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[2012] ZAWCHC 282
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Robert v No1 Bolussi Close CC (6767/2012) [2012] ZAWCHC 282 (7 August 2012)
IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE HIGH COURT, CAPE TOWN)
CASE NO: 6767/2012
NEDBANK LTD
(formerly trading as NEDCOR BANK LTD)
....................
Intervening
Party
In the matter between:
GARTH STEWARD
MACINTOSH ROBERT
.............................................................
Applicant
(Identity number )
and
NO 1 BOLUSSI
CLOSE CC
.................................................................................
Respondent
Registration number: 1999/0.09694/23
Registered Address: 1 Bolussi Close,
Gordon Bay, Western Cape
JUDGMENT
Nyman A.J.
1. This is an
application for the final winding up of the respondent. ! refer
hereinafter to the respondent as “the Close
Corporation”.
On 5 April 2012 an order was granted placing the Close Corporation
under provisional liquidation on the ground
that it is unable to pay
its debts. The rule
nisi
issued with the order called upon interested parties to show cause
why a final order of liquidation should not be granted. On 11
May
2012 Nedbank Ltd launched an application seeking leave to intervene
as a party in the liquidation proceedings and affording
it the right
to oppose the winding up application. I refer to Nedbank Ltd
hereinafter as “the Bank”.
2. Pursuant to an agreement concluded
by the Bank and the applicant, an order was granted on 16 made .2012,
granting the Bank leave
to intervene in the liquidation proceedings.
3. The applicant seeks an order of
liquidation in terms of subsections 344 (f) and (h) and 345 (1)(c) of
the Companies Act No. 61
of 1973 read with subsection 69(1 )(c) of
the Close Corporations Act No. 69. of 1994. I refer to the Close
Corporations Act hereinafter
as “the Act”. The applicant
relies on a liquidated debt in the sum of R600;000-00 which money was
advanced and lent
by the applicant to the Close Corporation in terms
of an oral .agreement. As proof of the applicant's claim, a copy of
an Acknowledgement
of Indebtedness, is annexed to the founding
affidavit in support of the liquidation application, which
Acknowledgement of Indebtedness
is signed by Hilton Michael La Vita
who is a sole member of the Close Corporation. The Acknowledgement of
Indebtedness reads as
follows:
“
I, the undersigned,
HILTON MICHAEL LA VITA
duly authorised
thereto by 1 BOLUSSI CLOSE CC of c/o 1 Bolussi Close, Gordon's bay
do
hereby acknowledge as follows:
1. GARTH MACKINTOSH lent and advanced
the Close Corporation a sum of R600 000.00 on
2. No 1 Bolussi Close CC is truly and
lawfully indebted to Garth Mackintosh in the said sum.
3. I undertake to pay the said sum
within 10 days of the finalisation of arbitration proceedings with a
Mrs Erasmus, being held:in•
Cape Tovyn,
4. I agree that the outstanding
balance from time to time will attract ; interest at a rate .of 5%
per annum; until the full sum
will ;haye b§en: fully paid.
5. I am liable in addition for costs
on an attorney and client scale, as well: as.collection costs.
6. I agree that in the event of my
default, judgment may be :eht6redr against me in term of Section 57
of the Magistrate’s
Court Act."
4. Payment of the loan was effected in
three instalments into the bank account of Mr La Vita respectively on
15 June 2009, 3 July
2009 and 29 July 2009.; No repayments were made
of the loan, despite demand made by the applicant in a meeting with
Mr La Vita
on 3 April 2012, and hence the liquidation application.
5. It is common cause that the Close
Corporation is indebted to the Bank in the amount of R5 578 144 under
a mortgage bond in respect
of certain immovable property. On 12 April
2011 the Bank obtained judgment against the Close Corporation. A
warrant of execution
was issued against the immovable property and
the immovable property was duly attached by the Sheriff on 19 May
2011. In consequence,
the Bank is a creditor who holds a secured
claim, against the Close Corporation and therefore enjoys a real and
substantial interest
in the liquidation, application. The Bank’s
opposition to the liquidation application is based on the following
two grounds:
5.1. The
applicant lacks
locus standi
to launch the liquidation application; sind
5.2 It is not just and equitable to
liquidate the Close Corporation.
6. It is the
Bank’s contention that the applicant lacks
locu$
standi
because firstly, the payments
of the loan were; made into the personal bank account of Mr La Vita
and not the Close Corporation,
and secondly, .clauses 2 and 3 to 6 of
the Acknowledgement of Indebtedness record that it is Mr La Vita and
not the Close Corporation,
who is liable to the applicant for the
repayment of the debt.
7. In answer to
the above point in
limine,
the applicant alleges that the reason why payment of the loan was
made into the personal bank account of Mr La Vita is because
the
Close Corporation does not have a bank account. The true position is
that La Vita bound the Close Corporation and that by operation
of
law, La Vita attracted personal liability. The applicant furthermore
alleges that the funds were intended for use and were in
fact used by
the Close Corporation.
8. I am in
agreement with the Bank’s submission that the applicant does
not enjoy
locus standi
to institute the liquidation application. In terms of section 2 of
the Act, a close corporation constitutes a separate juristic
person,
separate from its members. This separation is confirmed in section 52
of the Act which prohibits the making of loans and
furnishing of
security to members and others by the corporation.
9. Contrary to
paragraph 1 of the Acknowledgement of Indebtedness which records that
the applicant lent and advanced the Close Corporation
a sum . of R600
000.00, in fact, the money was paid into the bank ..account of Mr La
Vita. The applicant’s allegation that
the funds were intended
for use and were, in fact used by the Close Corporation is not
sustainable because there is no evidence
on the papers that the money
was used by the Close Corporation. In any event, it is difficult to
see how the money could have been
used, under the name of the Close
Corporation, given the applicant’s contention that the Close
Corporation does not have
a bank account: I might add that in my
opinion, this contention is far-fetched and clearly untenable within
the meaning of the
Plascon Evans
decision.
10. It is my
viewpoint that the applicant has not discharged the
onus
resting on him to show that he is a creditor in good standing of the
Close Corporation, since it is Mr La Vita and not the Close
Corporation who received payment of the loan into his bank account. I
am therefore satisfied that the applicant has failed to prove
on a
balance of probabilities that he has the necessary
locus
standi
as creditor (See:
Helderberg Laboratories CC and Others
v Sola Technologies (Pty) Ltd
2008
(2)
11. While it is
not necessary for me to consider whether it is just and equitable to
wind up the dose corporation, in the light
of my finding that the
applicant lacks
locus standi
,
I will nevertheless consider whether it is just and equitable to
grant such an order.
12. lt is the Bank’s case that
it is not just and equitable to liquidate the Close : Corporation
because no other creditors
will, benefit from the sale of the
immovable property due to the. discrepancy between the forced sale
value and ; the market value
thereof and the amount outstanding to
the bank, being the ; bondholder, as no free residue will be
available for distribution to
concurrent creditors. Accordingly, in
the event that the Close Corporation is wound up, the cost of the
liquidation and of selling
the property will not only greatly reduce
any benefit that could be received by the Bank from the sale of the
immovable property,
but the Bank will also be forced to pay a
Contribution to the costs of the liquidation.
13. The
applicant’s counsel conceded in argument that if the Close
Corporation is i finally wound up, the total proceeds of
the sale of
the immovable property will be paid to the Bank who enjoys a secured
claim. He however submitted that all that the
applicant enjoys is a
spes
that he will receive a benefit in respect of his unsecured loan. In
my viewpoint, this
spes
will remain unfulfilled.
14. It is not in dispute that if the
immovable property is sold, the price that it will fetch on the open
or closed market will
be between R2,2 to R2,7 million, well below the
amount of the Bank's claim. In these circumstances, the applicant
will not receive
any benefit from the liquidation. Given the
prospective costs of the liquidation proceedings, it does not make
economic sense to
place the Close Corporation under liquidation. As
correctly contended by the Bank, the liquidation will unnecessarily
diminish
the estate of the Close Corporation. Accordingly, I am of
the viewpoint that it will not be just and equitable to wind up the
Close
Corporation.
15. I therefore make the following:
order:
(a) The provisional order of
liquidation made on 5 April 2012 is discharged.
(b) Applicant is to pay the
intervening party’s costs of suit; including the costs of the
postponement of 31 July 2012.
Nyman AJ
Date
of Judgment: 8 August 2012