G Walker Engineering CC t/a Atlantic Steam Services v First Garment Rental (Pty) Ltd (2011 (5) SA 14 (WCC)) [2011] ZAWCHC 261; 7405/2006 (9 June 2011)

G Walker Engineering CC t/a Atlantic Steam Services v First Garment Rental (Pty) Ltd (2011 (5) SA 14 (WCC)) [2011] ZAWCHC 261; 7405/2006 (9 June 2011)

The court held that the deregistration of the plaintiff close corporation resulted in its legal non-existence, precluding the application of rule 39(3) for default judgment. Striking the matter from the roll would not resolve the prejudice to the defendant, as re-registration could revive the action at any time. The court found that the proper procedure would be to give notice to the Minister of Finance, as the state's rights vest upon deregistration, and allow for substitution under rule 15. Since this was not done, the court postponed the matter to allow the defendant to serve notice on the Minister, enabling the state to decide whether to prosecute the action. If no appearance is made...

Citation
[2011] ZAWCHC 261
Parties
Plaintiff: G Walker Engineering CC t/a Atlantic Steam Services; Defendant: First Garment Rental (Pty) Ltd (Cape)
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
9 June 2011
Case Number
7405/2006
Procedural Posture
Civil Trial / Trial Called; Plaintiff Deregistered; Matter Postponed
Outcome
The matter is postponed to 1 August 2011 for the trial to be called in the Third Division, with directions for notice to be served on the Minister of Finance for possible substitution as plaintiff.
Judges
A.G. Binns-Ward
Legal Topics
Deregistration of Close Corporation, Absolution From the Instance, Rule 15 Substitution, Rule 39 Default Judgment
Civil Procedure Commercial and Corporate Deregistration of Close Corporation Absolution From the Instance Rule 15 Substitution Rule 39 Default Judgment

Case Brief

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Parties

G Walker Engineering CC t/a Atlantic Steam Services

Plaintiff

First Garment Rental (Pty) Ltd (Cape)

Defendant

Procedural Posture

Civil Trial / Trial Called; Plaintiff Deregistered; Matter Postponed

Legal Issues

  1. 1 What is the effect of the plaintiff close corporation's deregistration on the pending action.
  2. 2 Is it appropriate to grant absolution from the instance or to strike the matter from the roll.
  3. 3 What procedural steps are required to dispose of the action when the plaintiff no longer exists.

Ratio Decidendi

The court held that the deregistration of the plaintiff close corporation resulted in its legal non-existence, precluding the application of rule 39(3) for default judgment. Striking the matter from the roll would not resolve the prejudice to the defendant, as re-registration could revive the action at any time. The court found that the proper procedure would be to give notice to the Minister of Finance, as the state's rights vest upon deregistration, and allow for substitution under rule 15. Since this was not done, the court postponed the matter to allow the defendant to serve notice on the Minister, enabling the state to decide whether to prosecute the action. If no appearance is made...

Court Disposition

The matter is postponed to 1 August 2011 for the trial to be called in the Third Division, with directions for notice to be served on the Minister of Finance for possible substitution as plaintiff.

Orders

  • The matter is postponed to 1 August 2011 for the trial of the action to be called in the Third Division, there to be disposed of as contemplated in paragraph [9] of this judgment.