Gillis-Mason Construction Co (Pty) Ltd v Overvaal Crushers (Pty) Ltd
Judge | Trengove J |
Judgment Date | 30 November 1970 |
Citation | 1971 (1) SA 524 (T) |
Hearing Date | 20 October 1970 |
Court | Transvaal Provincial Division |
Trengove, J.:
In this matter the applicant seeks an order for the winding up of the respondent company. The question to be E decided is whether the applicant has locus standi to present this petition. It is common cause that if the applicant is to qualify as a person having locus standi it can only be on the ground that, at the time the petition was presented, the applicant was "a creditor" of the respondent within the meaning of sec. 113 of the Companies Act, 46 of 1926, as amended. The applicant alleges that it is such "a creditor", but this is F disputed by the respondent. It becomes necessary, therefore, to consider the nature of the applicant's claim, but before doing so, I refer briefly to the circumstances which have given rise to this petition. The salient facts of this case are as follows:
The applicant carries on business as building and G civil engineering contractors. The respondent carries on business as stone crushing contractors.
During January and February, 1969, the applicant entered into four separate contracts with the South African Railways and Harbours for the construction of 11 railway bridges on a new line being built between H Vryheid and Empangeni in Natal. In terms of these contracts, the applicant is liable for liquidated damages to the S.A.R. & H. at the rate of R500 per day for each day that the works remain uncompleted after the period agreed upon for the completion of the contracts.
On 24th March, 1969 the applicant entered into a contract with the respondent in terms whereof the respondent undertook to supply and stockpile at its crushers approximately 83,000 cubic yards of crusher stone at R1.75 per cubic yard, to be collected
Trengove J
by the applicant as and when required. It was agreed that time was of the essence of the contract and that the respondent would be subject to the same penalties applicable to the main contracts between the applicant and the S.A.R. & H. The contract between the applicant A and the respondent was subsequently varied but, for the present purposes, these variations are of no real moment.
Some time after the commencement of the contract, it became evident that the respondent would not be able to meet its commitments under the contract. At a B meeting between the parties during August, 1970, the respondent informed the applicant that it was in serious financial difficulties and was, in fact, hopelessly insolvent. Shortly afterwards, the respondent ceased its stone crushing operations and repudiated its contract. The applicant then learnt that the respondent had an accumulated loss of approximately R59,000 and that the amount of C liabilities exceeded the book value of the assets by approximately R58,000. In view of this situation the applicant advised the respondent, on 11th September, 1970, that it accepted its repudiation of the contract subject to its right to claim damages to the extent of approximately R60,000. The applicant, on the other D hand, admits that it is indebted to the respondent in an amount of R16,096.79, being the balance due for crushed stone delivered in terms of the contract, but it says that it is withholding payment of this amount pending the determination of its claim for damages for breach of contract. The respondent disputes this claim. The respondent's attitude is that the applicant E is not entitled to withhold payment of this amount, and it also contends that even though there has been a breach of contract, the applicant will not suffer any damages whatever, as a result thereof.
I must now consider whether, on these facts, the applicant has locus standi to present a petition for the winding up of the F respondent company. It is clear that if the applicant has any claim against the respondent, it is an unliquidated claim for damages for breach of contract. Thus, the first issue to be determined, is whether a person having a claim for unliquidated damages for breach of contract can be regarded as "a creditor" for the purposes of sec. 113 of the Act. As far as I am aware this particular question does not appear to have come before G our Courts for consideration yet. Sec. 113 of the Act, so far as it is material, provides that an application to the Court for the winding up of a company shall be by petition presented, inter alia, by
"any creditor or creditors (including any contingent or prospective creditor or creditors)".
Counsel for the respondent submitted that a claim for H unliquidated damages does not qualify the applicant as a creditor for the purposes of sec. 113 of the Act. He contended that, before the applicant could petition the Court for a winding up order, he must first take steps to convert the claim for damages into a judgment sounding in money. Counsel for the applicant, on the other hand, argued that whatever the ordinary meaning of the term "creditor" might be, the phrase "any contingent or prospective creditor or creditors" is wide enough to cover
Trengove J
the case of an applicant who merely has an unliquidated claim for damages.
I think it is necessary, in view of these contentions, to refer very briefly to the history of sec. 113 of the Act. A useful A starting point would be sec. 82 of the English Companies Act, 1862, which is the forerunner of our sec. 113. This section provided that an application for a winding up order could be presented, inter alia, by any one or more "creditor or creditors" of the Company. Sec. 137 of...
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Kalil v Decotex (Pty) Ltd and Another
...the Badenhorst case supra and also on English E authorities, eg Gillis-Mason Construction Co (Pty) Ltd v Overvaal Crushers (Pty) Ltd 1971 (1) SA 524 (T) at 529B - D. The South African statute, even though based on the corresponding English statute, is to be interpreted and applied primarily......
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Ex parte De Villiers and Another NNO: In re Carbon Developments (Pty) Ltd (In Liquidation)
...at H8; Ex parte Currie NO C 1966 (4) SA 546 (D) at 549G-H; Gillis-Mason Construction Co (Pty) Ltd v Overvaal Crushers (Pty) Ltd 1971 (1) SA 524 (T) at 528A-C; Holzman NO v Knights Engineering & Precision Works (Pty) Ltd 1979 (2) SA 784 (W) at 786E-788A; Henochsberg (op cit vol 2 at 594); Ba......
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Pilot Freight (Pty) Ltd v Von Landsberg Trading (Pty) Ltd
...(SCA) ([2014] 1 All SA 294): dicta in paras [22] – [23] applied Gillis-Mason Construction Co (Pty) Ltd v Overvaal Crushers (Pty) Ltd 1971 (1) SA 524 (T): dictum at 529 Hülse-Reutter and Another v HEG Consulting Enterprises (Pty) Ltd (Lane and Fey NNO Intervening) 1998 (2) SA 208 (C): referr......
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Pilot Freight (Pty) Ltd v Von Landsberg Trading (Pty) Ltd
...(SCA) ([2014] 1 All SA 294): dicta in paras [22] – [23] applied Gillis-Mason Construction Co (Pty) Ltd v Overvaal Crushers (Pty) Ltd 1971 (1) SA 524 (T): dictum at 529 Hülse-Reutter and Another v HEG Consulting Enterprises (Pty) Ltd (Lane and Fey NNO Intervening) 1998 (2) SA 208 (C): referr......
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Kalil v Decotex (Pty) Ltd and Another
...the Badenhorst case supra and also on English E authorities, eg Gillis-Mason Construction Co (Pty) Ltd v Overvaal Crushers (Pty) Ltd 1971 (1) SA 524 (T) at 529B - D. The South African statute, even though based on the corresponding English statute, is to be interpreted and applied primarily......
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Ex parte De Villiers and Another NNO: In re Carbon Developments (Pty) Ltd (In Liquidation)
...at H8; Ex parte Currie NO C 1966 (4) SA 546 (D) at 549G-H; Gillis-Mason Construction Co (Pty) Ltd v Overvaal Crushers (Pty) Ltd 1971 (1) SA 524 (T) at 528A-C; Holzman NO v Knights Engineering & Precision Works (Pty) Ltd 1979 (2) SA 784 (W) at 786E-788A; Henochsberg (op cit vol 2 at 594); Ba......
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Pilot Freight (Pty) Ltd v Von Landsberg Trading (Pty) Ltd
...(SCA) ([2014] 1 All SA 294): dicta in paras [22] – [23] applied Gillis-Mason Construction Co (Pty) Ltd v Overvaal Crushers (Pty) Ltd 1971 (1) SA 524 (T): dictum at 529 Hülse-Reutter and Another v HEG Consulting Enterprises (Pty) Ltd (Lane and Fey NNO Intervening) 1998 (2) SA 208 (C): referr......
-
Pilot Freight (Pty) Ltd v Von Landsberg Trading (Pty) Ltd
...(SCA) ([2014] 1 All SA 294): dicta in paras [22] – [23] applied Gillis-Mason Construction Co (Pty) Ltd v Overvaal Crushers (Pty) Ltd 1971 (1) SA 524 (T): dictum at 529 Hülse-Reutter and Another v HEG Consulting Enterprises (Pty) Ltd (Lane and Fey NNO Intervening) 1998 (2) SA 208 (C): referr......