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South Africa Judgment

South Gauteng High Court, Johannesburg

Keller Geotechnics SA (Pty) Ltd v Franks Constructions (Pty) Ltd (2022/034570) [2023] ZAGPJHC 1291 (10 November 2023)

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01

Holding and result

The court found that the applicant had established its claim for the sum of R4,649,131.23 arising from the 27 April 2020 agreement, which was admitted by the respondent except for a bald denial of the indebtedness. The respondent's denial was rejected as untenable. The disputes raised regarding other claims were immaterial, as the applicant had proven the respondent's inability to pay its debts based on the admitted agreement and subsequent demands. The requirements for a final winding up order under section 345(1)(c) of the Companies Act 1973 were satisfied.

Court disposition

Final winding up order granted; respondent placed in liquidation.

Orders

  • Respondent is placed in final liquidation in the hands of the Master of the above Honourable Court.
  • The costs of this application are to be costs in the administration of the respondent's estate.

02

Material facts

Parties

Keller Geotechnics SA (Pty) Ltd

Applicant Counsel: Adv L Acker

Franks Constructions (Pty) Ltd (Formerly known as Zero Azania (Pty) Limited)

Respondent Counsel: Adv J H Lerm

Amounts and remedies

  • Balance Due Under 27 April 2020 Agreement: ZAR 4,649,131.23
  • Amount Short Paid for SARB Project: ZAR 907,727.55
  • Outstanding Amount for PIC Project: ZAR 12,797,254.22

03

Procedural history

  1. Posture

    Winding Up Application / Final Liquidation Order

04

Questions and positions

Legal issues

Party arguments

Applicant
The applicant contends that the respondent is indebted to it in the sum of R4,649,131.23 pursuant to an agreement concluded on 27 April 2020, and that further amounts are due in respect of the SARB and PIC projects. The applicant submits that the respondent has failed to pay the admitted indebtedness despite demand and meetings to resolve the outstanding amounts. The applicant argues that the respondent's inability to pay its debts is established and seeks a final winding up order.
Respondent
The respondent disputes the claims relating to the SARB and PIC projects, arguing that these amounts are not due and owing in the absence of payment certificates. The respondent admits the conclusion of the 27 April 2020 agreement but baldly denies the recordal of the indebtedness in the agreement. The respondent also denies the contents of the demand letters and meeting confirmations, but admits receipt thereof and attendance at the meeting.

05

Court’s reasoning

  1. 01

    Fakie NO v CCII Systems (Pty) Limited [2006] ZASCA 52; 2006 (4) SA 326 (SCA)

    A bald denial of an admitted indebtedness in a written agreement is untenable and may be rejected by the court.

  2. 02

    Wightman t/a JW Construction v Headfour (Pty) Limited and Another 2008 (3) SA 371 (SCA)

    The applicant must make out its case in its founding affidavit and cannot supplement it in reply.

  3. 03

    Companies Act 61 of 1973, section 345(1)(c)

    A company may be wound up if it is unable to pay its debts as contemplated by section 345(1)(c) of the Companies Act 61 of 1973.

06

Ratio, limits and disposition

Ratio decidendi

The court found that the applicant had established its claim for the sum of R4,649,131.23 arising from the 27 April 2020 agreement, which was admitted by the respondent except for a bald denial of the indebtedness. The respondent's denial was rejected as untenable. The disputes raised regarding other claims were immaterial, as the applicant had proven the respondent's inability to pay its debts based on the admitted agreement and subsequent demands. The requirements for a final winding up order under section 345(1)(c) of the Companies Act 1973 were satisfied.

Obiter and limits

  • It is not necessary for the court to become embroiled in disputes regarding the SARB and PIC project claims, as the admitted indebtedness is sufficient for the relief sought.
  • The applicant must make out its case in its founding affidavit and cannot rely on supplementary evidence in reply.

Court disposition

Final winding up order granted; respondent placed in liquidation.

  • Respondent is placed in final liquidation in the hands of the Master of the above Honourable Court.
  • The costs of this application are to be costs in the administration of the respondent's estate.

Source and reliance status

South Gauteng High Court, Johannesburg

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Judgment text

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Source document

South Gauteng High Court, Johannesburg

Judgment

[2023] ZAGPJHC 1291

REPUBLIC OF SOUTH

AFRICA

IN THE HIGH COURT OF

SOUTH AFRICA

GAUTENG DIVISION,

JOHANNESBURG

Case no: 2022/034570

NOT REPORTABLE

NOT OF INTEREST TO OTHER

In the matter between:

KELLER GEOTECHNICS SA (PTY) LTD Applicant

AND

FRANKS CONTRUCTIONS (PTY) LTD (Formerly known as ZERO AZANIA (PTY) LIMITED) Respondent

JUDGMENT

KAPLAN AJ:

1. In this matter the Applicant seeks an order placing respondent under a final winding up order on the basis that Respondent is unable to pay its debts in terms of sections 345(1)(c) of the Companies Act 61 of 1973 read with Item 9 of Schedule 5 of the Companies Act 61 of 2008.

2. Applicant contends that respondent is indebted to it in the following amounts:

2.1 The sum of R4 649 131.23 being the balance due and owing pursuant to an agreement concluded between the parties on 27 April 2020 (“the 27 April 2020 agreement”).

2.2 R907 727.55 being the amount short paid to the Applicant in respect of “the SARB project”.

2.3 R12 797 254.22 being the outstanding amount due and owing to the Applicant in respect of “the PIC project”.

3. respondent has raised disputes in regard to applicant’s claims set out in subparagraphs 2.2 and 2.3 supra on the basis that the said claims are not due and owing in the absence of payment certificates which are not before the Court and which cannot be added in the replying affidavit, because the applicant must make out its case in its founding affidavit.

4. I am of the view that it is not necessary for me to become embroiled in the disputes in regard to the Applicant’s claims set out in subparagraphs 2.2 and 2.3 supra. This is because I am satisfied that Applicant has established its claim set out in subparagraph 2.1 supra. In this regard:

4.1 The said claim arises out of the 27 April 2020 agreement between the parties.

4.2 The 27 April 2020 agreement:

4.2.1 is common cause on the papers;

4.2.2 records on page 1 in paragraph A that “Zero owes Frankie (respondent)” an amount of R5 649 131,23;

5. Whilst Respondent admits the conclusion of the 27 April 2020 agreement and its terms, it baldly denies the recordal in paragraph A thereof that “Zero owes Frankie (respondent)” an amount of R5 649 131.23”. This bald denial is untenable and falls to be rejected. (See Fakie NO v CCII Systems (Pty) Limited [2006] ZASCA 52; 2006 (4) SA 326 (SCA) and WIGHTMAN t/a JW Construction V Headfour (Pty) Limited and Another 2008(3) SA 371 (SCA).

6. Applicant avers in its founding affidavit that:

6.1 its attorney by way of a letter dated 13 January 2022 demanded payment of the outstanding balance of the admitted indebtedness (in the sum of R4 649 131.23) in the 27 April 2020 agreement;

6.2 a meeting was held on 10 March 2022 to discuss the Respondent’s outstanding indebtedness to Applicant;

6.3 on 10 March 2022 Applicant’s attorney addressed a letter to Respondent confirming the discussions between the parties at the meeting of 10 March 2022.

7. In its Answering Affidavit Respondent admits receipt of the letters in subparagraphs 6.1 and 6.3 supra from Applicant’s attorneys and that the meeting on 10 March 2022 was held. It baldly denies the contents of the said letters.

8. I am of the view by virtue of the aforegoing and in particular paragraphs 6 and 7 supra, that Applicant has proven Respondent’s inability to pay its debts.

9. In conclusion I find that Applicant has made out a case for the winding up of Respondent in accordance with Section 345(1)(c) of the Companies Act 1973 and accordingly an order is granted in the following terms:

9.1 Respondent is placed in final liquidation in the hands of the Master of the above Honourable Court.

9.2 That the costs of this application be costs in the administration of Respondent’s estate.

JL

KAPLAN

ACTING

JUDGE OF THE HIGH COURT

GAUTENG LOCAL DIVISION, JOHANNESBURG

Appearances:

Appearance for Applicant:

Adv L Acker

Instructed by:

KWA Attorneys

Appearance for Respondents:

Adv J H Lerm

Crawford Attorneys

Date of hearing: 7 November 2023

Date of judgment: 10 November 2023

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Authorities

Authorities used by the court

Cases, legislation, regulations, and constitutional provisions identified in the available record.

Fakie NO v CCII Systems (Pty) Limited [2006] ZASCA 52; 2006 (4) SA 326 (SCA)

Case cited

Wightman t/a JW Construction v Headfour (Pty) Limited and Another 2008 (3) SA 371 (SCA)

Case cited

Companies Act 61 of 1973

Legislation

Legislation referenced in the available case record.

Companies Act 71 of 2008

Legislation

Legislation referenced in the available case record.

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