IN THE HIGH COURT OF SOUTH AFRICA
FREE STATE DIVISION, BLOEMFONTEIN
In the matter between:
JAMES GEORGE JOUBERT
and
J D ELEKTRIESE INGENIEURSWESE (PTY) LTD
DANlel WYNAND DE JAGER
JOHANNES MARTHINUS PRINSLOO
Reportable
Case no: 6680/2025
APPLICANT
FIRST RESPONDENT
SECOND RESPONDENT
THIRD RESPONDENT
Neutral citation: Joubert v J D Elektriese lngenieurswese (Pty) Ltd and Others
(6680/2025 [2025] ZAFSHC 341 (06 November 2025)
Coram: LEKOKOTLA AJ
Heard: 4 September 2025
Delivered: 06 November 2025
Summary: Company law - right of access to company records by former director
and shareholder - right to inspect and copy documents and information - beneficial
interest in a company - right of access to company documents and information.
2
ORDER
1 The first, second and third respondents are directed to make the following
documents available to the applicant, within fourteen (14) days from date of this order:
1.1 The first respondent's memorandum of incorporation and any amendments to it;
1.2 A record of the directors of the first respondent, including details of any person
who has served as a director of the first respondent;
1.3 Copies of all reports presented at the annual general meetings of the first
respondent;
1.4 Annual financial statements of the first respondent, as contemplated in the
Companies Act 71 of 2008 (Companies Act);
1.5 Accounting records of the first respondent as contemplated in the Companies
Act;
1.6 Notice and minutes of all shareholder meetings, including all resolutions adopted
by the shareholders and any document that was made available by the first respondent
to the holders of the securities in relation to each resolution adopted;
1.7 Copies of all written communication sent generally by the first respondent to all
holders of any class of the first respondent's securities;
1.8 Minutes of all meetings and resolutions of directors or directors' committees, or
the audit committee of the first respondent; and
1.9 The security register of the first respondent.
2 The abovementioned documents should be in relation to a period of 19 years
from 1995 when the applicant became a director and shareholder of the first
respondent (together with the second respondent) until when he sold his shares to the
third respondent on 28 September 2023;
3 The first, second and third respondents are directed to pay the costs of the
application, including the cost of counsel on scale B.
JUDGMENT
Lekokotla AJ
[1] The applicant seeks access to certain information and records of the first respondent
for the time period in which he (the applicant) was a director and shareholder of the first
3
respondent. This is a period of 19 years from 1995 until when he sold his shares to the
third respondent on 28 September 2023.
[2] The specific documents that the applicant seeks are the company documents of the
first respondent. They include:
(a) the first respondent's memorandum of incorporation (MOI) and any amendments to it;
(b) a record of the directors of the first respondent, including details of any person who has
served as a director of the first respondent;
(c) copies of all reports presented at the annual general meetings of the first respondent;
(d) annual financial statements of the first respondent, as contemplated in the Companies
Act 71 of 2008 (the Companies Act);
(e) accounting records of the first respondent, as contemplated in the Companies Act;
(f) notice and minutes of all shareholder meetings, including all resolutions adopted by the
shareholders and any document that was made available by the first respondent to the
holders of the securities in relation to each resolution adopted;
(g) copies of all written communication sent generally by the first respondent to all holders
of any class of the first respondent's securities;
(h) minutes of all meetings and resolutions of directors or directors' committees, or the
audit committee of the first respondent; and
(i) the security register of the first respondent.
[3] The documents that the applicant requests are listed ins 26(1) and s 24(3) and (4)
of the Companies Act, and, it is common cause that the applicant was both the director
and shareholder of the first respondent and held a beneficial interest in the first respondent
during the relevant period.
[4] The applicant's basis for seeking these documents is to ascertain if there is a
damages claim that it can institute against the respondents. It intends to first appoint a
forensic auditor who will conduct an investigation and upon his or her findings, the applicant
will decide whether or not to institute a damages claim against the respondents.
will decide whether or not to institute a damages claim against the respondents.
[5] The respondents raised a point in limine of misjoinder of the second and third
respondents, whom they contend have been cited in their personal capacities. The
respondents' contention is that the documents that the applicant seeks belong to the first
4
respondent. As a company, the first respondent has separate legal personality and does
not need to be instructed on how it should produce the relevant documents, should it be
directed to do so by this court.
[6) The applicant contended that it specifically stated in paragraph 7.3 in respect of the
first respondent and in paragraph 8.1 against the third respondent that it has 'cited both
respondents in their respective capacities as directors of the first respondents insofar as it
is necessary to give effect to the order the court makes in these proceedings'. In respect
of the second respondent, the applicant also states that he has cited him in his capacity as
a shareholder during (at least) the relevant time. He only sought costs against them in the
event of opposition.
[7] During oral argument, counsel for the applicant pointed out that he has made factual
allegations against the second and third respondents, respectively, that require responses
from each of them. Furthermore, the applicant seeks substantive relief from both the first
and second respondents in prayers 1 and 2 of the notice of motion. Therefore, their being
cited as parties in these proceedings was necessary as they have a direct and substantial
interest in this application.
[8] The applicant expressly stated that he joined the second and third respondents in
their respective capacities as directors of the first respondent and not in their personal
capacities as contended by the second and third respondents. The applicant further
contended that he cited the second and third respondents as parties who would be
responsible for executing any order that this court may make.
[9] The respondents pointed out the provisions of s 19 of the Companies Act, which deals
with the separate legal personality of companies. In particular, s 19(2) states that a person
is not, solely by reason of being an incorporator, shareholder or director of a company,
is not, solely by reason of being an incorporator, shareholder or director of a company,
liable for any liabilities or obligations of the company, except to the extent that the act or
the company's Memorandum of Incorporation provides otherwise. The applicant pointed
out that it is precisely for this reason that he cited the second and third respondents as
they are the parties that would be responsible for executing any order that the court may
make.
5
[1 0] Furthermore, the applicant made very specific factual allegations against the second
and third respondents that only they could respond to in relation to the events that
transpired during the period in question, leading to him selling his shares to the third
respondent. Even though the affidavit on behalf of the respondents was deposed to by the
third respondent and the second respondent only filed a confirmatory affidavit, the lion's
share of the allegations made by the applicant relate to the 19 years when only him and
the second respondent were directors and shareholders of the first respondent. The
allegations that the third respondent could personally respond to are those relating to the
negotiations leading to him concluding the sale of shares agreement and what the contents
of those discussion was.
[11] In any event, the first respondent acts through the second and third respondents as
they are the current directors. Insofar as substantive relief that is sought by the applicant
is concerned, the second and third respondent would have to effect the order. Therefore,
the second and third respondents have a direct and substantial interest in the order that
would be granted by this court. The point in limine of misjoinder should therefore fail.
[12] The applicant contends that he was a director and 50% shareholder of the first
respondent until he concluded a sale of shares agreement with the third respondent in
respect of 50% of the shares available within the first respondent. The unsigned sale of
shares agreement that is attached to the founding affidavit indicates that the applicant is
the owner of 24.5% of the issued ordinary shares in the first respondent and 50% of the
preference shares issued in the first respondent with a redeemable value of at least R2
850 000.
[13] The respondents dispute that the applicant held 50% shareholding in the first
respondent or that the amount that he was paid by the third respondent in respect of his
respondent or that the amount that he was paid by the third respondent in respect of his
shares was equivalent to 50% shareholding. The issue of what percentage holding each
of the applicant and the second respondent held in the first respondent and what
percentage of that shareholding he sold to the third respondent is not an issue before me ,
I do not have to decide this issue. Therefore, I make no finding in respect of it. However, I
point out that it is one of the issues that the applicant seeks to explore and canvass in
future once he is in possession of the first respondent's documents that he suspects might
shed light on it. He seeks transparency from the respondents.
6
The need for transparency
[14] Section 7(a) of the Companies Act provides that the purposes of the act are to
promote compliance with the Bill of Rights as provided for in the Constitution, in the
application of company law.
[15] Section 7 (b)(iii) provides that a purpose of the act is to '[encourage] transparency
and high standards of corporate governance as appropriate, given the significant role of
enterprises within the social and economic life of the nation'.
[16] In Bernstein and Others v Bester and Others NN0, 1 the Constitutional court held
that the very use and establishment of a company is a public affair, which imposes on
those running it certain statutory responsibilities associated with running it. They include,
among others, statutory obligations of proper disclosure and accountability to
shareholders. Therefore, any information pertaining to participation in such a public sphere
cannot rightly be held to be inhering in the person, and it cannot consequently be said that
in relation to such information a reasonable expectation of privacy exists. Nor would such
an expectation be recognised by society as objectively reasonable.2
[17] In Nova Property Group Holdings Ltd and Others v Cobbett and Another (Nova
Property),3 the Supreme Court of Appeal (SCA) held that s 26 of the Companies Act is
enacted with precisely the objectives of openness and transparency as embodied in s
7 (b)(iii) of the Act in mind. It held:
'It recognizes that the establishment of a company is not purely a private matter and may impact
the public in several ways. It therefore seeks to impose strong rights of access in respect of very
specific but ultimately limited types of information held by companies. Section 26 must, therefore,
be interpreted in accordance with this purpose. '4
[18] In Company Secretary, Arcelormittal South Africa Ltd and Another v Vaal
Environmental Justice Affiance (Arcelormitta~,5 the dispute arose from the refusal by
Environmental Justice Affiance (Arcelormitta~,5 the dispute arose from the refusal by
1 Bernstein and Others v Bester NO and Others [1996) ZACC 2; 1996 (4) BCLR 449; 1996 (2) SA 751 (CC).
2 Ibid para 85.
3 Nova Property Group Holdings v Cobbett [2016) ZASCA 63; (2016) 3 All SA 32 (SCA); 2016 (4) SA 317
(SCA).
4 Ibid para 18.
5 Company Secretary of Arcelormittal South Africa and An other v Vaal Environmental Justice Alliance [2014)
ZASCA 184; 2015 (1) SA 515 (SCA); [2015) 1 All SA 261 (SCA) (Arcelormittal).
7
Arcelormittal South Africa Limited of two PAIA requests made by the respondent, the Vaal
Environmental Justice Alliance (VEJA), a non-profit voluntary association (characterising
themselves as advocates for environmental justice), for information relating to
Arcelormittal's past and present activities, including the latter's documented historical
operational and strategic approach to the protection of the environment in the
Vanderbijlpark and Vereeniging areas, in each of which they operate a major steel plant.
[19] The SCA, in Arcelormittal, conceded that it was mindful of the caveat in Clutchco v
Davis (C/utchco),6 that one must guard against forcing corporates to throw open their
books on claims of alleged minor errors or irregularities. It concluded that the basis
provided by VEJA for its application does not fall into the category of trivial or frivolous. It
concerns us all. The SCA held that it is clear that VEJA supplied an adequate basis for its
requests and is entitled to the information sought; it is entitled as an advocate for
environmental justice to monitor the operations of AM and its effects on the environment.
The SCA found that the additional obstacle raised by Arce/ormittal that it is a private entity
that does not have the same responsibility as the State to make available its company
documents to third parties was found by the SCA to be without any merit.
[20] The SCA further held, in Arcelormittal, that local or international corporations
operating within our borders, must be left in no doubt that in relation to the environment in
circumstances such as those under discussion, there is no room for secrecy and that
constitutional values will be enforced.7
[21] In Goosen-Joubert v Women4Women NPC (Goosen-Joubert),6 the court held that
the right to access information is imperative in cultivating a culture of transparency and
accountability. I now turn to the relevant legislative framework
Legislative regime
accountability. I now turn to the relevant legislative framework
Legislative regime
[22] The starting point is the Constitution, which is the superior law of the land. Section
32(1 )(b) of the Constitution provides that everyone has the right of access to any
information that is held by another person and that is required for the exercise or protection
6 C/utchco (Pty) Ltd v Davis [2005] ZASCA 16; [2005] 2 All SA 225 (SCA); 2005 (3) SA 486 (SCA) (C/utchco).
7 Arce/ormitta/ para 82.
8 Goosen-Joubert v Women4Women NPC [2022] ZAWCHC 82 (Goosen-Joubert) para 69.
8
of any rights. Section 32(2) provided for national legislation to be enacted to give effect to
this right. The Promotion of Access to Information Act 2 of 2000 (PAIA) is the national
legislation contemplated in s 32(2) of the Constitution. Part 3 of that statute regulates the
rights of access to the records of private bodies. The first respondent, a private company,
is such body.
[23) Section 50 of PAIA provides for access to information of private bodies. One of the
threshold requirements for a requester to obtain access to information held by a private
entity under s 50(1 )(a) of PAIA is that the requester must prove that that information
requested is necessary for the 'exercise or protection of any rights'.
[24] Section 53 of PAIA sets out the process to be followed in seeking documents from a
private person. Section 53(1) states that a requester must be given access to any record
of a private body if: (a) that record is required for the exercise or protection of any rights
(b) that person complies with the procedural requirements in this Act relating to a request
for access to that record; and (c) access to that record is not refused in terms of any ground
for refusal contemplated in Chapter 4 of this Part. In terms of s 53(3), a request
contemplated in subsec (1) includes a request for access to a record containing personal
information about the requester or the person on whose behalf the request is made.
[25) Section 26(1) of the Companies Act provides as follows:
'26 Access to company records
(1) A person who holds or has a beneficial interest in any securities issued by a profit company, or
who is a member of a non-profit company, has a right to inspect and copy, without any charge for
any such inspection or upon payment of no more than the prescribed maximum charge for any
such copy, the information contained in the following records of the company:
(a) The company's Memorandum of Incorporation and any amendments to it, and any rules made
(a) The company's Memorandum of Incorporation and any amendments to it, and any rules made
by the company, as mentioned in section 24 (3) (a);
(b) the records in respect of the company's directors, as mentioned in section 24(3)(b);
(c) the reports to annual meetings, and annual financial statements, as mentioned in section 24 (3)
(c)(i) and (ii);
(d) the notices and minutes of annual meetings, and communications mentioned in section 24 (3)
(d) and (e}, but the reference in section 24 (3) (d) to shareholders meetings, and the reference in
section 24 (3) (e) to communications sent to holders of a company's securities, must be regarded
9
in the case of a non-profit company as referring to a meeting of members, or communication to
members, respectively; and
(e) the securities register of a profit company, or the members register of a non-profit company that
has members, as mentioned in section 24(4).'
[26] Section 26 of the Companies Act provides for access to company records specifically.
Section 26(1) states that a person who holds or has a beneficial interest in any securities
issued by a profit company, or who is a member of a non-profit company, has a right to
inspect and copy, without any charge for any such inspection or upon payment of no more
than the prescribed maximum charge for any such copy, the information contained in the
documents listed under that section. Those documents are listed in ss 24(3) and (4),
respectively. Those are precisely the documents that the applicant seeks access to in this
application.
[27] A beneficial interest, when used in relation to a company's securities, is defined as
the right or entitlement of a person, through ownership, agreement, relationship or
otherwise, alone or together with another person to - (a) receive or participate in any
distribution in respect of the company's securities; (b) exercise or cause to be exercised,
in the ordinary course, any or all of the rights attaching to the company's securities; or (c)
dispose or direct the disposition of the company's securities, or any part of a distribution in
respect of the securities but does not include any interest held by a person in a unit trust
or collective investment scheme in terms of the Collective Investment Schemes Act, 45 of
2002.
[28] From the above, it is quite evident that both PAIA and the Companies Act give effect
to the constitutional right of access to information contemplated in s 32 of the Constitution,
in various ways.
[29] Section 26 of the Companies Act has been amended through the Companies
Amendment Act 16 of 2024 (Amendment Act). Even though the Amendment Act has been
Amendment Act 16 of 2024 (Amendment Act). Even though the Amendment Act has been
passed into law, it was assented to on 27 December 2024. However, it will only come into
operation on a date to be fixed by the President by proclamation in the Government
Gazette. This has not happened. The effect is that only certain sections of the Amendment
Act are already operational while others will come into effect in future. I will deal with this
10
aspect below.
Section 26 of the Companies Act
[30] Section 26(1 ), read with s 24 of the Companies Act, grants shareholders of a company
the right to inspect the company's Memorandum of Incorporation (as well as any
amendments, alterations or rules thereto), the directors' records, the securities register of the
company, the annual financial statements of the company, any reports presented at an
annual general meeting of the company, the notices and minutes of all shareholders
meetings, including all resolutions adopted by the shareholders and any document that was
made available by the company to the shareholders in relation to each such resolution, and
copies of any written communications sent generally by the company to all shareholders.
[31] In terms of s 26(2) of the Companies Act, any other person (including a potential third
party purchaser) only has a right to inspect the company's securities register and the
company's register of directors.
[32] Section 26(3) of the Companies Act expressly allows for a company's MOI to establish
additional information rights (with respect to company information) for any person or
categories of person as long as such additional rights do not negate or diminish the
mandatory protection of any record as afforded by PAIA.
[33] Section 68 of PAIA stipulates that a request for company information may be refused
by the company if the information requested includes: (a) trade secrets of the company;
(b) financial, commercial, scientific or technical information, other than trade secrets, of the
company, the disclosure of which would be likely to cause harm to the commercial
or financial interests of the company; and (c) information, the disclosure of which could
reasonably be expected to put the company at a disadvantage in contractual or other
negotiations and/or prejudice the company in commercial competition.
[34] The applicant contends that they fall under s 26(1) in that, for the relevant period, he
was the holder of the beneficial interest.
was the holder of the beneficial interest.
[35] In respect of the process to be followed in exercising the rights, s 26(4) allows a
person exercising the rights set out in subsection (1) or (2), or contemplated in subsection
11
(3) to do so: (a) for a reasonable period during business hours; (b) by direct request made
to a company in the prescribed manner, either in person or through an attorney or other
personal representative designated in writing; or (c) in accordance with the PAIA. It is
noteworthy that the request under PAIA is an alternative to the exercise of the rights under
s 26(4)(a) and (b).
[36] Section 26(5) goes further to provide expressly, and in unqualified terms, that where
a company receives a request in the prescribed form, the company 'must within 14
business days comply with the request'.
[37] Section 26(7) makes clear that the right conferred by s 26(1) are in addition to, and
not in substitution for, any rights a person may have to access information in terms of (a)
s 32 of the Constitution; (b) PAIA; or (c) any other public regulation. There is, in addition,
no requirement in s 26 of the Companies Act that a request for access to a company's
securities register must only be exercised in accordance with PAIA.
[38] Section 26(9) makes it an offence to fail to accommodate any reasonable request for
access, or to unreasonably refuse access, to any record that a person has a right to inspect
or copy in terms of this section ors 31; or (b) to otherwise impede, interfere with, or attempt
to frustrate, the reasonable exercise by any person of the rights set out in this section or s
31.
[39] Counsel for both parties referred to Nova Property, where the SCA considered
whether s 26(2) of the Companies Act, which allows public access to a company's
securities (shareholder) register - conferred an unqualified right of public access.
[40] The SCA held that s 26(2) conferred an unqualified right of access to a company's
securities register, and the motive of the person seeking access was irrelevant.9 Any other
construction, such as that the right was subject to the requirements of PAIA or a
discretionary override - would clash with the Act's stated objective of transparency, 10 the
discretionary override - would clash with the Act's stated objective of transparency, 10 the
wording of s 26(2) and s 26(4),11 and the right to freedom of expression.12 Furthermore,
9 Nova Property Group para 47-48.
10 Ibid para 18.
11 Ibid paras 20, 23-32 and 35.
12 Ibid para 37.
12
that unqualified access to companies' securities registers was essential for effective
journalism and an informed citizenry,13 and there was, in the absence of an express
statutory limitation on this right, no basis for the court to limit it.14
[41] This is the applicable legislation whose provisions the applicant has to prove that he
has met.
The motive behind the request
[42] The applicant stated that, during the relevant period, he was a director who oversaw
all operations in the warehouse as he is an artisan, while the second respondent managed
the day-to-day operations of the first respondent in respect of all financial and operational
duties based on his qualifications as a T5 technician. This, according to the applicant,
explains why he is not in possession of the documents that he seeks access to in this
application. This is also because, on the applicant's version, he did not have insight into
the financials daily or monthly, even though he was an active director at a time.
[43] The applicant argued that he suspects that, during the relevant period, there may
have been financial misconduct committed by the second respondent in respect of the first
respondent. Therefore, he seeks access to the company documents to establish if this is
indeed the case. He also he seeks access to the relevant documents because subsequent
to signing the sale of shares agreement with the third respondent in September 2023, he
became aware of discrepancies, particularly of a financial nature, which he was unaware
of at the time that he held a beneficial interest. He also suspects that the amount that he
was paid in respect of the shares may have not been the true value of the 50/%
shareholding that held when he was a shareholder in the first respondent. If any of these
suspicions are true, it is no surprise why the respondents are opposed to him being granted
access to the relevant documents.
[44] The criticism that was levelled by the respondents was that the applicant did not state
[44] The criticism that was levelled by the respondents was that the applicant did not state
that he sought the documents for the protection of rights.
[45] In light of what the SCA stated in C/utchco (which I discuss in more detail below), that
13 Ibid para 38.
14 Ibid para 42.
13
'required' does not mean necessary, but merely 'reasonably required', this contention must
fail because the applicant specifically and expressly stated the following in paragraph 30
of the founding affidavit:
'The information requested is reasonably required to exercise the protection of my rights as a
shareholder and director of the first respondent. The right I am attempting to protect in terms of the
application is my right to share in the profits of the first respondent and to be reasonably
compensated for my shares within the company.'
[46] The exact wording of what the applicant stated, is what s 32 of the Constitution
protects, which is his right to access information that he requires for the exercise or
protection of any rights. Therefore, this argument by the respondents ought to fail since
the applicant satisfied the test set out in Clutchco for requesting the relevant documents.
[47] The respondent also criticises the applicant's request for access to the first
respondent's information and documents that relate to the relevant period on the basis that
this is in effect a fishing expedition as the applicant is not certain that he will institute legal
proceedings or not and merely seeks access to information to consider his options. The
respondents contend that this is impermissible. In this regard, they rely on the SCA
authority in Mahaeeane and Another v Anglogold Ashanti Limited (Anglogold),15 which I
discuss in detail below.
[48] In Nova Property, 16 the SCA held that PAIA cannot be used to frustrate a person's
rights to company information and records. The technical arguments that the respondents
have raised in relation to the applicant's PAIA request for documents, which was over and
above his request under s 26 of the Companies Act appears precisely to achieve this
purpose.
[49] In Nova Property, the SCA held that when the media reports on matters, it must do
so accurately, and the accuracy of the reporting depends on the ability to exercise its right
so accurately, and the accuracy of the reporting depends on the ability to exercise its right
to access records and information.17 When the right to access information is hindered, the
right to freedom of expression is restricted. The violation of the right to freedom of
15 Mahaeeane and Another v Ang/ogold Ashanti Limited [2017] ZASCA 90; [2017] 3 All SA 458 (SCA); 2017
(6) SA 382 (SCA).
16 Nova Property para 21-23.
17 Nova Property para 37.
14
expression is not only a violation of the rights of the journalists involved but extends to
those who rely on the media for information. The court, in Nova Property, held that the
rights under s 26 of the Companies Act are additional to any rights to access information
provided for in PAIA. PAIA is, therefore, an alternative method to access the share register
of a company.
[50] In Goosen-Joubert, the high court considered the rights of an applicant who was not
a member of the non-profit company (NPC) to such company's financial information. The
court considered the fact that the respondent was an NPC with the object of empowering
and supporting married women. Also, the applicant had invested considerable time and
effort in the activities of the respondent and assisted it to raise funds.18
[51] In Goosen-Joubert, the applicant argued that the information and documents were
required to protect or exercise her right to just administrative action, the promotion of public
interest, and her right to equality before the law.19 In her request, the applicant also
indicated that she required the documents and information to lay a charge of theft. In
dealing with the legal aspects of the application, the court had to determine whether she
has met the requirements for access to the company documents that he sought. The court,
under PAIA, granted the applicant access to all the company's general ledgers and other
documentation used in the preparation of the company's financial statements.
Fiduciary duties of directors
[52] In terms of s 76(3) read with s 76(4) of the Companies Act, every director has a duty
to participate in the management and affairs of a company and must do so by exercising
the required duty of care, skill, and diligence, and by acting in the best interests of the
company. A director is entitled, at common law, to receive all the records and information
reasonably necessary to exercise an informed and independent judgment to enable them
reasonably necessary to exercise an informed and independent judgment to enable them
to participate meaningfully in the business and affairs of a company and to properly
execute their duties.
[53] Some of the directors' fiduciary duties outlive the directors' presence in the company.
This means that, to this day, the applicant could be held liable for any conduct that took
18 Goosen-Joubert para 57.
19 Ibid para 45.
15
place during his tenure at the first respondent. This is how fiduciary duties work.
[54] The bench posed a question to counsel for both parties on what their respective
attitudes would be if there was a query or even legal proceedings instituted against the first
respondent for alleged misconduct or financial or other impropriety, by for example SARS,
the Reserve Bank or maybe a supplier that they dealt with during the relevant period. If the
applicant were to make the same request that he has made to the respondents on the
basis that he needs the documents in question in order to respond to that query or defend
himself in the legal proceedings and the first respondents maintained the same attitude
that he has maintained in these proceedings, would the respondents then absolve the
applicant from any wrongdoing because it is essentially prohibiting him from exercising his
right to access to information required for the exercise or protection of any rights, as set
out in set out in s 32 of the Constitution.
[55] There was no direct response from counsel for the respondents. This is instructive
because it is highly unlikely that the second respondent would have absolved the applicant
from liability in those scenarios. He would most likely have invoked the applicant's fiduciary
duties during the relevant period and argued that to the extent that the applicant may have
failed to exercise his fiduciary duties during the relevant period, then he should be held
liable.
[56] The question then remains how else the applicant would have been expected to
exercise or protect any of his rights as contemplated in s 32(1 )(b) of the Constitution. This
is the question that remains unanswered by the respondents.
[57] However, the respondents provided a hint to a response to this question. In response
to the applicant's contention that he was not involved in the financial and day-to-day
running of the respondent during the relevant period since his involvement was limited to
running of the respondent during the relevant period since his involvement was limited to
managing the workshop, counsel for the respondents stated that the applicant cannot raise
those arguments because as a co-director of the first respondent during the relevant
period, he had fiduciary duties that he simply cannot wish away or denounce now that he
is no longer part of the first respondent. This response demonstrates precisely what is
wrong with the respondents denying the applicant a right of access to the documents that
he requires because at the very least he needs to protect his right as director (and
16
shareholder) during the relevant period. This demonstrates why he ought to be granted
access to the documents.
[58] The nature of fiduciary duties is such that some of them outlive the director's
involvement in a company. Any party can hold that director liable after the event for any
conduct that occurred while he was a director of the company. In light of that, it simply
cannot follow that he ought to be refused documents in the hope that no one holds him
liable for that. The protection of the right that the applicant seeks to exercise is to know
that everything was done above board during the relevant period.
[59] What was also puzzling is that the applicant attached to his founding affidavit, the
unsigned sale of shares agreement and required the signed version from the respondents.
The respondents' response was not to simply attach it but instead they stated that he
should be in possession of it. This is a non-useful response, especially for a party, who
has taken time and effort to approach court to seek access to these documents.
[60] A related question is whether the resignation of the director of the company
terminates his fiduciary duties. This question arose in Big Catch Fishing Tackle Proprietary
Limited and Others v Kemp and Others,20 where the court held that an executive director
may not carry on business activities within the company's scope of business during such
time as he/she is a director, but may change upon resignation, in the absence of a restraint
of trade or the limitation on use of confidential information agreements, et cetera. In case
of post-resignation, and in the absence of aforementioned agreements, a director does not
commit a breach of fiduciary duties by starting a similar business or joining a competitor,
however a breach could very well be committed if the company's confidential information
is used or if such use violates the company's interest, which is worthy of protection. The
is used or if such use violates the company's interest, which is worthy of protection. The
latter finding by the court is the flip side of the argument presented by the applicant before
this court.
No benefit from the Turquand rule
[61] The applicant cannot even assume that during the relevant period the first respondent
conducted itself appropriately and complied with its guiding documents, including the
memorandum of incorporation. The applicant is prohibited from deriving a benefit from the
20 Big Catch Fishing Tackle Proprietary Limited and Others v Kemp and Others 2019 ZAWCHC 20.
17
codification of the Turquand rule in s 20(7) of the Companies Act. This is because s 20(7)
provides that a person dealing with a company in good faith, other than a director,
prescribed officer or shareholder of the company, is entitled to presume that the company,
in making any decision in the exercise of its powers, has complied with all of the formal
and procedural requirements in terms of this Act, its MOI and any rules of the company
unless, in the circumstances, the person knew or reasonably ought to have known of any
failure by the company to comply with any such requirement.
[62] Because the applicant was a director and shareholder of the first respondent during
the relevant time, he is excluded from deriving a benefit from this provision, which makes
the need to obtain the relevant documents all the more necessary as he could never derive
any benefit of the Turquand rule.
Right of access under s 26 of the Companies Act
[63] As the former director of the first respondent, if this court finds that he holds a
beneficial interest for the relevant period in accordance with s 26(1 ), then it should follow
that he will be entitled to the documents that he seeks from the respondents.
[64] Insofar as the applicant seeks access to the documents and information in his
capacity as the shareholder, the SCA decision in Clutchco is instructive.21 In that case a
shareholder sought access to company's books of first accounting entry (such as cash
books, ledgers, journals and invoice books), alleging impropriety in company's financial
statements and asserting a right to establish the true financial position of the company in
order to be able to value his shareholding for purposes of resale.
[65] The SCA , in Clutchco, held that the right of access to first entry book does not avail
a shareholder where he asserts minor errors and that he needed more substantial grounds
of why he needed the information. More importantly, the SCA held that there might exist
of why he needed the information. More importantly, the SCA held that there might exist
special circumstances in which a court would, in terms of s 252 of the old Companies Act
61 of 1973, grant some form of access to company information to a member who
complained of oppressive conduct by the company.22 This case was decided under the old
Companies Act but the reasoning relating to the need to make available company
21 Op cit fn 7.
22 Ibid para 14.
18
documents and records to a shareholder where there is suspicion of oppressive or
improper conduct holds.
[66] In C/utchco, the SCA held that, in terms of s 50(1)(b) of PAIA, the 'requester' of
access to the records of any private body had to assert that the information was 'required
for the exercise or protection of (a) right'. In this context, 'required' meant not 'needed', but
rather 'reasonably required' in the particular circumstances,23 as long as it connoted a
substantial advantage or an element of need.24
[67] The SCA in Clutchco held that under the old Companies Act, a member is entitled to
receive copies of the company's annual financial statements (ss 286, 302, 309) and to
obtain copies of the minutes of the company's general meetings (ss 204, 206). A
shareholder is not entitled to sight of the minutes of directors' and managers' meetings
maintained in terms of s 242. Nor, unless the articles of association otherwise provide, is
he or she entitled to inspect the accounting records of first entry maintained by the
company in terms of s 284, unless the company's articles of association (more particularly,
article 24) provide otherwise or in special instances where a court orders. However, that
party could invoke Part 3 of PAIA provided that the circumstances warrant such a course.25
Clutchco went on to state different provisions under the old Companies Act that protect the
interests of shareholders.26 Under the new Companies Act, s 26(1) provides that anyone
who holds or has a beneficial interest in the company has the right to inspect and copy the
documents that are listed in that subsec and s 24(3) and (4) as I have mentioned above.
[68) Under the new Companies Act, s 26(1) provides that anyone who holds or has a
beneficial interest in the company has the right to inspect and copy the documents that are
listed in that subsection and s 24(3) and (4). Considering the definition of beneficial interest,
the applicant holds a beneficial interest in relation to the first respondent's securities for
the 19 years that he was a director and shareholder of the first respondent as he held, for
that period, a right or entitlement, through ownership, agreement, relationship or otherwise
to (a) receive or participate in any distribution in respect of the company's securities; (b)
exercise or cause to be exercised, in the ordinary course, any or all of the rights attaching
23 C/utchco para 12 and 13.
24 Ibid paras 11 and 13.
25 Ibid para 14.
26 Ibid para 15.
19
to the company's securities; or (c) dispose or direct the disposition of the company's
securities, or any part of a distribution in respect of the securities. He therefore falls under
s 26(1) and is entitled to the documents listed in s 26(1) read with s 24(3) and (4) of the
Companies Act, which he has listed in his notice of motion.
[69] What the respondents have not informed the court is that there are some of the
documents that the respondents are not in possession of. The respondents had this
opportunity and they did not use it and, instead, relied on technical arguments. It appears
as if they could not do so because these are crucial documents that speak to how the
second respondent conducted the financial affairs of the first respondent, presumably to
the applicant's lack of knowledge, during the relevant period.
[70] Section 19(4) of the Companies Act states that subject to subsec (5), a person must
not be regarded as having received notice or knowledge of the contents of any document
relating to a company merely because the document - (a) has been filed; or (b) is
accessible for inspection at an office of the company. It is therefore no answer to the
applicant's request for documents that he can obtain those documents from the CIPC.
Section 19(4) provides that a party obtaining documents from the CIPC does not amount
to a party as 'having received notice or knowledge of the contents of any document relating
to a company'.
[71] In Nova Property, albeit in the context of interpreting s 26(2), the SCA discussed the
workings of s 26. It held as follows:
'The second aspect of s 26(2) of the Companies Act that requires emphasis is the nature of the
right conferred by it in the context of s 26 as a whole. Unlike its predecessor, s 113 of the old
Companies Act, s 26(2) expressly confers a right of access in respect of the securities registers.
Section 26(5) then goes further and provides expressly, and in unqualified terms, that where a
Section 26(5) then goes further and provides expressly, and in unqualified terms, that where a
company receives a request in the prescribed form, the company 'must within 14 business days
comply with the request'. There is nothing in ss 26(2) and 26(5) which, in any way, qualifies this
right. Nor is there any reference in these sections to the reasonableness of either the request or
the response. The only sub-section which mentions reasonableness is s 26(9), which creates the
criminal prohibition. It provides:
"(9) It is an offence for a company to - fail to accommodate any reasonable request for access,
or to unreasonably refuse access, to any record that a person has a right to inspect or copy in
terms of this section or section 31; or to otherwise impede, interfere with, or attempt to frustrate,
20
the reasonable exercise by any person of the rights set out in this section or section 31."
A reasonable request in my view would be one which is made in accordance with the provisions of
s 26(4)(a) and (b) of the Companies Act.'27
[72] As was held in Nova Property, if Parliament had wanted to limit the s 26(2) right, it
would have done so expressly. Instead, it enacted an unqualified right ins 26(2) read with
s 26(4) and introduced a reasonableness qualification only in respect of the criminal
offence created bys 26(9).28 Even though this was in the context of section 26(2), it applies
with equal force in respect of section 26(1 ), which also does not contain a reasonableness
qualification.
[73] The SCA in Nova Property concluded that s 26(2) clearly confers an unqualified right
on members of the public and the media to obtain access to share registers. This means
that the 'motive' with which the person seeks access to the information concerned is
irrelevant.29 Nova Property further held that the motive for seeking documents (under s
26(2), which also applies to s 26(1) in light of the formulation of both provisions) is
irrelevant. Therefore, the respondents' contention that the motive which the applicant has
provided for seeking the relevant documents, i.e. to appoint a forensic auditor who will
conduct an investigation and upon his or her findings, the applicant will decide whether or
not to institute a damages claim against the respondent cannot be discounted. This is
particularly the case because s 32(2) does not merely require a party that requires access
to information merely to exercise a right but also to protect a right. This is precisely what
the applicant intends to do. This is particularly because the information and documents
that he seeks in this application relate to how the first respondent was managed financially
by the second respondent and the value of his shareholding.
[74] In Tiso Blackstar Group (Pty) Ltd v Steinhoff International Holdings N. V. (Tiso
[74] In Tiso Blackstar Group (Pty) Ltd v Steinhoff International Holdings N. V. (Tiso
Blackstar),30 the court granted the applicants (media houses and journalists, not
shareholders of the respondent, Steinhoff) access to a forensic report requisitioned by
them in terms of the PAIA. The objective of the report was to document findings by the
27 Nova Group para 26.
28 Ibid para 27.
29 Ibid para 28.
30 Tiso Blackstar Group (Ply) Ltd and Others v Steinhoff International Holdings N . V [2022] ZAWCHC 265;
2023 (1) SA 283 (WCC).
21
audit firm PricewaterhouseCoopers International Limited (PwC) during its investigation into
alleged accounting irregularities in Steinhoffs annual financial statements. This would
suggest that the report could be viewed as management information to which, in principle,
only directors are entitled to the extent that it is required to execute their legal duties.
[75] The court held that the onus rested on Steinhoff to justify the refusal of the report.31
Steinhoff denied the applicants access to the forensic report and argued, in the first
instance, that the report was not required for the applicants to exercise their right to
freedom of expression, and secondly, that the report was legally privileged, because it was
commissioned to obtain legal advice.32
[76] The court rejected Steinhoffs first argument on the basis that the applicant was
unable to exercise its right to freedom of expression under s 16 of the Constitution because
the information available in the public domain was incomplete. It held that Steinhoff had
failed to prove that the refusal was justified on the grounds provided for in s 67 .33 The court
also rejected Steinhoffs second argument on the basis that it had failed to prove on a
factual basis that the report was protected by legal privilege.34 This was based on the letter
of engagement, which stated that the purpose of PwC's appointment was to investigate
accounting irregularities in Steinhoffs financial statements, the court held that the report
had been requested for purposes of the production of financial statements35 and Steinhoffs
failure to mention in its SENS announcement to the market that the report was
requisitioned for purposes of actual or contemplated litigation or that the report had been
requested by its attorneys.36
[77] Consequently, the court found in favour of the applicants and granted them access
to the forensic report to enable access to correct information, which would allow them to
to the forensic report to enable access to correct information, which would allow them to
report accurately on matters of public interest. The right of the media entails the right to
press freedom, the right to receive information or ideas, and the constitutional right to
freedom of expression. Even though no reliance was placed on the Companies Act to
obtain access to the forensic report, the judgment and its effects raise pertinent questions
31 Ibid para 41; see also s 67 of the PAIA.
32 Ibid para 37 and 43.
33 Ibid para 38-40.
34 Ibid para 65-66 and 70.
35 Ibid para 57 and 59.
36 Ibid para 55 and 64.
22
about the rights of the media and other stakeholders to access information deemed to be
in the public interest, vis-a-vis the rights of shareholders and members of the public to
company records and information under the provisions of s 26(1) and 26(2), respectively,
of the Companies Act.
[78] The respondent relied on Unitas Hospital v Van Wyk & Anothef37 to contend that the
applicant did not make an effort to substantiate the request made on form C, and no sound
reason has been given for such requested documents. This was in support of the
respondent's argument that the applicant failed to make out a case for access to
information in terms of section 53 of the PAIA, as he had allegedly failed to state what the
right is that he wishes to exercise or protect, what the information is which is required and
how that information would assist him in exercising or protecting that right. This is
substance over form insofar as the applicant's PAIA request for information is concerned,
for reasons advanced above.
[79] The respondents also relied on Anglogo/d,36 where the applicants in that case
requested a list of ten records in terms of s 50(1) of the PAIA on the basis that such
information was required by their attorneys to advise on whether they have adequate
grounds to seek a remedy against the respondent, ie, to claim damages. The SCA held
that the underlying reasons given for why the records were required did not relate to the
exercise of the right to claim damages, but to the evaluation of whether the appellants
should do so or not. The reasons given, therefore, did not meet the test of the records
being 'required to exercise or protect' the right relied upon. On this basis, the respondents
submitted that the applicant has failed to discharge the onus in relation to the aforesaid
requirements. The respondents rely on the strength of this judgment to contend that the
applicant is not entitled to access to the required documents because he does not seek
applicant is not entitled to access to the required documents because he does not seek
them to exercise his right to claim damages, but rather to evaluate whether to do so or not,
which according to the respondents was rejected by the SCA in Anglogold.
[80] Anglogold is distinguishable in that in that case the request was exclusively in terms
of s 50(1) of PAIA. In this application, the main basis for requesting information is s 26(1)
of the Companies Act. The applicant was quite express that a request under PAIA was an
37 Unitas Hospital v Van Wyk and Another [2006] ZASCA 34; 2006 (4) SA 436 (SCA); [2006] 4 All SA 231
(SCA).
38 Op cit fn 16.
23
additional or alternative request for the sake of completeness.
[81] Anglogold is also distinguishable from this case in that in that case, the respondent's
argument was that since the appellants' request was received after the commencement of
the certification application, the operation of PAIA was excluded under s 7(1), which
provides that PAIA does not operate where the record is requested after the
commencement of proceedings and the production of or access to that record is provided
for in any other law. This was a live issue, which does not arise in the present proceedings.
[82] Insofar as the purpose for which the appellants in Anglogold sought the documents
in question, in that case it was found those reasons were not related to the exercise of the
right to claim damages but to the evaluation of whether they should do so, which meant
that they were not required to 'exercise or protect' the right relied on. This is because in
that case, most of the facts were within the knowledge of the appellants or admitted by the
respondent. The SCA concluded that since the appellants were clearly in a position to
formulate their claim without the requested documents, the documents in question were
not reasonably required for the exercise of the appellants' right to claim damages from the
respondent.
[83] This is not the case in the present matter. The facts that the applicant needs to
establish from accessing the relevant documents are not within his knowledge or admitted
by the respondents. In fact, it is quite the opposite as the respondents are relying on
technicalities to avoid giving him any of the relevant documents. Furthermore, the nature
and kind of the documents that the applicant seeks are reasonably required to formulate
his claim as he states that he suspects financial misappropriation in the hands of the
second respondent and/or that the value he obtained from selling his shares to the third
respondent may not have been properly quantified. Once he obtains these documents,
respondent may not have been properly quantified. Once he obtains these documents,
only then would he know if indeed there is financial misappropriation that was done by the
second respondent on the first respondent, its nature, the period within which it was
conducted and the amounts in respect of which it was done as well as the correct valuation
of his shares as at September 2023. He intends to uncover all this information through
appointing a forensic auditor. Only upon receipt of the forensic auditor's report would he
know how to formulate his claim and how much he should claim for in compensation. This
is a clear demonstration of how the present case is distinguishable from Anglogold.
24
[84] To further demonstrate the distinguishability of the present case with Anglogold, in
the latter case, the respondent was found to have provided all the records which contained
most of the facts, which were within the knowledge of the appellants or admitted by the
respondent. This is not the case in the present case. Some of the documents that the
applicant requires are founding documents such as the MOI, reports presented at the
annual general meetings of the first respondent; annual financial statements of the first
respondent, accounting records of the first respondent, notice and minutes of all
shareholder meetings, including all resolutions adopted by the shareholders and any
document that was made available by the first respondent to the holders of the securities
in relation to each resolution adopted; copies of all written communication sent generally
by the first respondent to all holders of any class of the first respondent's securities;
minutes of all meetings and resolutions of directors or directors' committees, or the audit
committee of the first respondent etc. It cannot be argued that the applicant is in a position
to formulate his claim against the respondents, if any, in the absence of these crucial
documents. They are therefore reasonably required for the exercise of protection of his
rights as contemplated in s 32 of the Constitution, read in the main with s 26 of the
Companies Act and, in the alternative or additionally, with ss 50 and 51 of PAIA.
[85] It is no answer for the respondents to place the applicant under s 26(2) category and
contend that he should have followed the process set out in that provision by making the
request and paying the prescribed fee when it is clear that he is not in the category of the
members of public who seek company registers for companies that they have never been
involved in or held a beneficial interest. Doing so would go against the intention of the
involved in or held a beneficial interest. Doing so would go against the intention of the
legislature when it made a distinction between the groups of people that fall under s 26(1)
and those that fall under s 26(4).
Compliance with PAIA
[86) Section 50(1 )(a) provides that a 'requester' must be given access to any 'record' of a
private body if 'that record is required for the exercise or protection of any right'. Such right
of access is far from untrammelled, as appears from the rest of Part 3. The expression
'required for the exercise or protection of any rights' is also to be found in item 23(2)(a) of
Schedule 6 to the Constitution, being the transitional arrangements in relation to the right
to information.
25
[87) In Nova Property, the SCA held that the use of the word 'or' ins 26(4)(b) (instead of
the conjunction 'and') makes it clear that procedurally, PAIA is an alternative to requesting
and obtaining access to a company's records in terms of s 26 of the Act.39 This finding is
consistent with the provisions of s 26(7) of the Companies Act, which makes clear that the
right conferred by s 26(1) are in addition to, and not in substitution for, any rights a person
may have to access information in terms of (a) s 32 of the Constitution; (b) PAIA; or (c) any
other public regulation.
[88) A complaint raised by the respondents was that the requests made for access to
information both on 21 February 2024 and on 14 June 2024, respectively, were directed
to the attorneys of the first respondent and not to the first respondent directly. This in my
view is placing substance over form. The essence of this provision is that the request for
information must come to attention of the relevant representatives of the company so that
they could provide the relevant information. Part of that reason is because s 26(5) provides
that for the requests made in the prescribed manner, under subsec (4)(b) it must within 14
business days comply with the request by providing the opportunity to inspect or copy the
register concerned to the person making such request. Because of this time limit among
other factors, it is crucial that the relevant individual(s) within the company receive the
request for information timeously so that they can furnish the requested information and
documents to the requester timeously.
[89) It is common cause that both requests for information reached the respondents. On
or about 14 March 2024, the respondents responded to the first request dated 21 February
2024. In its answering affidavit, the respondents indicated that there was no need to
respond to the latter letter as they had already communicated their position in their letter
respond to the latter letter as they had already communicated their position in their letter
in response, dated 14 March 2024. There could also be no valid criticism that the
respective requests were not clear regarding the nature of the information that the
applicant sought from the respondents because all the required documents are clearly
listed in each of the requests.
[90) Therefore, to the extent that the applicant submitted a PAIA request to the
respondents' attorneys, that is in addition to, and not in substitution for, any rights that the
39 Nova Property para 30.
26
applicant has to access information in terms of section 32 of the Constitution, section 26
of the Companies Act, PAIA; or any other public regulation.
[91] In Goosen-Joubert, where a party sought access to documents of the NPC, the court
held that it is in the public interest to ensure that funds raised by and for the respondent
are used for its stated purpose.40 The right to access information fosters a culture of
transparency and accountability in both public and private bodies.41 The court emphasised
that a body to which a request for access to records is made, must deal with the specific
request even though the requested records or information may already be available to the
applicant.42 The fact that the information that the applicant requested was available on the
respondent's website, attached to the founding papers of the application, or the fact that
the applicant was invited to a roundtable discussion, is no defence to not formally dealing
with a request for access to records in a proper manner.43 A body has a duty to respond
formally to a request for access to records or information as detailed in s 56 of the PAIA.
In a bold and innovative judgment, the court granted the applicant access to the accounting
records and bank statements of the respondent which she was not a part of, as she was
only a contestant to the beauty pageant organised by the respondent.44
[92] This is a critical judgment in the context of a requester who did not hold a beneficial
interest in the company in the strict conservative interpretation that the respondents
contend for. But the time she had spent in the organisation qualified her to be granted this
information.
[93] In Goosen-Joubert, the court stated that even if the applicant was a member of the
public, and had a reason to believe that the respondent's funds were not being used in a
manner that [they were] intended, she was entitled to invoke the provisions of PAIA.45
manner that [they were] intended, she was entitled to invoke the provisions of PAIA.45
[94] This remark in Goosen-Joubert is significant. It demonstrates a very liberal
interpretation, especially since the court referred to the remedy as an 'extraordinary
remedy'. Granted, in Goosen-Joubert, the company in question was an NPC. This may
40 Goosen-Joubert para 69.
41 Ibid.
42 Ibid para 66.
43 Ibid para 66 and 67.
44 Ibid para 18 and 73.
45 Ibid para 69.
27
have contributed to the court's adopted approach since members of the public do not have
financial interests in the company, nor are they members of the media. The one
explanation could be that in light of the company being an NPC, then its expenditure could
be regarded as being in the public interest
[95] The applicant is even in the better position than the applicant in Goosen-Joubert since
between 1999 and September 2023, he was a director and 50% shareholder of the first
respondent. He is certainly not a member of the public, as contemplated in s 26(2). There
is therefore no reason why he should be treated in the same way as people contemplated
in s 26(2) of the Companies Act as contended by the first respondent. In addition to the
above, this is why the applicant can simply not fall under s 26(2) category as contended
by the respondents.
[96] The potential effect of Tiso Blackstar is that those who do not have a direct legal
relationship with the company, may be entitled to a wider scope of company information
and records relative to a person who holds a beneficial interest in the company's securities.
This is highlighted in the judgment in Goosen-Joubert where the court granted the
applicant, who was not a member of the media or a member of an NPC, access to
accounting records and bank statements of the company.
[97] In Afriforum v Emadlangeni Municipality,46 the full bench restated the purpose of
PAIA, how it ought to be interpreted and discouraged the overly technical interpretation of
PAIA. It held as follows:
'In my view, the court a quo overlooked the objects and purpose of PAIA, which among others, is
to provide a simple and inexpensive mechanism of obtaining information held by public bodies.
Also, what seems to have eluded the court a quo, is the injunction in s 2(1 ), which provides that
when interpreting a provision of PAIA, every Court must prefer any reasonable interpretation of the
provision that is consistent with the objects of this Act over any alternative interpretation that is
inconsistent with those objects. In my view, the court a quo adopted too technical an approach to
the application. That approach led it astray, and in the process, scrutinized the applicant's request
for access to the records with an eye reserved for court pleadings. That is inconsistent with the
objects of PAIA.'
[98] The respondents also raised a complaint under the principle of subsidiarity. The
46 Afriforum v Emad/angeni Municipality [2016] ZAGPPHC 1222 para 38.
28
respondents' complaint is that the applicant cannot rely directly on the Constitution in an
attempt to circumvent reliance on the legislation that deals directly with right of access to
information.
[99] In MEG for Education, KwaZulu-Natal, and Others v Pil/ay,47 the Constitutional
Court held that a litigant cannot circumvent legislation enacted to give effect to a
constitutional right by attempting to rely directly on the constitutional right. To do so would
be to 'fail to recognise the important task conferred upon the legislature by the Constitution
to respect, protect, promote and fulfil the rights in the Bill of Rights'. There is no merit to
the respondents' complaint because the applicant has framed his case by making
reference to s 32 of the Constitution in the context of the right to access information since
the Constitution is the supreme law of the land.
[100] It is clear from the application that the documents and information that the applicant
seeks is premised on s 26(1) of the Companies Act. His reliance on PAIA is in addition to,
and not in substitution for, any rights that the applicant has to access information in terms
of s 32 of the Constitution, PAIA; or any other public regulation. The respondents' complaint
on this score ought to fail.
[101] It appears that our courts have clearly signalled a change in direction from the
approach adopted in Clutchco, and that the provisions in s 26(1) and 26(2) of the
Companies Act are virtually obsolete, especially from the perspective of the holder of a
beneficial interest in a company under s 26(1 ). This is an important development in light of
the recent amendments to s 26 of the Companies Act, which was signed to law on 27
December 2024, but this particular section is not yet in operation (while others came into
effect on 27 December 2024) for reasons I discuss next.
Amendments to the Companies Act, including s 26
[102] The scope of company information which is accessible to external parties (i.e. non
[102] The scope of company information which is accessible to external parties (i.e. non
shareholders and non-directors), such as third-party purchasers, in terms of s 26(2) of the
Companies Act is very limited. The reason for this is that the Act seeks to prevent access to
sensitive company information by persons who may not have a legitimate interest in such
47 MEG for Education: Kwazu/u-Natal and Others v Pi/lay [2007] ZACC 21 ; 2007 (3) BCLR 287 (CC); 2007
(2) SA 106 (CC); (2007) 28 ILJ 133 (CC) 2008 (1) SA 474 (CC) para 40.
29
information.
[103) However, specific sections of the Companies Amendment Act 2024 and the entire
Companies Amendment Act, and the entire Companies Second Amendment Act,
2024 (collectively, Companies Amendment Acts, 2024) came into effect on 27 December
2024. The Companies Amendment Acts of 2024 introduce several changes to the
Companies Act of 2008.
[104) Several amendments in the Companies Amendment Acts of 2024 that have not
come into effect require the manner and form of documents, fees, or other items to be
prescribed or determinations to be published, including through amended Companies
Regulations, to implement the relevant amendment. However, updates to the Companies
Regulations have not yet been published.
[105) For purposes of this judgment, amendments to the Companies Act 2024 which are
not yet in effect include s 26 of the Companies Act. The amendment to s 26 is to the effect
that third parties have the right to access directly from a company, the company's
Memorandum of Incorporation, rules, the record of directors contemplated in s 24(3)(b),
the annual financial statements (AFS) and the register of disclosure of beneficial interests
(where this is required). This is in addition to the securities and directors' registers, to which
they already have access under s 26(2).
[106) The amendment also states that third parties cannot have access to the AFS of
private, personal liability and non-profit companies with a public interest score below a
certain threshold (less than 100 for internally prepared AFS and less than 350 for
independently prepared AFS).
[107) These amendments are significant and they demonstrate the direction that the
legislators are taking by granting access to third parties some of the documents listed ins
26(1) read with ss 24(3) and (4) of the Companies Act. It is therefore untenable to refuse
the applicant access to the relevant document when soon people who have never held a
the applicant access to the relevant document when soon people who have never held a
beneficial interest in the company and who were restricted to the company's securities
register under s 26(2) will now have access directly from a company , to the company's
Memorandum of Incorporation, rules, the record of directors contemplated in s 24(3)(b),
30
the annual financial statements (AFS) and the register of disclosure of beneficial interests
(where this is required). In any event, this is in addition to the finding that I made above
that the applicant has or holds a beneficial interest in the first period for the relevant period
of 19 years that he was a director and shareholder of the first respondent.
[108] There is therefore no basis for the respondents to contend that for the relevant
period the applicant does not hold a beneficial interest. It is a right that attached to him for
the relevant period. This is particularly the case in light of the discussion above that he is
not absolved of any conduct during the relevant period. Therefore, an attempt to place him
in the category of s 26(2) is without substance as that section applies only to this parties,
such as shareholders who want to value the shares of the company or the media that
seeks to report about the activities of the company etc. The applicant's beneficial interest
for the relevant can simply not be taken away through technical arguments that seek to
waive or denounce his beneficial interest for the relevant period.
[109] I therefore make the following order:
1 The first, second and third respondents are directed to make the following
documents available to the applicant, within fourteen (14) days from date of this order:
1.1 The first respondent's memorandum of incorporation and any amendments to it;
1.2 A record of the directors of the first respondent, including details of any person
who has served as a director of the first respondent;
1.3 Copies of all reports presented at the annual general meetings of the first
respondent;
1.4 Annual financial statements of the first respondent, as contemplated in the
Companies Act, 71 of 2008;
1.5 Accounting records of the first respondent as contemplated in the Companies
Act;
1.6 Notice and minutes of all shareholder meetings, including all resolutions
Act;
1.6 Notice and minutes of all shareholder meetings, including all resolutions
adopted by the shareholders and any document that was made available by the first
respondent to the holders of the securities in relation to each resolution adopted;
1.7 Copies of all written communication sent generally by the first respondent to all
holders of any class of the first respondent's securities;
1.8 Minutes of all meetings and resolutions of directors or directors' committees, or
the audit committee of the first respondent; and
1.9 The security register of the first respondent.
2 The abovementioned documents should be in relation to a period of 19 years
from 1995 when the applicant became a director and shareholder of the first
respondent (together with the second respondent) until when he sold his shares to the
third respondent on 28 September 2023;
3 The first, second and third respondents are directed to pay the costs of the
application, including the cost of counsel on scale B.
31
B LEKOKOTLA
ACTING JUDGE OF THE HIGH COURT
32
Appearances
For the applicant: A van der Merwe
Instructed by: Leahy Attorneys Inc, Pretoria
c/o McIntyre van der Post Attorneys, Bloemfontein
For the respondent: R van der Merwe
Instructed by: De Beer & Classen Attorneys,
c/o Phatshoane Henney Inc Attorneys, Bloemfontein.