ABSA Bank Limited v Hammerle Group (Pty) Ltd (7457/13) [2013] ZAGPPHC 369 (20 December 2013)

ABSA Bank Limited v Hammerle Group (Pty) Ltd (7457/13) [2013] ZAGPPHC 369 (20 December 2013)

The court found that the applicant's claim under the loan agreement became due and payable upon acceleration on 24 November 2009. The debt arose from the loan agreement, not the notarial bond, and thus the applicable prescription period is three years under section 11(d) of the Prescription Act. The claim was not interrupted and has prescribed. The notarial bond did not constitute an independent source of indebtedness. The amount advanced under the Subscription and Shareholders Agreement is subordinated to other creditors and is not yet due and payable. The respondent's settlement proposal letter is privileged and inadmissible. The application for liquidation fails as the applicant is no...

Citation
[2013] ZAGPPHC 369
Parties
Applicant: ABSA Bank Limited; Respondent: Hammerle Group (Pty) Ltd
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
20 December 2013
Case Number
7457/13
Procedural Posture
Liquidation Application / Final Judgment
Outcome
Application for liquidation dismissed with costs; rectification of loan agreement granted; application to strike out privileged material granted.
Judges
P.M. Mabuse
Legal Topics
Prescription Act, Notarial Bond, Loan Agreement, Company Liquidation, Rectification of Contract, Subordination Agreement
Banking and Finance Civil Procedure Commercial and Corporate Prescription Act Notarial Bond Loan Agreement Company Liquidation Rectification of Contract +1 more

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Parties

ABSA Bank Limited

Applicant

Hammerle Group (Pty) Ltd

Respondent

Procedural Posture

Liquidation Application / Final Judgment

Legal Issues

  1. 1 Whether the applicant's claim under the loan agreement has prescribed.
  2. 2 Whether the debt is secured by a notarial bond and the applicable prescription period.
  3. 3 Whether the respondent is unable to pay its debts for purposes of liquidation.

Ratio Decidendi

The court found that the applicant's claim under the loan agreement became due and payable upon acceleration on 24 November 2009. The debt arose from the loan agreement, not the notarial bond, and thus the applicable prescription period is three years under section 11(d) of the Prescription Act. The claim was not interrupted and has prescribed. The notarial bond did not constitute an independent source of indebtedness. The amount advanced under the Subscription and Shareholders Agreement is subordinated to other creditors and is not yet due and payable. The respondent's settlement proposal letter is privileged and inadmissible. The application for liquidation fails as the applicant is no...

Court Disposition

Application for liquidation dismissed with costs; rectification of loan agreement granted; application to strike out privileged material granted.

Orders

  • The application for rectification of clause 2.1.2 of the loan agreement is granted.
  • The respondent's application to strike out paragraphs 78 to 79 of the founding affidavit, annexure 'FA19' to the founding affidavit, and paragraph 37.3 of the replying affidavit is granted.