Cooper NO and Others v Micromatica 324 (Pty) Ltd and Others (4182/2015) [2016] ZAWCHC 148 (10 October 2016)

Cooper NO and Others v Micromatica 324 (Pty) Ltd and Others (4182/2015) [2016] ZAWCHC 148 (10 October 2016)

The court held that the power to appoint liquidators for companies in liquidation is reserved for the master of the High Court under section 367 of the Companies Act 1973. Section 20(9) of the Companies Act 2008 does not confer upon the court the authority to appoint liquidators; it merely allows for the piercing of the corporate veil and the granting of consequential relief. The 8 July 2014 order did not constitute the appointment of liquidators in the sense contemplated by chapter 14 of the 1973 Act, but rather arranged the administration of rights and obligations among the companies, reflecting their consolidated status as a single entity for liquidation purposes. The Div-Prop...

Citation
[2016] ZAWCHC 148
Parties
Applicant: Chavonnes Badenhorst St Clair Cooper N O; Applicant: Johann Demetrius Appies N O; Applicant: Sadeck Zhaum Ahmed N O; Respondent: Micromatica 324 (Pty) Ltd and 135 Others; Appellant: City Capital SA Property Holding Limited; Appellant: M Janse van Rensburg; Appellant: W S Smith; Appellant: The Trustees for the time being of the O’Neille Family Trust; Appellant: V T Fernhout
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
10 October 2016
Case Number
4182/2015
Procedural Posture
Civil Application / Counter Application by Intervening Party to Set Aside Previous Court Orders Appointing Liquidators and Related Relief.
Outcome
Counter-application dismissed with costs, including costs of two counsel.
Judges
Van Rooyen AJ
Legal Topics
Appointment of Liquidators, Piercing Corporate Veil, Business Rescue, Companies Act Interpretation, Master of High Court Powers
Commercial and Corporate Civil Procedure Appointment of Liquidators Piercing Corporate Veil Business Rescue Companies Act Interpretation Master of High Court Powers

Case Brief

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Parties

Chavonnes Badenhorst St Clair Cooper N O

Applicant

Johann Demetrius Appies N O

Applicant

Sadeck Zhaum Ahmed N O

Applicant

Micromatica 324 (Pty) Ltd and 135 Others

Respondent

City Capital SA Property Holding Limited

Appellant

M Janse van Rensburg

Appellant

W S Smith

Appellant

The Trustees for the time being of the O’Neille Family Trust

Appellant

V T Fernhout

Appellant

Procedural Posture

Civil Application / Counter Application by Intervening Party to Set Aside Previous Court Orders Appointing Liquidators and Related Relief.

Legal Issues

  1. 1 Whether the court had the authority to appoint liquidators for the Dividend Investment Scheme, or whether this power is reserved exclusively for the master of the High Court.
  2. 2 Whether the 8 July 2014 and 3 December 2014 orders appointing liquidators should be set aside as a nullity.
  3. 3 How the Companies Act 71 of 2008 and Companies Act 61 of 1973 interact regarding the appointment of liquidators.

Ratio Decidendi

The court held that the power to appoint liquidators for companies in liquidation is reserved for the master of the High Court under section 367 of the Companies Act 1973. Section 20(9) of the Companies Act 2008 does not confer upon the court the authority to appoint liquidators; it merely allows for the piercing of the corporate veil and the granting of consequential relief. The 8 July 2014 order did not constitute the appointment of liquidators in the sense contemplated by chapter 14 of the 1973 Act, but rather arranged the administration of rights and obligations among the companies, reflecting their consolidated status as a single entity for liquidation purposes. The Div-Prop...

Court Disposition

Counter-application dismissed with costs, including costs of two counsel.

Orders

  • The application of City Capital SA Property Holdings Ltd for striking out parts of the applicants’ answering affidavit is dismissed with costs, including costs of two counsel.
  • The counter-application of City Capital SA Property Holdings Ltd for relief in paragraphs 3.1 and 3.2 of the notice of counter-application is dismissed with costs, including costs of two counsel.