Jackson v Louw N.O and Another (CA&R 149/17) [2018] ZAECGHC 141; [2019] 2 All SA 145 (ECG) (13 December 2018)

Jackson v Louw N.O and Another (CA&R 149/17) [2018] ZAECGHC 141; [2019] 2 All SA 145 (ECG) (13 December 2018)

The court held that the agreements regarding the livestock and equipment constituted voidable preferences under section 29 of the Insolvency Act. The Trust was the owner of the heifers and younger animals, and the equipment, at the time of disposition. The surrender of these assets to the appellant was not in the ordinary course of business, but rather arose from the Trust's insolvency and inability to meet its obligations. The evidence did not support a finding of collusion or fraudulent intent under section 31. The trial court's order was set aside and replaced with an order setting aside only the dispositions of the heifers and equipment, and awarding costs to the appellant.

Citation
[2018] ZAECGHC 141
Parties
Appellant: Donald George Duke Jackson; Respondent: Jacobus Marthinus Abrahams Louw NO; Respondent: Punithan Quentin Naidoo NO
Court
Eastern Cape High Court, Grahamstown
Jurisdiction
South Africa
Judgment Date
13 December 2018
Case Number
CA&R 149/17
Procedural Posture
Civil Appeal / Full Bench Appeal
Outcome
Appeal upheld with costs. The trial court's order is set aside and substituted with an order setting aside only the disposition of specified heifers and equipment under section 29 of the Insolvency Act.
Judges
D Van Zyl, J E Smith, G H Bloem
Legal Topics
Insolvency Act, Voidable Preference, Collusive Dealing, Secured Creditor Rights, Ordinary Course of Business, Statutory Pledge
Land and Property Civil Procedure Commercial and Corporate Insolvency Act Voidable Preference Collusive Dealing Secured Creditor Rights Ordinary Course of Business +1 more

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Parties

Donald George Duke Jackson

Appellant

Jacobus Marthinus Abrahams Louw NO

Respondent

Punithan Quentin Naidoo NO

Respondent

Procedural Posture

Civil Appeal / Full Bench Appeal

Legal Issues

  1. 1 Whether the agreements regarding livestock and equipment constituted impeachable dispositions under sections 29, 30, and 31 of the Insolvency Act.
  2. 2 Whether the Trust was the owner of the livestock and equipment at the time of disposition.
  3. 3 Whether the dispositions were made in the ordinary course of business or with the intention to prefer one creditor above another.

Ratio Decidendi

The court held that the agreements regarding the livestock and equipment constituted voidable preferences under section 29 of the Insolvency Act. The Trust was the owner of the heifers and younger animals, and the equipment, at the time of disposition. The surrender of these assets to the appellant was not in the ordinary course of business, but rather arose from the Trust's insolvency and inability to meet its obligations. The evidence did not support a finding of collusion or fraudulent intent under section 31. The trial court's order was set aside and replaced with an order setting aside only the dispositions of the heifers and equipment, and awarding costs to the appellant.

Court Disposition

Appeal upheld with costs. The trial court's order is set aside and substituted with an order setting aside only the disposition of specified heifers and equipment under section 29 of the Insolvency Act.

Orders

  • The disposition by the Greenacres Trust to the sixth defendant of 25 large heifers, 28 small heifers and 18 yard heifers on 7 September 2011 is set aside in terms of section 29 of the Insolvency Act 24 of 1936.
  • The disposition by the Greenacres Trust to the sixth defendant of a Holland 5630 4x4 tractor, a Ford 6610 4x4 tractor, a Duncan 15-row planter, an Aguirre twin disc fertiliser spreader and a blue tip trailer with drop sides on 31 August 2011 is set aside in terms of section 29 of the Insolvency Act.