Firm-O-Seal CC v Wynand Prinsloo & Van Eeden Inc and another
| Jurisdiction | http://justis.com/jurisdiction/166,South Africa |
| Judge | Ponnan JA, Meyer JA, Kathree-Setiloane AJA |
| Judgment Date | 27 June 2023 |
| Citation | 2023 JDR 2274 (SCA) |
| Hearing Date | 19 May 2023 |
| Docket Number | 483/22 |
| Court | Supreme Court of Appeal |
Ponnan JA and Kathree-Setiloane AJA (Meyer JA concurring):
The appellant, Firm-O-Seal CC, instituted action in the Mpumalanga Division of the High Court, Middelburg (the high court) against the first respondent, Wynand Prinsloo & Van Eeden Inc., and the second respondent, Mr Derick van Wyk, who, at the relevant time, served as an attorney and director of the first respondent.
Four claims were asserted arising out of professional legal services rendered by the respondents to the appellant. The claims were met by five special pleas - four of prescription and one of lack of locus standi. The parties agreed, pursuant to Rule 33(4) of the Uniform Rules of Court, that the special pleas be adjudicated prior to and separately from the remaining issues and the high court made an order to that effect. After hearing the parties, the high court upheld the special plea of lack of locus standi and consequently dismissed the claims with costs. It did not think it necessary to consider the four remaining special pleas of prescription or to enter into the substantive merits of the matter. It took the view that the finding on the special plea of lack of locus standi was dispositive of the matter. The appeal is with the leave of that court.
The special plea was framed thus:
SPECIAL PLEA: LACK OF LOCUS STANDI
The summons was issued in the name of and on instruction of the directors of “Firm-O-Seal CC” on 2 December 2020.
2023 JDR 2274 p3
Ponnan JA and Kathree-Setiloane AJA (Meyer JA concurring)
The particulars of claim appended to the summons at paragraph 2 contain the averment that the respondent was placed under business rescue on 5 June 2019.
On 27 January 2021, the attorneys for the appointed business rescue practitioner, confirmed that the business rescue practitioner Mr Mahier Tayob did not authorize the action already instituted against the defendants . . .
On 2 February 2021, the defendants requested that the respondent furnish them with a power of attorney as contemplated under Rule 7 . . .
On 4 March 2021, the respondent favoured the defendants with its reply under Rule 7 . . .
Annexure “A” as read with annexure “C” confirmed the fact that when the process was issued, the plaintiff has not resolved and was consequently not authorised to have bought the action.
The director(s) of the respondent in bringing the action acted outside the scope and ambit of section 137(2)(b) of the Companies Act 71 of 2011 (the “Act”).
Consequently the bringing of the action is void as contemplated under section 137(4) of the Act.
In the premises, the plaintiff did not resolve and therefore lacked locus standi to have instituted the action and on that basis the particulars of claim as read with annexures “A” and “C” cannot sustain a cause of action.’
The special plea was answered by the following replication:
The plaintiff denies the defendants’ allegation that the plaintiff does not have locus standi and puts the defendants to the proof thereof.
. . . the plaintiff further pleads as follows:
On the 25th of November 2020, Mr Schutte of Karien Schutte Attorneys, forwarded to Mr Essop, who at all material times represented the business rescue practitioner, the draft particulars of claim in this action.
Mr Essop was requested by Mr Schutte to obtain the business rescue practitioner’s consent to proceed with the issuing of the action.
On the 2nd of December 2020, Mr Essop confirmed to Mr Schutte that the business rescue practitioner had consented to the institution of the action.
Karien Schutte Attorneys...
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