REPUBLIC OF SOUTH AFRICA
IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION, JOHANNESBURG
CASE NO: 2025-236483
In the matter between:
KARISHA MUDLIAR First Applicant
KARISHA MUDLIAR N.O. Second Applicant
and
FINE ASSET INVESTMENTS 447 CC First Respondent
Registration Number: 2007/086903/23
MANORAMMA MUDLIAR Second Respondent
JUDGMENT
This judgment was handed down electronically by circulation to the parties' and/or the parties' representatives by email and by being
uploaded onto CaseLines. The date and time for hand-down is deemed to be on 120 MAY 2026
(1) REPORTABLE: no
(2) OF INTEREST TO OTHER JUDGES: no
(3) REVISED: yes
20 May 2026 GB ROME
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ROME AJ:
Introduction
[1]. This is an application for the final winding-up of the first respondent on the just and
equitable ground. The first applicant seeks that relief in her personal capacity and
also in her representative capacity in the estate of the late Prema Kanthan Mudliar.
[2]. The first respondent is Fine Asset Investments 447 CC, a close corporation
registered under number 2007/086903/23.
[3]. The papers show that the corporation was used as an investment and property
development vehicle and that its assets consist predominantly of immovable
property units in the Kariwood scheme. The application is opposed by the second
respondent.
[4]. The principal issue is whether the relationship necessary for the continued
functioning of the first respondent has broken down to the point where its affairs
can no longer properly be administered in the ordinary way.
[5]. The second respondent raises points concerning locus standi, lis alibi pendens,
prematurity, and the proposition that winding -up is inappropriate in the case of a
solvent close corporation.
[6]. Those points do not answer the case the applicant in substance makes. That case
is that, following the death of her father on 31 December 2023, the relationship
between herself and the second respondent, her mother, broke down completely;
that attempts to convene meetings and resolve disputes failed; that the second
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respondent refused to cooperate in the management of the corporation and in
relation to property sales; and that the result is deadlock in relation to its affairs.
Legal framework
[7]. The statutory source of the court’s power is the winding -up jurisdiction applicable
to close corporations. Section 68(d) of the Close Corporations Act 69 of 1984
provides that a corporation may be wound up by a court if it appears, on application
to the court, that it is just and equitable that the corporation be wound up. Section
66 of that Act applies the winding -up provisions of the Companies Act, with
necessary modifications, to the liquidation of close corporations.
[8]. In relation to solvent companies, section 81(1)(c)(ii) and section 81(1)(d)(iii) of the
Companies Act 71 of 2008 recognise that a court may wind up a solvent company
where it is otherwise just and equitable to do so. Although this matter concerns a
close c orporation, the principles developed in relation to the just and equitable
winding-up of companies are directly relevant.
[9]. In Thunder Cats Investments 92 (Pty) Ltd and Another v Nkonjane Economic
Prospecting & Investment (Pty) Ltd and Others i, Malan JA explained that the
phrase “otherwise just and equitable” in section 81(1)(d)(iii) is wide and is not
confined to the specific statutory examples of deadlockii.
[10]. The traditional categories remain relevant, including loss of substratum, illegality
or fraud, oppression, deadlock, and cases analogous to the dissolution of a
partnership.
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[11]. Of particular importance is the category sometimes described as the deadlock
principle or the domestic company / quasi -partnership principle. In Thunder Cats1
the Supreme Court of Appeal explained that this principle applies to small domestic
companies where, because of an express, tacit or implied arrangement, a personal
relationship of confidence and trust exists between the members in relation to the
company’s affairs. Where that relationship fails, winding -up may be just and
equitable.
[12]. In Apco Africa (Pty) Ltd and Another v Apco Worldwide Inciii, Ponnan JA reiterated
that “the just and equitable provision is not to be limited to cases where the
substratum of the company has disappeared or where there has been a complete
deadlock”iv. the just and equitable ground is not limited to cases of complete
deadlock or disappearance of substratum. Where a company is formed or
continued on the basis of a personal relationship involving mutual confidence, an
understanding that members will partic ipate in the conduct of the business, and
restrictions on transfer of interests, equitable considerations may justify winding -
up.
[13]. In Apco Africav Ponnan JA noted that actual deadlock is not always essential. What
matters is whether it has become impossible for the participants to place in one
another the confidence that each is entitled to expect in the conduct of the
enterprise.
[14]. A party’s fault in contributing to the breakdown is relevant but not necessarily
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decisive. In Thunder Cats Malan JA reiterated and confirmed the principle that a
lack of clean hands is not an absolute bar to seeking winding up under the aegis
of the just and equitiable ground2. The Court must assess the respective
contributions to the breakdown, but even fault on the part of the applicant will not
necessarily prevent a winding -up order where the effect of the breakdown is
paralysis and where a liquidator is required to place th e entity’s affairs under
competent independent control.
[15]. Motion court principles remain relevant. Final relief on motion is determined in
accordance with Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd vi.
However, not every denial gives rise to a real dispute of fact. A dispute must be
genuine, material and relevant to the issue the court must decide.
Locus standi
[16]. It is convenient to deal first with standing.
[17]. The challenge to locus standi cannot be sustained.
[18]. The applicant alleges that she has been a member of the corporation since May
2007 and that she holds a 20% member’s interest in it. That allegation is expressly
admitted in the answering affidavit, at least to the extent of her membership
reflected in the CIPC records.
[19]. That is sufficient to clothe her with standing in her personal capacity.
2 Thunder Cats, supra at paragraph 27
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[20]. The papers also record that she alleges she is a creditor of the corporation in the
amount of R1,267,232, comprising an outstanding member’s loan account and
amounts allegedly due under a consultancy agreement, although that
indebtedness is disputed
[21]. It is not necessary to resolve that dispute for present purposes. Her standing as
member is sufficient.
[22]. The issue concerning her position as executrix, and the challenge to the transfer
of the deceased’s 40% member’s interest, may have relevance in other
proceedings. They do not, however, displace her standing in her own right as a
20% member. Nor does the so-called gift issue affect the position. Whatever
disputes may exist concerning other interests or their derivation, they do not
answer the applicant’s reliance on her own admitted 20% interest.
[23]. The point based on locus standi must therefore fail.
Lis alibi pendens and prematurity
[24]. The second respondent also relies on lis alibi pendens and prematurity.This is said
to arise from pending KwaZulu -Natal proceedings concerning, amongst other
things, the disputed transfer of the deceased’s member’s interest and the first
applicant’s position as executrix.
[25]. The defence of lis alibi pendens is a dilatory plea. It does not extinguish a claim.
At most, it stays or postpones proceedings where the same dispute is pending
elsewhere.
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[26]. The requirements are well established. As was stated by Wallis JA in Caesarstone
Sdot-Yam Ltd v World of Marble and Granite 2000 CC and Othersvii
“As its name indicates, a plea of lis alibi pendens is based on the proposition that
the dispute (lis) between the parties is being litigated elsewhere and therefore it is
inappropriate for it to be litigated in the court in which the plea is raised. The policy
underpinning it is that there should be a limit to the extent to which the same issue
is litigated between the same parties and that it is desirable that there be finality in
litigation. The courts are also concerned to avoid a situation where different courts
pronounce on the same issue with the ri sk that they may reach differing
conclusions. It is a plea that has been recognised by our courts for over 100 years.”
[27]. The difficulty for the second respondent is that those requirements are not met
here. The pending KwaZulu -Natal proceedings concern different relief and
different issues: the validity of the transfer of the deceased’s member’s interest
and the first applicant’s possible removal as executrix. This application concerns
whether the first respo ndent should be wound up because the relationship
necessary for its continued functioning has irretrievably broken down and because
the close corporation can no longer be administered or operated to the advantage
of its members.
[28]. It is important to note that the issue of whether the first applicant remains executrix
has no bearing on her personal 20% member’s interest. Nor does it answer the
central question whether the relationship between the remaining family participants
has broken down so completely that the close corp oration can no longer function
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as the domestic property enterprise it was intended to be.
[29]. Even if the second respondent were ultimately successful in the KwaZulu -Natal
proceedings, the first applicant would remain, on the papers before me, a member
of the close corporation in her own right. The core impasse would remain: the first
applicant and the second respondent are unable to cooperate in relation to the
affairs of the close corporation.
[30]. The pending proceedings therefore do not render this application premature. They
also do not furnish a basis to stay it.The plea of lis alibi pendens must therefore
fail.
Solvency and the “last resort” point
[31]. The papers do show that the corporation is solvent. But that is not a bar to relief
on the just and equitable ground. The application is expressly framed under section
81(1)(c) and (d) of the Companies Act 71 of 2008 read with section 67 of the Close
Corporations Act 69 of 1984. There is force in the general proposition that
winding-up of a solvent entity is a serious remedy and should not be granted lightly.
But the proposition only goes so far.
[32]. Where a corporation is effectively rendered dysfunctional by a complete
breakdown in the relationship between the relevant members, and where that
breakdown causes deadlock in relation to operational decisions, a final winding-up
may be the only practical and fair remedy. That is particularly so where the entity
is not dormant. The papers show that this corporation is a property development
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and investment vehicle requiring decisions to be made concerning the sale and
management of units.
Breakdown and deadlock
[33]. It is necessary to identify the matter for what it is. The second respondent’s
answering affidavit does not dispel the breakdown. On the contrary, its tone and
content further demonstrate it. The answering affidavit advances serious
allegations against the first applicant, including allegations of fraud, appropriation,
exclusion, ulterior motive and misconduct. Those allegations are denied. I do not
need to decide whether they are true. Their existence, repetition and intensity
demonstrate that the relationship of trust has collapsed.
[34]. The matter is an unfortunate domestic and nuclear family breakdown. On the
papers it is not possible reasonably to conclude that the first applicant is the sole
cause of the breakdown in her relationship with her mother. The record reveals
mistrust, mutual suspicion, failed communication, recourse to attorneys, and
multiple proceedings. Whatever the rights and wrongs of particular incidents, the
relationship necessary for this family close corporation to function has gone.
[35]. There is no realistic prospect that ordinary business decisions can be made by
these members acting together. The second respondent has refused to attend or
recognise members’ meetings. She has sought to involve non -members in the
close corporation’s affairs. She has objected to steps taken by the first applicant in
respect of taxes, municipal obligations, banking and property transactions. She
disputes the first applicant’s entitlement to be involved in management at all.
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[36]. The first applicant, for her part, seeks to bring the close corporation’s affairs to an
end through liquidation. The second respondent resists that and contends that the
first applicant’s conduct has created the impasse. Even if that contention were
relevant to fault, it does not answer the objective question whether the close
corporation can still operate on the basis of mutual trust and co-operation. It plainly
cannot.
[37]. In these circumstances, the case falls squarely within the domestic company or
partnership-analogy line of authority described in Apco Africa (Pty) and Thunder
Cats. The close corporation was a small family enterprise. It depended on personal
confidence. The first applicant and her late father were, on the papers, the
operational drivers. The second respondent was a family member and member of
the close corporation, but not an active operational participant. After the
deceased’s death, the fragile personal arrangement collapsed.
[38]. The second respondent submits that the close corporation is solvent, asset -rich
and capable of continuing. That submission treats solvency as if it answers the just
and equitable enquiry. It does not.
[39]. The close corporation’s business is property -related. The evidence shows that its
remaining material function is the orderly administration, and the sale and
realisation of its property portfolio. It must pay liabilities, attend to rates, taxes and
municipal obligations, address tenant issues where they arise, consider and accept
or reject offers, sign transfer documents, manage banking and deal with the
proceeds.
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[40]. The breakdown has caused a practical deadlock in the close corporation’s ability
to make operational decisions, particularly in relation to sales. The example of the
lapsed property offer is material. The applicants say an above -market offer was
received, information was furnished, and the second respondent delayed and then
rejected the sale without reason. The second respondent disputes the
characterisation, but not in a manner that creates a material dispute requiring oral
evidence. The real point is tha t the close corporation cannot transact without co -
operation, and co-operation is absent. The fact that the close corporation is not a
conventional trading company does not make the deadlock immaterial. A property
holding and development entity can be paralysed by an inability to decide whether,
when and how to sell properties, how to meet carrying costs, and how to administer
assets pending sale. That is precisely the position here.
[41]. The continued existence of the close corporation in these circumstances is not
neutral. It risks further legal costs, further carrying costs, further delay, and further
erosion of value. It also prolongs the family conflict by preserving a structure that
requires co-operation from persons who are no longer capable of co-operating.
The oral submission concerning mediation and prejudice in liquidation
[42]. Counsel for the second respondent emphasised in oral argument that, because of
a reduction in value that might be realised if the properties were sold in a liquidation
process in a collective way or at broadly the same time, the second respondent
would suffer prejudice in the value of her effective interest, and that the matter
ought instead to have gone to mediation.
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[43]. I am unpersuaded by that submission. In the first place, the mediation point was
advanced only in oral argument. There was no suggestion on the papers that the
matter ought not to have proceeded to hearing in the absence of mediation
[44]. In the second place, there is no indication on the papers that mediation would have
produced a more orderly sale process, or a better realisation of values, in respect
of the properties owned by the first respondent. It is important to note that if the
respondents’ case was that winding -up ought not to be granted on the just and
equitable ground because some other process of sale would achieve a better
realisation of value, that case ought to have been set out in answer. It was not.
[45]. The difficulty with the submission is deeper than that. The allegation that liquidation
is not just and equitable because a different sort of realisation process would
achieve greater sale prices is, in itself, an acknowledgement that the breakdown
has rendered the ordinary administration of the first respondent untenable.
[46]. Once it is accepted, even implicitly, that the parties can no longer realise the
company’s assets through the normal processes of internal administration and
decision-making, the submission tends to support rather than weaken the
conclusion that the relationship necessary for the functioning of the company has
broken down beyond repair.
Conclusion
[47]. The applicant has established that there has been an irreconcilable breakdown in
the relationship necessary for the continued functioning of the first respondent.
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[48]. That breakdown has caused deadlock in relation to operating decisions, including
decisions concerning sales.
[49]. In those circumstances, the continued existence of the corporation serves no
beneficial purpose. A liquidator can realise the assets, pay liabilities, and distribute
the balance in accordance with the members’ respective rights.
[50]. It is accordingly just and equitable that the first respondent be finally wound up.
Costs
[51]. The notice of motion seeks a final winding -up order and costs, including costs
against the second respondent if she opposes Given the nature of the opposition
and the conclusion reached, costs should follow the result.
Order
The following order is made:
1. The first respondent, Fine Asset Investments 447 CC (Registration Number:
2007/086903/23), is placed under final winding-up.
2. The costs of the application, including the costs occasioned by the
opposition of the second respondent, are to be paid by the second
respondent at the scale C as provided for in Uniform Rule 67A. .
__ ______________
GB ROME
ACTING JUDGE OF THE HIGH COURT
COUNSEL FOR APPLICANT C-M de Vos
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Instructed by Senekal Inc.
COUNSEL FOR SECOND RESPONDENT A.B.G. Choudree.
Instructed by Phipson De Villiers Attorneys
DATE OF HEARING 7 MAY 2026
DATE OF JUDGMENT 20 MAY 2026
i Thunder Cats Investments 92 (Pty) Ltd and Another v Nkonjane Economic Prospecting & Investment (Pty) Ltd and
Others 2014 5 SA 1 (SCA) at paragraphs 15–17, 27–29, and 33.
ii Thunder Cats supra at paragraphs 12-14
iii Apco Africa (Pty) Ltd and Another v Apco Worldwide Inc 2008 (5) SA 615 (SCA) paragraphs 17 to 21
iv Ibid at paragraph 18
v Ibid, paragraph 21
vi Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd 1984 (3) SA 623 (A) at 634E – 635D.
vii Caesarstone Sdot-Yam Ltd v The World of Marble and Granite 2000 CC and Others 2013 (6) SA 499 (SCA)at
paragraph 2