Simcha Properties 6 CC v San Marcus Properties (Pty) Ltd (256/09) [2010] ZASCA 54; [2011] 1 All SA 287 (SCA) (31 March 2010)

Simcha Properties 6 CC v San Marcus Properties (Pty) Ltd (256/09) [2010] ZASCA 54; [2011] 1 All SA 287 (SCA) (31 March 2010)

The court held that the director of the respondent company was properly authorised to conclude the reinstatement agreement by virtue of resolutions passed by the sole shareholder in June and October 2007. These resolutions explicitly empowered the director to dispose of the company's sole asset and to sign all necessary documents to give effect to the transaction. The principle of unanimous assent applied, given that the company had only one shareholder, making formal meetings unnecessary. The reinstatement agreement was not a new transaction but a continuation of the original sale, and the earlier authorisation covered all acts required to give effect to the sale. The subsequent...

Citation
[2010] ZASCA 54
Parties
Appellant: Simcha Properties 6 CC; Respondent: San Marcus Properties (Pty) Ltd
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
31 March 2010
Case Number
256/09
Procedural Posture
Civil Appeal / Appeal From South Gauteng High Court, Johannesburg
Outcome
Appeal dismissed with costs, including costs of two counsel.
Judges
Lewis, Mlambo, Hurt, Griesel, Seriti
Legal Topics
Companies Act Section 228, Director Authorisation, Unanimous Assent, Ratification of Contract, Special Resolution Requirement
Commercial and Corporate Companies Act Section 228 Director Authorisation Unanimous Assent Ratification of Contract Special Resolution Requirement

Case Brief

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Parties

Simcha Properties 6 CC

Appellant

San Marcus Properties (Pty) Ltd

Respondent

Procedural Posture

Civil Appeal / Appeal From South Gauteng High Court, Johannesburg

Legal Issues

  1. 1 Was the director of the respondent company properly authorised under section 228 of the Companies Act to conclude the reinstatement agreement disposing of the company's sole asset?
  2. 2 Did the amendment to section 228 requiring a special resolution affect the validity of the transaction after the suspensive condition was fulfilled?

Ratio Decidendi

The court held that the director of the respondent company was properly authorised to conclude the reinstatement agreement by virtue of resolutions passed by the sole shareholder in June and October 2007. These resolutions explicitly empowered the director to dispose of the company's sole asset and to sign all necessary documents to give effect to the transaction. The principle of unanimous assent applied, given that the company had only one shareholder, making formal meetings unnecessary. The reinstatement agreement was not a new transaction but a continuation of the original sale, and the earlier authorisation covered all acts required to give effect to the sale. The subsequent...

Court Disposition

Appeal dismissed with costs, including costs of two counsel.

Orders

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