Isamcor (Pty) Ltd v Dorbyl Light & General Engineering (Pty) Ltd, Dorbyl Light & General Engineering (Pty) Ltd v Insamcor (Pty) Ltd (63/06 , 319/06) [2007] ZASCA 6; 2007 (4) SA 467 (SCA) (12 March 2007)

Parties

Procedural Posture

Civil Appeal / Appeal From Johannesburg High Court Judgments in Two Related Matters

Legal Issues

1. 1 Whether a restoration order under s 73(6) of the Companies Act may be set aside for failure to join a necessary party or issue a rule nisi.
2. 2 Whether a company restored to the register can claim royalties for the period after deregistration.
3. 3 Whether Insamcor had locus standi to oppose the restoration order and seek its setting aside.

Ratio Decidendi

The Supreme Court of Appeal held that the restoration order granted in favour of Dorbyl Light & General Engineering (DLG) was fatally defective because Insamcor, a party with a direct and substantial interest, was neither joined nor notified by way of a rule nisi. The court confirmed that restoration under s 73(6) of the Companies Act can have significant prejudicial effects on third parties, including reviving obligations and extinguishing rights acquired during deregistration. The practice, as established in Sengol and Jacobson, requires that all interested parties be given an opportunity to object, either by joinder or by service of a rule nisi. Because this was not done, the...

Court Disposition

DLG's appeal against the setting aside of the restoration order is dismissed with costs. Insamcor's appeal in the royalties matter is upheld with costs. The order of the court a quo in the royalties matter is set aside and replaced with dismissal of the application with costs.

Orders

• The appeal by Dorbyl Light & General Engineering (case number 319/2006) is dismissed with costs, including the costs of two counsel.
• The appeal by Insamcor (case number 63/2006) is upheld with costs, including the costs of two counsel.