IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION, JOHANNESBURG
CASE NO: 2025-039262
DATE: 20 MAY 2026
In the matter between:
MMB INVESTMENTS (PTY) LTD t/a BOARDMART Applicant
and
TRACY HILL N O First Respondent
MARTHINUS JACOBUS DEWALD BREYTENBACH N O Second Respondent
SANJA STRAUSS-KRUGER N O Third Respondent
[The above respondents are cited nomine officio in their
Official capacities as the duly appointed Joint Liquidators of
TOTALLY BOARD (PTY) LTD (in liquidation)]
THE MASTER OF THE HIGH COURT, JOHANNESBURG Fourth Respondent
Neutral Citation: MMB Investments v Hill NO and Others (2025-039262) [2026]
ZAGPJHC --- (20 May 2026)
Coram: Adams J
Heard: 5 May 2026
Delivered: 20 May 2026 – This judgment was handed down electronically by
circulation to the par ties' representatives by email , by being
uploaded to CaseLines and by release to SAFLII. The date and time
for hand-down is deemed to be 10:30 on 20 May 2026.
(1) NOT REPORTABLE
(2) NOT OF INTEREST TO OTHER JUDGES
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Summary: Company – winding-up – unlawful alienations and preferences –
void disposition – whether court may validate disposition made after
commencement of voluntary winding-up order – Companies Act 61 of 1973,
s 341(2) – and s 352, which provides that ‘a voluntary winding-up of a company
shall commence at the time of the registration in terms of section 200 of the
special resolution authorizing the winding-up’ – the default position is that post -
liquidation dispositions are void ab initio – the Court has a discretion to validate
them – the purpose of s 341(2) is to ensure equality amongst creditors –
Court refused to exercise its discretion in favour of applicant despite its bona fides
– payments were received when the applicant was not aware that the liquidated
company was in financial distress – and were made when it had no knowledge of
the fact that the liquidated company was being wound up – default position
nevertheless prevailed – applicant could not be allowed to enjoy the benefit of its
claim being settled in full, whilst the other creditors would have to be content with
whatever residue might still be available –
Application for validation of payments dismissed – counter-application succeeds
and applicant ordered to repay amounts received,
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ORDER
(1) The applicant’s application for the validation in terms of section 341(2) of
the Companies Act, 1973, of certain payments made by Totally Board (Pty)
Ltd (in liquidation) to the applicant, totalling R311 250.87, after the
commencement of its winding-up, be and is hereby dismissed with costs.
(2) The respondents’ counter-application succeeds.
(3) The applicant is ordered to repay to the respondent s the said sum of
R311 250.87, together with interest thereon at the applicable legal rate of
interest of 11.75% per annum from 17 April 2024 to date of final payment.
(4) The applicant shall pay the respondents’ costs of this opposed application,
as well as the costs of the counter-application, including Counsel’s charges
on scale ‘C’ of the tariff referred to in Uniform Rule of Court 67A(3), read
with rule 69.
JUDGMENT
Adams J:
[1]. This matter , which came before me as an opposed application on
Tuesday, 5 May 2026, concerns the application of the provisions of s 341(2) of
the Companies Act 61 of 1973 (Companies Act, 1973) . The applicant (MMB
Investments) applies for an order – in terms of the rider to the said section –
validating payments totalling R311 250.87 , made by Totally Board (Pty) Ltd (in
liquidation) to the applicant after the commencement of its winding -up. The
application is brought against the first to the third respondents (‘respondents’) in
their official nomine officio capacities as the Joint Liquidators of Totally Board
(Pty) Ltd (in liquidation).
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[2]. Section 341(2) reads as follows: -
‘341 Dispositions and share transfers after winding-up void –
(1) … … …
(2) Every disposition of its property (including rights of action) by any company
being wound-up and unable to pay its debts made after the commencement of
the winding up, shall be void unless the court otherwise orders.'
[3]. Section 341(2) should , in the case of a voluntary liquidation, be read
together with s 352, which, under the heading ‘ Commencement of voluntary
winding-up’, provides that the ‘a voluntary winding -up of a company shall
commence at the time of the registration in terms of section 200 of the special
resolution authorizing the winding-up’.
[4]. The respondents oppose the application on the basis that the proviso
contained in s 34 1(2) does not find application to the facts in this matter. They
therefore seek a dismissal of the applicant’s application. They have also preferred
a counter -application against the applicant, claiming an order declaring the
payment of the said amounts of R311 250.87 to be void, as well as an order that
the applicant repays to them the said sum, together with i nterest thereon and
costs of suit.
[5]. The parties are ad idem that the payment was made by the liquidated
company after the commencement of its winding u p. The crisp issue for
determination is whether the applicant has made out a case for the validation of
the said disposition. Put another way, the main issue for determination is whether
this Court, in terms of section 341(2) could, and should, exercise its discretion to
validate the payments in favour of the applicant. That issue is to be decided
against the factual backdrop of the matter, the facts in the matter , as set out in
the paragraphs which follow, being by and large common cause.
[6]. The payments totalling R311 250.87, which are the subject of this
application, were made to the applicant by Totally Board between 12 and 17 April
application, were made to the applicant by Totally Board between 12 and 17 April
2024, after the commencement of Totally Board's winding -up. The exact dates
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on which the individual payments were made are as follows: - on 12 April 2024 –
R162 940.54; on 15 April 2024 – R 57 310.33 was paid; on 16 April 2024 –
R76 000; and R15 000 was paid on 17 April 2024.
[7]. The applicant is a long-established supplier of melamine board, high-gloss
board, chipboard, MDF, hardboard, post -form tops, edging and other related
wood-based products, supplied nationally to trade buyers for use in inter alia
kitchen installations. Totally Board was, from approximately October 2017 until
its liquidation, a longstanding customer of the applicant, purchasing goods for
resale in its hardware and board retail business.
[8]. The trading relationship was originally conducted on an insured credit
facility with a limit of R 1 000 000 (exclusive of VAT), underwritten by Credit
Guarantee Insurance Corporation of South Africa ( ‘CGIC’). By the end of March
2024, Totally Board had reached its credit limit. By mutual agreement, and
considering the trusted commercial relationship, the parties agreed that any
further sales from 3 April 2024 onwards would be on a strict cash -on-delivery
(‘COD’) basis, with payment required upon or immediate ly following delivery.
And between 3 April 2024 and 17 April 2024, the applicant sold and delivered
goods to Totally Board, supported by contemporaneous tax invoices and delivery
notes.
[9]. The four payments in dispute, made between 12 and 17 April 2024 and
totalling R311 250.87, each correspond to specific deliveries during that period
and reflect, so it is contended by the applicant, value given to Totally Board in the
ordinary course of the COD arrangement. Unbeknownst to the applicant, and on
25 March 2024, Totally Bo ard’s sole director resolved to place the company in
voluntary winding-up. The special resolution was registered at the Companies
and Intellectual Property Commission (‘CIPC’) on 11 April 2024, thereby
commencing the winding-up and establishing the concursus creditorum in terms
commencing the winding-up and establishing the concursus creditorum in terms
of s 352(1) of the Companies Act, 1973.
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[10]. The applicant had no prior notice or knowledge of Totally Board's intention
to liquidate itself. On 17 April 2024, a representative of CGIC advised the
applicant that Totally Board's credit cover was withdrawn due to ‘adverse
information’ becoming available concerning Totally Board. CGIC did not explicitly
inform the applicant that Totally Board had commenced with a voluntary winding-
up of its affairs. Upon a representative of the applicant conducting a CIPC search
on 22 April 2024, the applicant first conf irmed the liquidation status of Totally
Board.
[11]. On 17 October 2024 the applicant received correspondence from the
respondents’ attorneys, demanding that the amount of R 311 250.87 be repaid to
the liquidators. The applicant's attorneys thereafter engaged with the liquidators
seeking either validation of the payments, or restitution of the goods. The
respondents confirmed that restitution was impossible as the goods had been
sold. And since the respondents refused to sanction the payments and abandon
their claim against the applicant, the applicant launched the current application in
terms of s 341(2) of the Companies Act.
[12]. That brings me to the application of the law to the aforegoing facts.
[13]. The default position is that post -liquidation dispositions are void ab initio,
but the Court has a discretion to validate them. The purpose of s 341(2) is to
ensure equality amongst creditors and to provide a safety valve, through the
Court's discretion, where invalidation would produce an unjust result.
[14]. In Pride Milling Company (Pty) Ltd v Bekker NO and Another 1, the
Supreme Court of Appeal (SCA) explained as follows the reasoning behind a
Court of Law being granted this discretion: -
‘[30] The provisions of s 341(2) could not be clearer. They, in unequivocal terms,
decree that every disposition of its property by a company being wound up is void. Thus,
the default position ordained by this section is that all such dispositions have no force
the default position ordained by this section is that all such dispositions have no force
1 Pride Milling Company (Pty) Ltd v Bekker NO and Another 2022 (2) SA 410 (SCA).
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and effect in the eyes of the law, ie the disposition is regarded as if it had never occurred.
The mischief that s 341(2) seeks to obviate is plain enough. It is to prevent a company
being wound up from dissipating its assets and thereby frustrating the cl aims of its
creditors.’
[15]. In casu, it is contended on behalf of the applicant that this Court should
exercise its discretion in favour of the applicant for the simple reason that t he
payments were directly linked to same -day or next-day deliveries under a COD
arrangement, which is the epitome of in the ordinary course of business and
reciprocal trading. In this regard, the applicant rendered full and fair value in
exchange for the impugned payments , evidenced prima facie by delivery notes,
invoices and bank statements. Goods were delivered and were further disposed
of and the value included in the L iquidation & Distribution account of the
Liquidated company.
[16]. Moreover, so the contention on behalf of the applicants continues, t he
goods were sold by Totally Board and/or its liquidators, generating revenue which
remains in the insolvent estate. Unlike the mischief section 341(2) aims to
prevent, there was no depletion of without value, no secret preference and no
collusion. Also, there was no knowledge, intention or suspicion on the applicant's
part as to the pending liquidation. The applicant was not privy to Totally Board's
internal resolutions and only became aware ex post facto.
[17]. What is more, so the applicant submits, i f the payments are invalidated
without restitution of goods, which is not p ossible in view of the fact that it has
been on sold, the estate will retain both the sale proceeds of the goods and the
purchase price, constituting an undeniable unjust enrichment at the applicant's
expense. No prejudice is shown to the concursus creditorum: the estate received
goods, value was added to the estate, and, as the L & D Account demonstrates,
goods, value was added to the estate, and, as the L & D Account demonstrates,
the benefits have accrued to the inso lvent estate, which can distribute these in
accordance with insolvency priorities. Conversely, to set aside the payments now
would unjustly enrich the insolvent estate and its creditors, whilst penalising the
applicant who, in good faith, supplied valuable goods.
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[18]. If compelled to repay the said sum, so the applicant’s argument is
concluded, it would join the ranks of concurrent creditors in an estate already
demonstrably unable to satisfy its debts (indebted by more than R27 million),
while the estate itself retains the funds from their onward sale, without paying for
the initial goods. The applicant pro-actively availed itself of the relief in terms and
approached the Court to validate the payments.
[19]. For all these reasons, so the applicant contends, the court’s discretion
should be exercised in its favour.
[20]. I disagree. As in casu, the applicant in Pride Milling also contended that
the payments at issue are to be validated in accordance with the rider to s 341(2)
and, in support of its case that they should be, alleged that the payments: (a) were
made in the ordinary course of business and in good faith; (b) were not to the
'detriment of the general body of [the liquidated company’s] creditors'; (c) had 'the
effect of increasing the asset value of [the liquidated company] to the benefit of
the body of the creditors'; (d) were received at a time when it (the applicant) was
not aware that the liquidated company was in financial distress; and (e) were
made when it had no knowledge of the fact that the liquidated company was being
wound up.
[21]. These factors are almost carbon copies of the ones mentioned by the
applicant in casu as considerations favouring the validation of the payments. In
Pride Milling, the SCA nevertheless refused to validate the dispositions and, in
the process, held that to validate the payments in the context of the facts of that
case, would mean that the applicant would be left to enjoy the benefit of its claim
being settled in full, whilst the other creditors would have to be content with
whatever residue might still be available.
[22]. On the basis of this authority, I am of the view that the applicant has not
demonstrated tenable reasons for me to exercise my discretion in favour of
demonstrated tenable reasons for me to exercise my discretion in favour of
validating the payments. I am further bolstered in my conclusion by Gainsford
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and Others NNO v Tanzer Transport (Pty) Ltd 2, in which the SCA noted that s
341(2) 'of the Act is clear in its terms' and held that:
‘The court will only order otherwise in terms of this section in limited circumstances. To
have the defence proffered by Tanzer upheld in general terms would have the effect of
avoiding the objects of the Act in that it would undoubtedly prefer one credito r above
another.'
[23]. The SCA continued:
'It is no defence to assert as Tanzer does that the dispositions were made by the
company's staff in ignorance of the fact that the company had been placed under
winding-up. Staff at a lower level carry out instructions and in any event that does not
deal with the question of whether the disp ositions were made at a time after the
commencement of the winding -up. As has already been mentioned, the instances in
which a court will validate a disposition are limited. Even where a disposition was alleged
to constitute "a mere administrative rectific ation", the fact that the effect thereof was to
remove a claim from the concursus and settle it in full in favour of the creditor concerned,
to the prejudice of the general body of creditors, is impermissible. This is in accordance
with the principle that "the free assets of the insolvent at the commencement of the
liquidation shall be distributed rateably amongst the insolvent's creditors as at that date".'
(Emphasis added).
[24]. For all of these reasons, the applicant’s application falls to be dismissed .
It follows that the respondents’ counter-application should succeed and an order
should be granted in favour of the respondents for repayment to them of the
amount in question.
Costs
[25]. The general rule in matters of costs is that the successful party should be
given his costs, and this rule should not be departed from except where there are
2 Gainsford and Others NNO v Tanzer Transport (Pty) Ltd 2014 (3) SA 468 (SCA) ; ([2014] 3 All SA 21;
[2014] ZASCA 32).
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good grounds for doing so, such as misconduct on the part of the successful party
or other exceptional circumstances. See: Myers v Abramson3.
[26]. The applicant should therefore be ordered to pay the respondents' costs
in respect of both the main application and the counter-application.
Order
[27]. In the result, I make the following order: -
(1) The applicant's application for the validation in terms of section 341 (2) of
the Companies Act, 1973, of certain payments made by Totally Board (Pty)
Ltd (in liquidation) to the applicant, totalling R311 250.87, after the
commencement of its winding-up, be and is hereby dismissed with costs ..
(2) The respondents' counter-application succeeds.
(3) The applicant is ordered to repay to the respondents the said sum of
R311 250.87, together with interest thereon at the applicable legal rate of
interest of 11. 75% per annum from 17 April 2024 to date of final payment.
(4) The applicant shall pay the respondents' costs of this opposed application,
as well as the costs of the counter-application, including Counsel's charges
on scale 'C' of the tariff referred to in Uniform Rule of Court 67 A(3), read
with rule 69.
3 Myers v Abramson, 1951(3) SA 438 (C) at 455
L RADAMS
Judge of the High Court
Gauteng Division, Johannesburg
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HEARD ON: 5 May 2026
JUDGMENT DATE: 20 May 2026
FOR THE APPLICANT: E Larney
INSTRUCTED BY: Louis Gishen & Associates Inc,
Sandton
FOR THE FIRST, SECOND and
THIRD RESPONDENTS: K J Braatvedt
INSTRUCTED BY: Braatvedt Attorneys,
Bryanston, Sandton