Hendricks NO and Others v Cape Kingdom (Pty) Ltd (14432/08) [2009] ZAWCHC 189; 2010 (5) SA 274 (WCC) (7 December 2009)

Hendricks NO and Others v Cape Kingdom (Pty) Ltd (14432/08) [2009] ZAWCHC 189; 2010 (5) SA 274 (WCC) (7 December 2009)

The court held that while the statutory requirements for service under s 346(4A)(a)(ii) and s 346A of the Companies Act are peremptory, substantial compliance is sufficient if the legislative purpose—ensuring employees are notified of the winding-up application—is achieved. In this case, personal service was effected on all identified employees, and further attempts were made to notify those at different premises. The court found that literal compliance would have been futile and that the steps taken by the applicants fulfilled the object of the statute. Therefore, the provisional order for winding-up was properly granted, and a final order should be made.

Citation
[2009] ZAWCHC 189
Parties
Applicant: Fadel Hendricks N.O.; Applicant: Iqbal Surve N.O.; Applicant: Johannes Hendrikus de Loor N.O.; Applicant: Gatsha Mazithulela N.O.; Applicant: Neil Stockinstrom Gardiner N.O.; Applicant: Nigel Gwynne-Evans N.O.; Applicant: Susan Therese Largier Harrison N.O.; Respondent: Cape Kingdom (Pty) Ltd
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
7 December 2009
Case Number
14432/08
Procedural Posture
Winding Up Application / Extended Return Day for Final Liquidation Order
Outcome
Final winding-up order granted; costs to be costs in the winding-up; no costs order against Stander personally.
Judges
Sholto-Douglas
Legal Topics
Winding Up of Company, Service of Process, Substantial Compliance, Notice to Employees, Companies Act 1973
Commercial and Corporate Civil Procedure Winding Up of Company Service of Process Substantial Compliance Notice to Employees Companies Act 1973

Case Brief

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Parties

Fadel Hendricks N.O.

Applicant

Iqbal Surve N.O.

Applicant

Johannes Hendrikus de Loor N.O.

Applicant

Gatsha Mazithulela N.O.

Applicant

Neil Stockinstrom Gardiner N.O.

Applicant

Nigel Gwynne-Evans N.O.

Applicant

Susan Therese Largier Harrison N.O.

Applicant

Cape Kingdom (Pty) Ltd

Respondent

Procedural Posture

Winding Up Application / Extended Return Day for Final Liquidation Order

Legal Issues

  1. 1 Whether the provisional order of liquidation should be set aside due to non-compliance with s 346(4A)(a)(ii) of the Companies Act 61 of 1973.
  2. 2 Whether the granting of a final order of liquidation should be refused, postponed, or otherwise dealt with due to alleged non-compliance with s 346A of the Companies Act.

Ratio Decidendi

The court held that while the statutory requirements for service under s 346(4A)(a)(ii) and s 346A of the Companies Act are peremptory, substantial compliance is sufficient if the legislative purpose—ensuring employees are notified of the winding-up application—is achieved. In this case, personal service was effected on all identified employees, and further attempts were made to notify those at different premises. The court found that literal compliance would have been futile and that the steps taken by the applicants fulfilled the object of the statute. Therefore, the provisional order for winding-up was properly granted, and a final order should be made.

Court Disposition

Final winding-up order granted; costs to be costs in the winding-up; no costs order against Stander personally.

Orders

  • The provisional order for the winding-up of the respondent is made final.
  • The costs incurred by the applicants, including the costs of two counsel, are to be costs in the winding up of the respondent.