Dry v Guest Village Little Dreams CC and another

• Jurisdiction: http://justis.com/jurisdiction/166,South Africa
• Judge: Reddy AJ
• Judgment Date: 07 August 2023
• Citation: 2023 JDR 3027 (NWM)
• Hearing Date: 17 March 2023
• Docket Number: M255/21
• Court: North West Division, Mahikeng

Reddy AJ:

Introduction

[1]

The crisp issue that falls for adjudication is whether nor not the insolvent respondent close corporations (Juandry Eiendomme CC and Guest Village Little Dreams CC) fall to be finally wound up because of a deadlock between the members thereof alternatively, whether a conditional counter application in terms of the provisions of section 36(1)(d) of the Close Corporations Act 69 of 1984 by one of the members of the latter, ought to be granted in lieu of a winding up order. There is an interlocutory application for the reinstatement of the rule nisi in the application under case number M256/2021.

[2]

The members of the close corporations are Mrs. Magdalena Johanna Dry (“Mrs. Dry”) and Mr. Jan Abraham Christoffel Dry (“Mr. Dry”). Mr. and Mrs. Dry are members of the Guest Village

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Little Dreams CC and Juandry Eiendomme, each holding fifty per cent (50%) of the members interest therein. Mr. and Mrs. Dry are litigants in matters M255/21 and M256/21.

Litigation backdrop

[3]

Mr. and Mrs. Dry are involved in a rancorous divorce. Mrs. Dry and her applicants have been successful in securing provisional orders for the liquidation of both close corporations (Guest Village Little Dreams CC, M255/21, and Juandry Eiendomme M 256/21) and now apply for the winding up of the respective close corporations. In promoting the expeditious, efficient, and effective hearing of the main and counter application, it was agreed by counsel for both parties, that a pragmatic approach be adopted. Resultantly, both applications as well as the counter application are founded on fundamentally similar facts and may be disposed of, by the hearing of one application, incorporating the counter application. This was then the agreed litigious course endorsed by this Court.

[4]

Afore a consideration of a winding up order, or the conditional counter application, it is peremptory for it to be found that there had been due diligence in the compliance with peremptory service requirements as evinced by s346(A4) (a)(i) and (ii) and s346A(1)(a) and (b) of the Companies Act 61 of 1973.

[5]

On 22 October 2021 in Case Number M255/21, a provisional order was granted along the following terms by Petersen J:

1

THAT: The estate of GUEST VILLAGE LITTLE DREAMS CC (Registration number: 2003/104930/23 (“the First Respondent” be placed under provisional

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liquidation in the hands of the Master of the North West Division, Mahikeng returnable on 25th day of November 2021 to the unopposed roll,

2.

THAT: A provisional order issued calling upon the First respondent and any other interested party to show cause, if any, to the Honourable Court, on the return date, why a final order of liquidation should not be granted against the First Respondent:

3.

THAT: This order must further be served on:

3.1.

The First Respondent at its registered address by the Sheriff.

3.2

any registered trade union as far as the Sheriff can reasonably ascertain represents any of the employees of the respondent.

3.3

the First Respondent’s employees, if any by affixing a copy of the application and provisional court order to any notice board to which the employees have access inside the First Respondent’s premises, or if there is no access to the premises by the employees, by affixing a copy to the front gate, where applicable, failing which, to the front door of the premises from which the First Respondent conducts any business

3.4.

the South African Revenue Service, Mahikeng.

3.5.

The Master of the High Court Mahikeng.

4.

THAT: This order is to be is to be published as follows:

4.1.

by publication in 1 (ONE) edition of the Beeld Newspaper.

4.2.

by 1 (ONE) publication in the Government Gazette

5.

THAT costs of this application, on a scale as between attorney-and-client shall be costs in the administration of the insolvent estate of the First Respondent

[6]

On 22 October 2021 in motion matter Case Number 256/21 the following order was granted by Petersen J:

1.

THAT: The estate of JUANDRY EIENDOMME CC (Registration number: 2006/039520/23(“the First Respondent”) be placed under provisional liquidation in the hands of the Master of the North West Division, Mahikeng returnable on 25th day of November 2012 unopposed motion roll.

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2.

THAT: A provisional order is issued calling upon the First Respondent and any other interested party to show cause, if any to the Honourable Court, on the return date, why a final order of liquidation should not be granted against the First Respondent

3.

THAT: This order must be served on:

3.1

The first respondent as its registered address by the Sheriff.

3.2

any registered trade union that as far as the Sheriff can reasonably ascertain represents any of the employees of the Respondent.

3.3

the First respondent’s employees, if any by affixing a copy of the application and provisional order to any notice board to which the emplovees have access inside the First Respondent’s premises, or if there is no access to the premises by the employees, by affixing a copy to the front gate, where applicable, failing which, to the front door of the premises from which the First Respondent conducts any business.

3.4

the South African Revenue Service;

3.5

The Master of the High Court, Mahikeng

4.

THAT: This order is to be published as follows:

4.1

By publication in 1(ONE) edition of the Beeld Newspaper;

4.2

by 1(ONE) publication in the Government Gazatte.

5.

THAT: The costs of this application on an attorney-and-client scale shall be costs in the administration of the insolvent estate of the First Respondent.

[7]

In terms of these orders, it was peremptory that service of the liquidation and the provisional orders be served on the employees of the first respondent, as well as the trade unions representing such employees as evinced by s346(4A) (a)(i) and(ii) and s346A(1)(a) and (b) of the Companies Act 61, of 1973. Notwithstanding the repeal of the 1973 Act, these provisions remain in force by virtue of the provisions of item 9 of Schedule 5 of the Companies Act 71 of 2008.

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[8]

Section 346(4A) of the Companies Act 1973 reads as follows:

“(4A) (a)

When an application is presented to the court in terms of this section, the applicant must furnish a copy of the application –

(i)

To every registered trade union that, as far as the applicant can reasonably ascertain, represents any of the employees of the company; and

(ii)

The employees themselves-

(aa)

by affixing a copy of the application to any notice board to which the applicant and the employees have access inside the premises of the company; or

(bb)

if there is no access to the premises by the applicant and the employees by affixing a copy of the application to the front gate of the premises, where applicable, failing which to the front door of the premises from which the company conducted any business at the time of the application.

(iii)

to the South African Revenue Service; and

(iv)

to the company, unless the application is made by the company, or the court, at its discretion dispenses with the furnishing of a copy where the court is satisfied that it would be in the interest of the company or the creditors to dispense with it.

(b)

The applicant must, before or during the hearing, file an affidavit by the person who furnished a copy of the application which sets out the manner in which paragraph (a) was complied with.”

[9]

Mrs Dry has inundated the record with supplementary affidavits to pass the barometer of compliance with the service requirement. The first service requirement relates to case number: M255/21 which provides as follows.

1.

1.

I am an adult female businesswoman residing at 16 Swart Street, Lichtenburg, North West.

2.

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I am the Applicant in the present application and the facts herein fall within my own personal knowledge and belief and unless otherwise indicated are to the best of my belief both true and correct.

3.

Where I make allegations...