Hülse-Reutter and Another v Heg Consulting Enterprises (Pty) Ltd (Lane and Fey NNO Intervening)

• Jurisdiction: South Africa
• Judge: Thring J
• Judgment Date: 15 August 1997
• Citation: 1998 (2) SA 208 (C)
• Docket Number: 8055/97
• Counsel: BK Pincus for the applicants No appearance for the respondent RS Van Riet (with him JA Van Der Westhuizen) for the intervening respondents
• Court: Cape Provincial Division

F Thring J:

I would have liked to have had more time to prepare this judgment, but because I have arrived at a firm conclusion as to what order I should make, and because I think that all the parties to this matter are anxious to avoid any further delay, I shall endeavour to give as clearly as I can, in the short time that has been at my disposal, G the reasons for my decision.

This is an application for a provisional winding-up order. The applicants are a married couple who describe themselves in their founding affidavits as being 'of' an address in Hamburg, Germany. The respondent is HEG Consulting Enterprises (Pty) Ltd, a company registered in accordance with the company laws of the Republic of H South Africa, with its registered office in Somerset West and its principal place of business at a house called 'Klaasenbosch' in Brommersvlei Road, Constantia. For the sake of convenience I shall refer to the respondent as 'the company' and to the house as 'the property'. The company does not oppose the application. However, two I parties have sought the leave of the Court to intervene as further respondents in this matter. They are the co-provisional trustees in the insolvent estate of a man called Jürgen Harksen, having been duly appointed as such pursuant to a provisional order of sequestration of Harksen's estate granted by this Court on 21 September 1995. The order was made final on 16 October 1995. Harksen's trustees also sought the authority of this Court so to J intervene,

Thring J

which is required by s 18(3) of the Insolvency Act 24 of 1936. On 11 August 1997, the first day of the hearing of A the matter, I granted them the necessary authority and leave to intervene after Mr Pincus, who appears for the applicants, had indicated that his clients were no longer persisting in their opposition to the granting of this relief. I shall refer to the intervening respondents as 'the trustees'. B

The company is a property-owning company. Inter alia, it owns the house 'Klaasenbosch'. It also owns shares in another property-owning company called Multi-Man (Edms) Bpk. The company's sole director is one Siegwart, a Swiss gentleman who resides abroad. Who, according to the company's records, is or are its shareholder or C shareholders is not stated in the papers before me, but it would appear to be averred by Harksen and certain others that the owner of its share capital is a certain Panamanian company called Imvesta Finance Inc, with which Siegwart has some connection.

Be that as it may, on 11 July 1997 this Court, presided over by my learned Brother Farlam, granted an order at the D instance of the trustees in case No 4840/96 declaring that, immediately prior to his sequestration, Harksen was the sole beneficial owner of all the company's shares. The learned Judge subsequently refused an application for leave to appeal against his order. I have been informed from the Bar by Mr Pincus that a petition to the Chief E Justice for leave to appeal against this order is in the offing. However, he submits that the decision of the application presently before me will not be affected by the outcome of any appeal which may eventuate in case No 4840/96. In any event, he indicated that he was prepared to argue this matter on the basis that the order made in that case would remain unaltered on appeal. Mr Pincus submitted that it would be undesirable for this application to be F postponed for a long time whilst the outcome of any possible appeal in the other case was awaited. I agree with him. The locus standi of the trustees to intervene is 'in the technical sense' and 'for the purpose of these proceedings' admitted by the first applicant in his replying affidavit. G

After initially entertaining some doubt in this connection, but particularly in the light of this admission by the first applicant, I decided to permit the matter to proceed, notwithstanding that my learned Brother Farlam's judgment may possibly become the subject of an appeal at some time in the future. This is because, even if that order should H be varied or set aside on appeal, the trustees would probably still have locus standi to intervene in the present matter on the basis that Harksen is probably a creditor of the company.

Section 346(1) of the Companies Act 61 of 1973 provides in its relevant parts as follows: I

'An application to the Court for the winding-up of a company may, subject to the provisions of this section, be made -

(a)

. . .

(b)

by one or more of its creditors (including contingent or prospective creditors);

. . . . ' J

Thring J

A The applicants claim to be creditors of the company. They allege that they have invested certain sums in the company, inter alia by means of loans made by them to it. The salient details averred by them in this regard are:

1.

A loan of 240 000 German marks made in July 1994. This was preceded, they say, by earlier loans B totalling 3 million German marks made by them to the company in October 1993, and subsequently ceded by them to a company of theirs called United Communications Corporation Ltd, to which I shall refer as 'UCC'. Because the loan for 3 million German marks is disputed by the trustees, they say, UCC C is not moving this application as co-applicant with them, although it supports their application.

2.

The disbursement by the applicants of R1 million on behalf of the company to its architects in July 1996 to settle the costs of certain improvements to the property. This was a loan to the company, they say.

3.

D The disbursement by the first applicant of sums amounting in all to R603 591 in payment of the costs of certain further improvements to the property and for the provision of furniture, fittings and décor. The first applicant says that, of this, he has been repaid R85 000, leaving a balance due to him by the E company of R518 591. He says that this, too, constitutes a loan to the company.

4.

The payment by the first applicant of various of the company's creditors in connection with yet more improvements made to the property after such creditors had instituted legal proceedings against the F company for the recovery thereof. The applicants say that the first applicant settled these claims and obtained cession thereof from the creditors concerned. The claims are:

(a)

R47 558,60, being the balance owing to a firm called Super Plants CC in respect of goods supplied and services rendered;

(b)

G R172 596,87 claimed by the company's architects in respect of fees and disbursements;

(c)

R61 947,57 claimed by a firm of quantity surveyors;

(d)

R21 816,80 claimed by a firm of landscape gardeners;

(e)

R27 399,00 claimed by a firm called Brickpave in respect of goods supplied and services rendered.

5.

H The disbursement by the first applicant of various amounts in respect of current expenditure on behalf of the company from October 1996 to date, totalling R46 658,67. These disbursements appear to include such things as telephone accounts, security guards' charges, etc.

6.

I The payment by the first applicant of substantial legal costs of the company incurred in respect of legal proceedings, the amount of which is not stated.

7.

The payment by the first applicant of premiums in respect of the insurance of the company's property in the sum of R37 513.

The applicants allege that the aggregate of their claims against the company, including interest accrued thereon, is J R3 323 857,10.

Thring J

The applicants also allege that the company owes money to a man called Johann Bergmann. On 21 May 1997 he A took out a judgment against the company by default of entry of appearance for various sums amounting in all to 1 740 000 German marks and, in addition, for R5 070 000 with interest thereon at 15% per annum from various dates. The property has since been attached by Bergmann in the execution of this judgment. B

That the applicants, or either of them, are, in fact, creditors of the company is in dispute. It is disputed by the trustees. They maintain that none of the claims alleged by the applicants against the company really exist. They allege that this application is mala fide, is an abuse of the process of this Court and has been brought with the C ulterior purpose, as they put it in their opposing affidavit, of

'12.1

frustrating us in the event of us being successful in case No 4840/96 by precluding us from dealing with the affairs and assets of HEG once we have obtained the shares, and

12.2

permitting the insolvent Jürgen Harksen to continue his occupation of Klaasenbosch for as long as possible'. D

(The first intervening trustee deposed to an opposing affidavit, the contents of which the second intervening trustee confirmed insofar as they fall within her knowledge. For the sake of convenience I shall refer to the first intervening trustee's affidavit as 'the affidavit of the trustees'.) They say further: E

'9. We dispute the alleged claims of Hans and Simone Hülse-Reutter, their company United Communications Corporation Ltd ("UCC") and Bergmann against HEG alluded to by Hülse-Reutter in his founding affidavit in the present application. We maintain that HEG is not insolvent nor is it in the interests of creditors of HEG that it be placed in liquidation. We have for F many months made our intention clear that, if we are successful in case No 4840/96, we will dispute and resist these alleged claims against HEG.'

In further explanation of their attitude, the trustees proceed as follows in their opposing affidavit:

'20. Harksen and Siegwart allege that Klaasenbosch was purchased by Siegwart's Panamanian company Imvesta through the medium of HEG and that Imvesta (and not Harksen) was always and remains the true shareholder of HEG. A great G many objective facts placed before this honourable Court by...