Daag Investments CC and Others v Sheriff of Roodepoort and Others (2015/19426) [2016] ZAGPJHC 286 (14 October 2016)

Daag Investments CC and Others v Sheriff of Roodepoort and Others (2015/19426) [2016] ZAGPJHC 286 (14 October 2016)

The court found that the Sheriff failed to comply with the clear requirements of sections 34 and 34A of the Close Corporations Act by not offering Lansdell's 25% member's interest in Daag Investments CC to the corporation or its existing members before selling it to a third party. This non-compliance rendered both the sale in execution and the attachment invalid. The opposition by the second and third respondents was unwarranted, as the statutory provisions were unambiguous and their eventual concession confirmed the applicants' position. The respondents' resistance caused unnecessary costs for the applicants, justifying a costs order against them.

Citation
[2016] ZAGPJHC 286
Parties
Applicant: Daag Investments CC; Applicant: Dale Shafer; Applicant: Steven Karp; Respondent: Sheriff of Roodepoort; Respondent: Mike Trenchard; Respondent: Trebelin Investments (Pty) Ltd; Respondent: Anthony John Joseph; Respondent: Krishna Periasamy Naicker
Court
South Gauteng High Court, Johannesburg
Jurisdiction
South Africa
Judgment Date
14 October 2016
Case Number
2015/19426
Procedural Posture
Review Application / Reasons for Judgment Following Ex Tempore Order
Outcome
Application dismissed with costs; sale in execution and attachment set aside.
Judges
VALLY
Legal Topics
Close Corporations Act, Sale in Execution, Member Interest Attachment, Costs Award, Pre Emptive Rights
Civil Procedure Commercial and Corporate Close Corporations Act Sale in Execution Member Interest Attachment Costs Award Pre Emptive Rights

Case Brief

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Parties

Daag Investments CC

Applicant

Dale Shafer

Applicant

Steven Karp

Applicant

Sheriff of Roodepoort

Respondent

Mike Trenchard

Respondent

Trebelin Investments (Pty) Ltd

Respondent

Anthony John Joseph

Respondent

Krishna Periasamy Naicker

Respondent

Procedural Posture

Review Application / Reasons for Judgment Following Ex Tempore Order

Legal Issues

  1. 1 Whether the sale in execution of Anthony Brian Lansdell's 25% member's interest in Daag Investments CC complied with sections 34 and 34A of the Close Corporations Act.
  2. 2 Whether the Sheriff was required to offer the member's interest to existing members before selling to a third party.
  3. 3 Whether the opposition to the application by the second and third respondents was warranted and justified.

Ratio Decidendi

The court found that the Sheriff failed to comply with the clear requirements of sections 34 and 34A of the Close Corporations Act by not offering Lansdell's 25% member's interest in Daag Investments CC to the corporation or its existing members before selling it to a third party. This non-compliance rendered both the sale in execution and the attachment invalid. The opposition by the second and third respondents was unwarranted, as the statutory provisions were unambiguous and their eventual concession confirmed the applicants' position. The respondents' resistance caused unnecessary costs for the applicants, justifying a costs order against them.

Court Disposition

Application dismissed with costs; sale in execution and attachment set aside.

Orders

  • The sale in execution of Anthony Brian Lansdell's 25% member's interest in Daag Investments CC, conducted by the Sheriff of Roodepoort on 2 April 2015, is set aside.
  • The attachment of Anthony Brian Lansdell's 25% member's interest in Daag Investments CC is set aside.