Van Den Heerden N.O. and Others v Van Tonder (A5076/2018; 407461/2015) [2021] ZAGPJHC 486 (20 April 2021)

Van Den Heerden N.O. and Others v Van Tonder (A5076/2018; 407461/2015) [2021] ZAGPJHC 486 (20 April 2021)

The court held that the respondent, as business rescue practitioner, breached section 134 of the Companies Act by disposing of Boabab's book debts without obtaining Lombard Insurance's prior consent. However, the respondent acted in accordance with the established practices of the Group, in good faith, and with the...

Source-derived case information.

Citation
[2021] ZAGPJHC 486
Parties
Appellant: Theodor Wilhelm Van Den Heever N.O.; Appellant: Gert Lourens Steyn De Wet N.O.; Appellant: Luke Bernard Saffy N.O.; Appellant: Selwyn Trackman N.O.; Appellant: Sumaiya Abdul Gaffar Khamissa N.O.; Appellant: Jacolien Frieda Jansen Van Rensburg N.O.; Respondent: Jacobus Michiel Van Tonder
Court
South Gauteng High Court, Johannesburg
Jurisdiction
South Africa
Judgment Date
20 April 2021
Case Number
A5076/2018; 407461/2015
Procedural Posture
Civil Appeal / Appeal From Court a Quo (modiba J)
Judges
Windell, MIA, MDALANA-MAYISELA
Legal Topics
Business Rescue, Fiduciary Duties, Financial Assistance, Disposal of Secured Assets, Director Liability, Statutory Interpretation
Commercial and Corporate Civil Procedure Business Rescue Fiduciary Duties Financial Assistance Disposal of Secured Assets Director Liability Statutory Interpretation

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Parties

Theodor Wilhelm Van Den Heever N.O.

Appellant

Gert Lourens Steyn De Wet N.O.

Appellant

Luke Bernard Saffy N.O.

Appellant

Selwyn Trackman N.O.

Appellant

Sumaiya Abdul Gaffar Khamissa N.O.

Appellant

Jacolien Frieda Jansen Van Rensburg N.O.

Appellant

Jacobus Michiel Van Tonder

Respondent

Procedural Posture

Civil Appeal / Appeal From Court a Quo (modiba J)

Legal Issues

  1. 1 Whether the respondent, as business rescue practitioner, breached section 134 of the Companies Act by disposing of Boabab's book debts without creditor consent.
  2. 2 Whether the respondent provided unlawful financial assistance to related companies in contravention of section 45 of the Companies Act.
  3. 3 Whether the respondent breached fiduciary duties under section 76(3) of the Companies Act.

Ratio Decidendi

The court held that the respondent, as business rescue practitioner, breached section 134 of the Companies Act by disposing of Boabab's book debts without obtaining Lombard Insurance's prior consent. However, the respondent acted in accordance with the established practices of the Group, in good faith, and with the bona fide belief that such payments were necessary to keep the companies trading and to attempt a rescue. The respondent relied on legal advice and operated under significant constraints, including incomplete financial records and lack of support from directors. The court found that the respondent did not provide unlawful financial assistance under section 45, as the payments...