Investec Bank Bpk en Anders v Scholtz NO; Investec Bank Bpk en Anders v Scholtz NO; Investec Bank Bpk en Anders v Scholtz NO (3056/2011, 3057/2011, 3058/2011) [2011] ZAFSHC 208 (15 December 2011)

Investec Bank Bpk en Anders v Scholtz NO; Investec Bank Bpk en Anders v Scholtz NO; Investec Bank Bpk en Anders v Scholtz NO (3056/2011, 3057/2011, 3058/2011) [2011] ZAFSHC 208 (15 December 2011)

The court found that the requirements for service on employees under the Insolvency Act were met, as notices were affixed at premises accessible to employees, and any procedural irregularity was merely formal and did not result in substantial injustice. The trust deeds of Rocklands Trust and Barkly Road Trust did not restrict the trustees' authority to bind the trusts as sureties, except for a requirement of unanimous resolution in Rocklands Trust, which was not disputed. All relevant suretyships were enforceable, and the trusts were liable for the full indebtedness to Investec. The trusts' liabilities far exceeded their assets, establishing factual insolvency. The court held that...

Citation
[2011] ZAFSHC 208
Parties
Applicant: Investec Bank Beperk; Applicant: Luke Bernard Saffy N.O.; Applicant: Chavonnes Badenhorst St.Clair Cooper N.O.; Applicant: Donovan Theodore Majiedt N.O.; Applicant: Allan David Pellow N.O.; Applicant: Eugene Frederick Saffy N.O.; Respondent: Andrew George Scholtz N.O.; Respondent: Andrew George Scholtz
Court
Free State High Court, Bloemfontein
Jurisdiction
South Africa
Judgment Date
15 December 2011
Case Number
3056/2011, 3057/2011, 3058/2011
Procedural Posture
Civil Application / Return Day of Provisional Sequestration Orders; Determination of Final Sequestration
Outcome
Final sequestration orders granted in favour of Investec; costs awarded as requested.
Judges
C.H.G. van der Merwe, R
Legal Topics
Sequestration, Insolvency, Suretyship, Trustee Powers, Compliance With Statutory Requirements
Civil Procedure Banking and Finance Sequestration Insolvency Suretyship Trustee Powers Compliance With Statutory Requirements

Case Brief

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Parties

Investec Bank Beperk

Applicant

Luke Bernard Saffy N.O.

Applicant

Chavonnes Badenhorst St.Clair Cooper N.O.

Applicant

Donovan Theodore Majiedt N.O.

Applicant

Allan David Pellow N.O.

Applicant

Eugene Frederick Saffy N.O.

Applicant

Andrew George Scholtz N.O.

Respondent

Andrew George Scholtz

Respondent

Procedural Posture

Civil Application / Return Day of Provisional Sequestration Orders; Determination of Final Sequestration

Legal Issues

  1. 1 Whether the statutory requirements for service on employees under the Insolvency Act were complied with.
  2. 2 Whether the estates of Rocklands Trust and Barkly Road Trust are factually insolvent.
  3. 3 Whether the trustees were authorised by the trust deeds to bind the trusts as sureties.

Ratio Decidendi

The court found that the requirements for service on employees under the Insolvency Act were met, as notices were affixed at premises accessible to employees, and any procedural irregularity was merely formal and did not result in substantial injustice. The trust deeds of Rocklands Trust and Barkly Road Trust did not restrict the trustees' authority to bind the trusts as sureties, except for a requirement of unanimous resolution in Rocklands Trust, which was not disputed. All relevant suretyships were enforceable, and the trusts were liable for the full indebtedness to Investec. The trusts' liabilities far exceeded their assets, establishing factual insolvency. The court held that...

Court Disposition

Final sequestration orders granted in favour of Investec; costs awarded as requested.

Orders

  • A final sequestration order is issued in respect of each of the estates of Jo-Ann Trust, Rocklands Development Trust, and Barkly Road Development Trust.
  • The costs of sequestration of each estate include the costs of the use of two advocates by the applicant, as well as the costs of the joining applicants.