THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION, JOHANNESBURG
Case 2026-092513
In the matter between:
THE SPAR GROUP LIMITED Applicant
and
DURBANVILLE INVESTMENTS (PTY)
LTD t/a BUCCLEUCH KWIKSPAR &
TOPS
Respondent
JUDGMENT
DU PLESSIS J
Introduction
[1] This is an urgent application in which the applicant seeks an order authorising
the perfection of its security under a general notarial covering bond registered in its
favour over the respondent’s movable property.
[2] The respondent opposes the application. It disputes the applicant’s reliance on
urgency, denies that it made any unequivocal admission of insolvency, contends that
(1) REPORTABLE: Yes☐/ No ☒
(2) OF INTEREST TO OTHER JUDGES: Yes☐ / No ☒
(3) REVISED: Yes ☒ / No ☐
Date: 03 May 2026
2
the relief sought is unduly invasive, and submits that the applicant has overstated the
risk to its security.
Background
[3] In September 2024, the respondent executed a general notarial covering bond
in favour of the applicant, registered under bond, to secure present and future
indebtedness arising from goods sold and delivered, drop shipment transactions,
monies lent and advanced, interest, and enforcement costs.
[4] The bond is framed in wide terms. It records that the applicant may, upon the
occurrence of specified trigger events, seek to perfect its security by taking possession
of the respondent’s movable assets and, in broad terms, exercising control necessary
to preserve and realise the security. The applicant alleges that, as at 21 April 2026,
the respondent was indebted to it in the amount of R3 160 794.56.
[5] The applicant further relies on a telephone conversation on 21 April 2026
between Mr Timothy Smit, the applicant’s attorney, and Mr Stephen Mutale, the
respondent’s sole director, during which, according to the applicant, Mr Mutale stated
that the respondent was insolvent and that Nedbank would not extend further credit to
it. The applicant also alleges that during the same conversation, Mr Mutale disclosed
the existence of a further notarial bond in favour of Nedbank over the respondent’s
movable property.
[6] Based on those matters, the applicant contends that the triggering provisions
of the bond have been engaged, that its interests are imperilled, and that liquidation
or perfection by another creditor is imminent.
[7] The respondent does not dispute the existence of the bond, the parties'
contractual relationship, or the applicant's status as a secured creditor under the bond.
Instead, its opposition concerns urgency, insolvency, impairment, proportionality, and
remedy.
3
[8] The respondent submits that any urgency is self-created because the applicant
has known of the indebtedness, the parties’ trading difficulties, and the existence of
the Nedbank bond for some time.
[9] It disputes the existence of any unequivocal admission of insolvency. It
contends that, at most, its director conveyed that the businesses were under financial
pressure. The respondent also relies on asset schedules, valuations, and sale-of-
business documents to show that the stores remain going concerns with value in their
stock, movable assets, and goodwill. It submits that immediate perfection will destroy
going-concern value, terminate the business in practical terms, and thereby produce
a punitive rather than protective outcome.
[10] In the alternative, the respondent proposed a structured order under which
perfection would be recognised in principle, but its implementation would be
suspended, subject to strict reporting, inspection, and payment conditions.
Urgency
[11] It is so that the parties’ broader commercial difficulties and the indebtedness
did not arise overnight. The papers show that the engagements extended over a
considerable period, and the applicant was aware of the Nedbank bond before
launching the application.
[12] However, the applicant’s case is not based merely on the historical existence
of debt. It is tied to what it alleges was a fresh disclosure on 21 April 2026 of insolvency
and the unavailability of further banking support, which, if accepted, materially altered
the risk profile facing the applicant as a bondholder.
[13] In applications to perfect security under a general notarial bond, the risk that a
concursus creditorum or competing enforcement may intervene is capable of
rendering the matter urgent in a real commercial sense.
[14] In the circumstances, the matter is sufficiently urgent to warrant a hearing on
the urgent roll.
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Merits
[15] Having regard to the papers, the applicant has, in my view, made out a case
for substantive relief. There is no real dispute about the agreements concluded. The
respondent obtained credit facilities from the applicant, became bound by the
applicant’s standard terms, executed acknowledgements of debt, and furnished a
general notarial covering bond to secure its present and future indebtedness.
[16] The respondent’s indebtedness to the applicant in a substantial amount is
likewise established on the papers. Even where the respondent seeks to contextualise
its position, it does not place in genuine dispute the broad fact of substantial arrears
and the applicant’s status as secured creditor under the bond.
[17] The applicant is thus not merely a creditor that complains about the breach of
a commercial agreement. As a secured creditor, holding a notarial bond with a
perfection clause, it seeks possession of the movables to establish a real right. This is
the position under South African law: a general notarial bond does not itself create a
real security right; only upon lawful delivery and possession does the bondholder
acquire a pledge enforceable against third parties. This has various implications, as
stated in Contract Forwarding (Pty) Ltd v Chesterfin (Pty) Ltd
1, namely:
[6] Real rights are stronger than personal rights and in the case of conflicting real rights
the principle prior tempore potior iure applies. The right in question, a pledge, is a real
right, which is established by means of taking possession and not by means of an
agreement to pledge. The bondholder who obtains possession first thereby establishes
a real right. If I may be permitted some more Latin: vigilantibus non dormientibus iura
subveniunt, meaning that the laws aid those who are vigilant and not those who sleep.
(Both principles provide a safer guide to the correct answer than the Court below’s ‘just
(Both principles provide a safer guide to the correct answer than the Court below’s ‘just
and equitable’ principle.11 The fact that it is ‘fortuitous’ that the vigilant person perfects
his rights first does not make the act either unjust or inequitable.)
1 [2002] ZASCA 143; [2003] 1 All SA 267 (SCA); 2003 (2) SA 253 (SCA).
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[18] In this case, it means the following: A creditor in the applicant’s position does
not seek possession for its own sake. It seeks possession because, absent perfection,
the practical value of the security may be lost or materially diluted if a concursus
creditorum intervenes before possession is obtained.
[19] The respondent contends that the applicant faces no real risk from the Nedbank
bond because, as the prior registered bondholder, the applicant would be protected
by the doctrine of notice, as explained in Contract Forwarding: Nedbank, having actual
knowledge of the applicant's prior bond, cannot perfect its later bond in disregard of it.
[20] The doctrine of notice may well constrain Nedbank from perfecting in disregard
of the applicant's priority, but it does not prevent Nedbank from applying for the
respondent's liquidation, nor does it prevent the onset of a concursus creditorum by
other means. Once liquidation commences, the applicant's right to perfect is entirely
lost, regardless of its prior ranking: an unperfected general notarial bond affords only
a statutory preference over the free residue of the insolvent estate, not secured
creditor status.
2 The applicant is therefore entitled to act now, before any such event,
rather than rely on the uncertain proposition that Nedbank will refrain from pursuing its
own remedies.
[21] The respondent’s arguments on proportionality, practical hardship, and the
potential loss of going-concern value were thoroughly presented and carefully
considered. Perfection by possession may indeed have severe consequences. Once
a creditor gains control of the stock and operations, the debtor’s business may cease
to function independently in any meaningful way. However, in this case, these factors
do not justify denying the applicant the primary relief to which they are entitled.
[22] Contract Forwarding also states that the court does not have a broad discretion
[22] Contract Forwarding also states that the court does not have a broad discretion
to refuse an order once an applicant has established a right to take possession.
3
2 For a discussion on this, see Jansen, M. (2003). “More legal security regarding security by means of general
notarial bonds: case comments.” SA Mercantile Law Journal, 15(3), 486-497.
3 Para 10. The court states: "Although aware of dicta by Didcott J to the effect that there is a discretion, I cannot
see how a court, in the exercise of its discretion, can refuse an order to an applicant who has a right to possession
of a pledged article to take possession. The principles relating to the limited discretion to refuse specific
performance apply only where the creditor has another remedy, such as a claim for damages, at its disposal. A
claim for damages cannot replace a claim for real security. In the absence of a conflict with the Bill of Rights or a
6
However drastic the consequences of an order for perfection of a notarial bond might
be, they do not justify refusing perfection altogether.
[23] In Beadica 231 CC v Trustees for the time being of the Oregon Trust
4 the
Constitutional Court reaffirmed that fairness and reasonableness are not freestanding
bases for declining to enforce contractual terms, and that public policy, rooted in
constitutional values, generally favours the enforcement of contracts freely and
voluntarily concluded. The respondent’s arguments rely mainly on insolvency law
principles and the preference for rescue over the demise of a company. That does not
assist.
[24] There is, in the present matter, no proper basis to conclude that enforcement
of the perfection clause would itself be contrary to public policy. On the contrary, the
respondent, a commercially savvy actor, voluntarily granted the bond as security for
substantial commercial indebtedness, and the circumstances now confronting the
parties are precisely those for which such security was intended.
[25] The dispute concerning the alleged admission of insolvency does not alter the
position in any decisive way. Even if that issue is approached cautiously, and even if
the respondent is given the benefit of the dispute on motion,
5 the applicant has shown
substantial arrears, ongoing financial distress, and the existence of a further bond in
favour of Nedbank over the same movable property. Viewed cumulatively, those
features establish a present and material risk to the efficacy of the applicant’s security.
The applicant accordingly succeeds. Costs follow the result.
Order
[26] Accordingly, the following order is made:
rule to the contrary, a court may not under the guise of the exercise of a discretion have regard to what is fair and
equitable in that particular court’s view and so dispossess someone of a substantive right.”
4 [2020] ZACC 13 para 83 onwards.
4 [2020] ZACC 13 para 83 onwards.
5 Following Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd 1984 (3) SA 623 (A).
7
1 The Applicant is authorised for the purposes of perfecting its security in terms
of the General Notarial Covering Bond registered in, inter alia, Pretoria as
BN000032704/2024 to enter upon the Respondent's premises or any other
place where any of the Respondent's movable property, of whatever
description and nature and wherever situated and held, ("the movable
property") and –
1.1 to enter upon the Respondent's premises and take physical possession and
control of the movable property;
1.2 to hold the movable property as security for payment of all amounts owing
by the Respondent to the Applicant and to retain such possession for so long
as the Applicant may deem fit;
1.3 to dispose of the movable property or any of same by public auction or by
private treaty or otherwise in the Applicant's sole discretion and on such
terms and conditions as the Applicant in its sole discretion may deem fit as
an arms-length transaction and at the best possible price and to convey good
valid and free title to the purchaser or transferee thereof;
1.4 have the movable property excussed and/or attached by legal process;
1.5 to apply for provisional sentence and to execute upon all or any of the
movable property;
1.6 to carry on and manage the Respondent's business in the name of and on
behalf of and as agent for and for the account of the Respondent for such
period as the Applicant may deem fit and to perform, for the said purpose,
such managerial and/or operational acts as the Applicant may deem
necessary or desirable;
1.7 to –
1.7.1 have access to, operate and draw on any account of the Respondent at
any deposit-taking institution and to sign any instruments or documents
and make use of any username, one-time-pin and/or passwords and to
perform all such acts as may be necessary or desirable in connection
therewith; and
1.7.2 open a bank account in the name of the Applicant for the sole purpose of
operating the Respondent's businesses in terms of any perfection order
granted by a Court;
8
1.8 to make payments to the Applicant in reduction of the Respondent's
indebtedness to it of all funds in any account of the Respondent at any
deposit-taking institution or from any funds which the Respondent (or the
Applicant on behalf of the Respondent) may receive or which may accrue
from time to time;
1.9 to take occupation of or to sub-let the premises in which the Respondent
conducts its businesses and/or to cede or assign the lease(es) in respect of
the premises;
1.10 to transfer and/or renew any licenses, permits, registration certificates and
the like relating to the Respondent's businesses, to sign all application forms,
documents, consents and instruments in the name of the Respondent and
to perform all such acts as may be necessary or desirable in that regard;
1.11 to conclude, perform and execute such agreements, deeds, and other
documents in connection with the alienation or disposal of the movable
property;
1.12 to secure, receive, demand, claim, sue and recover all goods, debts,
amounts and movable property that may be due, owing and payable or
belonging to the Respondent, either in the name of the Respondent or in the
name of the Applicant;
1.13 in accordance with the applicable laws and employment contracts, to engage
or dismiss employees of the Respondent, on its behalf, on such terms and
conditions as the Applicant may deem fit; and/or
1.14 to employ such other remedies to take such other steps against the
Respondent as allowed in law; and
2 That the Respondent pays the costs to be taxed on scale B.
____________________________
WJ du Plessis
Judge of the High Court, Gauteng Division,
Johannesburg
Date of hearing: 29 April 2026
Date of judgment:
3 May 2026
For the applicant:
D van Niekerk instructed by Cliff Dekker
Hofmeyr Inc
For the respondent:
N Kinstler of Kinstler Attorneys Inc