Steenkamp and Another v Central Energy Fund Soc Ltd and Others (13599/2017) [2017] ZAWCHC 107; 2018 (1) SA 311 (WCC) (22 September 2017)

Steenkamp and Another v Central Energy Fund Soc Ltd and Others (13599/2017) [2017] ZAWCHC 107; 2018 (1) SA 311 (WCC) (22 September 2017)

The court found that the removal of the applicants as directors was effected by the shareholder (CEF) at a shareholders meeting in terms of section 71(1) and (2) of the Companies Act. The procedural regime of section 71(3)-(8), which applies to board meetings and, in certain circumstances, to the Companies Tribunal, was not applicable as no board meeting was held for the removal. The applicants were afforded detailed reasons and a reasonable opportunity to make representations, both written and oral, before the resolution was put to a vote. The court further held that the decision to remove the directors constituted administrative action under PAJA, as CEF exercised public power in the...

Citation
[2017] ZAWCHC 107
Parties
Applicant: William Solomon Steenkamp; Applicant: Owen Cedric Tobias; Respondent: Central Energy Fund SOC Ltd; Respondent: Petroleum Oil & Gas Corporation SOC Ltd; Respondent: Minister of Energy
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
22 September 2017
Case Number
13599/2017
Procedural Posture
Urgent Application / Final Determination of Urgent Application for Review and Setting Aside of Removal as Directors
Outcome
Application dismissed. No costs order against the applicants or first respondent.
Judges
Bozalek
Legal Topics
Removal of Directors, State Owned Enterprises, Administrative Action, Companies Act, Promotion of Administrative Justice Act
Administrative Law Commercial and Corporate Removal of Directors State Owned Enterprises Administrative Action Companies Act Promotion of Administrative Justice Act

Case Brief

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Parties

William Solomon Steenkamp

Applicant

Owen Cedric Tobias

Applicant

Central Energy Fund SOC Ltd

Respondent

Petroleum Oil & Gas Corporation SOC Ltd

Respondent

Minister of Energy

Respondent

Procedural Posture

Urgent Application / Final Determination of Urgent Application for Review and Setting Aside of Removal as Directors

Legal Issues

  1. 1 Whether the removal of the applicants as directors of PetroSA was lawful under section 71 of the Companies Act.
  2. 2 Whether the removal constituted administrative action subject to review under PAJA.
  3. 3 Whether the decision to remove the applicants was predetermined, arbitrary, irrational, or unreasonable.

Ratio Decidendi

The court found that the removal of the applicants as directors was effected by the shareholder (CEF) at a shareholders meeting in terms of section 71(1) and (2) of the Companies Act. The procedural regime of section 71(3)-(8), which applies to board meetings and, in certain circumstances, to the Companies Tribunal, was not applicable as no board meeting was held for the removal. The applicants were afforded detailed reasons and a reasonable opportunity to make representations, both written and oral, before the resolution was put to a vote. The court further held that the decision to remove the directors constituted administrative action under PAJA, as CEF exercised public power in the...

Court Disposition

Application dismissed. No costs order against the applicants or first respondent.

Orders

  • The application is dismissed.
  • The applicants and the first respondent will bear their own costs.