Thunder Cats Investments 92 (Pty) Ltd and Another v Nkonjane Economic Prospecting And Investment (Pty) Ltd and Others (847/2012) [2013] ZASCA 164; [2014] 1 All SA 474 (SCA); 2014 (5) SA 1 (SCA) (26 November 2013)

Parties

Procedural Posture

Civil Appeal / Appeal From South Gauteng High Court, Confirmation of Winding Up Order

Legal Issues

1. 1 Whether the breakdown in the relationship between shareholders justifies winding-up of the company on the 'just and equitable' ground under section 81(1)(d)(iii) of the Companies Act 71 of 2008.
2. 2 Whether the shareholders agreement precludes winding-up on the basis of deadlock.
3. 3 Whether the applicants for winding-up must approach the court with 'clean hands'.

Ratio Decidendi

The Supreme Court of Appeal held that the breakdown in the relationship between the shareholders, evidenced by the inability to meet, persistent litigation, and failure to resolve disputes regarding the sale of shares, rendered the company unable to function. The shareholders agreement did not preclude winding-up on the 'just and equitable' ground, as clause 8.2 only excluded deadlock at board level and did not affect other forms of deadlock or breakdown in relations. The court found that both parties contributed to the breakdown and that lack of clean hands was not an absolute bar to relief. Failed negotiations and the inability to reach agreement on the sale of shares further...

Court Disposition

Appeal dismissed; winding-up order confirmed with amendment to costs order.

Orders

• The appeal is dismissed with costs, including the costs of two counsel.
• The order of the court below is confirmed, except that the words 'on the scale as between attorney and client' are deleted from the costs order.