Mosalakae and Others v Matlala and Others (267/2018) [2019] ZASCA 125 (27 September 2019)

Mosalakae and Others v Matlala and Others (267/2018) [2019] ZASCA 125 (27 September 2019)

The Supreme Court of Appeal found that the appellants failed to discharge the onus of proving that Sedimoza and Ntombisi were entitled to an increased shareholding in Gundo Investments (Pty) Ltd. The purported rights offer lacked essential contractual terms such as the number of shares and the price per share, and was not validly authorised or accepted. The payments made by Sedimoza and Ntombisi were not accepted by Dihla and did not result in an increase in shareholding. The share register was unlawfully amended without proper authority or consent from the other shareholders. The court held that all seven entities who paid the initial joining fee were entitled to equal shareholding and...

Citation
[2019] ZASCA 125
Parties
Appellant: Neo Doreen Mosalakae; Appellant: Kholofelo Mosala; Appellant: Sedimoza (Pty) Ltd; Appellant: Ntombisi CC; Appellant: Gundo Investments (Pty) Ltd; Respondent: Nomsa Matlala; Respondent: Ester Maphangwe; Respondent: Mariam Motshabi Sekati; Respondent: Suzan Neluheni; Respondent: Tshimbiluni Investment Holdings (Pty) Ltd; Respondent: Pembalani Investment Holdings (Pty) Ltd; Respondent: Kotulo-Nala CC; Respondent: Isenzo Eshile Contractors CC; Respondent: Bindi J-Zee Trading Enterprises CC
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
27 September 2019
Case Number
267/2018
Procedural Posture
Civil Appeal / Appeal From Gauteng Division of the High Court, Pretoria
Outcome
Appeal dismissed with costs, including costs occasioned by the employment of two counsel.
Judges
Navsa, Plasket, Dlodlo, Tsoka, Weiner
Legal Topics
Rectification of Share Register, Companies Act 1973, Shareholder Disputes, Black Economic Empowerment, Contractual Certainty, Onus of Proof
Commercial and Corporate Rectification of Share Register Companies Act 1973 Shareholder Disputes Black Economic Empowerment Contractual Certainty Onus of Proof

Case Brief

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Parties

Neo Doreen Mosalakae

Appellant

Kholofelo Mosala

Appellant

Sedimoza (Pty) Ltd

Appellant

Ntombisi CC

Appellant

Gundo Investments (Pty) Ltd

Appellant

Nomsa Matlala

Respondent

Ester Maphangwe

Respondent

Mariam Motshabi Sekati

Respondent

Suzan Neluheni

Respondent

Tshimbiluni Investment Holdings (Pty) Ltd

Respondent

Pembalani Investment Holdings (Pty) Ltd

Respondent

Kotulo-Nala CC

Respondent

Isenzo Eshile Contractors CC

Respondent

Bindi J-Zee Trading Enterprises CC

Respondent

Procedural Posture

Civil Appeal / Appeal From Gauteng Division of the High Court, Pretoria

Legal Issues

  1. 1 Whether the shareholding in Gundo Investments (Pty) Ltd was validly increased in favour of Sedimoza and Ntombisi.
  2. 2 Whether a valid rights offer was made and accepted, resulting in a contractual entitlement to increased shares.
  3. 3 Whether the share register should be rectified to reflect only Sedimoza and Ntombisi as equal shareholders or all seven entities as equal shareholders.

Ratio Decidendi

The Supreme Court of Appeal found that the appellants failed to discharge the onus of proving that Sedimoza and Ntombisi were entitled to an increased shareholding in Gundo Investments (Pty) Ltd. The purported rights offer lacked essential contractual terms such as the number of shares and the price per share, and was not validly authorised or accepted. The payments made by Sedimoza and Ntombisi were not accepted by Dihla and did not result in an increase in shareholding. The share register was unlawfully amended without proper authority or consent from the other shareholders. The court held that all seven entities who paid the initial joining fee were entitled to equal shareholding and...

Court Disposition

Appeal dismissed with costs, including costs occasioned by the employment of two counsel.

Orders

  • The appeal is dismissed with costs, including the costs occasioned by the employment of two counsel.