IN THE HIGH COURT OF SOUTH AFRICA
MPUMALANGA DIVISION, (MIDDELBURG LOCAL SEAT)
CASE NO: 483/2022
(1) REPORTABLE: NO
(2) OF INTEREST TO OTHER JUDGES: NO
(3) REVISED: YES
11 /06/2025
SIGNATURE DATE
In the matter between:
MSOBO COAL (PTY) LTD APPLICANT
And
JACOBUS HOSEA JORDAAN RESPONDENT
Delivered: This judgment was handed down electronically by circulation to the
parties' legal representatives by email. The date and time for hand-down is
deemed to be at 10:00 on 11 June 2026.
JUDGMENT
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Phahlamohlaka J
Introduction
[1] This is an application by Msobo Coal (Pty) Ltd ("the applicant") for an order
directing the respondent, Mr. Jacobus Hosea Jordaan, to furnish security for
costs in the sum of R500,000.00, or such sum as determined by the Registrar, in
terms of Rule 47 of the Uniform Rules of Court.
[2] The applicant further seeks a stay of the main action pending the
furnishing of such security, and, in the event of non-compliance, leave to
apply for dismissal of the main action.
Background
[3] The respondent, a former CEO and director of the applicant, instituted
action against the applicant for payment of profit shares allegedly due for
the financial years 2015, 2017, 2018, and 2019. The applicant opposes the
claim, alleging that the respondent's conduct as CEO and director was
unlawful, dishonest, and in breach of his duties, and that the claim is
vexatious, reckless, and an abuse of the court's process.
[4] The applicant further contends that the respondent is unable to satisfy any
adverse costs order due to preservation and restraint orders granted under
the Prevention of Organised Crime Act (POCA), which have resulted in the
appointment of a curator bonis over the respondent's assets.
Issues for Determination
[5] The issues to be determined are:
5.1 Whether the application for security for costs is premature.
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5.2 Whether the applicant has established exceptional
circumstances justifying an order for security for costs, namely
that the respondent's action is vexatious, reckless, or an abuse
of process.
5.3 Whether the applicant is entitled to a stay of the main action
pending the furnishing of security.
The legal position
[6] The legal position regarding the furnishing of security for costs is
comprehensively addressed in Rule 47 of the Uniform Rules of Court and the
common law.
[7] In Boost Sports Africa (Pty) Ltd v South African Breweries (Pty) Ltd 1 the
Supreme Court of Appeal remarked as follows:
“Absent s13, there can no longer be any legitimate basis for differentiating
between an incola company and an incola natural person. And as our
superior courts have a residual discretion in a matter such as this arising from
their inherent power to regulate their own proceedings, it must follow that the
former can at common law be compelled to furnish security for costs.
Accordingly, even though there may be poor prospects of recovering costs,
a court, in its discretion should probably order the furnishing of security for
such cause by an incola company if it is satisfied that the contemplated
main action or application is vexatious or reckless or otherwise amounts to an
abuse.”
[8] The Supreme Court of Appeal in Boost Sports Africa therefore clarified that
there is no longer a distinction between incola natural persons and companies.
1 2015 (5) SA 38 (SCA) at para [16]
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Security can be ordered against either, provided the action is vexatious,
reckless, or an abuse of process.
Analysis
[9] The applicant conteded that the respondent is legally impecunious due
to the POCA orders and cannot satisfy adverse costs orders and that the
curator bonis refuses to pay litigation costs or adverse costs orders. The
applicant further argued that the respondent has a history of launching
unmeritorious and harassing litigation, including through entities he controls.
[10] further, it is the applicants’ case that the respondent's claim for profit
share is unsustainable, as it arises from his former office, which he abused,
and is tainted by findings of dishonesty and breach of duty, and therefore the
applicant is exposed to the risk of unrecoverable costs and seeks security to
prevent prejudice.
[11] The respondents contended that the application is premature as the
amount of security has not been agreed or fixed by the Registrar. The
respondent further submitted that it is an incola and, as such, is not ordinarily
required to furnish security for costs.
[12] The respondent argued that the preservation and restraint orders are
interim and may be set aside; the application should await their
reconsideration. The respondent further asserts that the applicant has
delayed in bringing the application and relies on irrelevant allegations from
other litigation. The respondent denies any breach of duty or unlawful
conduct and asserts that his claim is bona fide and not vexatious or abusive.
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[13] The applicant must show that the action is vexatious, reckless, or an
abuse of process. It is not in dispute that the respondent is subject to
preservation and restraint orders, rendering him unable to satisfy adverse
costs orders. It is also common cause that the curator bonis refuses to pay
litigation costs or adverse costs orders. It is further common cause that the
respondent has relied on third-party funding to pay previous costs orders.
[14] The respondent has not disputed that his claim for profit share is based
on his former office, from which he was dismissed for serious misconduct after
disciplinary proceedings.
[15] In my view, the respondent's inability to satisfy adverse costs orders,
combined with the pattern of litigation and the nature of the claim,
constitutes exceptional circumstances.
[16] While there was some delay in bringing the application, the applicant
has explained that the trigger for the application was the respondent's
confirmed inability to pay costs following the grant of the POCA orders and
the curator's refusal to pay. It is my considered view that the the delay is not
fatal in the circumstances.
Conclusion
[17] In the circumstances and considering the respondent’s difficulties as well
as the plethora of litigations by the respondent, it is just and equitable to stay
the main action pending the furnishing of security, as the applicant would
otherwise be exposed to unrecoverable costs.
Order
[18] In the result I make the following order:
l . The respondent is directed to furnish security for the applicant's costs in
the form of a suitab le bank guarantee in the sum of R200,000.00 (two
hundred thousand rand) , or such sum as may be determined by the
Registrar, within ten (l 0) days of the determina tion of the amount of
security.
2. The main action is stayed pending the furnishing of such security,
failing which the app licant is granted leave to approach the Court on
the same papers , supplemented where necessary , to apply for the
dismissal of the main action.
3. The respondent is ordered to pay the costs of this application to be
taxed on Scale C.
K F Phahlamohlaka
Judge of the High Court
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Appearances
For the applicant: Adv Wilkins SC with Adv Martin
Instructed by: Malan Scholes Inc.
Email: ssingh@malanscholes.co.za
theuns@chriscoetzee.co.za
For the respondent: Adv Nel
Instructed by: Dr T C Botha Ingelyf
Email: litigation@tcbothalaw.co.za
info@awglaw.co.za
Date judgment reserved: 12 February 2026