MMI Group Limited v Haywood N.O and Others (1533/2018) [2019] ZAGPPHC 564 (28 November 2019)

MMI Group Limited v Haywood N.O and Others (1533/2018) [2019] ZAGPPHC 564 (28 November 2019)

The court found that the trustees and the fourth respondent failed to comply with the mandatory requirements of section 73 of the Insolvency Act, as no proper written fee agreement was produced and the bill of costs was not assessed by the Law Society. The Master had no discretion to waive these requirements. The alleged double recovery of costs by DLBM attorneys was not investigated, despite prima facie evidence that most of the costs had already been recovered from the sale of an immovable property. The applicant's objection was therefore valid and should have been upheld. However, the trustees did not act with gross negligence or impropriety, so personal costs orders were not...

Citation
[2019] ZAGPPHC 564
Parties
Applicant: MMI Group Limited; Respondent: Mari Haywood N.O; Respondent: Adriaan Willem van Rooyen N.O; Respondent: Ina Hogewind N.O; Respondent: Tintingers Incorporated; Respondent: The Master of the High Court Gauteng Division
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
28 November 2019
Case Number
1533/2018
Procedural Posture
Review Application / Judgment
Outcome
Application granted in part; the Master's decision disallowing the objection is set aside and substituted with an order upholding the objection. The trustees are directed to comply with statutory requirements regarding assessment of costs and investigation of double recovery. Each party to bear their own costs.
Judges
Ranchod
Legal Topics
Insolvency Act Section 73, Liquidation and Distribution Account, Trustee Costs, Creditor Protection, Double Recovery of Costs
Civil Procedure Land and Property Insolvency Act Section 73 Liquidation and Distribution Account Trustee Costs Creditor Protection Double Recovery of Costs

Case Brief

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Parties

MMI Group Limited

Applicant

Mari Haywood N.O

Respondent

Adriaan Willem van Rooyen N.O

Respondent

Ina Hogewind N.O

Respondent

Tintingers Incorporated

Respondent

The Master of the High Court Gauteng Division

Respondent

Procedural Posture

Review Application / Judgment

Legal Issues

  1. 1 Whether the Master was correct in disallowing the applicant's objection to the fourth respondent's reduced account without assessment by the Law Society.
  2. 2 Whether the amount claimed by DLBM attorneys was correctly allowed in the first liquidation and distribution account, given the alleged double recovery of costs.

Ratio Decidendi

The court found that the trustees and the fourth respondent failed to comply with the mandatory requirements of section 73 of the Insolvency Act, as no proper written fee agreement was produced and the bill of costs was not assessed by the Law Society. The Master had no discretion to waive these requirements. The alleged double recovery of costs by DLBM attorneys was not investigated, despite prima facie evidence that most of the costs had already been recovered from the sale of an immovable property. The applicant's objection was therefore valid and should have been upheld. However, the trustees did not act with gross negligence or impropriety, so personal costs orders were not...

Court Disposition

Application granted in part; the Master's decision disallowing the objection is set aside and substituted with an order upholding the objection. The trustees are directed to comply with statutory requirements regarding assessment of costs and investigation of double recovery. Each party to bear their own costs.

Orders

  • The application for condonation for filing a supplementary affidavit is granted.
  • The decision of the fifth respondent dated 29 November 2017 disallowing the applicant's objection to the amended second and final liquidation and distribution account is set aside and substituted with an order upholding the objection.