Sackstein NO v Proudfoot SA (Pty) Ltd (119/02) [2003] ZASCA 8; [2003] 2 All SA 59 (SCA); 2003 (4) SA 348 (SCA) (7 March 2003)

Sackstein NO v Proudfoot SA (Pty) Ltd (119/02) [2003] ZASCA 8; [2003] 2 All SA 59 (SCA); 2003 (4) SA 348 (SCA) (7 March 2003)

The Supreme Court of Appeal held that the South African liquidator of an external company registered in South Africa is empowered to impeach dispositions of property made in a foreign country under sections 29 and 30 of the Insolvency Act as read with section 340 of the Companies Act. The court found that the definition of 'property' in section 2 of the Insolvency Act does not restrict the liquidator's powers to property within South Africa, and that the common law applies to assets situated abroad. The court distinguished between the invalidation of a disposition and the recovery of property, holding that the South African court has jurisdiction to entertain the impeachment process where...

Citation
[2003] ZASCA 8
Parties
Appellant: L N Sackstein NO (in his capacity as liquidator of Tsumeb Corporation Limited (in liquidation)); Respondent: Proudfoot SA (Pty) Limited
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
7 March 2003
Case Number
119/02
Procedural Posture
Civil Appeal / Appeal From the Witwatersrand Local Division, High Court
Outcome
Appeal upheld. Judgment of the court a quo set aside. Paragraphs 4.4 and 4.5.2 of the Plea struck out. Costs awarded to the appellant, including costs of two counsel in both courts.
Judges
Olivier, Brand, Conradie, Heher, Lewis
Legal Topics
External Company Liquidation, Impeachment of Dispositions, Jurisdiction of Liquidator, Companies Act Section 391, Insolvency Act Section 29, Cross Border Insolvency
Commercial and Corporate Civil Procedure External Company Liquidation Impeachment of Dispositions Jurisdiction of Liquidator Companies Act Section 391 Insolvency Act Section 29 Cross Border Insolvency

Case Brief

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Parties

L N Sackstein NO (in his capacity as liquidator of Tsumeb Corporation Limited (in liquidation))

Appellant

Proudfoot SA (Pty) Limited

Respondent

Procedural Posture

Civil Appeal / Appeal From the Witwatersrand Local Division, High Court

Legal Issues

  1. 1 Whether a South African liquidator of an external company registered in South Africa has the power to impeach dispositions of property made in a foreign country under sections 29 and 30 of the Insolvency Act as read with section 340 of the Companies Act.
  2. 2 Whether the definition of 'property' in section 2 of the Insolvency Act restricts the liquidator's powers to property situate within South Africa.
  3. 3 Whether the South African court has jurisdiction to entertain the impeachment process where the disposition occurred in Namibia.

Ratio Decidendi

The Supreme Court of Appeal held that the South African liquidator of an external company registered in South Africa is empowered to impeach dispositions of property made in a foreign country under sections 29 and 30 of the Insolvency Act as read with section 340 of the Companies Act. The court found that the definition of 'property' in section 2 of the Insolvency Act does not restrict the liquidator's powers to property within South Africa, and that the common law applies to assets situated abroad. The court distinguished between the invalidation of a disposition and the recovery of property, holding that the South African court has jurisdiction to entertain the impeachment process where...

Court Disposition

Appeal upheld. Judgment of the court a quo set aside. Paragraphs 4.4 and 4.5.2 of the Plea struck out. Costs awarded to the appellant, including costs of two counsel in both courts.

Orders

  • Paragraphs 4.4 and 4.5.2 of the respondent's Plea are struck out.
  • The respondent is ordered to pay the costs of the action in the court a quo and the costs of the appeal, including costs consequent upon the employment of two counsel in both courts.