Moodliar and Others v Recycling and Economic Initiative of South Africa NPC and Others; Gore and Others v Kusaga Taka Consulting (Pty) Ltd and Others (977/2019) [2020] ZASCA 101; 2020 (6) SA 386 (SCA) (15 September 2020)

Moodliar and Others v Recycling and Economic Initiative of South Africa NPC and Others; Gore and Others v Kusaga Taka Consulting (Pty) Ltd and Others (977/2019) [2020] ZASCA 101; 2020 (6) SA 386 (SCA) (15 September 2020)

The Supreme Court of Appeal held that liquidators are not entitled to retain company assets to secure or pay their proposed fees before the estate account has been taxed and confirmed. Upon discharge of the provisional liquidation order, all assets, including funds earmarked for liquidator remuneration, must be restored to the company. The Companies Act 61 of 1973 and its Regulations do not permit liquidators to retain or appropriate assets for their fees prior to confirmation of the estate account. The authorities cited by the liquidators do not support their position; rather, they reinforce the requirement that remuneration must be claimed through the proper statutory process and cannot...

Citation
[2020] ZASCA 101
Parties
Appellant: Sivalutchmee Moodliar; Appellant: Trevor Philip Glaum; Appellant: Keitumetse Taunyane; Appellant: Stephen Malcolm Gore; Appellant: Francis Tjale; Respondent: Recycling and Economic Development Initiative of South Africa NPC; Respondent: Kusaga Taka Consulting (Pty) Ltd; Respondent: Bowman Gilfillan; Respondent: The Master of the High Court, Western Cape Division, Cape Town
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
15 September 2020
Case Number
977/2019
Procedural Posture
Civil Appeal / Appeal From the Western Cape Division of the High Court
Outcome
Appeal dismissed with costs, except for limited amendment regarding costs of counter-applications.
Judges
Navsa, Mbha, Plasket, Weiner, Unterhalter
Legal Topics
Winding Up of Companies, Liquidator Remuneration, Return of Company Assets, Estate Account Confirmation
Commercial and Corporate Civil Procedure Winding Up of Companies Liquidator Remuneration Return of Company Assets Estate Account Confirmation

Case Brief

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Parties

Sivalutchmee Moodliar

Appellant

Trevor Philip Glaum

Appellant

Keitumetse Taunyane

Appellant

Stephen Malcolm Gore

Appellant

Francis Tjale

Appellant

Recycling and Economic Development Initiative of South Africa NPC

Respondent

Kusaga Taka Consulting (Pty) Ltd

Respondent

Bowman Gilfillan

Respondent

The Master of the High Court, Western Cape Division, Cape Town

Respondent

Procedural Posture

Civil Appeal / Appeal From the Western Cape Division of the High Court

Legal Issues

  1. 1 Are former liquidators entitled to retain company funds to pay or secure their proposed fees before restoring control of assets upon discharge of provisional liquidation orders?
  2. 2 Does the Companies Act 61 of 1973 and its Regulations permit liquidators to retain assets or draw remuneration prior to estate account taxation and confirmation?
  3. 3 What is the proper procedure for liquidators to claim remuneration after discharge of liquidation orders?

Ratio Decidendi

The Supreme Court of Appeal held that liquidators are not entitled to retain company assets to secure or pay their proposed fees before the estate account has been taxed and confirmed. Upon discharge of the provisional liquidation order, all assets, including funds earmarked for liquidator remuneration, must be restored to the company. The Companies Act 61 of 1973 and its Regulations do not permit liquidators to retain or appropriate assets for their fees prior to confirmation of the estate account. The authorities cited by the liquidators do not support their position; rather, they reinforce the requirement that remuneration must be claimed through the proper statutory process and cannot...

Court Disposition

Appeal dismissed with costs, except for limited amendment regarding costs of counter-applications.

Orders

  • The appeal is dismissed with costs, including costs for two counsel, except as related to the costs order of the counter-applications.
  • The order of the court below is amended: Relief sought by Recycling and Economic Development Initiative of South Africa NPC and Kusaga Taka Consulting (Pty) Ltd in prayer 3 of their Notices of Motion is granted with costs.