Absa Bank Limited v Marotex (Pty) Ltd and Others (1046/15) [2016] ZAGPPHC 1190 (28 October 2016)

Absa Bank Limited v Marotex (Pty) Ltd and Others (1046/15) [2016] ZAGPPHC 1190 (28 October 2016)

The court found that the applicant could not rely on section 130 to seek conversion to liquidation, as the business rescue plan had already been adopted in terms of section 152. The alleged misrepresentations in the plan did not invalidate its adoption, and the applicant's recourse lay in seeking removal of the practitioners under section 139, not in setting aside the plan or converting to liquidation. The business rescue practitioners' counter-application for conversion to liquidation failed due to non-compliance with notification requirements and lack of reasonable grounds. The fifth to seventh respondents succeeded in their application for removal of the practitioners, as the...

Citation
[2016] ZAGPPHC 1190
Parties
Applicant: Absa Bank Limited; Respondent: Marotex (Pty) Ltd; Respondent: W K Cawood N.O; Respondent: J C Beer N.O; Respondent: The Body Corporation of Harmony Village; Respondent: Ruth Rose Makiwane; Respondent: Mvuyo Mvelase Ndziba; Respondent: Lindelwa Nobantu Ndziba; Respondent: Deborah Lovell Harding
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
28 October 2016
Case Number
1046/15
Procedural Posture
Urgent Application / Judgment on Main Application and Counter Applications
Outcome
Main application and application to amend dismissed; counter-application of practitioners dismissed; fifth to seventh respondents' application for removal of practitioners succeeds; costs awarded to fifth to seventh respondents.
Judges
Hughes
Legal Topics
Business Rescue, Winding Up, Locus Standi, Misrepresentation, Removal of Practitioner
Commercial and Corporate Civil Procedure Business Rescue Winding Up Locus Standi Misrepresentation Removal of Practitioner

Case Brief

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Parties

Absa Bank Limited

Applicant

Marotex (Pty) Ltd

Respondent

W K Cawood N.O

Respondent

J C Beer N.O

Respondent

The Body Corporation of Harmony Village

Respondent

Ruth Rose Makiwane

Respondent

Mvuyo Mvelase Ndziba

Respondent

Lindelwa Nobantu Ndziba

Respondent

Deborah Lovell Harding

Respondent

Procedural Posture

Urgent Application / Judgment on Main Application and Counter Applications

Legal Issues

  1. 1 Whether the business rescue proceedings of the first respondent should be converted to liquidation proceedings.
  2. 2 Whether the adopted amended business rescue plan was validly adopted and binding.
  3. 3 Whether the seventh respondent and erstwhile management had locus standi to represent the first respondent.

Ratio Decidendi

The court found that the applicant could not rely on section 130 to seek conversion to liquidation, as the business rescue plan had already been adopted in terms of section 152. The alleged misrepresentations in the plan did not invalidate its adoption, and the applicant's recourse lay in seeking removal of the practitioners under section 139, not in setting aside the plan or converting to liquidation. The business rescue practitioners' counter-application for conversion to liquidation failed due to non-compliance with notification requirements and lack of reasonable grounds. The fifth to seventh respondents succeeded in their application for removal of the practitioners, as the...

Court Disposition

Main application and application to amend dismissed; counter-application of practitioners dismissed; fifth to seventh respondents' application for removal of practitioners succeeds; costs awarded to fifth to seventh respondents.

Orders

  • The main application and the application to amend of the applicant are dismissed with costs.
  • The counter application of the second and third respondents is dismissed.