded until a year after the respondent ceased to be jointly in charge of the
governance of Tariomix .59 I understand this to mean that the period of three years
would have started to run only when the applicants, as joint provisional liquidators ,
were substituted for the respondent and Ms Kleynhans and they took charge of the
affairs and governance of Tariomix. This would have been on 23 February 2023
when the provisional order was granted.60 This, in my view, puts paid to the
prescription argument.

[48] The respondent , as appearing above, does not deny that large amounts of
money belong ing to Tariomix were disbursed at casinos . As what appears to be a
ground of justification , the respondent says that all these were not for his own
personal benefit, but for legitimate business transactions of diamond dealing for the
benefit of Tariomix. But this does not accord with his other statement that Tariomix
‘never owned diamonds or property or any other substantial assets ’.61 Surely , unless
the money was wasted there will be something by way of assets to show for it. No
wonder the applicants found no proof or record of a single transaction made with the
impugned funds alleged to have purchase d diamonds . Also, no actual diamond s
were found by the applicants when they took over the reins at Tariomix . It is
impossible to imagine what became of the funds of Tariomix than to agree with the
applicants that the respondent indeed ruthlessly gambled away Tariomix’s funds

56 Section 13(1)(e) of the Prescription Act.
57 Section 66(1), CA 2008. See further Piet Delport, Henochsberg on the Companies Act 71 of
2008 (LexisNexis, October 2024) 250(3).
58 Section 13(1)(e) of the Prescription Act.
59 Section 13(1)(i) of the Prescription Act.
60 I do not view the deeming provision under s 348 of the CA 1973 to be applicable under the
circumstances.
61 AA par 75, CaseLines 27-26.
source d from the third party investors . The investors genuinely believed they were
investing in a legitimate business of Tariomix , but only to have their monies
misappropriated through gambl ing by the respondent .

[49] Considering what appears above, I find that the applicants, as the joint
provisional liquidators of Tariomix, have – prima facie – established a liquidated
claim against the respondent in the amount of R144 382 805 arising from the
gambling debt. Although, there is no need to establish more than R100 liquidated
claim to gain standing to apply for sequestration, I look at the other debts alleged by
the applicants to be owing by the respondent. This, also, serves to address the
requirement of factual insolvency (as borne by comparison of the fair value of assets
with the fair estimate of liabilities) , necessary to meet for purposes of the relief
sought by the applicants , dealt with below .62

Amounts paid to or for the benefit of the respondent from Tariomix
[50] The respondent, according to the applicants, is also in debted to them or
Tariomix in respect of monies paid over to him or from which he unduly benefitted ,
as follow s: (a) R133 699,94 (for contributions to his medical aid ); (b) R359 314,16
(for personal expenses ); (c) R4 368 798,65 (for various transfers allocated to him);
(d) R40 000,00 (for a donation ); (e) R115 690,80 (for internet payments allocated to
him), and (f) R16 728,40 (for entertainment expenses ). These payments amount to
R5 034 231,95 . They are derived from a general ledger account prepared by Dr
Cloete63 and also reflected in the Forensic Investigator s’ report .64 I have already
ruled favourably on the admissibility of b oth these sources , above .65 Reliance on this
type of evidence is also supported by the authorities .66 Therefore, I accept that th is
claim is - prima facie , established as a liquidated claim in the amount to R5 034
231,95 .


62 Pars [66]-[71] below, for a discussion on whether the respondent is insolvent or not.
63 FA pars 15.1-15.5, CaseLines 05-39 to 05 -40.
64 Ibid.
65 Pars [38], [41] -[43] above.
66 VBS Mutual Bank (in liquidation) v Ramavhunga and another (25062/2018) [2019] ZAGPJHC
295 (23 August 2019) [29], [31] (i.r.o. an affidavit by an investigator or curator) and Bertelsmann and
others, Mars: The Law of Insolvency 10th Ed, 2019, p 123 (as authority for recognition of books of a
company ), as examples of liquidated claims.
The costs orders granted in favour of the applicants against the respondent
[51] I have indicated above that the legal skirmishes between the parties date a
while back and started elsewhere. The applicants were awarded legal costs in
respect of some of this litigation. They rely on two cost orders granted in their favour
by the North West Division . Bills of costs were prepared and totalled an amount of
R736 600,09 .67

[52] When the applicants first relied on th e bill of costs – at the launch of this
application - they were still untaxed. They were only subsequently taxed and allowed
in the amount of R616 599,94, together with accumulating interest thereon. I agree
with counsel for the respondent that whilst the bill of costs were still to be subjected
to taxation , absent agreement thereon between the parties, the potential or
prospective debt was far from constituting a liquidated claim.68 The taxation process
allows for objections to bill of costs before the taxing master determin es the final
amount and certif ies same to render the amount legally due and payable .69

[53] The respondent says he only be came aware of the taxation of the bills when
the sheriff attended at his Bronkhorstspruit property on 9 September 2024 with a
warrant of execution . He tendered payment of the taxed amount of R616 599,94 , but
this was refused by the applicants. In the applicants’ view accept ance of payment of
the taxed bills would constitute an act of insolvency on the part of the respondent
and voidable disposition , as the respondent is factually insolvent. The respondent
considers this a ‘systematic prevention of payment’ to justify the applicant s’ reliance
on his inability to make payment for their sequestration application .70 But counsel for
the respondent argues that, even if the debt or claim became liquidated after
taxation, it cannot be relied upon for locus standi as at the launch of the application.


67 FA annexures ‘FA27 ’- ‘FA28 ’, CaseLines 05-412 to 05 -426.
68 Bertelsmann and others, Mars: The Law of Insolvency 10th Ed, 2019, p 123 . See also Blakes
Maphanga Inc v Outsurance Insurance Co Ltd 2010 (4) SA 232 (SCA) [18] although in the context of
attorney and client fees. See further Uniform Rule 45(2) requiring taxation of costs by the taxing
master or written agreement thereon by the parties, in a fixed amount, prior to process of execution ,
save where such costs were awarded for specified amount.
69 Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law par 2.1. See also Blakes
Maphanga v Outsurance Insurance 2010 (4) SA 232 (SCA) [16]-[18].
70 Further supplementary answering affidavit (‘FSAA’) par 10 -15, CaseLines 06 -52 to 06 -53.
[54] Consequently, there are two issues to be determined, namely, (a) whether a
creditor may rely for purposes of bringing a sequestration application on a liquidated
claim which did not exist at the time of launching of the application, and (b) whether
a tender of payment of a liquidated claim may be refused on the basis that such may
constitute an act of insolvency or voidable disposition. I deal with these issues, next.

[55] Naturally, I start with (a) of the two issues in the preceding paragraph. I
immediately reject as misplaced the argument by counsel for the applicants that a
costs order fit s the mould of an accrued liquidated claim envisaged in section 9(2) of
the IA 1936.71 A costs order is not a liquidated claim let alone one ‘ which has
accrued but which is not yet due ’, to imbue a creditor with the requisite locus
standi .72

[56] Although, locus standi for purposes of applying for sequestration of an estate
of a debtor is prescribed in the statutory provision, one may begin with a generic
description of the concept. The learned authors of Amler’s Pleadings73 state that the
issue of locus standi is both procedural and to do with substance of the matter .74
Locus standi relates to ‘the sufficiency and directness of a person’s interest in the
litigation to be accepted as a litigating party [and also] the capacity of a person to
conclude a jural act ’.75 The SCA in Four Wheel Drive Accessory Distributors C C v
Rattan NO76 sets out the following as , generally, the requirements for locus standi :
(a) the applicant or plaintiff ought to ‘have an adequate interest in the subject matter
of the litigation ’, namely, ‘ a direct interest in the relief sought ’; (b) such interest ought
not be too remote or far removed ; (c) ‘the interest must be actual, not abstract or
academic ’, and (d) the interest ‘ must be a current interest and not a hypothetical
one’.77


71 Par [26] above for a reading of s 9 of the IA 1936 in the material part.
72 Ibid.
73 LTC Harms and M Townsend , Amler’s Pleadings (10th edn, LexisNexis 2024 ).
74 Harms and Townsend, Amler’s Pleadings 250.
75 Ibid .
76 Four Wheel Drive Accessory Distributors CC v Rattan NO 2019 (3) SA 451 (SCA).
77 Four Wheel Drive Accessory Distributors CC v Rattan NO 2019 (3) SA 451 (SCA) [7], relying
on similar previous version of Erasmus: Superior Court Practice RS 23, 2024, D1 Rule 17-21 to 17 -
22.
[57] But the locus standi in section 9(1) of the IA 1936 is very specific: an applicant
must be a creditor (or an agent of such creditor) ‘who has a liquidated claim for not
less than [R100] … against a debtor ’.78 [underlining added ] This means an applicant -
creditor must have a liquidated claim to apply for compulsory sequestration of the
estate of a debtor. The provision does not define ‘petition’ and therefore it is not clear
whether the possession of a liquidated claim by an applicant -creditor ought to be
when the application is issued or it can come along until when the application is
heard. Section 9(2) of the IA 1936 allows a possessor of a ‘liquidated claim which
has accrued but which is not yet due on the date of hearing of the petition ’ to qualify
for locus standi to apply for sequestration. [underlining added] Section 9(2) appears
to be availing legal standing to a possessor of a liquidated claim of a lower threshold
than the one in terms of section 9( 1). It would undermine the purpose of the IA 1936
or the insolvency law in general, which is focussed on providing for the interests of
creditors,79 or even lead to ‘insensible or unbusinesslike results ’ to consider section
9(1) to preclude a creditor to rely on a liquidated claim which is due by the time the
application is heard when such is possible for a liquidated claim not yet due at the
hearing of the matter.80 I am mindful of the fact that section 9(2) concerns claims
which are already ‘liquidated’, as opposed to the claim in my proposition . But my
focus is on the timing of the consideration: the date of hearing. In my view the only
main concern will be the possibility of prejudice to the debtor -respondent in such
proceedings. Such prejudice is more imaginary than real as compulsory
sequestration have other substantive requirements than only legal standing of the
creditor -applicant, namely, proof of insolvency or act of insolvency and advantage to
creditors.81 Therefore, the liquidated claim envisaged in section 9(1) of the IA 1936
ought to be established when the application is considered by the court seized with
such matter.82 Of course, there is a risk for an applicant who may solely rely on this
type of claim to pursue a sequestration application.83 The hearing of the application

78 Par [26] above.
79 Bertelsmann and others, Mars: The Law of Insolvency 10th Ed, 2019, p 123 ; 10th Ed, 2019, p
2.
80 Natal Joint Municipal Pension Fund v Endumeni Municipality 2012 (4) SA 593 (SCA) [18].
81 Section 10(c) of the IA 1936, quoted in par [28] above.
82 Section 10(a) of the IA 1936, quoted in par [28] above.
83 There is partial support for my view in Boraine, Kunst and Burdette (eds), Meskin’s Insolvency
Law (at par 2.1) where the standing of a creditor with a favourable cost order to bring sequestration
proceedings is recognised even where the costs have not yet been taxed, although the Court may
deem the claim not liquidated due to the amount not capable of speedy determination.
may arrive sooner than the consummation of the debt into a liquidated claim . But the
possibility of risk does not detract from the fact that a creditor may have a good
reason to launch the application now rather than later, for example, where there is
threat of dissipation of assets b y a clearly insolvent debtor. For these reasons, I find
that t he applicants were entitled to rely on the fixed amount of the taxed costs for this
application.

[58] The second and final issue under this part is whether a tender of payment of a
debt or claim which became liquidated , for example a bill of costs subjected to
taxation by the taxing master, may be refused on the basis that the payment would
amount to an act of insolvency or voidable disposition. Actually, a tender of payment
of any debt. In as far as ‘acts of insolvency’ under section 8 of the IA 1936 are
concerned , I can only think of the one under subsection (c) as being material for
current purposes . This act of insolvency comes about when a debtor make s (or
attempts to make) a disposition of property which prejudices or would prejudic e such
debtor’s c reditors or result in the preference of one creditor above another . Acts of
insolvency are not linked to factual insolvency of a debtor, but represent another
basis for seeking sequestration of a debtor’s estate.84 I don’t think the applicants
were unreasonable to refuse payment under the circumstances. Such payment –
indeed - may have been ruled a voidable preference . And, also, it ought to be borne
in mind that sequestration is not an enforcement or demand for payment of a
particular debt, but a collective debt -collection mechanism .

[59] Therefore, on the basis of what appears above, the claim or debt in the
amount of R616 599,94 - fixed by the taxing master post the issuing of this
application, but prior to its hearing – is ruled a liquidated claim for purposes of this
application.

Debt in respect of the stolen cash, diamon ds and gold
[60] The respondent , as indicated above, reported to the police th eft in the form of
cash or currency , diamonds and gold worth R50 million allegedly perpetrated by a
certain Mr Jooste . The applicants consider the stolen items to be the assets of

84 Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law par 2.1.2.
Tariomix . According to them the assets were stolen whilst unlawful ly possess ed by
the respondent . They also rely on the value placed by the respondent on the items
(i.e. R50 million ) to claim locus standi to bring this application .

[61] The respondent labels reliance on this claim or debt by the applicants for their
standing, desperate and unsustainable . The claim emanates from Facebook posts
by the respondent and news articles (with the latter ruled admissible above)
attributed to the respondent on the theft incident.85 The respondent denies that he
admit ted any wrongdoing or possession of the impugned assets. He says the stolen
items did not belong to Tariomix , but stopped short of disclosing who they belong ed
to.86 He provided an inventory of some of the items and mentioned that the
paperwork for the remainder of the items was also taken during the theft . Overall, the
respondent accuses the applicants of misunderstanding the social media post s and
taking them out of context. His comments about hiding assets were only
metaphorical and far from him admi tting to concealing assets of Tariomix .87 He also
says that he made the comments due to his distrust of the applicants.88 The logic of
the latter averment escapes me, but nothing surely turns on this.

[62] Our law recognises a liquidated claim derived from an admission of the theft
of a fixed amount of money by a debtor in certain circumstances.89 In this matter the
respondent whilst admitting theft by a third party, denies any wrongdoing and
disputes title of the company (i.e. Tariomix) over the impugned assets . But even if
title to the assets was not an issue, it is still doubtful whether the assets really exist
or are only imaginary. The applicants couldn’t trace any diamonds, actual or as
reflected in the records of Tariomix. The inventory attached to the respondent’s
answer – with respect – does not alter my view. The respondent may have been
chest -beating in the social media post for irrelevant reasons. The social media posts
- under these circumstances - cannot serve as a basis to establish a debt equating to
a liquidated claim , even on a prima facie basis. But the posts may be relevant when

85 Par [17] above.
86 AA pars 91 -92, CaseLines 27 -30; AA annexure ‘AA11’, CaseLines 27 -484 to 27 -499.
87 AA par 166 at CaseLines 27 -46.
88 AA par 94 at CaseLines 27 -30 to 27 -31.
89 Bertelsmann and others, Mars: The Law of Insolvency 10th Ed, 2019, p 123 .
urging the court to consider a possible advantage to creditors which may ensue from
the discovery or recover y of assets through an investigation by the liquidators.

Conclusion (on whether Tariomix or the applicants, is a creditor with locus standi )
[63] On the basis of the above alleged debts or amounts, except for the debt
relating to the R50 million worth of diamonds and gold, considered either jointly or
severally, I am of the opinion that prima facie the applicants, as creditors, have
established against the respondent, as the debtor , a claim of more than R100 in the
composite amount of R150 033 637, as constituted above.90

[64] The respondent has not show n that his indebtedness is disputed on bona fide
and reasonable grounds .91 This does not amount to saddling the respondent with
some form of an onus to establish the aforesaid.92

Is the r espondent factually insolvent or has he committed an act of
insolvency ?
General
[65] The second requirement for the granting of provisional sequestration is that
the applicant -creditor , prima facie , must satisf y the court that t he respondent -debtor
is factual ly insolven t or has committed an act of insolvency .93 The applicants relied
on both instances and I look at both, next .

Factual insolvency
[66] Factual insolvency prevails when a debtor’s assets – fairly valued – are
exceeded by his liabilities – fairly estimated.94 This requirement is purely about rands
and cents in the form of fair value of assets and fair estimation of the liabilities. The

90 Pars [3 2]-[50], [60] -[62] above.
91 Kalil v Decotex 1988 (1) SA 943 (A) 980B -D; Helderberg Laboratories CC and others v Sola
Technologies (Pty) Ltd 2008 (2) SA 627 (C) [21]-[22]. See also Boraine, Kunst and Burdette (eds),
Meskin’s Insolvency Law par 2.1.1 and the authorities relied upon by the learned authors.
92 Braithwaite v Gilbert (Volkskas Bpk Intervening) 1984 (4) SA 717 (W) 718. See also
Helderberg Laboratories v Sola Technologies 2008 (2) SA 627 (C) [22] in the context of winding up of
a company . See further Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law par 2.1.1,
where the learned authors clearly refer to ‘the onus .. on the respondent to rebut the inference by
showing that he has sufficient assets to be able to settle his liabilities ’.
93 Section 10(b) of the IA 1936, quoted in par [28] above.
94 Bertelsmann and others, Mars: The Law of Insolvency 10th Ed, 2019, pp 2-3, partly relying on
Venter v Volkskas Ltd 1973 (3) SA 175 (T) 179; Ex parte Harmse 2005 (1) SA 323 (N) [8].
applicants have declared that they we re unable to ascertain the exact extent of the
respondent’s financial affairs , particularly in respect of his assets.

[67] A creditor seeking sequestration of a debtor’s estate on the basis of factual
insolvency is not required to adduce evidence to a finite nature as determin ation of
the debtor’s assets and liabilities only in terms of r ands and cents , lest the court is
seized with a friendly sequestration.95 All that is required to discharge the onus - on
a prima facie basis - of factual insolvency is presenting to the court ‘sufficient
evidence to justify the inference as a matter of probability that the respondent is
insolvent ’.96

[68] Starting with the liabilities, the applicants have so far been found to have
established the respondent ’s liability towards Tariomix in the amount of
R150 033 637. Regarding assets, th e applicants allege that they were only able to
ascertain that the respondent has indirect interest in immovable properties. Nothing
was found in his personal name. The respondent holds all shares in private
companies owning immovable properties in Rhodesfield, Johannesburg and
Kungwini Country Estate , Bronkhorstspruit. The applicants have not provided values
or valuation of the properties or of the respondent’s shareholding in the companies.
They only say the properties appear to be unencumbered.97 But they doubt that the
value of the se properties or of the respondent ’s indirect interest in them could
exceed the respondent’s liability towards Tariomix . Therefore, even when
considering only the debt owing by the respondent to Tariomix (i.e. without factoring
in possible debts of other creditors) , the respondent ’s debts or liabilities far exceeds
his assets, as represented by the potential value of the properties held through the
companies, it is submitted . Clearly, the respondent is insolvent , the submission
concludes .

[69] The respondent’s assets and liabilities have been considered for purposes of
litigation or process in terms of the T ax Administration Act 28 of 2011 . The South
African Revenue Service (‘SARS ’) obtained a preservation order in June 2021

95 Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law par 2.1.1.
96 Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law par 2.1.1 and the authorities
cited there.
97 FA pars 18.4 -18.6, CaseLines 05 -44.
against Tariomix, th e respondent and Ms Kleynhans for unpaid taxes of Tariomix . 98
This led to the freezing of monies held in the bank accounts of Tariomix and
appointment of a curator bonis . The curator’s report (dated 20 March 2024 )99 reveals
that the respondent has assets valued at R4 928 669,83 and liabilities estimated to
be R4 657 299,87 , and, thus, a s urplus or positive amount of R271 369,96 .100 The
assets include two motor vehicles owned by the respondent with the approximate
value of R2 085 000 and cash in the amount of R2 842 169,83.101

[70] Reliant on the curator’s report , the applicants contend that the respondent’s
financial position is a lot worse. And the so -called ‘ surplus ’ of R271 369,96 is no
match to the large indebtedness owing to Tariomix , the contention concludes. The
curator only consider ed the liability towards SARS , and no one else . Therefore, it is
submitted, f rom this objective evidence , the respondent is undoubtedly factually
insolvent and his estate ought to be sequestrated.

[71] The respondent says the above, as with this application itself, is based on a
conflation of the affairs of Tariomix and his personal affairs. The application ,
according to the respondent, is riddled with references to the benefit or advantage
that will accrue to the creditors of Tariomix whilst nothing is said about his personal
creditors . Speaking of creditors, t he respondent claims to owe no money to SARS as
he has settled with SARS a nd he is adhering to the terms of settlement .102 I find this
contradictory, to say the least. But I agree with the applicant s that the only available
evidence establishes that the respondent is factually insolvent . The curator’s report,
which does not appear to be disputed by the respondent, appears to provide
objective evidence of the respondent's assets valued at R4 928 669,83 . There is no
reasonable basis upon which the respondent would have allowed some of his assets
to be excluded from the arrangement with SARS. I agree with the applicants that the
liabilities estimated at R4 657 299,87 do not include those of other creditors,
particularly Tariomix, represented by the applicants.


98 It is stated that SARS, subsequently, consented to the discharge of the order against
Tariomix, save for the cost order still to be ruled upon.
99 RA, annexure ‘RA6’, CaseLines 000-190 to 000 -203.
100 RA pars 35.3 ; 35.7 -35.8, CaseLines 000 -57 to 000 -58; annexure ‘RA6’ , CaseLines 000 -197.
101 RA annexure ‘RA6’, CaseLines 000 -197.
102 AA par 102, CaseLines 27 -33.
Act of insolvency
[72] The applicant s also raise the other basis envisaged in section 10103 of the IA
1936 for pursuing this sequestration application than factual insolvency , dealt with
above : act of insolvency. Acts of insolvency are a clear indication that the legislature
recognised the inherent difficulty of establishing insolvency , on the basis of assets
versus liabilities and put together specified types of conduct called ‘ acts of
insolvency ’, which , when commi tted result in presumption of a state of insolvency .104

[73] The applicants consider the respondent to have committed an act of
insolvency by enter ing into a settlement arrangement with SARS to pay off his tax
liability .105 They rely on section 8 (e)106 of the I A 1936. Section 8 (e) of the I A 1936
envisages an act of insolvency to have been committed by a debtor who arrange s
(or offers to arrange) with a creditor to be releas ed either ‘ wholly or partially from his
or her debts’.107

[74] But a debtor does not commit an act of insolvency envisaged in s ection 8 (e)
of the I A 1936 by merely making an arrangement to pay his or her creditors the full
amount even where the full payment is partially postponed or an extension of time to
pay is granted .108 The act of insolvency under section 8(e) involves release of the
debtor either ‘wholly or partially from his debts ’ (my emphasis),109 as clearly stated in
the provision.110 Perhaps, such an arrangement may give rise to the scepticism said
to have been expressed by Innes, CJ , over a century ago, in de Waard v Andrew
and Thienhaus111 concerning a nulla bona return, that ‘ the best proof of solvency is
that a man should pay his debts ’.112 But, such scepticism about the ability of a debtor

103 Par [28] above for a reading of the provision.
104 Mackay v Cahi 1962 (4) SA 193 (O) 196 , a decision of the full court (comprising Hofmeyr J,
Erasmus AJ and Smuts AJ) of the Orange Free State Provincial Division (the equivalent of the current
Free State Division) .
105 RA par 35, CaseLines 000 -57 to 000 -58.
106 Section 8(e) of the IA 1936 reads as follows: ‘A debtor commits an act of insolvency … (e) if
he makes or offers to make any arrangement with any of his creditors for releasing him wholly or
partially from his debts’.
107 Ibid.
108 Mackay v Cahi 1962 (4) SA 193 (O) 202E -F, cited with approval in Bertelsmann and others,
Mars: The Law of Insolvency 10th Ed, 2019, p 8.
109 Footnote 10 6 above.
110 Footnote 10 8 above .
111 De Waard v Andrew and Thienhaus 1907 TS 727 .
112 De Waard v Andrew and Thienhaus 1907 TS 727 at 733, where Innes CJ is said to have held:
“[s]peaking for myself I always look with suspicion upon and examine very narrowly, the position of a
to pay off his debts should not lead the court to consider any arrangement regarding
payment entered into by a debtor with his or her creditor (s) to equate to an act of
insolvency when there is no evidence of the debtor arranging to be fully or partially
released from his debt(s) , but arranging to pay the debt(s) in full.113 Otherwise , a
mere commercial or business arrangement or even court -sanctioned settlement
between persons not even near the realm of insolvency would be discouraged or
hampered.

[75] Therefore, I do not consider the arrangement between the respondent and
SARS, without more, to equate to an act of insolvency. My view does not waver even
in the light of the respondent’s assertions, including the admission to making ‘regular
settlement payments’ to SARS.114 But, be that as it may, the respondent’s insolvency
has already been established above to pave the way for a consideration of the next
requirement , namely, advantage to creditors .

Advantage to creditors
[76] An applicant in a sequestration application also ought to show that he, she or
it is not pursuing a futile mission and that sequestration would avail some form of
benefit to the creditors of the prospective insolvent -debtor . This confirms the
collective nature of sequestration.115


debtor who says, 'I am sorry that I cannot pay my creditor, but my assets far exceed my liabilities'. To
my mind the best proof of solvency is that a man should pay his debts; and therefore I always
examine in a critical spirit the case of a man who does not pay what he owes”, as quoted in Mackay v
Cahi 1962 (4) SA 193 (O) 195H.
113 Mackay v Cahi 1962 (4) SA 193 (O) 202E -F. See also Bertelsmann and others, Mars: The
Law of Insolvency 10th Ed, 2019, p 8.
114 SAA par s 97-98, CaseLines 27 -572 to 27 -573; annexure ‘AA18’, CaseLines 27 -594 to 27 -596
(i.e. SARS statement of account: assessed tax) .
115 Bertelsmann and others, Mars: The Law of Insolvency in South Africa 10th Ed, 2019, p 2
where the learned authors point out that sequestration of an estate of a debtor is a ‘ collective debt -
collecting procedure ’ and differs – in purpose with the ‘individual debt -collecting procedures’, such as
obtaining judgment followed by a warrant of execution to attach and sell assets of a debtor. The
authors , further (at p3) , point out that the collective nature of sequestration ensures that the
insufficient assets (i.e. proceeds thereof) of a debtor are distributed in an orderly and fair manner in
order to satisfy the claims of all creditors. And this brings about concursus creditorum (i.e. ‘the rights
of the creditors as a group are preferred to the rights of individual creditors’). See also Walker v Syfret
1911 AD 141 at 166.
[77] The actual wording of the requirement (i.e. ‘ reason to believe that
[sequestration] will be to the advantage of creditors ’)116 for compulsory sequestration
appears to be at a lower threshold than that for voluntary surrender (i.e.
‘[sequestration] will be to the advantage of creditors ’)117 The latter appears to be
requiring a definite set of facts, as it is the prospective insolvent who is required to
make the assertion about his or her own affairs, whereas the former attests to -
ordinarily – an arm’s length relationship of a creditor and debtor where the former ,
often , lacks detailed knowledge or minute details of the affairs of a debtor (not
discounting the possibility of the so -called friendly sequestrations) . And, the ‘reason
to believe ’ required in compulsory sequestration ‘predicates facts which engender
belief, which must be proved by the applicant, prima facie at the stage when a
provisional order is sought, and on a balance of probabilities when a final order is
sought ’.118

[78] Advantage to creditors is a relative concept and ought to be determined on
the basis of the circumstances of each case .119 It may be established in many ways,
but it is generally believed that the evidence ought to reveal a reasonable prospect of
a not negligible di vidend .120 But the respondent , as appearing above, only ha s
meagre personal assets to his name and a mountain of debt or liabilities . Therefore,
any attempt to prove an advantage to creditors focussed on a pecuniary benefit
would dismally fail. This is highlighted by the submission by c ounsel for the
applicants that , the respondent’s creditors have a reasonable prospect of receiving a
dividend from the proceeds of the sale of the immovable properties (held in
companies wholly -owned by the respondent) by trustee s to be appointed should
sequestration be granted . Obviously, in terms of our law the immovable properties
do not belong to the respondent, as a shareholder, but the companies.121 The

116 Section 10(c) of the IA 1936 , quoted in par [28] above. See also Boraine, Kunst and Burdette
(eds), Meskin’s Insolvency Law 2.1.4 .
117 Section 6(1) of the IA 1936.
118 Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law 2.1.4, partly relying on London
Estates (Pty) Ltd v Nair 1957 (3) SA 591 (N); [1957] 4 All SA 1 (N) 4; Nedbank Ltd v Thorpe [2009]
JOL 24292 (KZP) [12]. See pars above [29] -[30] on the prima facie basis level of proof .
119 Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law 2.1.4.
120 Trust Wholesalers & Woollens (Pty) Ltd v Mackan 1954 (2) SA 109 (N) 111G –H; Cyril Smiedt
(Pty) Ltd v Lourens 1966 (1) SA 150 (O) at 157C. See par [79] below , for criticism of the view that
advantage to creditors ought to reveal a reasonable prospect of a not negligible dividend.
121 Stellenbosch Farmers’ Winery Ltd v Distillers Corporation (SA) Ltd and another 1962 (1) SA
458 (A) 471 -472; Itzikowitz v Absa Bank Ltd 2016 (4) SA 432 (SCA) [9]; Hlumisa Investment Holdings
respondent’s interest therein would only materialise after the debts of the companies
have been met. But, for current purposes, t hese immovable properties have not
been given any possible value and are not included in the figure of R4 928 669,83
stated in report of the curator appointed pursuant to SARS’ preservation order,
although they are referred to therein .122 It is not a complicated mathematical exercise
to fathom that the possible values from the immovable properties and of those
mentioned in the curators report (i.e. of R4 928 669,83 ) would definitely be
overshadowed by the liabilities attributed to the respondent in the amount of
R150 033 637, above , and the one to SARS pegged at R4 657 299,87 . Therefore, I
respectfully differ with counsel for the respondent by holding that the absence of
valuation of the shares held by the respondent in the private companies defeats the
alleged benefit to creditors. What I turn to next is also relevant in this regard.

[79] Counsel for the applicants, perhaps sharing the optimism of his client, submits
that the situation may improve due to possible proceeds from assets allegedly
hidden by the respondent under trees in the Northern Cape once th ose assets are
uncovered for the benefit of the creditors . Despite my optimism , above, regarding the
latter ‘assets’ falling short of giving rise to a liquidated claim, I agree that should the
‘assets’ materialise they would contribute towards an advantage to creditors. All
these confirm the need to heed caution sounded by the Constitutional Court
in Stratford and Others v Investec Bank Limited and Others123 not to rigidify the
broad meaning of the concept ‘advantage’ through employment of epithets , such as
‘a not negligible dividend ’.124

RF Ltd and another v Kirkinis and Others 2020 (5) SA 419 (SCA) [17], [24]; Pepkor Holdings Ltd and
others v AJVH Holdings (Pty) Ltd and others 2021 (5) SA 115 (SCA) [43]. See also Brighton M
Mupangavanhu , ‘The Lawfulness of a Memorandum of Incorporation Clause that Permits a Company
Board to Refuse Transfer of Shares Without Reasons: Analysis of Visser Sitrus (Pty) Ltd v Goede
Hoop Sitrus (Pty) Ltd (2017) 31:2 Speculum Juris 191, 193. See further s 19(1)(a) -(b), CA 2008 on
the legal status of a company, including its separate legal personality , discussed in Delport,
Henochsberg on the Companies Act 71 of 2008 at 86-92(2) .
122 Pars [69] -[70] above.
123 Stratford and Others v Investec Bank Limited and Others 2015 (3) BCLR 358 (CC); 2015 (3)
SA 1 (CC) . See also Commissioner, South African Revenue Services v Hawker Air Services (Pty) Ltd;
Commissioner, South African Revenue Service v Hawker Aviation Partnership and others 2006 (4)
SA 292 (SCA) [29] .
124 Stratford v Investec Bank 2015 (3) BCLR 358 (CC); 2015 (3) SA 1 (CC) [44] -[45]. See also
Dinath NO and others v Mukhawana (85785/2017) [2019] ZAGPPHC 71 (7 March 2019) [36]; VBS
Mutual Bank (in liquidation) v Madzonga (25057/2018) [2019] ZAGPJHC 273, [2019] JOL 45577 (GJ)
(23 August 2019) [52]; Wild & Marr (Pty) Limited v Yusuf (27815/2018) [2019] ZAGPJHC 341 (20 May
2019), [2019] JOL 45630 (GJ) [5], where the principle from Stratford was applied . See further Boraine,
Kunst and Burdette (eds), Meskin’s Insolvency Law 2.1.4 where the learned authors express doubt

[80] The applicants , also, urge this Court to consider the fact that a trustee
appointed will be able to investigate the respondent ’s bank accounts and ascertain
the flow of funds from bank statements with a view to recover assets that may have
been disposed of by way of impeachable transactions , as envisaged by the
provisions of sections 26 to 31 of the IA 1936 .125 This approach is borne by the
authorities. It is held that the belief that sequestration would yield an advantage for
creditors may n ot only be engendered by the debtor hav ing property, but may also
be indicat ed by facts to the effect t hat the estate administration process may lead to
acquisition or recovery of property benefi cial to creditors .126 Assets may be
unearth ed or recover ed through setting aside of voidable or undue preferences.127

[81] On the facts of the matter, the respondent possess of very few assets in his
name. Even, the fact that he has shareholding in property -owning compan ies, does
not significantly alter the situation, when considering the liabilities towards Tariomix
attributed to the respondent. Also, the respondent may have reduced his liability
towards SARS, but his insolvency remains intact. But, this should not minimise the
fact that an investigation may uncover more assets attached to the monies which
flowed from Tariomix as discussed above. Some of these monies may have been
dissipated through dispositions or transactions which our insolvency law allow to be
set aside or impeached . Therefore, there is indeed reason to believe that
sequestration will be to the advantage of the respondent’s creditors.

Conclusion on the requirements for sequestration
[81] The conclusion reached on the requirement in the preceding paragraph
denotes the fulfilment of all the requirements for provisional sequestration.128 But, it
is submitted on behalf of the respondent, correctly so I should say, that the Court

about the correctness of the view that advantage of sequestration ought to be a ‘ pecuniary benefit’
which is ‘not negligible dividend’ as such approach confines the test to determination of only on the
quantum of the pecuniary benefit, also reliance upon Stratford .
125 See, generally, Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law 5.31 and
Bertelsmann and others, Mars: The Law of Insolvency 10th Ed, 2019, pp 273 -319 (i.e. Chapter 13) on
impeachable transactions .
126 Stratford v Investec Bank 2015 (3) BCLR 358 (CC); 2015 (3) SA 1 (CC) [46]. See also
Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law 2.1.4.
127 Ibid.
128 Pars [2 6]-[30] above.
retains the discretion to refuse the order sought e ven if it is satisfied th at th e
requirement s have been met.129 The applicants ought to have avoided abus ing the
process of this Court by invoking insolvency proceedings when debt recover y by way
of an action would have sufficed . Sequestration is a drastic measure and the
applicants ought to have utilised their extant ‘considerable and extensive powers’ as
liquidators of Tariomix to recover the assets of Tariomix, the submission concludes.

[82] I do not agree that there was an abuse of the process of this Court in the
applicants choosing sequestration . The facts on this matter call for the use of the
machinery of sequestration , especially given the fact that the respondent is clearly
not forthcoming regarding his financial position. The mechanism of insolvency
enquiry with all its trappings, such as interrogation and forensic investigation
focussed on the affairs of the respondent , would, no doubt, prove valuable to the
trustees in their quest to uncover assets, including those which may be hidden in the
semi -arid Northern Cape. There is no viable less drastic alternative to sequestration
on the facts of this matter.

[83] I am also satisfied that the service and notice requirements and other
formalities have been complied with to allow the granting of an order for the
provisional sequestration of the estate of the respondent , subject to what I turn my
attention to, next .

Other issues
[84] In addition to oppos ing the application on the grounds dealt with above, the
respondent urges the Court to refuse the application on other grounds to do with
alleged non-compliance with the statutory and other requirements.


129 Body Corporate Palm Lane v Masinge 2013 JDR 2332 (GNP) where the court exercised its
discretion to refuse an order of sequestration , in order to afford the debtor an opportunity to repay the
debt. Recently in Body Corporate of Old Trafford v Muronzi (016676/2023) [2024] ZAGPPHC 623 (21
June 2024) an order for final sequestration was not granted in the exercise of the court’s discretion
under s 12 of the IA 1936 and recognition of the right to have access to adequate housing in s 26 of
the Constitution of the Republic of South Africa, 1996. See also a critical review in M Roestoff and A
Boraine, ‘Body Corporate Palm Lane v Masinge 2013 JDR 2332 (GNP) ’ [2015] De Jure 16. See,
generally, Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law par 2.1. 5 and Bertelsmann
and others, Mars: The Law of Insolvency 10th Ed, 2019, p p 155-159, on abuse of the process for
sequestration and the discretion of the Court, respectively .
[85] Counsel for the respondent submits that there is non-compli ance with section
9(3) of the IA 1936.130 The provision requires that a petition (read, notice of
motion)131 sets out in its heading information in the form of the full names , date of
birth and, if any, identity number , of the debtor -respondent .132 Further, the debtor ’s
marital status should be stated and, should he or she be married, also, the full
names , identity number and date of birth of his or her spouse .133 Should an
applicant -creditor be partially or wholly unable to comply with these statutory
requirements, he or she must furnish reason s for such i nability.134 But there is clearly
compliance in this regard save for the date of birth which appears in the identity
number. I, also, do not find any merit in the respondent’s assertion that there is non-
compliance with s ection 9(3)(b) of the IA 1936 . I am satisfied that all requisites
relating to the deposition and condition of the founding affidavit have been met. This
is so, even when clearly such type of challenge cannot be based on s ection 9(3)(b) .

[86] The respondent also complains about non -compliance regarding the pre -
litigation mediation requirements under Rule 41A. He says there was not even an
attempt to deliver the required notice in terms of Rule 41A. The applicants simply
contend that there is no procedural irregularity with regard to the compliance with the
provisions of Rule 41 A. But the respondent does not say that it complied with the
rule either.135

[87] Rule 41A of the Uniform Rules provides for a notice of agreement or
opposition to mediation to be given by a party in every new application or action
proceedings to the opposing party .136 The Rule serves a crucial purpose in the
facilitati on of ‘ an expeditious and cost -effective resolution of a dispute between
litigants ’.137 Rule 41A , also, appli es to compulsory sequestration applications , but
appears impossible to apply in voluntary surrender proceedings which involve only

130 Par [ 26] above for a reading of the provision.
131 Footnote 17 above.
132 Section 9(3)(a) and (c) of the IA 1936.
133 Ibid.
134 Section 9(3)(c) of the IA 1936.
135 Nomandela and another v Nyandeni Local Municipality and others 2021 (5) SA 619 (ECM)
[9]-[11].
136 Rule 41A(2).
137 Erasmus: Superior Court Practice RS 23, 2024, D1 Rule 41A -3.
debtor -applicant(s) and no respondent .138 Possible a spects of a sequestration -
related dispute which parties may strive to agree o r highlight issues they disagree on
include the nature and extent of the debt ; advantage to creditors , and compliance
with statutory requirements .139

[88] Compliance with the Court ’s Rules and practice directives by litigants and
their representatives is paramount for the process and administration of justice by
the Court. However , objection s or argument based on non -compliance with Rules,
such as Rule 41A , is best placed when preliminarily raised at the first opportunity
before the Court, obviously after be ing taken up with the opposing part y informally
and formally on the papers . Barring agreement between the parties, the Court at the
first sitting will have an opportunity to decide how to best address the situation
without delving deeper into the issues in dispute, including postponement of the
matter in order to direct the parties to a mediation process . In this case the parties
missed that opportunity when they appeared before the urgent court on 18 July 2024
and agree d the order made by the Court without any indication of the implication s of
non-consideration of the mediation process . I should not be understood to be saying
that mediation is impossible beyond th at stage . But, where the parties have
vigorously exchange d papers and intensely engaged each other on other issues ,
despite non -compliance with Rule 41A, any subsequent or continued argument on
non-compliance may only serve tactical or procedural objectives, rather than being a
genuine and steadfast quest to resolve the dispute or aspects thereof through the
alternative dispute resolution mechanism of mediation . Also, i t may well be that other
issues , such as urgency which inherently involves relaxation of some aspects of
compliance with the Rules as deemed fit by the Court ;140 nature of the dispute , such
as voluntary surrender,141 and interest s of justice calling for the determination of the
dispute without delay ,142 may actually render referral to mediation not the appropriate
option .143 Some of these issues are present in the current matter. But for current

138 Boraine, Kunst and Burdette (eds), Meskin’s Insolvency Law par 2.1.
139 Ibid.
140 Ethypersadh v Minister of Police N.O and Others (2023 -064414) [2023] ZAGPPHC 595 (25
July 2023) [7].
141 Footnote 13 9 above.
142 Nomandela v Nyandeni Local Municipality 2021 (5) SA 619 (ECM) [9] -[11].
143 Erasmus: Superior Court Practice RS 23, 2024, D1 Rule 41A -4 to D1 Rule 41A -4 for other
cases dealing with (non)compliance with Rule 41A.
purposes I find that the non -consideration of referral to mediation by either of the
parties, does not preclude this Court from determining the issues in the matter and
granting the relief sought .

Conclusion and co sts
[89] Evident from what appears above, the applicants have met the material
requirements for the Court to grant an order for the provisional sequestration of the
respondent’s estate. This will be accompanied by an order for costs as envisaged in
sections 14(2) and 97(3) of the IA 1936 which costs are to be taxed and include
costs of opposition of this application. Naturally, the costs will be in the
administration of the insolvent estate of the respondent.

[90] The respondent was partially successful in the application to strike out. But
the costs relating to this part of the proceedings will be minimal. However , I will
exclud e the costs of the strike out application from costs of the main application to
avoid saddling the respondent with liability for payment of the costs of the striking .

[91] What remains is the issue of costs reserved by the urgent court on 18 July
2024 . I will order that those costs form part of the costs of the application, already
awarded above. I cannot imagine any other sensible approach given the applicants
substantial success .

[92] The provisional sequestration order will have a return date. In order to cater
for the return date to be reflected in the body of the order , I will allow either of the
parties to avail a draft order on the exact terms of the order appearing below save
that a specific date obtained from the Registrar of this Court shall be substituted for
the following words in paragraph 2) of the order below: ‘ a date to be determined by
the Court ’.

Order
[93] In the p remises, I make the order (which may also appear in a signed draft
order as stated in par [9 2] above) , that:
1) the estate of the respondent, Louis Petrus Liebenberg (identity number :
6[...]) be and is hereby placed under provisional sequestration in the
hands of the Master of the Gauteng Division, Pretoria;

2) the respondent and any other interested party are called upon to show
cause why this Court should not order the final sequestration of the
respondent at 10:00 or so soon thereafter as the matter may be heard;

3) a copy of this order shall be forthwith served on the respondent;

4) a copy of this order shall be published in the Government Gazette and
Citizen Newspaper;

5) a copy of this order shall be served on:
5.1) the South African Revenue Service, Pretoria; and
5.2) the Master of the High Court, Pretoria ;

6) costs of this application , subject to 7) hereof, are costs in the
administration of the respondent’s insolvent estate ;

7) the costs in 6) hereof shall include costs associated with the hearing of
the matter on 18 July 2024, but exclude costs associated with the
respondent ’s application to strike out.


Khashane La M. Manamela
Acting Judge of the High Court


Date of Hearing : 13 Novembe r 2024
Date of Judgment : 31 January 2025

Appearances
For the Applicant s : Mr J Hershensohn SC (with Mr R de
Leeuw )
Instructed by : Strydom Rabie Attorneys Inc , Pretoria


For the Respondent : Mr A J Daniels S C (with Ms L Acker )
Instructed by : Thomson Wilks Inc , Johannesburg