GCC Engineering (Pty) Ltd and Others v Maroos and Others (901/2017) [2018] ZASCA 178; 2019 (2) SA 379 (SCA) (3 December 2018)

GCC Engineering (Pty) Ltd and Others v Maroos and Others (901/2017) [2018] ZASCA 178; 2019 (2) SA 379 (SCA) (3 December 2018)

The Supreme Court of Appeal held that section 131(6) of the Companies Act 71 of 2008 suspends only the process of liquidation proceedings, not the winding-up order itself or the appointment and powers of provisional liquidators. The directors of a company in liquidation lose their management powers, which do not revert to them during the suspension period. There is no statutory or common law basis for re-vesting control and management in the directors once a winding-up order has been granted. The Master of the High Court has no role in business rescue proceedings and cannot be required to oversee a manager appointed by the court. The orders of the court a quo that purported to appoint a...

Citation
[2018] ZASCA 178
Parties
Appellant: GCC Engineering (Pty) Ltd; Appellant: Gert Louwrens Steyn de Wet NO; Appellant: Frans Langford NO; Appellant: Kgashane Christopher Monyela NO; Appellant: Ecsponent Investment Holdings (Pty) Ltd; Appellant: Master of the High Court; Respondent: Lawrence Maroos; Respondent: Zetaboa Trading; Respondent: All other third to sixty-first respondent applicants as set out in the notice of motion in the main application; Respondent: GCC Engineering (Pty) Ltd; Respondent: Mahomed Yaseen Camisa NO; Respondent: The Companies and Intellectual Property Commission
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
3 December 2018
Case Number
901/2017
Procedural Posture
Civil Appeal / Appeal From Gauteng Division of the High Court, Pretoria
Outcome
Appeal upheld. Orders of the court a quo set aside and substituted.
Judges
Cachalia, Seriti, Molemela, Schippers, Mothle
Legal Topics
Business Rescue, Liquidation Proceedings, Powers of Liquidators, Companies Act, Role of Master, Director Management
Commercial and Corporate Civil Procedure Business Rescue Liquidation Proceedings Powers of Liquidators Companies Act Role of Master Director Management

Case Brief

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Parties

GCC Engineering (Pty) Ltd

Appellant

Gert Louwrens Steyn de Wet NO

Appellant

Frans Langford NO

Appellant

Kgashane Christopher Monyela NO

Appellant

Ecsponent Investment Holdings (Pty) Ltd

Appellant

Master of the High Court

Appellant

Lawrence Maroos

Respondent

Zetaboa Trading

Respondent

All other third to sixty-first respondent applicants as set out in the notice of motion in the main application

Respondent

GCC Engineering (Pty) Ltd

Respondent

Mahomed Yaseen Camisa NO

Respondent

The Companies and Intellectual Property Commission

Respondent

Procedural Posture

Civil Appeal / Appeal From Gauteng Division of the High Court, Pretoria

Legal Issues

  1. 1 Whether the appointment and powers of provisional liquidators are suspended under section 131(6) of the Companies Act 71 of 2008.
  2. 2 Whether control and management of a company in liquidation can be re-vested in its director.
  3. 3 Whether the Master of the High Court has any role in business rescue proceedings.

Ratio Decidendi

The Supreme Court of Appeal held that section 131(6) of the Companies Act 71 of 2008 suspends only the process of liquidation proceedings, not the winding-up order itself or the appointment and powers of provisional liquidators. The directors of a company in liquidation lose their management powers, which do not revert to them during the suspension period. There is no statutory or common law basis for re-vesting control and management in the directors once a winding-up order has been granted. The Master of the High Court has no role in business rescue proceedings and cannot be required to oversee a manager appointed by the court. The orders of the court a quo that purported to appoint a...

Court Disposition

Appeal upheld. Orders of the court a quo set aside and substituted.

Orders

  • The appeal is upheld.
  • The first and second respondents are ordered to pay the costs of this appeal on an attorney and client scale, including the costs of two counsel where so employed, jointly and severally, the one paying the other to be absolved.