South African Alpha SCP obo Challenger v Uys and Others (20382/2023) [2026] ZAWCHC 459 (31 August 2026)

SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document in
compliance with the law and SAFLII Policy


IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE DIVISION, CAPE TOWN)

Reportable
CASE NO:20382/2023
In the matter between:
SOUTH AFRICAN ALPHA SCP Applicant
ON BEHALF OF CHALLENGER
and
ALWYN UYS First Respondent
SIVULATHMEE MOODLIAR N.O. Second Respondent
CORNELIA MARIA CLOETE N.O. Third Respondent
BONEX INTERNATIONAL (PTY) LTD Fourth Respondent

CORAM; NDITA, J
Heard: 21 May 2025
Delivered:31 August 2026
SUMMARY: Company - Directors and officers, liability for debts of a company,
reckless trading in contravention of section 424 of the Companies Act 61 of 1973.
Facts establishing reckless trading. Evidence- Interlocutory application for evidence
presented at an enquiry in terms of section 417 of the 1973 Companies Act,
admissible in terms of section 3 of the Law of Evidence Amendment Act. 45 of 1988.

Company-section 20(9) of the Companies Act 2008, piercing the corporate veil -
approach of the court. Procedure – application to strike out.


___________________________________________________________________

ORDER

1. The evidence presented at the Enquiry held in terms of
section 417 of the 1973 Companies Act is hereby admitted in these
proceedings and shall form part of the record herein.
2 . Paragraphs 51.5.2; 52 to 59; 63.3.2 to 63.3.4; 63.4; 63.5.1 to
63.5.2 and the last sentence of paragraph 63.6; and paragraphs
63.9.3, 63.10 and the last sentence of 63.5 as well as paragraphs:
70.3 and 96.1 are hereby struck pout of the Applicant’s founding
affidavit. The Applicant is entitled to 80% of its costs.
3. CLAIM A succeeds. It is hereby declared that the First
Respondent, Mr Alwyn Uys is hereby declared to be liable for the
debts of Bonfrut (Pty) Ltd (in Liquidation).
4. The application to strike out the Applicant’s replying affidavit is
dismissed with costs.
5. CLAIM B is dismissed with costs

JUDGMENT
_________________________________________________________
Introduction
[1] In this application, the Applicant in Claim A seeks relief in terms of
section 424 of the Companies Act 61 of 1973 (“the 1973 Companies
Act”) that the First Respondent be declared liable for the debts of Bonfrut
(Pty) Ltd (in Liquidation) of which he was appointed as a director . In
Claim B, the Applicant seeks the following declaratory orders in terms of
section 20(9) of the Companies Act 71 2008 (“the 2008 Act”), against the
Fourth Respondent:
1.1 that the Fourth Respondent be deemed not to be a juristic
person separate from Bonfrut;
1.2 that pursuant to the declaration in paragraph 1.1 above,
Bonfrut and the First Respondent shall be regarded as a single
entity by ignoring their separate legal existence and treating
Bonfrut as it were the only company; and
1.3 the Fourth Respondent is liable to the Applicant in the
amount owed by Bonfrut to the Applicant, by virtue of section 20(9)
of the Companies Act, of 2008.
1.4 The First and Fourth Respondents be ordered to pay the

costs of this application, jointly and severally. The one paying, the
other to be absolved, together with any other respondent who
opposes, including the costs of Senior counsel.
[2] This application is opposed by the First and Fourth Respondents.
[3] In addition to the main application, the Applicant brought an
interlocutory application seeking that the court allow into evidence
transcripts of testimony given at the liquidation enquiry in terms of
section 417 of the 1973 Act and section 3 of the Law of Evidence
Amendment Act 45 of 1988 regulating the admission of hearsay
evidence.
[4] The First and Fourth Respondents have also brought an
interlocutory application seeking to strike out substantial parts of the
founding and replying affidavits on the basis that they comprise,
variously, hearsay, unsubstantiate argument and/or new matter in reply.
The Parties
[5] The Applicant, South Africa Alpha SPC (On behalf of Challenger
Trade Segregated Portfolio (“Challenger”), is a foreign company in the
Cayman Islands, within the jurisdiction of the Cayman Islands Monetary
Authority, with its principal business at c/o Harney Services (Cayman)

Limited, […] Floor H […] Place, 1 […] S[…] C[…] Street, George Town,
Grand Cayman, KYQ-1002, Cayman Islands.
[6] The First Respondent is Alwyn Uys (“Mr Uys Junior”) an adult male
businessman who is an erstwhile director of Bonfrut (PTY) LTD (in
liquidation) (“Bonfrut”) and a director of the Fourth Respondent, Bonex
International (PTY) Ltd.
[7] The Second Respondent is Sivulatchwee Moodliar N.O., a major
female insolvency practitioner and director of Sanek Trust Recovery
Services (Pty) Ltd of […] Floor, […] S[…] G[…] M[…], Cape Town. She is
cited in these proceedings in her representative capacity as duly
appointed joint liquidator of Bonfrut.
[8] The Third Respondent is Cornelia Maria Cloete N.O., a major
female insolvency practitioner of Xirimele Trustees of 4 […] E[…] B[…]
Street, Garsfontein, Pretoria. She is cited in these proceedings in her
representative capacity as duly appointed joint liquidator of Bonfrut.
[9] The Second and Third Respondents are collectively referred to as
the liquidators. Both were appointed on 14 December 2020. No relief is
sought against the liquidators, save in the event of opposition, the
Applicant seeks costs against them jointly and severally with all the
Respondents who oppose this application.

[10] The Fourth Respondent, Bonex International, (PTY) LTD, is a
private company duly registered in accordance with the laws of the
Republic of South Africa with its registered address at […] S[…] Avenue,
St Francis Bay Eastern Cape Province.
[11] To align this judgment with the papers, the First Respondent is
referred to as Mr Uys Junior and his father as Mr Uys Senior. The First
and Fourth Respondents are intermittently referred to as the
Respondents.


Factual Background
[12] In the founding affidavit deposed to by Mr Ga ry Isbister, the
Applicant’s asset manager, it is averred that the relief sought is sought
on notice of motion because the facts giving rise thereto are common
cause, based on admissions made by the First Respondent and other
relevant witnesses during an enquiry convened in terms of sections 417
and 418 of the 1973 Companies Act.
[13] It is common cause that Bonfrut operated a fruit exportation
business in South Africa, Europe and America. It secures fruit from
farmers (“Suppliers”) prior to their harvest, which it then on -sells to its
international customers (“Offtakers”). Bonfrut advanced funds to the
Suppliers to secure their fruits prior to harvesting, with the result that the

capital outlay was required some time prior to the recovery of this
expense from the purchase price paid by the relevant Offtaker. Since
Bonfrut did not have the capital to fund such advances itself, funding
was sought from Challenger.
[14] On 23 January 2018, the Applicant and Bonfrut entered into two
agreements, namely, a Full Invoice Discounting Agreement (“Discounting
Agreement”) and a Cession in Security Agreement (“the Cession
Agreement”). In terms of the cession agreement, Bonfrut ceded and
assigned all ceded rights in favour of Challenger as security for Bonfrut’s
obligations in accordance with the terms of the Discounting Agreement.
These are collectively referred to as the Challenger Agreements. In
respect of both agreements, Mr Gerhard Uys (“Mr Uys Senior”)
represented Bonfrut. Pursuant to the agreements, Bonfrut became
indebted to the Applicant in a sum of USD 687 949, 40. Bonfrut was
placed in liquidation, and Challenger lodged a claim in Bonfrut’s
insolvent estate. To this end, the liquidation and distribution account in
respect of Bonfrut reflects that the latter remains indebted to Challenger
in the amount of R9 583 692.00
[15] On 21 September 2020, the Liquidators launched an ex parte
application for the convening of a Commission of Enquiry into Bonfrut’s
business, dealings and affairs in terms of section 417 and 418 of the

1973 Companies Act. Several witnesses gave evidence during the
hearing. The Applicant has attached to the record a copy of the certified
transcript of the proceedings. According to the Applicant, the evidence
obtained at the Enquiry establishes that:
15.1 Mr Uys Junior, being an erstwhile director and prescribed
officer of Bonfrut, knowingly carried on its business recklessly, with
gross negligence and/or with an intention to defraud its creditors,
most notably, Challenger;
15.2 the incorporation and use of Bonex constituted an
unconsciable abuse of its separate juristic personality, in that the
business of Bonfrut was unlawfully hijacked and transplanted into
Bonex in an attempt to avoid payment to Bonfrut’s creditors, with
the result that Bonex should be deemed not to be a juristic person.
[16] I have already indicated that the order sought against Mr Uys
Junior and Bonex is based on the evidence from the Enquiry. According
to the Applicant, the evidence establishes the following:
16.1 That Mr Uys Junior and Bonex knowingly conducted the
business of Bonfrut whilst it was trading in insolvent circumstances
and with the intention to defraud the creditors of Bonfrut .
Additionally, Mr Uys Junior incurred Bonfrut’s lability to Challenger
and then used these funds to pay other creditors of Bonfrut,

knowing full well that the result would be that Bonfrut would not be
able to satisfy the liability owed to Challenger.
16.2 Mr Uys Junior showed no regard for the separate legal
entities of Bonfrut and Bonex as he transferred the business
previously operated by Bonfrut and corporate opportunities of
Bonfrut to Bonex. He also redirected funds owing to Bonfrut to
Bonex, who trades with the same customers Bonfrut traded with.
16.3 Mr Uys Junior used the proceeds from purchased invoices
which were ceded to Challenger in terms of the Agreements to pay
company expenses and other creditors instead of paying
Challenger, in breach of the Challenger Agreements. Furthermore,
he also intentionally shifted Bonfrut’s business to Bonex, to avoid
Bonfrut’s liability to Challenger and other creditors.
16.4 Payments due to Bonfrut were intentionally redirected to
growers /farmers to defraud Challenger and other creditors of
Bonfrut. Thus, Bonex was incorporated and used in a manner such
that there was no distinguishable corporate identity between
Bonex and Bonfrut s liability to Challenger.
[17] With regard to the Applicant’s claim B in terms of section 20(9) of
the 2008 Act, the Applicant alleges that the transcript of the proceedings

unequivocally established that Bonex was used by Mr Uys Junior and Mr
Uys Senior:
17.1 such that there was no distinguishable corporate identity
between Bonex and Bonfrut;
17.2 for a dishonest and improper purpose;
17.3 as a device or façade to conceal wrongdoing’
17.4 in a manner that affects a third party in a way that reasonably
should not be countenanced.
[18] I first deal with the interlocutory application for the acceptance into
the record of the alleged hearsay evidence tendered at the Enquiry in
terms of section 417 of the 1973 Companies Act.
The application in terms of section 3 of the Law of Evidence
Amendment Act
[19] The Applicant brought an interlocutory application in terms of
section 3(1) of the Law of Evidence Amendment Act 45 of 1988 for an
order in the following terms:
“1. Declaring, to the extent necessary, that the transcripts relied upon by
the applicant in the main application are admissible under section 3 of the
Law of Evidence Amendment Act 45 of 1988”.

[20] In seeking the relief against the Respondents in the main
application, the Applicant relies heavily on the evidence tendered at the
Enquiry held in terms of sections 417 and 418 of the 1973 Companies
Act to draw inferences of impeachable conduct on the part of Mr Uys
Junior and Bonex. It is common cause that the Enquiry was partially
conducted in the Afrikaans language, however, th e relevant portions
have been translated to English by a sworn translator. The specific
transcripts sought to be admitted include, but are not limited to:
20.1 The testimony of Mr Alwyn Uys (Mr Uys Junior), regarding
his role in the management of Bonfrut, his knowledge of the
company’s insolvency, and his actions in relation to the
misapplication of company funds.
20.2 The testimony of Ms Liesbet Ferreira (Ms Ferreira), a former
employee of Bonfrut, provided key information regarding the
improper diversion of funds for creditors, including Challenger.
20.3 The evidence of Mr Gerhard Uys ( Mr Uys Senior), a former
director of Bonfrut, regarding the fraudulent transfer of assets from
Bonfrut to Bonex International. A company allegedly used to shield
Bonfrut’s assets from its creditors.
20.4 The testimony of Ms Alana Potgieter (Ms Potgieter) , who
provided evidence concerning her involvement in the financial

administration of Bonfrut and her role in facilitating transactions,
including those with Challenger.
20.5 The evidence of Ms. Lizi van Niekerk, (Ms van Niekerk) , a
former procurement/sales employee at Bonfrut’s financial
operations. Her involvement in business transactions that are
relevant to the case is important for the determination of the issues
in this matter.
20.6 The evidence of Mr Charl Uys, brother of Mr Gerhard Uys
(Mr Uys Senior) who also testified regarding his involvement in
Bonfrut’s financial dealings and the overall business management
during the period of insolvency.
[21] It was submitted on behalf of the Applicant that the admission of
the transcripts of evidence is essential to ensure that all relevant
evidence is placed before court, more so that the evidence was obtained
lawfully, with the Respondents having had an opportunity to testify, and
the probative value of the evidence outweigh any potential prejudice to
the Respondents.
[22] The Respondents resist the admission of the 417 Enquiry
evidence on the basis that it cannot be used against a party as proof of
facts dealt with in the transcript but may be used to cross -examine such
person in respect of such facts dealt with in the Enquiry . According to

this contention, the exclusion of such evidence is not based on the fact
that it constitutes hearsay as defined in section 3 of the Law of
Amendment Act, but rather, on an independent common law rule due to
the prejudicial effect of allowing such evidence in legal proceedings
which may easily lead to an unfair hearing. In any event, so further
contend the Respondents, the entirety of the Applicant’s application is
based on facts that do not fall within the personal knowledge of the
deponent to the founding affidavit.
[23] Counsel for the Applicant pointed out, correctly, in my view , that it
is established in our law that evidence procured at an enquiry is
admissible against the party who gave evidence, contrary to the
averments made by the First Respondent to the effect that:
“Even where a party gave evidence at such proceedings, transcripts thereof
cannot be used against that party as proof of the facts dealt with in the
transcripts but may only be used to cross -examine such person in respect of
such facts or as proof of what he said in the proceedings.”
It is not questionable that the Enquiry proceedings relating to evidence
given by the First Respondent are admissible against the First
Respondent. Section 417 provides that:
“417 Summoning and examination of persons as to affairs of the
company.-

(1) In any winding -up of a company unable to pay its debts, the Master of
the Court may, at any time after a winding -up order has been made,
summon before him or it any director or officer of the company or person
known or suspected to have in his possession any property in the of the
company or person known or suspected to have in his possession any
property of the company believed to be indebted to the company, or any
person whom the Master or the Court deems capable of giving information
concerning thee trade, dealings, affairs, or property of the company.
(2) …
(a) …
(b) …
(c) An incriminating answer or information directly obtained, or
incriminating evidence directly derived from, an examination in terms of this
section shall not be admissible as evidence in criminal proceedings in a
court of law against the person concerned or the body corporate of which he
or she was an officer, except in criminal proceedings where the person
concerned is charged with tan offence relating to –
(i) the administering of an oath or the administering or making of an
affirmation;
(ii) the giving of false evidence;
(iii) the making of a false statement;
(iv) a failure to answer lawful questions fully or satisfactorily.”
[24] Counsel for the Respondents submitted that the application for
admission of such proceedings must be refused because (a) the
provisions of section 3 of the Law of Evidence Amendment Act do not

apply to transcripts of section 417 proceedings and (b) the transcripts
should in any event not be admitted even if section 3 applies.
Furthermore, so continues the contention, Section 417 (c) circumscribes
instances where the transcript of a section 417 enquiry may be
admissible in criminal proceedings. Relying on O'Shea NO v Van Zyl NO
& Others [2011] ZA (SCA) 156 at para [21] where the court explained
that rationale for the rule against admissibility of transcripts of liquidation
enquiries as being because “To allow a liquidator to rely on such
statements without calling the witness would be inimical to the law of
evidence”.
[25] In opposing the application, the Respondents emphasise that it is
settled law that transcripts of proceedings are inadmissible in
subsequent civil proceedings, save that the transcript of the evidence of
an individual may be used only against the person who testified (but not
against the a director of a company). Accordingly, so further contends
the Respondents, all transcripts of the testimony given at the Enquiry are
inadmissible against Bonex, and all transcripts, except for those of Mr
Uys Junior, himself, are also inadmissible against Mr Uys Junior.
[26] In prayers 1 to 6 of the Respondent’s application to strike out, the
Respondents seek that the provisions of the transcript be struck out on
the basis that Mr Gary Isbister, the deponent to Challenger’s founding

papers has little or no personal knowledge of the internal operations of
Bonfrut and is therefore in no position to give evidence as to whether (a)
Bonfrut was carrying on business recklessly at any time, (b) Bonfrut was
carrying on business with the intent to defraud its creditor s or for a
fraudulent purpose or (c ) whether Mr Uys Junior was knowingly a party
to any such conduct. Furthermore, Mr Isbister has no knowledge of
whether conduct by Bonex amounts to unconscionable abuse of its
juristic personality, the requirement for the relief it seeks in terms of
section 20(9) of the 2008 Act.
[27] Counsel for Challenger contended that there is authority for the
contention that transcript of liquidation proceedings may be admitted in
terms of section 3(1) of the Law of Evidence amendment Act 45 of 1988.
It is so that in Engelbrecht NO and Others v Van Staden and Others 2011
ZAWCHC 447 (6 December 2011) Rogers AJ, (as he then was) examined
the admissibility of evidence elicited in a section 417 enquiry into
subsequent civil proceedings and whether such evidence can be used
against other respondents and expressed the following opinion:
“[18]…the Supreme Court of Appeal approved the statement of general
principle laid down in Gilbert Hamer and applied it to the case where one of
several trustees of a family trust testified at a s 417 enquiry….. …... In the O
'Shea case there was no evidence that Mr O'Shea (a co -trustee) had testified
as an authorised representative of the trust rather than in his personal

capacity. His evidence was thus held to be inadmissible to establish the
liquidators' claim against the trust. ..
[20] Gilbert Hamer and O'Shea at least decided that evidence given in the
circumstances dealt with in those matters and which would ordinarily be
inadmissible hearsay when adduced against any person other than the
witness himself is not rendered admissible by provisions such as s 65(5) of
the Insolvency Act. What is less clear is whether they also decide that such
statements may never be received into evidence against a third party, for
example under the modern law regarding the admissibility of hearsay
evidence as regulated by s 3 of the Law of Evidence Act 45 of 1988. The latter
Act was not in force when Gilbert Hamer was decided. In O'Shea the
possibility of receiving the evidence as hearsay in terms of Act 45 of 1988
appears not to have been raised. …. The references in Gilbert Hamer and O
'Shea (and in the authorities reviewed therein) to privity of interest and the
circumstances in which admissions made by an agent are admissible against
his principal suggest that the conclusion that the evidence was inadmissible
rested on the fact the evidence was hearsay, which in modern law is not an
absolute bar to receiving the evidence. ……. There is the further consideration
that although s 65(5) of the Insolvency Act contains (as did s 155(2) of the
1926 Companies Act) an express provision regarding admissibility in later
proceedings (including civil proceedings), the provisions of s 417 of the
Companies Act 61 of 1973 (as they have read since their amendment in 2002)
deal expressly only with later criminal proceedings. The admissibility or
inadmissibility of such evidence in civil proceedings thus appears to rest on

general principles of the law of evidence rather than on the terms of the
Companies Act.[emphasis added]
[21] I am thus inclined to think that a court may in appropriate cases permit a
litigant to rely on evidence given by X at a s 417 enquiry for purposes of
making out a case against Y provided this would be in the interests of justice,
having regard to the requirements laid down in s 3 of Act 45 of 1988.”
[28] This approach was endorsed in Van Zyl and Another NNO v Kaye
NO and Another 2014 (4) SA 452 (WCC) wherein Binns-Ward J, affirming
Rogers AJ’s reasoning stated that:
“[41] Section 417(2) in its current form was enacted to address the issues of
constitutional incompatibility inherent in the abrogation of the right against
self-incrimination. I do not think that the subsection has any bearing on civil
proceedings.
[42] …. It is plain that the provisions for secrecy in s 417(7), and the resultant
limitation on the use of the evidence, are to promote the achievement of the
objects of the enquiry proceedings, and not for any other policy purpose.
Once that purpose has been served, ….the basis and the need for such
secrecy fall away. ……
[43] I find nothing in the provisions, save as expressly provided in s 417(2),
that militates in principle against the use of the evidence adduced at such
enquiries in other proceedings to the extent that the ordinary rules of evidence
would allow. ……
[44] ….. the effect of allowing the use of the evidence at subsequent civil
proceedings has thus far been that the evidence has been permitted to be

used only against the examinee as a party or a witness in such subsequent
proceedings. I agree with the opinion expressed by Rogers AJ in Engelbrecht,
that the exclusion of its wider use would appear to have been founded on the
hearsay rule. For all these reasons I have concluded that the evidence
adduced at the enquiry is amenable to being introduced in the current
proceedings in terms of s 3(1) (c ) of Act 45 of 1988, subject of course, to the
requirements if that provision being satisfied.”
[29] The obiter remarks in Engelbrecht, subsequently endorsed in Van
Zyl, supra, were affirmed and applied by Griesel J, in Von Wielligh v
Bester N.O. and Others v Merchant Commercial Finance and Others
Case number 16211/13 delivered on 18 February 2014, wherein reliance
was placed on the evidence elicited in an enquiry , in order to prove
impeachable transactions , but because there was no application in
terms of section 3(1) the Law of Evidence Amendment Act, the learned
judge held thus:
“[11] It was thus incumbent the applicant to seek admission of the hearsay
evidence, not for the respondent to seek its exclusion. The applicant has not
sought to make out a case or to lay a basis for the admission of the evidence
on this basis, with the result that I am not persuaded that the evidence in
question ought to be admitted in the interests of justice,”
[30] What emerges from the above review of cases relating to the
admission of section 417 Enquiry proceedings is that where an
application for the admission of such proceedings has been made in

terms of section 3 (1) of the Law of Evidence Act, a court may consider
whether it is in the interest of justice to admit into the evidence the
record of such Enquiry in subsequent proceedings. I n my view, this
position has now been firmly established in our law. In the matter at
hand, as earlier alluded to, Challenger has filed an application for the
enquiry proceedings in terms of section 417 to be admitted in terms of
section 3 of the Law of Evidence Act. Thus, I turn to consider the
assessment in terms of the Act.
[31] Section 3 of the Law of Evidence Amendment Ac t provides as
follows:
“3 Hearsay evidence
(1) Subject to the provisions of any other law, hearsay evidence shall not be
admitted as evidence at criminal or civil proceedings, unless-
(a) each party against whom the evidence is to be adduced agrees
to the admission thereof as evidence at such proceedings;
(b) the person upon whose credibility the probative value of such
evidence depends, himself testifies at such proceedings; or
(c) the court, having regard to-
(i) the nature of the proceedings;
(ii) the nature of the evidence;
(iii) the purpose for which the evidence is tendered;
(iv) the probative value of the evidence;

(v) the reason why the evidence is not given by the person upon
whose credibility the probative value of such evidence depends;
(vi) any prejudice to a party which the admission of such evidence
might entail; and
(vii) any other factor which should in the opinion of the court be
taken into account,
is of the opinion that such evidence should be admitted in the interests of
justice.
(2) The provisions of subsection (1) shall not render admissible any evidence
which is inadmissible on any ground other than that such evidence is hearsay
evidence.
(3) Hearsay evidence may be provisionally admitted in terms of subsection (1)
(b) if the court is informed that the person upon whose credibility the probative
value of such evidence depends, will himself testify in such proceedings:
Provided that if such person does not later testify in such proceedings, the
hearsay evidence shall be left out of account unless the hearsay evidence is
admitted in terms of paragraph (a) of subsection (1) or is admitted by the court
in terms of paragraph (c) of that subsection.
(4) For the purposes of this section-
“Hearsay evidence” means evidence, whether oral or in writing, the probative
value of which depends upon the credibility of any person other than the
person giving such evidence;
“party” means the accused or party against whom hearsay evidence is to be
adduced, including the prosecution.”

[32] The underlying principle in section 3(1) (c) is that hearsay
evidence is not admissible in both civil and criminal proceedings,
however, the test whether such evidence should be admitted in any
proceedings is a determination of whether it is in the interests of justice
to do so. I now turn to consider whether in casu, it is in the interest of
justice to admit the record of from section 417 Enquiry. In so doing, I
must consider the various factors listed in the provision that must be
taken into account when conducting this kind of assessment. It is trite
that the factors listed in section 3 should be viewed collectively.
The nature of the proceedings
[33] It is well to restate that the standard of proof in the present
proceedings is on a balance of probabilities, unlike that of proof beyond
reasonable doubt in criminal cases. DT Zeffert and AP Paizes, The Law
South African Law of Evidence , 2nd, page 401 opine that since the
person upon whose credibility the probative value of the evidence
depends is, in the case of hearsay evidence not subjected to the crucial
devices designed to identify, assess and eliminate those aspects of the
evidence that render it potentially unreliable, it is important for the court
(a) to understand that what the potential dangers are (b) consider the
extent to which those dangers actually arise in the case before it; and (c)
identify factors that tend to reduce or even eliminate those dangers.

[34] I have already indicated that the evidence in question was given
under oath during an Enquiry in terms of sections 417 and 418 of the
2008 Companies Act into the collapse of Bonfrut. More specifically, the
witnesses’ testimonies were obtained for the purpose of investigating the
company’s financial affairs and potential misconduct on the part of the
directors.
[35] In the present matter, the witnesses were required by law to
provide truthful and complete testimony duly led by a commissioner who
oversaw the enquiry. T he evidence was given by persons who had
knowledge of the operations of both Bonfrut and Bonex. This was not
second hand hearsay evidence, it was first hand hearsay evidence. In
comparison to hearsay evidence tendered in criminal proceedings where
a person made a written statement under oath but was for some reason
unable to give evidence, it seems to me that the fact that in this enquiry
the commissioner leads the proceedings and asks probing questions as
evident from the transcript , lends credence to the acceptability and
reliability of the evidence elicited during the Enquiry proceedings.
Nature of the evidence
[36] Schwikkard and Van der Merwe , Principles of Evidence , 3 rd ed,
2009, at 279, list a myriad of factors that affect credibility under this
rubric. They are:

(a) the fact that the witness has or had no interest in the matter
before the court may impact on the assessment of reliability;
(b) the statement was made against the interest of the declarant;
(c) other evidence supporting the hearsay evidence;
(d) simplicity of the subject matter and the absence of the subject -
matter and absence of contradictory evidence.
[37] In Kapa v S 2023 (4) BCLR 370 (CC) Majiedt J , at para [79]
outlined that “the enquiry under this rubric is, first, the extent to which the
evidence can be considered reliable; and, second, the weighing of the
probative value of the evidence against its prejudicial effect” . The Court
alluded to the following factors relevant to the reliability question:
(a) any interest in the outcome of the proceedings by the
witness;
(b) the degree to which it is corroborated or contradicted by
other evidence;
(c) the contemporaneity and spontaneity of the hearsay
statement; and
(d) the degree of hearsay. (See Kapa, para 81)
[38] The individuals who testified regarding Bonfrut affairs held key
positions in the company and were closely involved with its financial and
operational decisions.

[39] Ms van Niekerk, an erstwhile procurement/sales employee,
described how Bonfrut’s internal sales figures were often manipulated to
present a more favourable financial picture to creditors.
[40] Mr Charl Uys, the brother of Mr Uys Senior, provided a perspective
of how Bonfrut’s finances were managed during its period of insolvency.
[41] Each witness had direct involvement in the company’s operations
and provided firsthand knowledge of the alleged misconduct. It can be
accepted therefore that their evidence is reliable. Th e witnesses’
evidence is further supported by the testimony Mr Uys Junior who
confirmed that he attended to the calculations on payments to be made
to Challenger based on Bonfrut’s cash flow.
The purpose for which the evidence was tendered
[42] I have already indicated that Challenger tendered the transcripts to
establish that Bonfrut’s directors and employees engaged in reckless
trading and financial mismanagement which led to the company’s
inability to meet its obligations to creditors such as Challenger. Central
to these allegations is the evidence of Ms Ferreira to the effect that
funds from the Intaker invoices, which in terms of the parties’ agreement,
were meant to be paid to Challenger, were instead used to pay other
creditors. Ms Ferreira gave evidence to the effect that she personally
effected the already mentioned payments on instructions from the

company’s directors, who were fully cognizant of the fact that this
practice breached Bonfrut’s agreement with the Challenger. Ms
Ferreira’s evidence is bolstered by Ms Potgieter’s confirmation of the
systematic nature of misappropriation and diversion of funds to cover
Bonfrut’s operational expenses.
[43] Ms van Niekerk’s evidence shows how Bonfrut misled creditors by
inflating sales figures and presented a false picture of its financial health.
Her evidence is corroborated by that of Mr Charl Uys who stated that
funds were shifted between accounts to delay the insolvency, all the
while knowing that the company was unable to meet its financial
obligations.
The probative value of the evidence
[44] The Supreme Court of appeal in S v Ndhlovu [2002] ZASCA 70;
2002 (6) SA 305 (SCA) the court explained the meaning of probative
value thus:
“‘Probative value’ means value for purposes of proof. This means not only,
what will the hearsay evidence prove if admitted?’, but ‘will it do so reliably?’
In the present case, the guarantees of reliability are high. The most
compelling justification for admitting the hearsay in the present case is the
numerous pointers to its truthfulness.”

[45] Another useful guide in assessing the probative value of the
evidence herein can be found i n Minister of Police v M and Others
(JR56/14) [2016] ZALCJHB 314; (2017) 38 ILJ 402 (LC) (19
August 2016) set out a few guidelines on when, in arbitration
proceedings conducted in terms of the LRA, a single piece of
hearsay, such as a transcript, might constitute prima facie proof of
an allegation. Although the guidelines specifically refer to
arbitration proceedings, I am of view that they are useful in the
enquiry that is the subject matter of this judgment. These are the
following, hearsay should:
(1) be contained in a record which is reliably accurate and
complete;
(2) be tendered on the same factual dispute;
(3) be bi -lateral in nature. In other words, the hearsay should
constitute a record of all evidence directly tendered by all
contending parties;
(4) in respect of the allegations, demonstrate internal
consistency and some corroboration at the time the hearsay
record was created….;

(5) show that the various allegations were adequately tested in
cross-examination. For example, the transcripts record not
only K’s allegations but also RM’s attempts to discredit them;
(6) have been generated in procedurally proper and fair
circumstances.
[46] In casu, the witnesses were not cross -examined. Counsel for the
Respondents strenuously argued against the admission of the hearsay
evidence bemoaning the fact that the witnesses were not subjected to
cross-examination thereby depriving the Respondents of an opportunity
to test the veracity of those who gave evidence.
[47] Admittedly, the admission of the section 417 enquiry proceedings
is significantly prejudicial to the First and Fourth Respondents as they
would be deprived of the opportunity to cross -examine the witnesses.
However, in, Kapa, supra, the court explained at paragraph [81] that :
“In Savoi, this Court explained that courts’ aversion to hearsay evidence
stems from its general unreliability as it is not subject to the reliability checks
applicable to other evidence – such as cross-examination – and as its nature
makes it difficult for a party to effectively counter inferences drawn from it.
This Court noted, however, that notwithstanding hearsay evidence being
untested, and despite the possibility of risks of faulty memory or erroneous
perception, insincerity or ambiguities in narration, hearsay evidence may
prove to be reliable.”

[48] In Ndhlovu, supra, at para [24], the Supreme Court of Appeal
pointed out that section 35(3)(i) does not create an automatic right to
cross-examine. The Supreme Court of Appeal said that:
“The Bill of Rights does not guarantee an entitlement to subject all
evidence to cross -examination. What it contains is the right (subject to
limitation in terms of section 36) to ‘challenge evidence’. Where that
evidence is hearsay, the right entails that the accused is entitled to resist
its admission and to scrutinise its probative value, including its reliability.
The provisions enshrine these entitlements. But where the interests of
justice, constitutionally measured, require that hearsay evidence be
admitted, no constitutional right is infringed. Put differently, where the
interests of justice require that the hearsay statement be admitted, the
right to ‘challenge evidence’ does not encompass the right to cross -
examine the original declarant.”
[49] In Kapa, supra, the Court further held that the factors listed in
section 3(1)(c) must be viewed holistically and weighed collectively in
determining whether it is in the interests of justice to admit the hearsay
evidence. The Court then remarked that minority judgment
‘impermissibly evaluates the probative value of the statement in a
piecemeal fashion. It should instead apply a holistic approach, assessing
whether on the whole the statement was of adequate probative value in
light of all of the other circumstantial evidence taken together.
Approached in this way, the outcome must be different’ (para 98).

[50] In my judgment, the factors favouring the admission of the section
417 Enquiry transcripts far outweigh those favouring its exclusion. I am
of the view that the evidence at the Enquiry is not only reliable, but it
also has a high degree of corroboration with admissible evidence and/or
common cause facts. I find that it is in the interests of justice to admit the
evidence elicited in the section 417 enquiry in its entirety, inclusive of the
all the annexures.
[50] The question that must next considered is what weight this court
should attach to it.
[51] The evidence tendered at the enquiry is in my opinion of high
probative value. This I say because it is not merely viva voce evidence
relating to the central issue of Bonfrut’s mismanagement, but it is
supported by documentary evidence in the form of financial statements,
notwithstanding the fact that the evidence is that some of them were
manipulated to reflect a much healthier financial status of Bonfrut. In
addition, the financial statements were neither audited nor independently
reviewed. Furthermore, the witness’s versions are corroborative of each
other. Mr Uys Junior confirmed that he attended to calculation on
payments made to Challenger, based on Bonfrut’s cash flows and
further that he approved payments made to Challenger. Mr Uys Junior
further conceded that he had access to Bonfrut’s bank accounts, both

prior to his appointment and after his resignation . It is common cause
that Mr Uys Junior was appointed as a director of Bonfrut on 17 October
2018 (and as confirmed by Mr Uys Senior), even after Mr Uys Junior’s
resignation as director on 26 September 2019, he continued to render
services to Bonfrut, the extent of which diminished over time.
[52] Like reliability, probative value is enhanced by the existence of
admissible evidence which is consistent with the hearsay evidence. In
the present matter, the hearsay evidence sought to be admitted is
reliable and sufficiently corroborated by the circumstantial evidence.
The reason the evidence is not given by the person upon whose
credibility the probative value depends
[53] I have already indicated that the evidence given by the First
Respondent, Mr Uys ( Junior) is admissible in these proceedings. It was
contended on behalf of Challenger that the witnesses who testified at the
Enquiry cannot be compelled to provide affidavits in this matter, and in
the circumstances, the Transcript is the best available evidence.
[54] The Respondents emphasise that motion proceedings are
inappropriate in the present matter as the people who testified at the
Enquiry could be summoned to give evidence in court. Whilst this may
be so, this matter is concerned with the admission of the Transcript

where the witnesses actually gave evidence as opposed to reliance on
statements made by witnesses who did not give any evidence.
Any prejudice to a party that the admission of such evidence may entail
[55] Counsel for Challenger argued that there cannot be any prejudice
to the Respondents occasioned by the admission of the evidence
tendered at the Enquiry as they have had ample opportunity to review
the transcripts and are fully aware of the evidence presented therein
whereas excluding the transcripts on the other hand would significantly
prejudice the Applicant by denying it access to critical evidence
regarding Bonfrut’s financial mismanagement.
[56] I have already dealt with the prejudice to the Respondents caused
by the missed opportunity to cross -examine witnesses and have found
that notwithstanding, it is in the interests of justice to admit the transcript
of the Enquiry proceedings.
The Application to strike out
[57] The Applicant brought an application to strike out the entirety of
annexures FA11A and FA11B to the founding Affidavit except for the
transcripts of the evidence of Mr A Uys. In light of the finding I have
made hereinabove, the application to strike out evidence based on the
transcript in respect of all the witnesses who testified falls away.
Likewise, all the exhibits attached to the answering affidavit provide

context to the testimony given by the various witnesses, as such it is
necessary to have them treated as admissible hearsay evidence. These
are exhibits “ FA1” to “ FA50”). For the sake of completeness, I must
now turn to consider each of the paragraphs assailed by the
Respondents.
[58] Paragraphs 30-32 reads as follows:
30 Mr Uys Junior’s LinkedIn profile, a screenshot of which is attached
hereto, marked “FA12”, states that he was employed by Bonfrut for a period of
7 years and 11 months in the position of “Marketing Financial Analyst and
assistant to the CEO”.
31. His role and responsibilities in this position are described as follows:
“Responsible for key financial tasks in assistance to the CEO regarding
budgeting, financial planning and financial analysis.
32 On a secondment basis, worked on projects relating to financial due
diligence procedures by calculating profit margins of essential sales products,
short to long term liabilities, financial modelling and integrating VBA into the
database enhancing the data input output efficiency”.
[59] In my view, there is no basis for striking out the above paragraphs
because during the Enquiry, Mr Uys Junior confirmed that his
responsibilities included all of the above.
Paragraph 34.1

“Ms Potgieter confirmed that Mr Uys Junior attended to financial
management, budgets, payments and to Bonfrut’s account with Challenger>”
[60] The evidence of Ms Potgieter does not constitute hearsay
evidence as it has already been admitted into these proceedings.
34.2 Mr Uys Junior confirmed that he had access to Bonfrut’s financial system
and could at all times see the amounts owed by to Bonfrut’s creditors (which
would have been required for the purposes of inter alia budgeting and making
payments)
34.3 Ms van Niekerk, Ms Potgieter and Mr Uys Senior testified that Mer Uys
Junior had access to Bonfrut’s bank accounts and attended to payments.
Importantly Mr Uys Junior confirmed that he had this access both prior to his
appointment as director of Bonfrut and thereafter,
Paragraph 34.4
Mr Uys Junior and Ms Ferreira confirmed that Challenger was Mr Uys Juniro’s
responsibility. In this regard:
34.1Mr Uys Junior confirmed that he attended to the calculations on payments
made to Challenger based on Bonfrut’s cash flows and further, that he
approved payments made to Challenger;
34.4.2 Ms Potgieter confirmed that Mr Uys Junior was responsible for creditor
payments and in particular, payment to the administration of Challenger.
[60] The evidence relating to the above paragraphs has already been
declared admissible.

Paragraph 34.5
[61] Paragraph 34.5 does not exist.
Paragraph 35.1
Mr Uys Junior was appointed as a director of Bonfrut on or about 17 October
2018, but fulfilled the same role after his appointment as he did prior thereto,
his appointed having been necessitated by the fact that Mr Uys Senior, who
had previously been Bonfrut’s sole director, having required a potentially life
threatening operation; and
35,1.1Mr Uys Senior confirmed that even after Mr Uys Junior’s resignation as
a director of Bonfrut on 26 September 2019 be continued to render services to
Bonfrut, although the extent of these services diminished over time (which is
unsurprising considering that Bonfrut went into liquidation shortly thereafter).
[62] The contents of this paragraph were confirmed by the evidence of
Mr Uys Senior at the Enquiry.
Paragraph 38 including subparagraphs and FA13
Para 38: In seeking such funding, Bonfrut presented Challenger with amongst
other things, its annual financial statements for the year ended 31 May 2017,
a copy of which is attached hereto, marked “FA13”. As appears from the
contents, these financial statements were neither audited nor independently
reviewed, and a very healthy picture of Bonfrut financial position was
represented, in that they reflect the following:

38.1 total assets exceeded total liabilities by more than R5.5 million;38.2
revenue had increased from R82 million in the previous financial year
to R85 million in the 2017 financial year;
38.3 gross profit had increased from R5.2 million in the previous financial
year, with profit for the year having escalated from R414 855.00 in the
previous year to R626 676.00 in the 2017 financial year; and
38.4 shareholder loans decreased over the course of the financial year, from
R1,5 million to a mere R500 000.00
[63] The deponent to the founding affidavit states that the financial
statements were presented to Challenger in order to assess whether it
was comfortable to advance finance to Bonfrut and he has personal
knowledge of this fact. Regarding annexure “FA13” all annexure to the
founding affidavit have already been admitted as evidence. Thus, there
is no basis to strike out this paragraph.
Paragraph 39
39.1 On 14 September 2017 Bonfrut had borrowed R700 000.00 from Ms
van Niekerk in order to pay salaries, as it did not have sufficient fund available
to make payment of same; an’
39.2 as appears from the document provided by Charl during the course of
the Enquiry, a copy of which (and the sworn translation thereof ) is attached
hereto, marked “FA14”, over the period 18 to 29 December 2017 (a month
prior to the conclusion of the Discounting Agreement), Bonfrut had borrowed
additional funding in the amount of R5million from Charl.

[64] The contents of these paragraphs have been admitted by Mr Uys
Junior in paragraph 77 of the answering affidavit. More specifically w ith
regard to paragraph 39.2, Mr Uys Junior in the answering affidavit stated
that “However, it is correct that Bonfrut needed to manage its cash flow,
as is normal in this industry. In order to do this the loans referred to in
paragraphs 39.1 and 39.2 were made at the instance of my father.” In
paragraph 78, Mr Uys Junior further states that “ I was not directly
involved with these transactions and I have no direct knowledge of their
terms, but I understand that the amount referred to in paragraph 39.2
was repaid by September 208 (9 months after the agreement with
applicant and was entered into almost a year before the applicant first
defaulted on any payments due in terms of the agreement .) In any
event, The transcript of the Enquiry has already been admitted as
evidence.
Paragraph 45.5
45.5 As soon as Offtaker paid the paid the Offtaker Invoice amount into
Bonfrut’s Forex account (who received same on behalf Challenger,
Challenger, having taken cession of the right to payment of the Offtaker
Invoices) the amount owing to Challenger in terms of the Discounting
Agreement would fall due to [sic] paid from Bonfrut’s US Dollar Forex account
and the balance owing to the supplier in terms of the Supplier Invoice would
be paid; and

45.6 Ms Ferreira administered and paid Challenger based on instructions
received from Mr Uys Senior and Mr Uys Junior.
[65] This is the evidence elicited at the section 417 Enquiry. Besides Mr
Uys Junior at paragraph 86 of the answering affidavit acknowledged that
he had a basic understanding of the Discounting Agreement, this being
the terms of thereof.
Paragraph 46
46,1 Ms Ferreira testified that she was aware of the implications of the
Challenger Agreement in that the proceeds from the purchased Offtaker
Invoices were ceded to Challenger. Ms Ferreira conceded that the funds
collected in terms of the Offtaker Invoices (the rights to which had been ceded
to Challenger) were not paid to Challenger but were instead used to pay
Bonfrut’s expenses. She further testified that Mr Uys Senior and Mr Uys
Junior would instruct her to use these funds to make payment of the balance
owing in terms of the Supplier Invoices before making payment to Challenger
and that she would give effect to these instructions.
46.2 Ms Potgieter testified that she understood that when a container was
loaded, Bonfrut would request funding from Challenger, and would receive
80% of the Offtaker Invoice value, but the moment payment was received by
the Offtaker in respect of the Offtaker Invoice, Challenger had a right to
payment before the Supplier. She further indicated that it was her
understanding that, despite the aforesaid, these funds were applied to paying
Suppliers prior to any payment being made to Challenger.

[66] This is evidence elicited at the Enquiry. Mr Uys Junior at paragraph
92 of the answering affidavit also states that “It is correct that I assisted
Ms Ferreira with the administration of the discounting agreement and
that invoices were presented to the applicant in order to assist with
Bonfrut’s cashflow. It is also correct that applicant became entitled to the
payment from the monies received from the Offtakers.”
Paragraph 46.3
Mr Uys Junior testified that:
46.3.1 he and Ms Ferreira worked with Challenger and did all the necessary
administration relating to the Invoice Discounting Agreement;
46.3.2 Bonfrut did not have the capital required to fund the upfront payment to
Suppliers and that this capital was provided by Challenger; and
46.3.3 he was ware that Challenger was entitled to the income received from
Offtaker Invoices as this claim had been ceded from Bonfrut to Challenger.
[67] The evidence of Mr Uys Junior is as a matter of law admissible in
these proceedings and there therefore is no reason to have struck out.
As already alluded to above, Mr Uys Junior conceded at paragraph 92
that Challenger became entitled to the payment from monies received
from the Offtakers.
Paragraph 46.4

Mr Uys Senior testified that, in terms of the Discounting Agreement any funds
received in respect of Offtaker Invoices constituted Challenger’s funds and
were to be applied first to paying Challenger.
[68] Mr Uys Senior ‘s evidence at the Enquiry has already been ruled to
be admissible in the present proceedings as an exception to the hearsay
rule. Again, these allegations have been admitted by Mr Uys Junior in
paragraph 92 of the Answering Affidavit.
Paragraph 48
I draw attention to the fact that, just five days after the conclusion of the first
Sale Transaction, Mr Uys Senior addressed correspondence (a copy of which
(and the sworn translation thereof) is attached hereto marker “FA15”.
48.1 Bonfrut had lost significant volume in both citrus and grapes (such that
the turnover would have decreased dramatically);
48.2 Bonfrut needed to reduce overheads, of which salaries were the largest
part;
48.3 Bonfrut intended to incentivise its staff to increase volume through a
commission structure;
48.4 Bonfrut was not profitable (despite what was reflected in the 2027
financial statements) and that it could not operate at a loss indefinitely; and
48.5 attaching a proposal through which the salary structure applicable to
them would be changed to a commission structure.

[69] FA15 is an email sent by Mr Uys Senior. Both the annexure and
the contents thereof have been admitted by Mr Uys Junior. There is no
basis to strike out these paragraphs. Besides, the Respondents have not
asked for annexure FA15” to be struck out. Additionally, all exhibits
attached to the founding affidavit have already been declared to be
admissible in these proceedings.
Paragraph 51
Bonfrut’s Annual Financial Statements for the year ended 31 May 2018, (a
copy of which is attached , marked “FA16” were signed by Mr Uys Senior, in
his capacity as Bonfrut’s sole director, on 17 September 2018. In similar vein
to the previous financial years, these financial statements were neither
audited independently nor reviewed. I draw attention to the following:
51.1 despite being apparent from what is described above that Bonfrut was
likely already insolvent (or, at the very least, close to insolvency), the financial
statements reflect that it was both commercially and factually insolvent;
51. 2 there was significant decrease in revenue from R85 million in the
previous year to R76million in this financial year;
51.3 despite the decrease in revenue of almost R9million. Gross profit had
increased by R1,5 million;
51.4 Mr Uys Senior’s loan account had increased from R531 993.00 to
R1 862 068.00

51.4.1 I draw attention to the fact that it is specifically recorded that this loan
account was unsecured, interest free and that it was not expected that same
would be repaid within the next 12 months, thereby allowing this to be
categorised as a long term liability, thereby creating the impression of a more
favourable balance sheet;
51.4.2 having regard to what is set forth below, the impression created was
false as this loan was, in fact, largely repaid over the next financial year
51.5 there was significant increase in trade and other receivables, from
R516 046.00 in the previous year to R7 358 306;
51.5.1 given that revenue decreased, one would have expected to see trade
receivables decrease by a proportionate amount, As appears from the
evidence obtained at the enquiry, as significant portion of this amount
constituted bad debt, and ought to have been written off;
51.5.2 the write off of trade receivables would, however, have made Bonfrut’s
balance sheet look weaker, with the result that Challenger would have been
less likely to provide it with finance. It is likely on this basis that the debt was
not written off (in this financial year, or in the financial years that followed, until
Bonfrut was liquidated;
[70] Paragraph 51.5.2 constitutes an opinion of the deponent to the
founding affidavit, is speculative and argumentative. It falls to be struck
out.
51.6 Mr Uys Senior’s loan account increased from R531, 993.00 in the
previous financial year to R1 862 068.00.

57.7 As described above, a substantial loan had been obtained from Charl,
in the value of R5 million.
51.7.1 for the sake of completeness, I note that both Mr Uys Senior
and Charl testified that the aforesaid loan was not, in fact, made by
Charl to Bonfrut but was rather made by Charl to Mr Uys Senior and
then by Mr Uys Senior to Bonfrut, however:
51.7.1.1 over the course of several years, Bonfrut’s annual
financial statements consistently reflected separate (material)
balances owing to each of Mr Uys Senior and Charl; and
51.7.1.2 the aforesaid version is also contradicted by
various other evidence obtained at the enquiry, which is not
relevant to the present application;
51.7.2 despite the fact that this loan is recorded as being “repayable on
demand”, it is (similarly to Mr Uys Senior’s loan account), reflected as a
long term liability on Bonfrut’s balance sheet;
51.7.3 had it been reflected as a current liability (as it should have
been, given its repayment terms and that it was, in fact repaid in the
next financial year), Bonfrut’s 2018 financial statements would have
reflected that it was commercially insolvent, which would have been a
major cause for concern for Challenger and likely would have resulted
in it refusing to provide Bonfrut with any further funding.

[71] Paragraph 51.6 to 51.7.3 is information contained in Bonfrut’s
financial statements. The financial statements served before the Enquiry.
There is no basis to strike out the contents of these paragraphs.
Paragraph 51.8
51.8 a further material loan was obtained from Matthys Grobler (“Mr
Grobler”) in the amount of R275 578.00, this loan was reflected as a long-term
liability but should have been reflected as a current liability given that it was
payable on demand (and was, in fact repaid over the next 12 months) thereby
creating the impression of a strengthened balance sheet;
51.9 a loan from Ms van Niekerk in the amount of R571 000.00 is recorded
(being the balance of the R700 000.00 loan amount described which was
owing as at 31 May 2018);
51.9.1 as aforesaid, this loan was obtained in order to allow Bonfrut to pay
salaries to its staff members, given it’s dire financial situation in late 2017 and
prior to the conclusion of the Challenger Agreements; and
51.9.2 again, this loan was reflected as a long-term liability given that it was
repayable on demand (and was in fact, repaid over the next 12 months
period) thereby creating the impression of a strengthened balance sheet.
[72] Paragraphs 51.8 to 51.9.2 is information in the financial statements
which have already been admitted in evidence in the present
proceedings.

52. Having regard to the comments above, it is evident that Bonfrut’s
financial statements for the year ended May 2018 created a vastly improved
impression than was factually the case. By way of example, if 1) Charl had
demanded repayment of his R5 million loan account (as he did) and 20 even
half of the increase in its trade receivables was not, in fact recoverable (as
was also the case) Bonfrut’s current liabilities would have far exceeded its
current assets, and the financial statements would have reflected that Bonfrut
was, in fact commercially insolvent.
53. Whilst it must have been clear that there was, at least, a significant risk
that Bonfrut would become commercially insolvent, it was specifically
confirmed by Mr Uys Senior in the aforesaid financial statements that he was
“satisfied that [Bonfrut] had or has access to adequate resources.”
54. Evidence obtained during the Enquiry indicates that it was well known
by some of Bonfrut’s staff members that Mr Uys Senior intentionally made
changes to Bonfrut’s financial statements so as to create a favourable
impression, thereby allowing Bonfrut to obtain further funding as well as credit
insurance on the basis of an inflated and materially misstates balance sheet.
55. Given the aforesaid, it is clear that the financial statements of Bonfrut
were intentionally materially misstated, so as to mislead Challenger, amongst
others.
56. Having regard to the aforesaid, it is clear that even prior to May 2018
Bonfrut’s directors must have been aware that there was serious risk of the
liquidation of Bonfrut , which risk would surely materialise in the event that it
could not timeously collect the amount owed to it from its debtors or in the

event that the loan accounts which were repayable on demand, were in fact,
called up.
59. It appears that, in order to ensure that Bonfrut would be in a position to
make repayment of the existing substantial loan accounts which were owing
to Mr Uys Senior, as well as his brother Charl. (per financial statements) and
Bonfrut’s employees, Mr Uys Senior and Mr Uys Junior engaged in a
stratagem to misrepresent Bonfrut’s financial position in order to obtain
finance from Challenger, so as to generate income and create cash flow to
allow repayment of these loan accounts, and in addition, later misappropriated
funds collected by Bonfrut on Challenger’s behalf, in order to make payment
of other Bonfrut expenses, so as to continue with the business of Bonfrut
through the guise of Bonex.
60. It appears that, following Mr Uys Junior’s appointment as director, there
was no change in Bonfrut’s stratagem to continue to source further finance
from Challenger (on the basis of fraudulent misrepresentations as to Bonfrut’s
financial position) so as to ensure that Bonfrut could continue trading and
could further repayment and could further make repayment of loans obtained
from Mr Uys Senior and other family members, despite the fact that , given
the above conduct as reflected in Bonfrut’s 2028 annual financial statements,
a reasonable person in their shoes would have foreseen that there was a
strong chance that Bonfrut would have foreseen that there was a strong
chance that Bonfrut wouldn’t be able to repay Challenger as payment fell due.

[73] In paragraphs 52 to 59, the deponent to the founding affidavit
presents argument and conclusions based on his own opinion. This is
impermissible. Paragraphs 52 to 59 must be struck out.
63.3 The value of trade receivables increased from R7.3 million in the
previous financial year to R8.3 million in the current financial year:
[74] This is a statement of a fact as evidenced by the financial
statements; there is no basis to strike it out.
63.3.1 as appears from annexure “FA20” hereto, a mere three months after
signing these financial statements Gerhard conceded that “the debtor’s book
is a mixture of bad debt, disputed/litigation and an unresolved dispute still in
negotiation. In any event, it is unrealistic to expect that these debtors will turn
into quick cash … however, litigation is a long and costly process as advised
by Werkmans, which I certainly can’t carry anymore’’;
63.3.2 given the aforesaid, and what is contained in paragraph 51.5.1 above,
the amount reflected as trade receivables should have been written off prior to
signature of the financial statements. Had this been done, the 2019 annual
financial statements would have reflected that Bonfrut was both factually and
commercially insolvent;
63.3.2 it is plain that this was not attended to in order to inflate Bonfrut’s
balance sheet and to create the incorrect impression that it remained a viable
concern, so as to ensure that Challenger, on the basis of this
misrepresentation, would continue to provide funding to Bonfrut, and to allow

for the further repayment of the loan accounts of Mr Uys Senior and his family
members.
63.3.4 given Mr Uys Junior’s position in Bonfrut, he must have been aware
(and a reasonable person in his position would have been aware) of the
significant risk that Bonfrut would be unable to repay Challenger, but
nonetheless knowingly participated in the procurement of further funding from
Challenger and authorise use of these funds to repay the loan accounts of his
family members as aforesaid.
[75] Paragraphs 63 .3.2 to 63.3.4 must be struck out as it constitutes
conclusions reached by the deponent upon analysis of the financial
statements. This is impermissible.
63.4 in regard to the “bank overdraft” in the amount of R7 405 403.00, the
amount reflected as “bank overdraft” was, in fact the amount owing by Bonfrut
to Challenger. I assume that this was reflected as bank account to create the
impression to credit insurance (amongst others) that Bonfrut had access to
revolving credit facilities.
[76] The last paragraph of paragraph 63.4 speaks to assumptions
made by the deponent. Without further ado, it must be struck out.
63.5 Loans from shareholders and other financial liabilities (which had
included the loans from Charl, Ms van Niekerk and Mr Grobler), had
decreased by over R8,5 million whilst the “bank overdraft” i.e. funding from
Challenger, had increased by 7.4 million. By way of further explanation:

[77] This information is derived from the financial statements which
have already been admitted as evidence in these proceedings , thus
there is no justification to strike out paragraph 63.5 and 63.5.1.
63.5.1 Charl, Ms van Niekerk, and Mr Grobler’s loan accounts, in the total
value of R5 846 578.00 had been repaid in full;
63.5.2 the aforesaid, considered in conjunction with the payments described
above, reflects most starkly the fact that Challenger funds were being utilised
to repay Bonfrut’s existing loan accounts to friends and family members
before it was placed in liquidation;
[78] In paragraphs 63.5.1 and 63.5.2, the depone nt imper missibly
draws inferences from facts. These paragraphs must be struck out.
63.5.3 in fact, as appears from the transcript of the Enquiry, it was conceded
by two employees of ECAT who had assisted in the preparation of the
financial statements, Mr Blignaut and Mr Dyer, that prima facie that the
aforesaid indicates that Challenger’s funds were used to repay the aforesaid
loan accounts.
[79] Inasmuch as it is true that Mr Blignaut and Mr Dyer testified that on
the face of it appeared as if Challenger funds were used to pay the main
account, their views cannot be elevated to evidence. This paragraph is
not struck out as this is the evidence given by the two witnesses at the
enquiry.

63.6 VAT decreased from R747 518.00 in the previous year to a mere R77 115.00.
Whilst there was a significant drop in revenue (by over R30 million), I am advised that
the reflected VAT amount appears to be impossibly low. It appears that VAT liability
must have been intentionally understated so as to understate Bonfrut’s expenses and
create the impression of a stronger financial position;
[80] The last sentence of paragraph 63.6 is struck out. It is
impermissible for the Applicant to draw this inference.
63.7 Other income in the inflated of R1.2 million was reflected in the Statement of
Comprehensive Income. The aforesaid amount was incorrect and was restated in the
annual financial statements for the year ended February 2020 to be R754 091.00. In
this regard, it was confirmed in the Enquiry that:
63.7.1 such rental income had never been received (Mr Uys Junior and Mr Uys
Senior having resided in Bonfrut’s immovable property rent free);
63.7.2 the aforesaid entry created the impression of a more favourable financial
position and would have enabled Mr Uys Senior and Mr Uys Junior to hide this fringe
benefit from SARS (same having not been declared); and
63.7.3 after the liquidation of Bonfrut this entry was reversed, resulting in an increase
in Mr Uys Senior’s loan account (to his obvious intended benefit),
63.8 as appears in the prior period errors note in the 2020 financial statements
interest expenses were understated in the 2019 annual financial statements by
R278 163.00 and motor vehicle expenses were understated by R147 658.00.
63.8.1 insofar as the motor vehicle expenses are concerned, evidence given at the
Enquiry was to the effect that these expenses had initially been excluded on the
basis that these expenses had initially been excluded on the basis that Mr Uys’s
personal expenses as he made use of Bonfrut’s vehicle (resulting in the impression

of a strengthened income statement) but that this was later reversed in the 2020 year
such that Bonfrut would again carry these costs and Mr Uys Senior’s loan account
would increase accordingly) (to his benefit and to the detriment of Bonfrut);
63.8.2 insofar as interest expenses are concerned, evidence obtained at the Enquiry
was to the effect that , although Mr Uys Senior’s loan account was specifically
recorded as having been interest free, interest was in fact levied on same and this
was reflected in the 2020 financial statements by way of an increase in Mr Uys
Seniro’s loan account to his benefit;
63.8.3 the overall result of the aforesaid was that the 2019 financial statements
reflected a stronger financial position when it suited Bonfrut to show a strengthened
position to enable it to procure further funding) and that, once Bonfrut when into
liquidation, it suited Mr Uys Senior better to show a weaker financial position and
higher loan account owing to him, this was revised.
63.9 Share capital increased by R3 million. In this regard, evidence obtained at the
enquiry from Mr Uys Senior, Ms Blignaut and Mr Dyer. As well information obtained
through the liquidation process, allowed Challenger to verify the following:
63.9.1 Mr Uys Senior was at all times the sole shareholder of Bonfrut;
63.9.2 in order to create the impression of strengthened balance sheet, Mr
Uys Senior issued further shares in Bonfrut to himself (despite the fact that,
as he was already the sole shareholder, he would obtain absolutely no
benefit);
[81] The first portion of paragraph 63.9.2 (“in order to create the
impression of a strengthened balance sheet ”) is struck out as it
constitutes the deponent’s opinion.

63.9.3 payment in respect of these shares was made by way of a reduction in
Mr Uys Senior/Charl’s loan account, so as to reduce the liabilities reflected on
Bonfrut’s balance sheet, to ensure that same reflected a more favourable
financial position.
[82] The last portion of paragraph 63.9.3 constitutes a drawing of an
inference. It is struck out.
63.10 in order to conceal that Bonfrut had been trading recklessly and was
insolvent, the director’s report confirmed that. “Bonfrut has access to adequate
financial resources to continue in operational existence for the foreseeable future”.
[84] Paragraph 63.10 is struck out as it is speculative.
64 In continuance of the aforesaid strategy, in June 2019, payment of
R110 000.00 was made to Mr Uys Senior, in reduction of his loa n account. In
the same month, additional finance in excess of USD170 000.00 was sought
and obtained from Challenger.
65 Mr Uys Junior and Mr Uys Senior, having ensured that all available funds
were used to repay amounts ostensibly owing to made to them, their family
members and associates. As various other creditors which were viewed as
critical Bonfrut/Bonex’s business going forward, it is unsurprising that on or
about 20 August 2019, Bonfrut first fell into arrears in respect of the amounts
owing to Challenger in respect of the Discounting Agreement. As a result, the
last date on which funds were made available by Challenger to Bonfrut was 4
September 2019.

[85] The last sentence of paragraph 65 is struck out as it is speculative
and argumentative,
66. When one has regard to what is set forth above, it becomes immediately clear
that Bonfrut, through Mr Uys Junior and Mr Uys Senior, was preferring certain
creditors over Challenger.
[86] Although Paragraph 66 is analytical and constitutes views and
opinions of the deponent the conclusion is premised on preceding facts.
67. Furthermore, evidence obtained at the Enquiry confirms that, despite knowing
that Challenger was entitled to all funds received in respect of Offtaker invoices,
these funds were in fact paid to other creditors of Bonfrut.
68. On 26 September 2019, Mr Uys Senior resigned as a director of Bonfrut.
69. Despite Mt Uys Junior’s resignation from his position as a director, testimony
obtained during the course of the Enquiry reflects that he retained transactional
authority on its bank accounts and continued to perform the same duties as those
previously performed by him in that he:
69.1 participated in the exercise of executive control over the management
of the whole, or a significant portion of Bonfrut and the activities of Bonfrut;
69.2 participated in the running of the day-to-day business of Bonfrut; and
69.3 was one of the controlling minds behind Bonfrut.70. I am
advised that Mr Us Junior thus remained a prescribed officer of Bonfrut
for purposes of Regulation 38 of the Companies Regulations, 2011.

[87] Paragraph 69 .1, to 69. 10 is retained in its entirety as constitute
conclusions drawn from financial statements and Mr Uys Junior’s own
evidence which have already been admitted in these proceedings.
71. Around the same time as Mr Uys Junior’s resignation as a director of Bonfrut,
a new entity. Bonex, was formed on Mr Uys Senior and Mr Uys Junior’s instructions,
with an intention to shift Bonfrut’s business to corporate opportunities to into Bonex,
thereby avoiding liability to Bonfrut’s creditors. A copy of the aforesaid
correspondence (and the translation thereof) is attached hereto, marked “FA21”.
72. Just over two months after his resignation as a director of Bonfrut, and as
appears from annexure “FA22” hereto, on 28 November 2019, Mr Uys Junior was
appointed as directors of Bonex.
[88] Reference to the annexures already admitted as evidence is
permissible.
73. On or about 11 November 2019 (a mere week after a further R800 000.00
was paid by Bonfrut to Charl in reduction of Charl’s loan account as reflected in
Bonfrut’s financial statements) Mr Richard Hart ( “Mr Hart”) of Challenger, met with
Mr Uys Senior regarding the amount owing by Bonfrut to Challenger. During this
meeting Mr Uys Senior:
73.1 indicated that Bonfrut was unable to settle the amount owing to
Challenger due to a marked decline in fruit prices and many of Bonfrut’s
debtors falling into arrears. It is evident that at this stage Bonfrut was still
intentionally concealing the true reasons for its inability to make payment to
Challenger, being the repayment of substantial loan accounts to other
creditors and the bad debt which existed prior to Challenger having initially
been engaged; and

` 73.2 admitted to receiving payment in respect of at least one of the Offtaker
invoices purchased by Challenger in terms of the Discounting Agreement, and
having utilised the funds collected on Challenger’s behalf to make payment to
Bonfrut’s other creditors. Of course, given his position within Bonfrut, payment
of these funds to other creditors would have been signed off by Mr Uys Junior
and attended to by him or at least with his knowledge and therefore his tacit
consent.
74. Despite the aforesaid clear admission of Bonfrut’s blatant insolvency, Mr Uys
Junior and Mr Uys Senior then continued to dispose of Bonfrut’s funds, wrongfully
and in contravention of its obligations to Challenger, as more fully explained below,
and continued to misrepresent its financial position to Challenger, in attempt to
conceal that it had been trading recklessly.
[89] Paragraph 74 constitutes factual conclusions drawn from the
evidence.
75. In this regard, I refer to Bonfrut’s provisional balance sheet dated 31
December 2019, a copy of which is annexed hereto marked “FA23”, which reflects
the following:
75.1 its current liabilities amounted to R10, 686, 414.02 and its current assets
amounted to R7, 333, 389.60. Given Mr Uys Senior’s prior advice as to the
irrecoverable nature of its debtors’ book, the situation was clearly much worse
than reflected, as the current assets included a value of R6, 524,897.00 in
respect of “ Customer Control Account ” which should, at least to a large
extent, have been written off; and
75.2 Its total liabilities amounted to R14,028,873.37 and its assets amounted
to R14,568,116.85, such that the balance sheet reflects that Bonfrut was

factually solvent. As aforesaid, total assets include significant irrecoverable
debt, which amounted to several million, such that, despite what is reflected
on this document, Bonfrut, was, in fact, been both commercially and factually
insolvent.
76. I also draw attention to the fact that from 31 May 2029 (by which date it would
certainly have been clear to Mr Uys Junior that Bonfrut was hopelessly insolvent,
(having regard to the facts described above) Bonfrut continued to make payment to
various creditors, despite not effecting any payments to Challenger in the total
amount of R15 771 848.92. This is reflected in the spreadsheet attached hereto,
marked “FA24”, the aforesaid amount having been calculated by taking the euro and
dollar amounts and converting them to Rands.
[90] Reference to the spreadsheet marked “FA24” is admissible as all
annexures referred to in the section 417 transcript have already been
admitted as evidence.
Para: 77 In January 2020, Mr Uys Senior addressed correspondence to Mr Hart,
copying me, Ms Potgieter and Mr Uys Junior:
77.1 recording the terms of the December 2020 meetings;
77.2 recording that the rebates figures had been received from Producer
Ally and proposing that 50% of the aforesaid amount be paid to Challenger,
with the remainder to be retained by Bonfrut for running costs and bridging.
This did not occur and no funds were in fact paid to Challenger. There funds
were rather applied to payment of various other creditors of Bonfrut, as is
reflected in the spreadsheet referred to in paragraph 76 above;
77.3 stating that he was putting “in every effort to cut and reduce overhead
cost to get through this tough period….”

77.4 describing his apparent intention to continue with Bonfrut. This is
particularly important as it explains why funds available in Bonfrut (which had
not been used to settle Mr Uys Senior, Mr Uys Junior and their family
members and employees loan accounts) were directed to payment of its
suppliers, as this relationship needed to be maintained so that Mr Uys Senior
and Mr Uys Junior could continue trading through Bonex. As appears from
what is set forth below, when it became clear that Bonfrut’s liquidation was
inevitable, a further scheme was conceived of by Mr Uys Senior and Mr Uys
Junior to shift the business of Bonfrut and its corporate opportunities to
Bonex; and
77.5 it was his intention to do consulting work to generate additional
income and eventually carry the running cost of Bonfrut.
[91] Refence to Mr Uys Senior’s meeting in a subsequent email is
admissible as he confirmed this in his own evidence.
79 Despite being aware of its insolvent position, Bonfrut continued to draw
significant sums from its Bond Accounts in an amount in excess of R550 000.00
during the period January to March 2020.
80 The annual financial statements for the financial year ended 31 May 2020, a
copy of which is attached hereto, marked “FA26”, were signed by Mr Uys Senior, in
his capacity as director of Bonfrut on 27 September 2020. Similar to the previous
financial years, these financial statements were neither audited nor independently
reviewed. I draw attention to the following:
80.1 Mr Uys Senior remained listed as the sole director and signed the
financial statements on 10 July 2020. This is despite the fact that Mr Uys
Junior was the director until 26 September 2019;

80.2 this is the first set of financial statements in which it is confirmed that
Bonfrut did not have adequate financial resources to continue in operation for
the foreseeable future. The statement of financial position reflects that Bonfrut
was both factually and commercially insolvent;
80.3 despite Bonfrut’s insolvent status, it had clearly commenced disposing
of its assets (likely in order to avoid their attachment by Bonfrut’s creditors),
as appears from massive decrease in value of its property, plant and
equipment, from R936 426 in the 2019 financial year. The VW Polo, VW
Amarok and IT equipment in the value of R85 732,00 were also disposed of,
despite substantial investment into IT equipment (in the amount of
R201 611.00) having been made in the previous financial year. None of the
funds received in respect of any asset disposals were paid to Challenger,
despite the fact that it was Bonfrut’s most significant creditor.
[92] The factual rendition of what is contained in the financial
statements by the deponent in paragraph 80.3 is procedurally
acceptable. However, conclusion that this was designed to avoid their
attachment by creditors is struck out as it is purely speculative.
80.4 Mr Uys Senior’s shareholder loan decreased from R961 644.00 to
R51, 644.00 reflecting the continued use of funding to repay the loan
accounts of Bonfrut’s directors;
80.5 the small loan of R40 000 from Mr Uys Junior in the previous financial
year appears to have been repaid in its entirety;
80.6 the “prior period errors” as described above were adjusted, resulting in
decreased income, increased expenses and an increase in Mr Uys Senior’s

loan account in the amount of R920 000.00 in the financial year ending in
May 2019; and
80.7 it was finally recorded that the director is also convinced that the trade
receivables are irrecoverable’.
[93] Paragraphs 80.1 to 80.7 relates to conclusions drawn from
financial statements.
BONEX STARTS TRADING
81 As appears from annexure “FA21” hereto, on 20 September 2019, around
the time that Bonfrut started to experience financial difficulties and one month after
Bonfrut first fell into arrears in respect of the Challenger Agreement, Ms Potgieter
instructed ECAT to incorporate a new entity with a similar name to Bonfrut, being
Bonex, with her as the sole director.
82. Approximately a week later, and as appears from annexure “ FA27” hereto, on
or about 26 September 2019 Mr Uys Junior resigned as a director of Bonfrut.
However, this was not the end of Mr Uys’ involvement in Bonfrut, as mentioned
above.
83. On 10 October Bonex was incorporated. It is from this date that Mr Uys
Senior and Mr Uys Junior set about the intentional shifting of the business of Bonfrut
to Bonex, as set out below.
[94] Whereas the incorporation of Bonex is factual, the last sentence in
paragraph 83 referring to Mr Uys Senior and Mr Uys Junior’s intentional
shifting of the business of Bonfrut to Bonex is purely speculative.

84. As appears from annexure “FA28” hereto, at the time of its incorporation,
Bonex’s sole director was M s Potgieter. Evidence obtained during the course of the
Enquiry revealed that:
84.1 Ms Potgieter was chosen to be the sole director because:
84.1.1 Bonex was intended to operate the business of export administration,
which is the same work which Ms Potgieter had previously been doing for
Bonfrut;
84.2 she had been materially involved in the development of the system
which Bonex would use to attend to administration business, which had
initially been developed for Bonfrut and which had previously been in
Bonfrut’s business, for purposes of its own administration. Given the
aforesaid, she knew the system better than anyone else; and
84.1.3 Mr Uys Senior himself felt that he could not be a director of Bonex
because same would have constituted a conflict of interest, due to the fact
that he was already a director of Bonfrut . Despite the aforesaid, during the
Enquiry it was confirmed that Mr Uys Junior never actually had anything to
do with its operations, same having been entirely run by Mr Uys Senior, The
aforesaid makes it clear that My Uys Junior’s appointment as director of
Bonex, in circumstances where, in fact, he was not involved in its business at
all, clearly reflects that the incorporation of Bonex was a scheme by which
Bonfrut’s corporate opportunities were transferred to Bonex , under the guise
that it was a separate entity.
85. On 27 November 2019, Ms Potgieter addressed correspondence to Mr Uys
Senior in which she stated that she understands Mr Uys Senior reasons behind and
decisions regarding Bonex but that she was not prepared to register it in her name,
She further stated that she realised that the company had already been registered in

her name and that the customs leg of Bonex still needed to be registered, however,
she indicated that she was not prepared to take on such a big risk in her personal
capacity because there was no guarantee that, if there were issues, that she wouldn’t
sit with a massive burden on her shoulders for which she may be held personally
liable, but which she did not create. Ms Potgieter further suggested that Bonex be
transferred to any other nominated person and that she would prefer not to proceed
with any further registrations (being a reference to the registration of Bonex as an
exporter) until transfer was finalised. Finally, she stated that Mr Yus Junior might be a
suitable person to take over and offered to compile the customs formed with the new
details. A copy of correspondence (and sworn translation thereof) is annexed hereto
marked “FA29”.
86. When questioned during the course of the Enquiry on why she sent the
aforesaid correspondence, Ms Potgieter confirmed that Mr Uys Senior had instructed
her to register Bonex as an exporter and it was then that she realised that it was Mr
Uys Senior’s intention to continue the business of Bonfrut through Bonex.
87. Whilst during the Enquiry Mr Uys Senior denied that he had instructed her to
do so, he did not mention in his email response to her that she should not attend to
such registrations, which would have been expected if his version is to be believed.
88. On 28 November 2019, Ms Potgieter addressed correspondence to ECAT in
which she informed them of her intended resignation as sole director of Bonex and
that Mr Uys Senior and Mr Uys Junior should be added as the new directors. She
further requested for the shares to be trans to the Gerhard Uys Family Trust. A copy
of the correspondence (and the sworn translation thereof is attached marked “FA30”.
89. On the same date, Ms Potgieter addressed further correspondence to ECAT
in which she corrected her earlier request to the effect that Mr Uys Junior should be

in which she corrected her earlier request to the effect that Mr Uys Junior should be
appointed as the sole director and shareholder of Bonex . See annexure “FA31”

hereto, which contains a copy of the aforesaid correspondence (and the sworn
translation thereof). On that same date, Mr Uys Junior was appointed as the sole
director of Bonex (despite playing no active role in the business whatsoever, all
responsibility having been delegated to Mr Uys Senior) and Ms Potgieter resigned as
director. In this regard, I refer to annexure “FA22”.
90. On 28 November 2019, Mr Uys Junior was issued 120 Ordinary Non-Par
share in Bonex , for an issue price of R120.00, as appears from Share Certificate
number 2, a copy of which is annexed hereto marked “FA32”.
[95] Paragraphs 85 to 90 constitute the factual background elicited
from the evidence at the Enquiry. Those proceedings have already been
admitted as evidence.
[96] Paragraphs 91 to 95 is a summary of the evidence given at the
enquiry. As previously stated, those proceedings have been admitted as
evidence.
Paragraph 96 : The link between Bonfrut and Bonex is further clear when one has
regard to the following:
96.1 the similarity in the registered names – when asked to comment on
the similarity of the names of Bonfrut and Bonex, Mr Uys Junior explained
that the reason for that is probably to strengthen the association with Bonfrut,
as it is a well-known name in the industry;
96.2 the fact that Bonex was incorporated by one of Bonfrut’s employees
and the instruction to incorporate Bonex was given to them in their capacity
as such;

96.3 Bonex’s registered address was, until 17 November 2021, the
Durbanville property owned by the Bonfrut.
96.4 On 18 February 2020, Mr Uys Senior instructed ECAT to include
Bonex on Bonfrut’s E -Filing 9SARS) profile. A copy of the aforesaid
correspondence (and the sworn translation thereof) is annexed hereto,
marked “FA34” hereto.
96.5 Bonex uses Bonfrut’s systems to conduct its business, such system
having been specifically designed to be capable of being used by multiple
companies. In this regard:
[97] Paragraphs 96.1 to 96.5 is a summary of the evidence.
Attempt to Divert Payments Due to Bonfrut
97. On or about 3 July 2020, Challenger brought a liquidation application against
Bonfrut under case number 8359/2020, by virtue of the fact that it had breached the
Discounting Agreement and owed Challenger (at the time of launching) USD
554 993.21.
98. On 5 July 2020, two days after the liquidation proceedings were launched, Mr
Uys Senior sent a WhatsApp message to Ms Potgieter, instructing her to credit the
offtaker’s accounts with the amounts that was [sic] due to the growers (farmers) by
generating credit notes for each of the customer (offtaker) invoices. Mr Uys Seniro
stated that the balance that would remain in the offtaker’s account would be for the
physical costs that Bonfrut incurred. Mr Uys Senior further instructed Ms Potgieter to
create a company for each of the growers (farmers) in the export administrative
system (i.e. Bonfrut’s system which was later used by Bonex ) and to generate
invoices to the offtakers in the respective growers’ (farmers) names. A copy of the

aforesaid correspondence (and the sworn translation thereof) is annexed hereto,
marked “FA37”.
99. A provisional liquidation order was granted on 8 July 2020, and such order was
made final on 30 July 2020. Copies of the aforesaid court order are attached hereto,
marked as annexure “FA38” and “FA39” respectively.
[98] Paragraphs 98 to 99 is the factual background based on the
evidence given at the Enquiry.
123. As fully explained above, Bonex was used by Mr Uys Senior and
Mr Uys Junior:
123.1 such that there was no distinguishable corporate identity
between Bonex and Bonfrut;
123.2 for a dishonest and improper purpose;
123.3 as a device or façade to conceal wrongdoing;
123.4 in manner which adversely affects a third party in a way that
reasonably should not be countenanced such that it constituted an
unconsciable abuse of the juristic personality of Bonex.
[99] Paragraphs 123.1 to 123.4 objected to by the Respondent is a
conclusion drawn by the deponent as and it clearly sets out those are
based on the explanation already given. They therefore are not struck
out.
The striking out of the replying affidavit

[100] As earlier alluded to, the Respondents seek the striking out of
certain paragraphs of the Applicant’s replying affidavit mainly on the
basis that they constitute new matter.
Para 38: In any event, this explanation is simply not good enough, given that
it is common cause that Mr Uys Junior was a director of Bonfrut from 16
October 2016 to 26 October 2019 and therefore owed it various fiduciary
duties. The answering affidavit is replete with admissions reflecting Mr Uys
Junior’s complete abdication of his duties.
38.1 “My role, responsibility and duties did not change when I
became a director [of Bonfrut] (para 57 of the founding affidavit);
38.2 “Invoices were offered to [Challenger] for discounting in terms of
the [Discounting Agreement] upon instructions from my father when it
necessary for cash flow purposes … I did not decide on when or how
this was necessary as it was the function that was always fulfilled by
father even when I was a director of the company” (paragraphs 34.1
and 34.2 of the Answering Affidavit);
38.3 ‘I also did not make any decisions as to how the funds obtained
[from Challenger] would be spent. In as far as I authorised any
payments from these funds it was always done on the instructions of
my father” (paragraph 12.3 of the Answering Affidavit”.
38.4 “I have never (before I was a director of Bonfrut or thereafter) had
any involvement in the preparation of financial statements or making
any policy decision regarding the management of Bonfrut … This was

always the realm of my father who was always in absolute control of
the business, was responsible to manage its cash flow, made decisions
as to when and how it was necessary to obtain finance (including when
to offer invoices to [Challenger] for discounting”. (paragraphs 43 to 44
of the Answering Affidavit);
38.5 “I did not make marketing decisions or prepare budgets, neither
was I responsible for the financial planning of Bonfrut. It was never my
responsibility to make any decisions regarding financial planning or
budgeting” (paragraph 63 of the Answering Affidavit);
38.6 “I was not involved in projects regarding financial due diligence
procedures, calculating of profit margins, financial modelling
considering the liability of Bonfrut …” (paragraph 63 of the Answering
Affidavit);
38.7 “It is similarly denied that I played any key role in the financial
administration of Bonfrut. Both before and after I became a director, my
input was limited for the most part to actioning instructions from my
father in the conduct of the business of Bonfrut (paragraph 67 of the
Answering Affidavit);
38.8 “It is correct hat I was appointed as director of Bonfrut on 15
October 2018 and that I resigned on 28 September 2019. However, I
never, on a practical level exercised general executive control over the
management of any part of the business Not before, during or after my
appointment as director” (paragraph 70 of the Answering Affidavit;

38.9 “My father was always in full control over the management and
executive functions of the business.”
[101] The conclusions reached by the Applicant in paragraph 38 appear
to be drawn from Mr Uys Junior’s answering affidavit and do not
constitute new matter.
Para 39: In other words, Mr Uys Junior’s version is that both before, during
and after the period in which he was a director of Bonfrut, he had no qualms
with:
39.1 actively participating in the procurement of funding amounting
to tens of millions of Rands from Challenger (as will be addressed
below), absent any knowledge of Bonfrut’s financial position
whatsoever;
39.2 releasing payments from the funds received from Challenger in
accordance with his father’s instructions and without any consideration
as to whether any portion of the funds received should be retained or
applied to some other purpose or whether the provisions of the
Discounting Agreement were being complied with; and
39.3 releasing payments form the funds received from Offtakers in
accordance with his father’s instructions and without any consideration
as to how those funds should be applied or to Challenger’s rights in
respect of same (it being apparent from the evidence at the enquiry, as
described above, that he was aware of and understood the import of
the cession and the underlying claim to Challenger).

[102] The conclusions appear to be based on Mr Uys Junior’s answering
affidavit and evidence at the Enquiry and do not constitute new matter.
Para 41 I can think of no better example of reckless trading than a director
assisting with the procurement of extensive funding without any knowledge
whether it was required or why, and then blindly following instructions in
respect of the use of all funds received. It goes without saying that such
conduct is delinquent.
Para 50 : On a best case scenario for him, he was duty bound to properly
consider the terms of the Challenger Agreements during the period in which
he was a director, given the extent of the funding which was provided to
Bonfrut to by Challenger. (last sentence),
53 Mr Uys statement that “There is accordingly nothing strange/
reckless/untoward that the funds from Challenger were used to pay creditors
and loan accounts” is difficult to understand, given that the funds were
provided on the basis that they would be used to purchase fruit, rather than to
fund Bonfrut’s cash flow requirements generally and to allow it to make
repayment of any and all amounts owing by it to the Uys Family, its
employees and their friends.
54 In fact I am advised that Bonfrut’s conduct in seeking funding from
Challenger on the basis that the funds would be applied to advance purchase
of fruit whilst actually intending to utilise the funds to repay loan accounts and
pay creditors, and then implementing that intention constitutes fraud in itself.
55 To the extent that Mr Uys Junior denies that he had knowledge of the
limited purpose to which the funds could be applied (given that he denies

having knowledge of all the terms of the Challenger Agreements in detail) this
makes his conduct all the more negligent.
56 To be clear, during the period in which Mr Uys was a director of Bonfrut,
Bonfrut acquired funding valued at R20 million from Challenger, and it
therefore goes without saying that Mr Uys Junior was duty bound at the very
least, to obtain knowledge of the purpose for which these funds were provided
and to apply them for that purpose. he common cause fact that funding from
Challenger was acquired
65 Mr Uys was a director at the time that Bonfrut first defaulted in its payment
obligations to Challenger. Having regard to his fiduciary duties, one would
expect him to be in a position to provide some explanation as to how it came
about that Bonfrut was not able to make payment to Challenger of the
amounts owing . Of course, having regard to his version, he is apparently
unable to do so because he had no idea whatsoever what was going on with
the finances of the business, his role having been limited to follow his father’s
instructions without question or concern.
[103] Paragraph 65 is struck out as it constitutes the opinion of the
deponent to the replying affidavit.
66 Mr Uys Junior’s extreme negligence is obvious.
[104] Paragraph 66 is struck out; the conclusion constitutes the
deponent’s opinion.

69.14 It therefore appears that whoever actioned the repayment (being on the
common cause facts, either Mr Uys Senior or Mr Uys Junior) did not even
care to check that any amount was owing at all.
[105] Paragraph 69.14 is not new evidence but rather a conclusion
drawn from the common cause fact that either Mr Uys Junior or Mr Uys
Senior would attend to payments.
74 The reason is that the numbers very obviously don’t make sense.
74.1 Challenger makes payment to Bonfrut of 80% of the value of an Offtaker
Invoice;
74.2 With these funds, Bonfrut;
74.2.1 must pay the producer 50% (in advance) in respect of its invoice
for the fruit which Bonfrut will export and sell;
74.2.2 must make payment of all the costs associated with exporting
the fruit as well as its own internal business costs; and
74.2.3 according to Mr Uys Junior, repay accounts of Charl Uys loan
account.74.3 Bonfrut then receives from an Offtaker (i.e. 100%) and at
this point must:
74.3.1 pay Challenger 80% of the amount received plus interests and
costs.
74.3.2 pay producer 50% of the cost price of the fruit. It would never
have been possible to pay the amount from the (less than) 20%

remaining of the amount received unless, of course Bonfrut ‘s profit
margins were astronomically high3hich clearly wasn’t the case given:
74.3.2.1 Bonfrut’s insolvency; and
74.3.2.2 The contents of the financial statements, on Mr Uys Junior’s
version are correct, and reflect that in the 2018 financial year, Bonfrut s
total profit was R598 000.00 and in the 2019 financial year, Bonfrut’s
total profit was R33 486, such that it would never have been able to
recover the repayment to Challenger. Of course, for the reasons stated
above, its financial position was clearly considerably worse that what
was reflected in the financial statements.
[106] Flowing from the aforegoing, and for the reasons already stated,
the following paragraphs of the founding affidavit are struck out:
Paragraphs: 51.5.2; 52 to 59; 63.3.2 to 63.3.4; 63.4; 63.5.1 to 63.5.2 and
the last sentence of paragraph 63.6.
Paragraphs: 63.9.3, 63.10 and the last sentence of 63.5.
Paragraphs: 70.3 and 96.1.
[107] Regarding the replying affidavit, I have found that none of the
paragraphs sought to be struck out constitute new matter. To this end,
the application to strike out must fail.
[108] The determination of the aforegoing applications delineates the
evidence from which the court may assess whether the Applicant has

made out a case for the relief sought in terms of section 424 of the
Companies Act, 1973, as well as section 20(9) of the Companies Act,
2008.
Issues for determination
[109] As discernible from the factual matrix, the following issues for
determination arise:
109.1 Whether the First and the Fourth Respondent knowingly
conducted the business of Bonfrut whilst it was trading in insolvent
circumstances and with the intention to defraud the creditors of
Bonfrut.
109.2 Whether the First Respondent incurred Bonfrut’s liability to
the Applicant and then used these funds to repay significant loan
accounts and other creditors of Bonfrut, knowing that the result
would be that Bonfrut would not be able to satisfy the liability owed
to the Applicant.
109.3 Whether the Fourth Respondent was established as a shell
company to take over Bonfrut’s business, allowing inter alia the
First Respondent to divert assets and evade liability for the debts
owed to the creditors of the, and in particular, the Applicant;

109.4 Whether the conduct of the First Respondent in shifting
Bonfrut’s financial liabilities, manipulating financial statements and
concealing its insolvency, amounts to reckless or dishonest
conduct in terms of section 424 of the 1973 Act;
109.5 Whether the First Respondent should be declared
personally liable for all the debts of Bonfrut due to reckless or
fraudulent trading in terms of section 424 of the 1973 Act.
109.6 Whether the First Respondent should be declared a
delinquent director based on his conduct in relation to Bonfrut.
109.7 Whether the Fourth Respondent was used inter alia the First
Respondent:
109.7.1 such that was no distinguishable corporate
identity between Bonex and Bonfrut;
109.7.2 for a dishonest or improper purpose;
109.7.3 as s device to conceal wrongdoing;
109.7.4 in a manner which adversely affects a third party
in a way that reasonably should not be countenanced;
109.7.5 such that it constitutes an unconsciable abuse of
the juristic personality of the Fourth Respondent.

109.8 Whether the Bonfrut and the Fourth Respondent should be
treated as a single entity under section 20(9) of the 2008 Act.
109.9 Whether the Fourth Respondent should be declared to be
jointly and severally liable with the First Respondent for the debts
of Bonfrut to the Applicant in terms of section 20(9);
109.10 Whether the evidence obtained at the Commission of
Enquiry into Bonfrut’s business dealings and affairs, in terms of
section 417 and 418 of the 1973 Act read with Item 9, Schedule 5
to the 2008 Act can be admitted and relied upon by the Applicant,
Analysis
[110] The Applicant alleges that the First Respondent, as a director of
Bonfrut carried on its business in a reckless manner with intent to
defraud Challenger by continuing to operate it whilst knowing very well
that it was insolvent and was incurring new debts whilst it could not pay
existing ones and failing to place it under business rescue when
circumstances were demanding that course of action. It will be recalled
that in Claim A, the Applicant seeks that the First Respondent be
declared liable for the debts of Bonfrut (Pty) Ltd (in Liquidation) as
contemplated in section 424 of the Companies Act 61 of 1973 read with
Item 9, Schedule 5 to the Companies Act 71 of 2008. In Claim B the

Applicant seeks an order as contemplated in section 20(9) of the 2008
Companies Act that:
110.1 the Fourth Respondent, Bonex be deemed not to be a
juristic person separate from Bonfrut;
110.2 pursuant to the declaration in paragraph 101,1 above, that
Bonfrut and Bonex shall be regarded as a single entity by ignoring
their separate legal existence and treating Bonfrut as if it were the
only company;
110.3 that Bonex is liable to Challenger in the amount owed by
Bonfrut to Challenger.
[111] Liability of a director is governed by section 76 (3) of the
Companies Act, 2008 which provides as follows:
“… a director of a company wh en acting in that capacity , must exercise the
powers and perform the functions of a director –
(a) in good faith and for a proper purpose;
(b) in the best interests of the company; and
(c) with the degree of care, skill and diligence that may reasonably be
expected of a person:-
(i) carrying out the same functions in relation to the company as those
carried out by the director; and
(ii) having the general knowledge skill and experience of that director.”

[112] Section 77(2) (a) provides that a director of a company may be
held liable in accordance with the principles of the common law relating
to breach of fiduciary duty, relating to any loss, damages or costs
sustained by the company as a result of any breach by the director of a
duty ….
[113] The Applicant is seeking final relief in motion proceedings on the
basis that the facts as stated by the respondents together with the
admitted facts in the Applicant’s affidavit justify the orders sought.
Furthermore, where facts are denied by the Respondents, it nonetheless
is clear that the facts, though not formally admitted, cannot be denied
and must be regarded as admitted.
[114] I first deal with Claim A. Section 424 of the 1973 Companies Act
provides as follows:
“When it appear … that any business of [a] company was or is being carried
on recklessly or with intent to defraud creditors of the company or creditors of
any other person or for any fraudulent purpose, the Court may, on the
application of … any creditor … of the company, declare that any person who
was knowingly a party to the carrying on of business in the manner aforesaid,
shall be personally responsible without any limitation of liability, for all or any
of the debts or other liabilities of the Company as the Court may direct.”

[115] In Ebrahim and Another v Airport Cold Storage (Pty) Ltd 2008 (6)
SA 585 (SCA) at para [15] Cameron JA outlined the policy
considerations behind section 424 thus:
“[T]he function of the statutory provision also shapes its application. Although
juristic persons are recognised by the Bill of Rights ….it is an apposite truism
that close corporations and companies are imbued with identity only by virtue
of statue. In this sense their separate existence remains a figment of law,
liable to be curtailed or withdrawn when the objects of their creation are
abused or thwarthed. The section retracts the fundamental attribute of
corporate personality, namely separate legal existence, with its corollary of
autonomous and independent liability of debts, when the level of
mismanagement of corporations s affairs exceeds the merely inept or
incompetent and becomes heedlessly gross or dishonest. The provision in
effect exacts a quid pro quo: for the benefit of immunity from liability for debts,
those running the corporation may not use its formal identity to incur
obligations recklessly, grossly negligently or fraudulently. If they do, they risk
being made personally liable.”
[116] Counsel for the Applicant contended that the First Respondent and
Bonex have knowingly conducted the business of Bonfrut whilst it was
trading in insolvent circumstances and with intent to defraud creditors of
Bonfrut, specifically Challenger in that:
116.1 the First Respondent used the proceeds from the purchased
invoices which were ceded to Challenger in terms of the

Challenger Agreements to pay company expenses and other
creditors, instead of paying Challenger;
116.2 the First Respondent intentionally shifted Bonfrut’s business
to Bonex, to avoid Bonfrut’s liability to Challenger and other
creditors;
116.3 payments actually due to Bonfrut were intentionally
redirected to growers/farmers to defraud Challenger and other
creditors of Bonfrut.
116.4 the true state of Bonfrut’s financial affairs was intentionally
concealed through inaccurate and false accounting records, which
were given to Challenger and other Creditors of Bonfrut;
116.5 Bonfrut was incorporated and used in a manner such that
there was no distinguishable corporate identity between Bonex
and Bonfrut, to avoid or conceal Bonfrut’s liability to Challenger.
[117] According to the argument, this conduct constitutes a further
ground which warrants a declaration of personal liability on the part of
the First Respondent and Bonex for the debt owed to Challenger.
Accordingly, the First Respondent and Bonex ought to be liable for the
debts of Bonfrut, jointly and severally, the one paying the other to be
absolved, as contemplated in section 424 of the 1973 Act.

[118] With regard to Claim B, I t was contended on behalf of the
Applicant that Bonex was used by Mr Uys Senior and the First
Respondent:
118.1 such that there was no distinguishable corporate identity
between Bonex and Bonfrut.
118.2 For a dishonest purpose
118.3 As a device or façade to conceal wrongdoing ;
118.4 in a manner which adversely affects a third party in a way
that reasonable should not be countenanced such that it
constituted an unconsciable abuse of the juristic personality of
Bonex.
[119] For the Applicant to succeed in Claim A of this application, it must
prove on a balance of probabilities that the First Respondent had
knowledge of the facts from which a conclusion can be drawn that
Bonfrut’s business was being carried recklessly or with intent to defraud.
As formulated in Philotek (Pty) Ltd and Others v Snyman and Others
1998 (2) SA 138 (A)M at 143 G -H, the test for recklessness is objective
and the defendant’s objectives measured against the standard conduct
of the notional reasonable person and is subjective insofar as one has to
postulate that notional being as belonging to the same group or class as

the defendant, moving in the same spheres and having the same
knowledge or means to knowledge.
[120] Counsel for the First and Fourth Respondents argued that the
evidence tendered does not establish that Bonfrut’s business was
carried recklessly or with intent to defraud or for a fraudulent purpose.
According to this contention, no proof of subjective intent to defraud
creditors has been established because where a director incurs a
transaction on behalf of a company subjectively believing that a
company will be able to honour it, it cannot be said that he/she carries
on with intent to defraud, no matter how unreasonable the belief was.
That said, Challenger has not shown that Mr Uys Junior was knowingly a
party to the carrying on of the business in a manner to defraud creditors.
Neither can it be inferred that Mr Uys Junior was aware of the facts from
which the conclusion can be drawn that the business of Bonfrut was
carried on in the manner set out in section 424(1), and that he
participated in respect of the carrying out of the business in such a
manner by either taking positive steps with the requisite knowledge.
This, according to the argument is so because one cannot impute
knowledge to a director who did not have it but should have, had he
been diligent as was held in Fourie v Braude and Others 1996 (1) SA
610 (T) at 614 G-J to the following effect:

“In my view, … a director may well be regarded as a party to reckless or
fraudulent conduct where he does nothing, provided his supine attitude can
on the facts be interpreted as a condonation of and concurrence in the
conduct complained of. In such a case, he knows of the conduct and does
nothing.
It is a far cry, however, from this situation to one where the director 1.has
knowledge at all of the conduct complained of. By knowledge I do not mean
detailed knowledge but at least a knowledge that something fishy is being
perpetrated and the refusal or wilful neglect to make enquiries. One cannot
however, in my view, go one step further and impute knowledge to a director
who did not have it but should, had he been diligent, have acquired it. That
situation cannot be brought home under the wording of s 424 of the
Companies Act ….”
[121] Against this backdrop, in determining the issues and analysing the
evidence in this application I recap the factual matrix. I have already
stated that the agreements entered into between Challenger and Bonfrut
on 23 January 2018 were the following:
11.1 a Full Recourse Invoice Discounting Agreement;
11.2 a Cession in Security Agreement;
[122] The terms of the Challenger Agreements are not in dispute. They
are that:

122.1 Challenger would purchase Bonfrut’s right, title and interest
to Bonfrut’s claims against a particular Offtaker, in respect of a
particular invoice relating to the sale of specified fruit
(“Commodities”) by Bonfrut to that Offtaker. In the papers, this is
referred to as the “Sale Transaction”. Bonfrut would cede its right
to payment in respect of each Offtaker Invoice to Challenger;
122.2 Payment of the purchase price by Challenger to Bonfrut in
respect of each Sale Transaction would be made on a specific
date, which was referred to as the “Purchase Date”;
122.3 The purpose of the transaction was to generate cash flow for
Bonfrut to purchase the Commodities in advance of harvest, the
Purchase Date would be earlier than the due date for payment to
Bonfrut by the Offtaker, in terms of the relevant Offtake Invoice;
122.4 Challenger would recover the Purchase Price, plus additional
amount specified in the Discounting Agreement, from the amount
paid to Bonfrut by the relevant Offtaker in terms of the relevant
Offtaker Invoice;
122.5 In the event that the Offtaker Invoice was not paid by a
particular date, as specified in the relevant Sale Transaction,
Bonfrut would become liable to make payment to Challenger of the

amount specified in the relevant Offtaker Invoice, plus an
additional amount as specified in the Discounting Agreement.
[123] It is undisputed that Bonfrut has gone into liquidation and
Challenger’s claim against Bonfrut has been proven in Bonfrut’s
insolvent estate, in the amount of R9 583 692.00.
[124] In order to fully comprehend the basis for the relief sought by the
Applicant, it is necessary to record how the terms of how the
agreements were implemented. According to the evidence of witnesses
at the Enquiry, the Challenger agreements operated in the following
manner:
124.1 a Supplier would invoice Bonfrut for various Commodities
(“the Supplier Invoice”);
124.2 as soon as a Supplier’s Commodities were loaded, Bonfrut
would invoice the Offtaker (purchaser of the fruit);
124.3 that Offtaker Invoice, together with supporting
documentation, was then sent to Challenger, who would then
make payment to Bonfrut of an amount equal to 80% of the
Offtaker Invoice value;
124.4 these funds would then be used by Bonfrut to pay the
Supplier 50% of the Supplier Invoice;

124.5 as soon as the Offtaker paid the Offtaker Invoice amount
into Bonfrut’s forex account (who received same on behalf of
Challenger, Challenger having taken cession of the right to
payment of the Offtaker Invoices), the amount owing to Challenger
in terms of the Discounting Agreement would fall due to be paid
from Bonfrut’s US Dollar Forex account and the balance owing to
the Supplier in terms of the Supplier Invoice would be paid.
[125] Taking the contractual context into account, I turn to examine the
First Respondent’s role in Bonfrut.
[126] With regard to Claim A, it is undisputed that the First Respondent
was employed by Bonfrut for a couple of years. More specifically, his
LinkedIn profile reflects that he was employed by Bonfrut for a period of
7 years and 11 months as a “Marketing and Financial Analyst and
assistant to the CEO. His role and responsibilities are defined as follows:
“Responsible of [sic] all marketing decisions regarding reports to the UK,
European and Middle Eastern Markets.
Responsible for key financial tasks in assistance to the CEO regarding
budgeting, financial planning and financial analysis.
On a secondment basis, worked on projects relating to financial due diligence
procedures by calculating profit margins of essential sales products, short to
long term liabilities, financial modelling and integrating VBS into the database
enhancing the data input and output efficiency.”

[127] As to Bonfrut’s reckless trading, Ms Ferreira, an operational and
administrative employee, testified that she administered payments to
creditors under the direct instruction of Mr Uys Junior and Mr Uys Senior.
In her evidence, she explained how the funds from Offtaker invoices,
ceded to Challenger, were instead used to pay other creditors, in
violation of Bonfrut’s agreement with Challenger. In the same vein, Ms
Potgieter, a former procurement/sales employee, confirmed that the
payments made by Bonfrut were often applied to other creditors
whereas Challenger had a prior ity right to the proceeds from Offtakers
Invoices. She also confirmed that the funds were applied to Bonfrut’s
own expenses before payments to Challenger were made. Mr Charl Uys
confirmed that reckless financial strategies were employed by the
company’s directors. Put in another way, he confirmed the overall
financial mismanagement at Bonfrut. The upshot of the evidence of the
witnesses referred to above is that it was tendered to demonstrate the
financial mismanagement and reckless trading engaged in by Bonfrut’s
directors and employees.
[128] This is further supported by the fact that Mr Uys (Junior)’s
evidence, which unequivocally establishes that Challenger,
notwithstanding being a priority creditor of Bonfrut, was not paid in
accordance with the agreements whilst other creditors were preferably

paid, and this is what led to Challenger seeking the liquidation of
Bonfrut. In his evidence, Mr Uys Junior confirmed that he attended to the
calculations on payments to be made to Challenger based on Bonfrut’s
cash flow.
[129] In his evidence before the Enquiry, the First Respondent confirmed
that he had access to Bonfrut’s financial systems and was able to see
the amounts owed to Bonfrut creditors at all times , inclusive of the
amounts owed to Challenger. This is confirmed by Ms van Nieker k, Ms
Potgieter and Mr Uys Senior. Ms Potgieter further confirmed that the
First Respondent was responsible for creditor payments and in
particular, payment to and the administration of Challenger. Likewise,
Ms Ferreira and the First Respondent himself confirmed that Challenger
was the First Respondent’s responsibility. According to the Applicant, the
First Respondent exercised general executive control over and
management of the whole, or a significant portion of Bonfrut activities
even before and after he was appointed as a director . Thus, he was a
prescribed officer of Bonfrut as envisaged in Regulation 38 of the
Companies Regulations, 2011,1 before 17 October 2018 as well as after

1 Section 66(10) of the Companies Act provides that the Minister may make regulations designating any
specific function(s) within a company to constitute prescribed office for the purpose of the Act .m m
Regulation 38 provides that despite not being a director of particular company, a person is a prescribed
officer of the company for all purposes of the Act if that person:
3.1 exercises general executive control over and management of the whole, or a significant portion, of the
business and activities of the company;
3.2 regularly participates to a material degree in the exercise of general executive control over and
management of the whole, or a significant portion, of the business activities of the company.

his resignation as director thereof on 26 September 2029. To this end,
Mr Uys Senior confirmed during his evidence that even after his
resignation as director of Bonfrut, the First Respondent continued to
render the same services to Bonfrut, although these services diminished
over time. The Applicant suggests that because prescribed officers have
precisely the same fiduciary duties and duty of care, skill, and diligence
as directors, he carried the same responsibilities as those of a director.
[130] The nub of the Applicant’s case seems to be that even at the stage
the Challenger agreements were concluded, Bonfrut was recklessly
trading in that it was carrying on business and incurred debts when in
the opinion of a reasonable man there was no prospect of the creditors
receiving payment when due and that directors were aware that
creditors money was being unreasonably risked for the following
reasons:
130.1 Pursuant to the Challenger Agreements, and just five days
after the conclusion of the Sale Transaction:
130.1.1 Bonfrut lost significant volume in both citrus and grapes
resulting in a dramatic decrease of its turnover;
130.1.2 Bonfrut needed to incentivise its staff to increase volume
through a commission structure;

130.1.3 Bonfrut was not profitable (despite the 2017 financial
statements reflecting differently); and
130.1.4 Attaching a proposal through which the salary structure
applicable would be changed.
[131] Accordingly, in my view, on this basis alone, both Mr Uys Senior
and the First Respondent must have been aware that there was a
significant risk that Bonfrut would be unable to repay its indebtedness to
Challenger, particularly if one or more of the Offtakers did not make
payment to it of an Offtaker Invoice on or before the due date, therefore.
This finding is fortified by the fact that the First Respondent, according to
his own evidence, was very much aware of the terms of the Challenger
Agreements, and more particularly the cession of the claim to payment
of the Offtaker Invoice to Challenger, yet he had no qualms with:
131.1 actively participating in the procurement of further funding
from Challenger amounting to millions of Rands whilst knowing full
well the precarious financial position Bonfrut was in;
131.2 released payments from the funds received from Challenger
in accordance with Mr Uys Senior’s instructions without any
consideration of whether the Discounting Agreement was being
complied with. Clause 2.1. of the Discounting Agreement provides
that “Bonfrut requires finance which will enable it to finance the

purchase of the Commodities [fruit] from the Suppliers [Producers]
(“the Purpose”) and Challenger is desirous of providing financial
assistance to Bonfrut on an uncommitted basis for this Purpose.”
The First Respondent confirms in his affidavit that “the funds
obtained from [Challenger] in terms of the agreement were used to
[pay] creditors and loan accounts.”
131.3 released payments from the funds received from Offtakers
in accordance with Mr Uys Senior’s instructions and without any
consideration as to how those funds should be applied to
Challenger’s rights in light of his awareness of the cession
agreement.
[132] To be more specific to the period in which the First Respondent
was a director, the common cause facts establish that:
132.1 Bonfrut obtained funding from Challenger in the amount of
USD 130 000,00;
132.2 Bonfrut paid out over R1.3 million in respect of loans
obtained by it from the Uys family, its employees and friends of the
Uys family; and

132.3 Bonfrut fell into arrears in respect of the amounts owing to
Challenger during the period in which the First Respondent was a
director.
[133] The aforegoing facts show that Bonfrut was trading recklessly. This
I say advisedly, bearing in mind that not every inability by a company to
pay its debts may be construed as reckless trading. However, the facts
in casu establish that Bonfrut consistently failed to honour its financial
obligations to Challenger whilst securing more financing whilst knowing
that it would not be able to pay back Challenger. This finding resonates
with what was said in Ex Parte de Villiers and Another NNO: In re
Carbon Developments (Pty) Ltd (In liquidation) 1993(1) SA 493 (A) at
504 A – C:
“In my judgment, there is nothing wrong in the fact that directors incur credit at
a time, when to their knowledge, the company is not able to meet all its
liabilities as they fall due. What is manifestly wrong is if directors allow a
company to incur credit at a time when the business is being carried on in
such circumstances that it is clear that the company will never be able to
satisfy its creditors . however, ther e is nothing to say that directors who
genuinely believe that the clouds will roll away and the sunshine of prosperity
will shine on then again Abd disperse the fog of their depression are not
entitled to incur credit to help them get over the bad time.”

[133] In the matter at hand, it must have been clear to the directors,
more particularly the First Respondent that the depression was not going
to clear at any time soon, hence resorting to incorporating Bonex to raise
funds to meet Challenger contractual obligations as attested to by Mr
Uys Senior.
[134] The Applicant also alleges that recklessness or subterfuge of
Bonfrut is also borne out in statements, which were presented to
Challenger which were materially misstated and misleading. I now turn
to consider these issues.
The Financial Statements
[135] According to the Applicant, although the 2018 financial statements
(neither audited nor independently reviewed) , duly signed by Mr Uys
Senior paint a picture of a commercially solvent Bonfrut, the factual
reality is that Bonfrut was trading recklessly. In assessing this contention,
the following facts from the 2018 Bonfrut financial statements is
recorded:
135.1 there was a significant decrease in revenue from R85 million
to R75 million in the 2018 financial year;
135.2 despite the decrease in revenue of almost 9million as
reflected above, the gross profit increased by over R1.5 million;

136.3 Mr Uys Senior’s loan account had increased from
R531 993.00 to R1 862 068.00
135.3.1 it is recorded that this loan was unsecured,
interest free and that it was not expected that same would be
repaid within the next 12 months. According to the Applicant,
allowed the loan to be categorised as a long -term liability
rather than a current liability, thereby creating the impression
of a more favourable balance sheet. And, this impression
was false as this loan was largely repaid over the next
financial year.
135.4 there was an increase in trade and other receivables, from
R515 046.00 in the previous year to R7 368 306.00;
[136] The evidence of Ms Potgieter is that a significant portion of this
amount constituted bad debt and ought to have written off. The Applicant
contends that the write off of trade receivables would have made
Bonfrut’s balance sheet look weaker with the result that Challenger
would have been less likely to provide it with finance.
136.1 Mr Uys’s loan account increased from R531, 993.00 in the
previous financial year to R1 862 068.00.

136.2 A substantial loan in the value of R5 million was obtained
from Mr Charl Uys:
136.2 both Mr Uys Senior and Mr Charl Uys testified at the Enquiry
that the aforesaid loan was not, in fact made by Charl to Bonfrut
but was rather made by Mr Charl Uys to Mr Uys Senior and then
by Mr Uys Senior to Bonfrut, but:
136.2.1 over the course of the years, Bonfrut’s annual
financial statements consistently reflected separate
(material) balances owing to each Mr Uys Senior and Mr
Charl Uys; and
136.2.2 despite the loan being recorded as “payable on
demand”, it (is similar to Mr Uys Senior’s loan) was reflected
as a long-term liability on Bonfrut’s balance sheet. According
to the Applicant this recording in the financial statements was
designed to mislead Challenger for if it had been reflected as
a current liability, Bonfrut’s financial statements would have
been shown that it was commercially insolvent.
136.3 Likewise, a loan in the amount of R275 578.00 from Mr
Matthys Grobler was reflected as long term liability whereas it
should have been reflected as a current liability as it was payable

on demand and was in fact repaid over the next 12 months period)
thereby creating an impression of a healthy balance sheet.
136.4 It will be recalled that Bonfrut obtained a loan in the amount
of 700 000.00 from Ms van Niekerk in order to enable Bonfrut to
pay salaries to its staff members. This loan too was reflected in the
financial statements as a long-term liability. The Applicant contends
that Mr Uys Senior’s confirmation in the 2018 financial statements
that he was “satisfied that [Bonfrut] has or has access to adequate
resources to continue in operational existence for the foreseeable
future” is based on a false premise as the status of the loans was
deliberately misstated in the financial statements with the intention
to create a healthy balance sheet for Bonfrut to secure more
funding.
[137] Notwithstanding what is reflected in the financial statement of
2018, it is clear from the uncontroverted evidence elicited at the Enquiry
that at the time the Challenger Agreements were signed, Bonfrut was
already experiencing significant financial difficulties for the following
reasons:
137.1 on 14 September 2017, Bonfrut had borrowed a sum of
R700 000,00 from Ms van Niekerk in order to pay salaries as it did
not have sufficient funds to do so; and

137.2 over the period 18 to 29 December 2017, (a month prior to
the conclusion of the Discounting Agreement) Bonfrut had
borrowed an additional R5 million from Mr Charl Uys .
[138] Through the course of the Enquiry and by virtue of information
obtained through the liquidation process the following facts emerged:
138.1 in July 2018, payment in the amount of R800 000, 00 was
made in reduction of Mr Uys Senior’s loan account whilst in the
same month finance in the amount of USD 450 000,00 was sought
and obtained from Challenger;
138.2 in August 2018, payment in the amount of R1 000 000,00
was made in reduction of Mr Uys Senior’s loan account in the
same month finance in excess of USD 300 000,00 was sought and
obtained from Challenger;
138.3 similarly, in September 2018, payment in the amount of
R5 048 219,00 was made with reference ‘Charl Uys’, presumably
in reduction of the loan owing by Bonfrut to Mr Charl Uys in
accordance with the financial statements. In the same month,
finance more than USD350 000,00 was sought and obtained from
Challenger;

138.4 in October 2018, payment of R490 000,00 was made in
reduction of Mr Uys Senior’s loan account.
[139] The above pattern, according to the financial statements continued
after the appointment of Uys Junior as director of Bonfrut on or about 16
October 2018. To this end:
139.1 in December 2018, a payment in the amount of R1million
was made in reduction of Mr Uys’s loan account subsequent to
Bonfrut’s seeking and obtaining finance in excess of USD
150 000,00 from Challenger;
139.2 in 2019, in breach of its obligations in terms of the
Discounting Agreement, Bonfrut withdrew R400 000,00 from the
bond accounts in respect of Bonfrut’s Wellington and Durbanville
Properties clear indication that funds sought and received from
Challenger in excess of USD 80 000,00 were insufficient to sustain
Bonfrut’s business;
139.3 in February 2019, payment in the amount of R52 000, 00
was made reflected as having been made to the First Respondent
and payment of R50 00, 00 was made in reduction of Mr Gobler’s
loan account in the same month finance in excess of USD
250 000,00 was sought and obtained from Challenger;

139.4 in April 2019 payment in the amount of R40 000,00 to the
First Respondent. The amount is reflected as being backpay of cell
phone expenses and an amount of R159 165.00 was made to Mr
Grobler in reduction of his loan account and a sum of
R100 000,00 was paid to Ms VAN Niekerk whilst in the same
month finance in excess of USD170 000.00 was sought and
obtained from Challenger.
[140] It is clear from the evidence elicited at the Enquiry that at the time
the Challenger Agreements were concluded on 23 January 2018, the
financial difficulties experienced by Bonfrut alluded to above were not
disclosed during the signing of the Challenger Agreements and the
financial statements presented to the latter reflected a healthy financial
status of Bonfrut. Furthermore, the payments effected after the
appointment of the First Respondent as director as shown above, were
made contrary to the terms of the Discounting Agreements. It is my
judgment that the misleading financial statements constituted reckless
trading.
The 2019 financial statements
[141] Similar to the 2018 financial statements, the 2019 financial
statements for the year ended 31 May 2019 were signed by Mr Uys
Senior and were neither audited nor independently reviewed. Thy were

not signed by the First Respondent, who, as i have already indicated
was appointed as director on 16 October 2018. As to the 2019 financial
statements. In this regard, the First Respondent gave evidence at the
Enquiry to the effect that whilst he was aware of the financial statements,
he had no real knowledge as to the information they contained.
According to the information contained therein, Bonfrut remained
factually and commercially solvent. To this end:
141.1 the value of trade receivables had increased from R7.3
million in the previous year to R8.3 million in the current financial
year.
[142] The Applicant contends that the evidence at the Enquiry show s
that a significant portion of the trade receivables constituted bad debt
and should have been written off prior to signature of the financial but
that was not done because in order for Bonfrut to secure further
financing, an impression of Bonfrut ‘s commercial solvency had to be
created. In addition, because of the First Respondent’s position at
Bonfrut, he must have been aware (as a reasonable person in his
position should have been) that Bonfrut would be unable to pay its debts
to Challenger but nonetheless knowingly participated in the
procurements of further funding from Challenger and authorised the use
of these funds to repay the loan accounts of his family members.

According to the Applicant this assertion is bolstered by the fact that two
employees of ECAT who had assisted in the preparation of the financial
statements and gave evidence at the Enquiry, Ms Blignaut and Mr Dyer,
conceded that prima fac ie the Challenger funds were used to pay family
loans.
[143] The 2019 financial statements reflect that Bonfrut remained both
factually and commercially solvent. This is largely based on the fact that
the value of trade receivables had increased from R7.3 million in the
previous financial year to R8.3 in the current financial year. The
Applicant argues that these trade receivables ought to have been written
off as bad debts prior to the signing of the financial statements. This was
not done because the intention was to inflate Bonfrut’s balance sheet
and to create an impression that it remained a viable concern to ensure
that Challenger, on the basis of this misrepresentation would allow for
further repayment of the loan accounts of Mr Uys and his family
members. The reality is that t he 2019 financial statements reflect that
loans from shareholders and other financial liabilities (including the loans
from Mr Charl Uys, Ms van Niekerk and Mr Grobler had been paid in full.
[144] According to the 2019 financial statements, VAT decreased from
747 518 .00 to a paltry sum of R77 115.00. The Applicant states that an
inference that can be drawn from the is that the VAT liability was

understated to create an impression of a stronger financial position for
Bonfrut.
[145] In the Statement of Comprehensive Income an amount of R1.2
million was reflected whereas the amount was incorrect as evidenced in
the 2020 financial statements for the year ended February 2020 shown
to be R754 091.00 largely due to rental reduction. However, the
evidence in the Enquiry confirmed that:
145.1 such rental income had never been received (the First
Respondent and Mr Uys Senior having resided in Bonfrut’s
immovable property rent free);
145.2 the aforesaid entry created the impression of a more
favourable financial position; and
145.3 after the liquidation of Bonfrut this entry was reversed,
resulting in an increase in Mr Uys Senior’s loan account.
[146] It also transpired at the enquiry that certain other expenses were
understated, for example, motor vehicle expenses, interest which had an
effect of increasing Mr Uys Senior’s loan account. The upshot of all the
aforegoing undisputed financial facts is that through the Challenger
finance, payment was made to certain creditors in contravention of the
Discounting Agreement.

[147] This in essence suggests that Bonfrut made payments to certain
preferred creditors whereas, Challenger was entitled to all funds in
respect of Offtaker Invoices.
The 2020 financial statements
[148] It is common cause that the First Respondent resigned as Director
at Bonfrut on 26 September 2019. However, the Applicant contends that
despite his resignation, testimony obtained at the Enquiry reflect s that
he retained transactional authority and continued to perform the same
duties as those he had performed as director in that he:
148.1 participated in the exercise of executive control over the
management of the whole or a significant portion of Bonfrut and/or
its activities;
148.2 participated in the running of the day -to-day business of
Bonfrut;
148.3 was one of the controlling minds behind Bonfrut.
[149] Thus, he remained a prescribed officer of Bonfrut for the purposes
of section 38 of the Companies Regulations 2011. According to the
Applicant, the First Respondent ought to be found liable for Bonfrut’s
debts on this basis alone.

The First Respondent’s defence
[150] The First Respondent denies that proceeds from invoices which
were ceded to Challenger were paid to other creditors other than
Challenger. The denials must be assessed in the light of the common
cause facts which are the following:
150.1 It is not in dispute that the funds provided by Challenger to
Bonfrut are no longer with Bonfrut.
150.2 Bonfrut’s financial statements for the year ending 31 May
2017 purport to show a healthy financial picture as Bonfrut’s
assets exceeded its liabilities by approximately R5,5, its revenue
had increased to from R82million in the previous year and its gross
profit from R5.2 million to R6 million.
150.3 despite this apparent healthy balance, by 14 September
Bonfrut was unable to make payment of salaries owing to staff and
a loan in the sum of R700 000.00 was procured from Ms van
Niekerk. In addition, a further loan in the amount of R5million was
obtained from Mr Charl Uys in December 2017.
150.4 a month later Bonfrut entered into a Discounting Agreement
and the first Sale Transaction was concluded on 14 February
2018. Five days after the conclusion of the first sake transaction

and on 19 February 2018, Mr Uys addressed correspondence to
all Bonfrut staff members advising that:
150.4.1 Bonfrut had lost considerable volume over the
2017 season, both in citrus and grapes;
150.4.2 Bonfrut was conducting business at a loss and
could not continue in that manner indefinitely;
150.4.3 overheads had to be reduced and drastic action
needed to be taken by way of moving staff onto a
commission structure.
[151] The First Respondent contends that he did not make any decisions
concerning Bonfrut’ s business both prior to his appointment as director
and during the term of his appointment as such. Even on this score I find
the First Respondent’s denials as being untenable as his own evidence
shows that he was well aware of the intended operation of the
Challenger Agreements and in fact loaded some of the payments to
Challenger on his own accord. The scope of his operation as a director
is quite vast, as attested to by his own LinkedIn profile and his role and
functions as someone responsible for the Challenger accounts
demanded that he, at least be well versed of the of the obligations
Bonfrut had to discharge, the amount of the debt. The evidence is
overwhelming that he participated in the day -to-day management of the

affairs of Bonfrut and the extent of Bonfrut’s financial difficulties ought to
have been obvious to him when the company could not meet its basic
obligations of paying salaries to its employees and repeatedly took loans
from staff members. In my opinion, the First Respondent knew the
factual situation, namely that Bonfrut in addition to obtaining loans, it
was not honouring the Discounting Agreement with Challenger, yet more
finance was required. In other words, Bonfrut continued to incur debts in
circumstances where it could not meet its basic obligations, and the First
Respondent was a party to conduct that went beyond the realm of just
poor judgment and crossed into gross negligence. In my view, therein
lies the recklessness in Bonfrut’s trading . The First Respondent also
admitted that the funds obtained from Challenger were used to pay other
creditors much against the purpose for which they were obtained.
[152] The First Respondent also challenges the contents of the
accounting records and avers that they should be treated with
circumspection as the conclusions drawn by Challenger from the
financial statements were largely speculatory as Bonfrut never
experienced any financial difficulty and it was expected that it would
meet its financial obligations towards Challenger. According to him, the
financial statements presented a true account of Bonfrut’s financial
position.

[153] It is indeed so that the financial statements were completed and
signed off by Mr Uys Senior. However, the duties assigned to the First
Respondent as director of Bonfrut were of such a nature that he knew
the relevant facts pertaining to Bonfrut’s trading as he was responsible
for tendering payments to Bonfrut which, as a reasonable business
person he would have effected after reviewing Bonfrut’s financial affairs.
I am satisfied that on the facts of the present matter, Bonfrut was trading
recklessly and this was known to the First Respondent who in my view ,
was not only fully aware of that conduct but acquiesced or concurred
with it. I am further fortified in this finding by the dict um in Ozinsky NO v
Lloyd and Others 1992(3) SA 396 ( C) at 414 G -H where the court held
that:
“If a company continues to carry on business and incur debts when, in the
opinion of reasonable businessman, standing in the shoes of the director ,
there would be no reasonable prospect of creditors receiving payment when
due, it will in general be a proper inference that the business is being carried
on recklessly.”
[154] In my judgment, the First Respondent’s defence that at all times
whilst being a director he was acting on the instructions of Mr Uys Senior
and can thus not be held liable for the debts of Bonfrut is untenable. The
First Respondent was instrumental in disbursing the funds received from
by Bonfrut from Challenger whilst being aware of the terms and purpose

of the funding. I find that his reliance on his father’s instructions is a ruse
to simply avoid liability. He was a director in his own right and had played
a key role in the financial administration of Bonfrut. The First
Respondent is in my judgment not only liable for the period in which he
was a director, he is also liable on the basis as Bonfrut’s prescribed
officer. In his evidence at the Enquiry, he confirmed that at the very least,
he had basic knowledge of accounting procedures and prior to the
engagement with Challenger, he had been employed at Bonfrut and was
responsible for key financial tasks, financial planning and financial
analysis. Furthermore, the evidence obtained at the Enquiry shows that:
154.1 the First Respondent himself admitted that he had access to
Bonfrut’s financial system and could at all times see the amounts
owed to Bonfrut creditors. (This would have been necessary in
order for him to execute his budgeting and making payments on
behalf of Bonfrut).
154.2 The First Respondent was responsible for the Challenger
account as he attended to the calculation of payments that were to
be made to the latter, based on Bonfrut’s cash flow and further that
he approved payments made to Challenger.
154.3 Ms Potgieter also confirmed that the First Respondent was
responsible for the administration of the Challenger account.

I therefore conclude that the First Respondent must be held liable for the
debts of Bonfrut as he knew and foresaw that there was no reasonable
prospect that the debt owed by Bonfrut to Challenger would not be paid.
[155] I now turn to consider Claim B.
[156] To recap, in Claim B, the Applicant seeks a declaration that the
fourth Respondent, Bonex , be deemed not to be a juristic person
separate from Bonfrut.
[157] It is common cause that on 20 September 2019, Ms Potgieter, at
the instance of Mr Uys Senior, instructed ECAT to incorporate a new
entity known as Bonex. Bonex was incorporated on 10 October 2019,
and Ms Potgieter was its sole director. Its business was export
administration. The evidence elicited at the enquiry establishes that Ms
Potgieter was chosen as Bonex’s sole director because:
157.1 She had experience with export administration as she had
been doing the same work in her capacity as employee at Bonfrut;
157.2 She had been materially involved in the development of the
system Bonex would use to attend to the administration of
business, which had initially been developed for Bonfrut ’s business
for the purpose of its own administration and knew the system very
well.

157.3 Mr Uys Senior was of the view that he could not be a director
of Bonex as that would have constituted a conflict of interest since
he was already a director of Bonfrut.
[158] It will be recalled that the First Respondent resigned as director of
Bonfrut on 26 September 2019. On 28 November 2019, he was
appointed as the sole director of Bonex pursuant to Ms Potgieter
renegading from executing functions as a director of Bonex on the basis
that she was reluctant to take on a responsibility that carried personal
liability. On the same day, the First Respondent was issued with 120
Ordinary Non-Par shares in Bonex, for an issue price of R120.00.
[159] At the Enquiry, Mr Uys explained the business model of Bonex as
follows:
159.1 Bonex would assist farmers with their export administration,
utilising a digital export administration system created by Bonfrut
and previously used in Bonfrut’s business. It facilitates data entry,
processing and invoicing;
159.2 the system would reflect, amongst other things, a grower’s
export documentation, loadings, stock in containers, release of
fruit, prices and payments;

159.3 upon loading of a farmer’s fruit, Bonex would present to the
farmer data of what it is in each container, more specifically, the
split sizes, variants, classes and destination;
159.4 based on the volume of fruit, Bonex would charge a fee,
either per pallet or per carton; and
159.5 initially, the idea was for Bonfrut to remain an exporter and
for Bonex to facilitate Bonfrut’s administration.
[160] The First Respondent in his evidence at the Enquiry confirmed that
Bonex makes use of the system, which was developed within Bonfrut,
and which was previously used by Bonfrut’s administration. He also
explained that Mr Uys Senior is doing consultation work for farmers
through Bonex , which includes advice on exporting, farming and other
operational matter. According to his evidence, Ms Potgieter was made a
director of Bonex because (in her capacity as employee of Bonfrut) she
wrote the system which Bonex uses and because she has always used
it, she had a better understanding of how it works. He further stated that
initially Bonex was not meant to do consultations, but the idea was that
producers be allowed to access the system developed by Bonfrut (and
which was paid for by Bonfrut for the purposes of its business).
[161] As to the actual business Bonex conducted, Ms Potgieter testified
that during 2020 Bonex had various clients for whom it did

administration. Touwskaroo Agri was one such client whose export was
facilitated by Bonfrut and Bonex did administration for it for one
container. She further testified that Bonfrut attended to Touw skaroo Agri
export free of charge and as marketing for Bonex. Touwskaroo had
previously been a client of Bonfrut.
[162] Ms van Niekerk also gave evidence relating to the incorporation of
Bonex and stated that Mr Uys Senior intended to liquidate Bonfrut before
Challenger could do so, in the hope registering Bonex. and Bonex had
been trading as Bonfrut. Clearly no evidential value can be placed on Ms
Potgieter’s opinion as to what the Mr Uys Senior intention to liquidate
Bonfrut so that he could continue trading with Challenger.
[163] Counsel for the Applicant argued that the evidence establishes that
Mr Uys Senior and the First Respondent intended to continue
conducting the business of Bonfrut through Bonex and the link between
the two companies is obvious when regard is had to the following:
163.1 the similarities of the names. Ordinarily, nothing much can be
assessed from the use of similar names, neither can any inference
be drawn solely therefrom. However, in the present matter, the
First Respondent explained that the reason for the use of
somewhat similar names is probably to strengthen association with
Bonfrut, as it is a well-known name in the industry.

163.2 Bonex was incorporated by one of Bonfrut’s employees on
the instructions of Mr Uys;
163.3 Bonex’s registered address was, until 17 November 2021,
the Durbanville property owned by Bonfrut;
163.4 it is undisputed that on 18 February 2020, Mr Uys Senior
instructed ECAT to include Bonex on Bonfrut’s E -Filing (SARS)
profile.
163.5 Bonfrut’s export system was used by Bonex;
163.6 Ms Potgieter used the Bonfrut system for Bonex’s
operations;
[164] The Applicant contends that Mr Uys Junior and Bonex knowingly
participated in the business of Bonfrut with intent to defraud creditors of
Bonfrut, specifically Challenger. The Applicant contends that Mr Uys
Junior and Bonex knowingly conducted and/or participated in the
business of Bonfrut to defraud the latter’s creditors in that:
164.1 Mr Uys used the proceeds from the purchased invoices
which were ceded to the Challenger Agreements to pay company
expenses and other creditors instead of paying Challenger.’
[165] The next question to consider is whether the evidence shows that
incorporation of Bonex constitutes, use or actions showing an

unconsciable abuse of the company as a separate entity such that it
may be deemed not to be a juristic person and whether Bonfrut and
Bonex should be considered one single entity.
Section 20(9) provides thus:
“If, on application by an interested person, or any proceedings in which a
company is involved, a court finds that the incorporation of the company or
any use of the company, or any act by or on behalf of the company constitutes
an unconsciable abuse of the juristic personality of the company as a
separate entity, the court may:
Declare that the company is to be deemed not to be a juristic person in
respect of any right, obligation, or liability of the company or of a shareholder
of the company, or in the case of a non -profit company, a member of the
company, or of another person specified in the declaration; and
Make any further order that the court considers appropriate to give effect to a
declaration contemplated in paragraph (a).”
[166] The criteria for piercing the corporate veil is summarised in Ex
Parte Gore NO 2013 (3) SA 383 (WCC) at para 22 as follows:
“1. Ownership and control of a company are not of themselves sufficient to
justify piercing the veil;
2. The court cannot pierce the veil, even when no unconnected third party
is involved, merely because it is perceived that to do so is necessary and in
the interests of justice;

3. The corporate veil can only be pierced when there is some impropriety;
4. The company is involvement in an impropriety will not by itself justify a
piercing of its veil: [furthermore] the impropriety must be linked to use of the
company structure to avoid or conceal liability;
5. It follows … that if the court is to pierce the corporate veil, it is
necessary to show both control of the company by the wrongdoer and
impropriety in the sense of a misuse of the company as a device or façade to
control wrongdoing;
6. A company can be a façade for such purposes even though not
incorporated with deceptive intent, the relevant question being whether it is
being used as a façade at the time of the relevant transaction(s);7. And the
court will pierce the corporate veil only so far as is necessary to provide a
remedy for the particular wrong which those controlling the company may
have done. In other words, the fact that the court pierces the corporate veil for
one purpose does not mean that it will necessarily be pierced for all
purposes.”
[167] In Cantaur Mining South Africa (Pty) Ltd v Moodliar N.O. and
Others (CCT117/24] ZACC 20 (18 May 2026) the Constitutional Court
affirming the interpretation of section 20(9) in Gore stated as follows:
“[81] Section 5(1) of the 2008 Companies Act provides that the Act must be
applied and interpreted in a manner that gives effect to its purposes as set out
in section 7. Section 5(2) states that, to the extent appropriate, a court
interpreting the Act may consider foreign law. In terms of section 19(1), a

company becomes a juristic person from the time and date that its
incorporation is registered and exists continuously until its name is removed
from the companies register. This is in conformance with the common law.
[82] I agree with the judgment in Gore that section 20(9) is supplemental to
the common law, rather than substitutive. I also agree with Gore that the
section is cast in very wide terms, indicative of an appreciation by the
Legislature that it might find application in widely varying factual
circumstances. The 2008 Companies Act does not define what would
constitute unconsciable abuse. It avoids metaphors like fraud, scam and
façade. The court must find the relevant wrongdoing on the facts of each
case.”
[168] In addition, the Court emphasised that a court is not obliged to
invoke section 20(9) even though an unconsciable abuse of a company’s
separate personality may be shown. In short, the court has a discretion
whether to pierce the corporate veil.
[169] Linked to this question is the allegation made by the Applicant to
the effect that Mr Uys Senior attempted to divert payments due to
Bonfrut. To recap, Challenger brought the liquidation application against
Bonfrut on 3 July 2020. the evidence shows that on 5 July 2020, Mr Uys
Senior through a WhatsApp message instructed Ms Potgieter to credit
the offtaker’s accounts with the amounts that were due to the farmers by
generating credit notes for each one of the customer invoices.
Furthermore, Mr Uys Senior further instructed Ms Potgieter to create a

company for each of the growers (farmers) in the export administrative
system (i.e. Bonfrut’s system which was later used by Bonex) and to
generate invoices to the offtakers in the respective grower’s names. The
effect of the aforegoing was that offtakers made payment of amounts
owing to Bonfrut to the growers directly and that the payment did not
reach Bonfrut’s insolvent estate . In this way, the grower’s goodwill was
retained and the First Respondent and Mr Us Senior continued to
business with Bonex.
[170] According to the Applicant, the only reasonable inference to be
drawn from this conduct is that this method of Offtakers paying growers
directly (a system that had never been previously used by Bonfrut) is the
diversion of funds from Bonfrut which had always received payment from
Offtakers and then paid the growers amounts due to them in their
capacity as Bonfrut’s own creditor. The Liquidators after having received
a copy of the correspondence wrote to Prime Orchards advising that Mr
Uys Senior’s request should not be acceded to. According to the
evidence of Ms Potgieter Bonfrut’s arrangements with prime Orchards
had always been that Bonfrut procures the fruit from the grower and then
shipped the fruit to Prime Orchards who would pay Bonfrut and Bonfrut
would in turn make payment to the grower.

[171] It is clear from the aforegoing that the funds owing to Bonfrut were
diverted to various growers to the disadvantage or prejudice of
Challenger and other creditors.
[172] According to the Applicant, This conduct persisted with the Tatyana
Dan Fruit, a Russian offtaker. Much was made about Mr Uys Senior’s
WhatsApp message to Tatyana on 15 July 2020 that Bonfrut “ is in the
process to change from Bonfrut as an exporter to assisting growers to
do their own exports and we run their marketing for them through their
own business. This will place us in a much better position for the future
to supply fruit. So for the moment we do not want to continue via Bonfrut
and rather push for the new model and way of doing exports. So please
bear with us and finalise all current business as advised by Mr Potgieter.
Thanks for your cooperation and we hope to continue with the model
asap.”
[173] Upon a consideration of all the evidence in this application, I have
come to the conclusion that the threshold set out in Ex Parte Gore has
not been met in this case. First, the fact that Bonex ‘s registered address
was at the property owned by Bonfrut and that Mr Uys Senior instructed
ECAT instructed ECAT to include Bonex on Bonfrut’s E -Filing (SARS)
profile does not without more , justify the piercing of Bonex’ corporate
veil. It may well be that the diversion of the growers’ payments would

disadvantage Challenger and Bonfrut’s creditors, I cannot on these facts
conclude that the redirection of funds to the grower’s bank accounts was
intended to enable Mr Uys Senior and the First Respondent to maintain
a positive relationship with the growers so that the y could continue
business with them through Bonex as attested to by Ms Potgieter. In the
first place Ms Potgieter ‘s evidence of Mr Uys’ intentions in this regard is
purely speculative and may not be elevated to fact . Equally, the fact that
Bonex’s registered address was, until 17 November 2021, the
Durbanville property owned by Bonfrut , as well as that Bonfrut’s export
system was used by Bonex belonged to Bonfrut is not indicative of fraud
or improper purpose. I cannot on the facts presented find that the
incorporation of Bonex was a scheme by which Bonfrut’s corporate
opportunities were transferred to Bonex under the guise that it was a
separate entity and that the latter should be deemed not to be a juristic
person in respect of rights and obligations of Bonfrut. It follows that
Claim B, must fail. Consequently, in my judgment there is no basis for
holding the Fourth Respondent (Bonex) in the amount owed by Bonfrut
to Challenger.
Costs
[174] The Applicant has achieved substantial success; there is therefore
no reason why costs should not follow the result. It remains to be said

that in the application to strike out portions of the founding affidavit, the
Respondents have succeeded albeit on a small scale. I think it is fair in
this regard that the Applicant be awarded 80% of the costs of the
application to strike out relating to the founding affidavit. Insofar as the
replying affidavit is concerned the application failed and the Applicant
must be awarded costs. Costs should, in my view be awarded on Scale
B.
Conclusion
[175] In conclusion, I have in this judgment found that it is in the interests
to admit the evidence tended at the Enquiry in terms of section 417 of
the Companies Act. Linked to this finding, I have found that certain
paragraphs in the founding and replying affidavits may not be struck out
as they constitute hearsay evidence, and I have already found them to
be admissible in the interests of justice. Regarding Claim A, I have held
that the First Respondent must be declared liable for the debts of
Bonfrut (Pty) Ltd (in Liquidation) in terms of section 424 of the
Companies Act.
[176] As a consequence of these findings, the following order is issued:
176. The evidence presented at the Enquiry held in terms of
section 417 of the 1973 Companies Act is hereby admitted in these
proceedings and shall form part of the record herein.

176.2 Paragraphs 51.5.2; 52 to 59; 63.3.2 to 63.3.4; 63.4; 63.5.1 to
63.5.2 and the last sentence of paragraph 63.6; and paragraphs
63.9.3, 63.10 and the last sentence of 63.5 as well as paragraphs:
70.3 and 96.1 are hereby struck pout of the Applicant’s founding
affidavit. The Applicant is entitled to 80% of its costs.
176.3 CLAIM A succeeds. It is hereby declared that the First
Respondent, Mr Alwyn Uys is hereby declared to be liable for the
debts of Bonfrut (Pty) Ltd (in Liquidation) as a director and as a
prescribed officer..
176.4 The application to strike out the Applicant’s replying affidavit
is dismissed with costs.
176.5 CLAIM B is dismissed with costs.
_____________
NDITA, J

Appearances
For the Applicant
Advocate S Mahon SC
Instructed by
Schindler Attorneys

For the 1st and 4th Respondents
Advocate J Muller SC
Advocate L N Wessels
Instructed by
Boshoff Bronn Smit Attorneys