Imperial Bank Ltd v Barnard and Others NNO

• Jurisdiction: South Africa
• Citation: 2013 (5) SA 612 (SCA)

Imperial Bank Ltd v Barnard and Others NNO
2013 (5) SA 612 (SCA)

2013 (5) SA p612

Citation	2013 (5) SA 612 (SCA)
Case No	349/12; [2013] ZASCA 42
Court	Supreme Court of Appeal
Judge	Mpati P, Cachalia JA, Pillay JA, Schoeman AJA and Saldulker AJA
Heard	February 22, 2013
Judgment	March 28, 2013
Counsel	PG Robinson SC (with A Botha) for the appellant.; WJ Vermeulen SC for the respondents.

Flynote : Sleutelwoorde B

Company — Winding-up — Liquidator — Proceedings by and against — Citation — Proceedings brought by liquidator on behalf of company must be brought C in name of company — However, particulars of proceedings brought by liquidator in own name may, where clear that acting in representative capacity, be corrected by addition of name of company as plaintiff — Companies Act 61 of 1973, s 386(4)(a).

Headnote : Kopnota

The respondents' particulars, by which they instituted action against the D appellant bank in their representative capacities as the liquidators of a close corporation, cited them in their own names, followed by the letters 'NO'. After their names there appeared the words 'in their representative capacities as the joint liquidators in the estate of' the CC. The bank argued that the citation did not comply with s 386(4) of the Companies Act 61 of 1973, under which liquidators could 'bring or defend in the name and on behalf E of the company any action or other legal proceedings of a civil nature'.

The liquidators in response filed a notice of intention to amend their particulars by citing the CC as the plaintiff, represented by the liquidators nomine officio. The bank objected on the ground that since the liquidators lacked locus standi to issue summons in their own names, the service of the combined summons had not stayed prescription of their claim. Accordingly F the bank argued that the introduction of a new plaintiff would deprive it of a defence of prescription. The high court, holding that the liquidators were entitled to sue nomine officio, allowed the amendment.

Held: Although an application for amendment of particulars would not be allowed where it defeated a claim of prescription by introducing a new cause of action or new parties, in the present case the summons made it clear that G the liquidators were representing the CC and not acting in their personal capacities. The amendment granted by the high court did not have the effect of substituting the plaintiff, but merely corrected the misnomer in the particulars, and the claim sought to be enforced in the original summons and particulars of claim remained the same after the amendment. Prescription was interrupted by the service of summons and the question of H prejudice did not arise. Appeal dismissed. (Paragraphs [8] and [16] – [19] at 616B/C – F and 620C – 621E.)

Cases Considered

Annotations

Case law

Airborne Express CC v Van den Heever NO (WLD case No 05/18568): referred to I

Associated Paint & Chemical Industries (Pty) Ltd t/a Albestra Paint and Lacquers v Smit 2000 (2) SA 789 (SCA): compared and dictum in para [13] applied

Barnard and Others NNO v Imperial Bank Ltd and Another 2012 (5) SA 542 (GSJ): J approved on appeal

2013 (5) SA p613

Churchill v Standard General Insurance Co Ltd 1977 (1) SA 506 (A): dictum A at 517B – C applied

De Villiers and Others NNO v Electronic Media Network (Pty) Ltd 1991 (2) SA 180 (W): distinguished

Devonia Shipping Ltd v MV Luis (Yeoman Shipping Co Ltd Intervening) 1994 (2) SA 363 (C): dictum at 369F – I applied

Dumasi v Commissioner, Venda Police 1990 (1) SA 1068 (V): dictum at B 1071B – D applied

Fey NO and Another v Lala Govan Exporters (Pty) Ltd 2011 (6) SA 181 (W): referred to

Four Tower Investments (Pty) Ltd v André's Motors 2005 (3) SA 39 (N): dictum in paras [15] – [16] applied

Fundstrust (Edms) Bpk (in Likwidasie) v Marais en Andere 1997 (3) SA 470 (C): C referred to

Letsitele Stores (Pty) Ltd v Roets and Others 1958 (2) SA 224 (T): referred to

Neon and Cold Cathode Illuminations (Pty) Ltd v Ephron 1978 (1) SA 463 (A): applied

Rosner v Lydia Swanepoel Trust 1998 (2) SA 123 (W): compared

Sentrachem Ltd v Prinsloo 1997 (2) SA 1 (A): dictum at 15J – 16D applied D

Shepstone & Wylie and Others v Geyser NO 1998 (1) SA 354 (N): referred to

Trans-African Insurance Co Ltd v Maluleka 1956 (2) SA 273 (A): dictum at 279A – B applied.

Statutes Considered

Statutes

The Companies Act 61 of 1973, s 386(4)(a): see Juta's Statutes of South Africa E 2012/13 vol 2 at 1-212.

Case Information

PG Robinson SC (with A Botha) for the appellant.

WJ Vermeulen SC for the respondents.

An appeal against a decision in the South Gauteng High Court, Johannesburg (Weiner J), reported at 2012 (5) SA 542 (GSJ). F

Order

The appeal is dismissed, with costs.

Judgment

Mpati P (Cachalia JA, Pillay JA, Schoeman AJA and Saldulker AJA concurring): G

[1] On 3 August 2007 the respondents, acting in their representative capacities as the duly appointed joint liquidators in the estate of Pro Med Construction CC (in liquidation) [1] (Pro Med), instituted action against the appellant, as first defendant, and Land for Africa (Pty) Ltd (Land for H Africa), as second defendant, claiming payment, from the appellant, of an amount of R25 million, together with interest and costs of suit. The amount claimed was said to be 'in lieu of transfer' of certain fixed property allegedly purchased by Pro Med, prior to its liquidation, from the appellant, in terms of an agreement of purchase and sale concluded on 27 February 2003. Subsequent to the conclusion of that agreement I the appellant apparently sold the property to Land for Africa. However, no order was sought against Land for Africa, which, consequently, does not feature in this appeal.

2013 (5) SA p614

Mpati P (Cachalia JA, Pillay JA, Schoeman AJA and Saldulker AJA concurring)

A [2] In the particulars of claim the first respondent is described as 'Hendrick Jacobus Rust Barnard, an adult male liquidator and practising attorney . . .'. The rest of the liquidators are also cited in their own names and the fourth and fifth respondents are similarly described as adult male and female liquidators and practising attorneys respectively, B while the second and third respondents are described as adult male liquidators practising as such. While admitting the names of the respondents the appellant has denied in its plea, which was delivered on 13 November 2007, that the respondents are 'properly cited in compliance with the provisions of s 386(4) of the Companies Act 61 of 1973 (the Act), or that they are entitled to bring [the] action in their own C name'. Section 386(4)(a) of the Act, which applies to the liquidation of close corporations by virtue of the provisions of s 66 of the Close Corporations Act 69 of 1984, empowers liquidators —

'to bring or defend in the name and on behalf of the company any action D or other legal proceedings of a civil nature . . .'.

[3] On 17 February 2011 the respondents served on the appellant a notice of intention to amend their particulars of claim 'in the following respects':

'Replacing paragraphs 1.1 to 1.5 of their particulars of claim with the E following: —

"1.

The Plaintiff is Pro Med Construction CC (In Liquidation) (Pro Med), Master's reference G2750/04 duly represented herein by: —

1.1

Hendrik Jacobus Rust Barnard NO,

1.2

Norman Klein NO

1.3

F Farouk Sharief NO

1.4

Themba Benedict Langa NO

1.5

Itumeleng Brenda Mohale NO

who bring this action in the name and on behalf of Pro Med pursuant to the provisions of section 386(4) of the Companies Act 61 of 1973.'

G The appellant objected to the proposed amendment on the basis that the notice of intention to amend was served more than three years after the debt became due; that Pro Med's claim had become prescribed in terms of s 11 of the Prescription Act 68 of 1969 (the Prescription Act) and that it would be prejudiced (in the sense that it would be deprived of the H opportunity to raise the defence of prescription) were Pro Med to be substituted 'as the new plaintiff for the existing plaintiffs', being the respondents. The respondents thereafter sought leave from the court a quo to effect the proposed amendment. On 1 November 2011, and despite the appellant's opposition, the court (Weiner J) granted the I amendment. This appeal is with its leave.

[4] There are two issues in the appeal. The first, raised by the respondents, is whether the order granting the amendment is purely interlocutory and thus not appealable. The second is whether the amendment amounted to a substitution of parties or whether it merely involved a J correction of a misdescription of the plaintiff. Although it appears to me,

2013 (5) SA p615

Mpati P (Cachalia JA, Pillay JA, Schoeman AJA and Saldulker AJA concurring)

at least prima facie, that the order...