Jansen and Another v Royal Pie Company (Pty) Ltd (88661/2019) [2019] ZAGPPHC 966 (24 December 2019)

Jansen and Another v Royal Pie Company (Pty) Ltd (88661/2019) [2019] ZAGPPHC 966 (24 December 2019)

The court found that the respondent is commercially insolvent. The calling up of the loan by VEA Group Holdings, amounting to over R7 million, and the absence of any explanation or evidence that the respondent could immediately repay this debt, justified the inference that the respondent is unable to pay its debts as they fall due. The respondent's reliance on VEA's financial support is contradicted by VEA's simultaneous demand for repayment, which terminated any ongoing financial backing. The respondent's overdraft and history of defaulting on loan obligations further support the conclusion of insolvency. The applicants, as shareholders, have locus standi to bring the application. The...

Citation
[2019] ZAGPPHC 966
Parties
Applicant: A C Jansen; Applicant: C Jansen; Respondent: Royal Pie Company (Pty) Ltd
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
24 December 2019
Case Number
88661/2019
Procedural Posture
Urgent Application / Provisional Winding Up Application
Outcome
Provisional winding-up order granted against the respondent.
Judges
DS Fourie
Legal Topics
Commercial Insolvency, Provisional Winding Up, Shareholder Dispute, Locus Standi, Loan Call Up
Commercial and Corporate Commercial Insolvency Provisional Winding Up Shareholder Dispute Locus Standi Loan Call Up

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 2 Party arguments 2 Amounts and remedies 3
Sign in to unlock

Parties

A C Jansen

Applicant

C Jansen

Applicant

Royal Pie Company (Pty) Ltd

Respondent

Procedural Posture

Urgent Application / Provisional Winding Up Application

Legal Issues

  1. 1 Whether the respondent is commercially insolvent and unable to pay its debts as they fall due.
  2. 2 Whether the applicants have locus standi to bring the winding-up application as shareholders.
  3. 3 Whether the calling up of the loan by VEA Group Holdings affects the respondent's solvency.

Ratio Decidendi

The court found that the respondent is commercially insolvent. The calling up of the loan by VEA Group Holdings, amounting to over R7 million, and the absence of any explanation or evidence that the respondent could immediately repay this debt, justified the inference that the respondent is unable to pay its debts as they fall due. The respondent's reliance on VEA's financial support is contradicted by VEA's simultaneous demand for repayment, which terminated any ongoing financial backing. The respondent's overdraft and history of defaulting on loan obligations further support the conclusion of insolvency. The applicants, as shareholders, have locus standi to bring the application. The...

Court Disposition

Provisional winding-up order granted against the respondent.

Orders

  • The respondent is placed under provisional winding-up.
  • Interested persons are called upon to show cause why a final winding-up order should not be granted on 10 March 2020 at 10:00 or as soon thereafter as the matter may be heard.