Maddocks N.O and Another v South African Reserve Bank and Another (D8203/2019) [2021] ZAKZDHC 13 (1 April 2021)

Maddocks N.O and Another v South African Reserve Bank and Another (D8203/2019) [2021] ZAKZDHC 13 (1 April 2021)

The court held that the forfeiture orders issued by the South African Reserve Bank after the commencement of liquidation unlawfully interfered with the concursus creditorum and the statutory duties of the liquidators under the Companies Act. The Currency and Exchanges Act and its regulations do not expressly suspend the application of insolvency law in these circumstances. The court found that the Reserve Bank, by appropriating the companies' claims against the banks, effectively became a creditor subject to insolvency law. The Kwazulu-Natal High Court has jurisdiction to review and set aside the forfeiture orders, as the administrative action affected parties within its area and the...

Citation
[2021] ZAKZDHC 13
Parties
Applicant: Johnine Winsome Elisie Maddocks N.O.; Applicant: Amerasan Pillay N.O.; Respondent: South African Reserve Bank; Respondent: National Treasury
Court
Kwazulu-Natal High Court, Durban
Jurisdiction
South Africa
Judgment Date
1 April 2021
Case Number
D8203/2019
Procedural Posture
Review Application / Judgment
Outcome
Application granted in favour of the applicants; forfeiture orders declared null and void; National Treasury directed to pay the amounts to the applicants; costs awarded against respondents.
Judges
Olsen
Legal Topics
Forfeiture Orders, Concursus Creditorum, Currency and Exchanges Act, Liquidation Procedure, Administrative Action Review, Statutory Interpretation
Administrative Law Civil Procedure Banking and Finance Forfeiture Orders Concursus Creditorum Currency and Exchanges Act Liquidation Procedure Administrative Action Review +1 more

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Parties

Johnine Winsome Elisie Maddocks N.O.

Applicant

Amerasan Pillay N.O.

Applicant

South African Reserve Bank

Respondent

National Treasury

Respondent

Procedural Posture

Review Application / Judgment

Legal Issues

  1. 1 Whether the forfeiture orders issued by the South African Reserve Bank after the commencement of liquidation are null and void.
  2. 2 Whether the Currency and Exchanges Act and its regulations override insolvency law in the context of company liquidation.
  3. 3 Whether the Kwazulu-Natal High Court has jurisdiction to review and set aside the forfeiture orders.

Ratio Decidendi

The court held that the forfeiture orders issued by the South African Reserve Bank after the commencement of liquidation unlawfully interfered with the concursus creditorum and the statutory duties of the liquidators under the Companies Act. The Currency and Exchanges Act and its regulations do not expressly suspend the application of insolvency law in these circumstances. The court found that the Reserve Bank, by appropriating the companies' claims against the banks, effectively became a creditor subject to insolvency law. The Kwazulu-Natal High Court has jurisdiction to review and set aside the forfeiture orders, as the administrative action affected parties within its area and the...

Court Disposition

Application granted in favour of the applicants; forfeiture orders declared null and void; National Treasury directed to pay the amounts to the applicants; costs awarded against respondents.

Orders

  • Notice 515 of 2018, Notice 527 of 2017, and Notice 514 of 2018 are declared null and void.
  • The National Treasury is directed to pay the amounts set forth in the aforementioned forfeiture orders, together with interest, into the applicants’ banking account.