Ngonyama and Another v Ntsimbintle Holdings (Pty) Ltd and Others (21/5779) [2021] ZAGPJHC 31 (26 February 2021)

Ngonyama and Another v Ntsimbintle Holdings (Pty) Ltd and Others (21/5779) [2021] ZAGPJHC 31 (26 February 2021)

The court found that the requirements for urgent interim relief were satisfied. The applicants demonstrated a prima facie right to the dividends, as established in the prior judgment of Kathree-Setiloane J, and faced a real risk of irrecoverable loss if the dividends were paid to the liquidators before the appeal was decided. The balance of convenience favoured preserving the funds in the hands of the first respondent, a neutral and financially sound party, rather than risking disbursement to liquidators whose conduct and solvency were in question. The court held that the allegations of fronting under the BBBEE Act and the public interest in upholding the rule of law further supported the...

Citation
[2021] ZAGPJHC 31
Parties
Applicant: Lulama Smuts Ngonyama; Applicant: Thundercats Investments 92 (Pty) Ltd; Respondent: Ntsimbintle Holdings (Pty) Ltd; Respondent: Bosasa Youth Development Centres (Pty) Ltd (in liquidation); Respondent: Ralph Farrel Lutchman N.O.; Respondent: Cloete Murray N.O.; Respondent: Ofentse Andrew Nong N.O.; Respondent: Tshepo Harry Nonyane N.O.; Respondent: Jared Watson N.O. (Executor of the Estate Late Gavin Watson)
Court
South Gauteng High Court, Johannesburg
Jurisdiction
South Africa
Judgment Date
26 February 2021
Case Number
21/5779
Procedural Posture
Urgent Application / Interim Urgent Application for Interdict Pending Appeal
Outcome
Interim interdict granted; first respondent ordered to retain one third of dividends in an interest-bearing account pending outcome of appeals.
Judges
T P Mudau
Legal Topics
Interim Interdict, Dividend Distribution, Beneficial Ownership, Liquidation Procedure, Fronting Practice, Broad Based Black Economic Empowerment
Civil Procedure Commercial and Corporate Interim Interdict Dividend Distribution Beneficial Ownership Liquidation Procedure Fronting Practice Broad Based Black Economic Empowerment

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Parties

Lulama Smuts Ngonyama

Applicant

Thundercats Investments 92 (Pty) Ltd

Applicant

Ntsimbintle Holdings (Pty) Ltd

Respondent

Bosasa Youth Development Centres (Pty) Ltd (in liquidation)

Respondent

Ralph Farrel Lutchman N.O.

Respondent

Cloete Murray N.O.

Respondent

Ofentse Andrew Nong N.O.

Respondent

Tshepo Harry Nonyane N.O.

Respondent

Jared Watson N.O. (Executor of the Estate Late Gavin Watson)

Respondent

Procedural Posture

Urgent Application / Interim Urgent Application for Interdict Pending Appeal

Legal Issues

  1. 1 Whether the applicants are entitled to an interim interdict preventing payment of dividends pending appeal.
  2. 2 Whether the requirements for urgent relief under Rule 6(12) are satisfied.
  3. 3 Whether the applicants have established a prima facie right to the dividends in dispute.

Ratio Decidendi

The court found that the requirements for urgent interim relief were satisfied. The applicants demonstrated a prima facie right to the dividends, as established in the prior judgment of Kathree-Setiloane J, and faced a real risk of irrecoverable loss if the dividends were paid to the liquidators before the appeal was decided. The balance of convenience favoured preserving the funds in the hands of the first respondent, a neutral and financially sound party, rather than risking disbursement to liquidators whose conduct and solvency were in question. The court held that the allegations of fronting under the BBBEE Act and the public interest in upholding the rule of law further supported the...

Court Disposition

Interim interdict granted; first respondent ordered to retain one third of dividends in an interest-bearing account pending outcome of appeals.

Orders

  • The matter is heard as one of urgency under Rule 6(12) and deviations from the Rules of Court are condoned.
  • The first respondent is interdicted and restrained from paying one third of any dividend to the second respondent pending the outcome of the seventh respondent's appeal to the Supreme Court of Appeal or any further appeal to the Constitutional Court.