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South Africa Judgment

North West High Court, Mafikeng

Zwelethu Enviroment Services v Cumming and Others (Pty) [2010] ZANWHC 11 (28 September 2010)

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Source document

01

Holding and result

The Court found that there was no reasonable prospect of another Court coming to a different conclusion regarding the rectification of the share register. The correspondence between the parties, both in English and Afrikaans, clearly stated that the shares would be held by the applicant until the purchase price was paid in full, after which they would be transferred to the first respondent. The first respondent did not dispute the content of this correspondence prior to the proceedings and even referred to it as the formal agreement. The subsequent written agreement further confirmed the terms. Accordingly, the Court held that there was no genuine dispute of fact and refused leave to appeal.

Court disposition

Application for leave to appeal refused.

Orders

  • The application for leave to appeal is refused.

02

Material facts

Parties

Zwelethu Environment Services (Pty) Ltd

Applicant Counsel: J H Dreyer SC; SJ Myburgh

David Edmund Alistair Cumming

Respondent Counsel: A B Rossouw SC

Green Springs Investments 101 (Pty) Ltd

Respondent Counsel: A B Rossouw SC

Venter De Jager (Brits) Inc

Respondent

Woest Malan Wenhold Inc

Respondent

03

Procedural history

  1. Posture

    Leave to Appeal / Application for Leave to Appeal Following Urgent Rectification Order

04

Questions and positions

Legal issues

Party arguments

Applicant
The applicant contended that the correspondence and subsequent written agreement clearly established its entitlement to rectification of the share register. It argued that the first respondent had not previously disputed the content of the correspondence or sought to correct it, and that the terms were clear and unambiguous. The applicant maintained that there was no genuine dispute of fact and that the relief granted was justified under section 115 of the Companies Act.
Respondent
The respondents argued that the Court erred in failing to find a genuine dispute of fact regarding the terms of the oral agreement. They submitted that the dispute should have been resolved on the papers in their favour, and that the correspondence did not accurately reflect what was agreed at the applicant's attorneys' offices. The respondents relied on this as the main ground for seeking leave to appeal.

05

Court’s reasoning

  1. 01

    Van den Heerden v Cronwright 1985(2) SA 342 (T)

    Leave to appeal should only be granted if there exists a reasonable prospect of success on appeal.

  2. 02

    Companies Act 61 of 1973, section 115

    Rectification of a company's share register may be ordered in terms of section 115 of the Companies Act 61 of 1973 where entitlement is established.

06

Ratio, limits and disposition

Ratio decidendi

The Court found that there was no reasonable prospect of another Court coming to a different conclusion regarding the rectification of the share register. The correspondence between the parties, both in English and Afrikaans, clearly stated that the shares would be held by the applicant until the purchase price was paid in full, after which they would be transferred to the first respondent. The first respondent did not dispute the content of this correspondence prior to the proceedings and even referred to it as the formal agreement. The subsequent written agreement further confirmed the terms. Accordingly, the Court held that there was no genuine dispute of fact and refused leave to appeal.

Obiter and limits

  • The finding that there is no reasonable prospect of success on appeal renders it unnecessary to consider the conditional Rule 49(11) application.

Court disposition

Application for leave to appeal refused.

  • The application for leave to appeal is refused.

Source and reliance status

North West High Court, Mafikeng

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Judgment reading view

Judgment text

The complete available source text.

Source document

North West High Court, Mafikeng

Judgment

[2010] ZANWHC 11

IN THE NORTH WEST HIGH COURT, MAFIKENG

CASE NO: 162/10

In the matter between:

ZWELETHU

ENVIRONMENT SERVICES

(PTY) LTD …...............................................................................Applicant

and

DAVID

EDMUND ALISTAIR CUMMING …...............................1ST Respondent

GREEN SPRINGS INVESGTMENTS 101 (PTY) LTD …..............2ND

RESPONDENT

VENTER DE JAGER (BRITS) INC …..........................................3rd

RESPONDENT

WOEST MALAN WENHOLD INC ….......................................4TH

RESPONDENT

COUNSEL FOR THE APPLICANT: J H DREYER SC; SJ MYBURGH

COUNSEL FOR THE FIRST AND SECOND RESPONDENTS: A B ROSSOUW SC

______________

JUDGMENT

(APPLICATION FOR LEAVE TO APPEAL)

NKOSI-THOMAS AJ

A.

INTRODUCTION

This is an application for leave to appeal against the whole of the judgment and order made on 18 March 2010, on the grounds set out in the first and second respondents’ notice delivered in terms of Rule 49(1)(b) of the rules of this Court.

The applicants for leave to appeal were the first and second respondents respectively in the main application and the respondent herein was the applicant in the said main application.

For purposes of convenience, I will employ herein their appellations as were employed in the main application.

On 18 March 2010 I granted an order, on an urgent basis, that the share register of the second respondent be rectified by striking out the name of the first respondent therein and inserting into it the name of the applicant as 100% shareholder of the second respondent and that such rectification be effected by the second respondent’s auditors.

The aforesaid relief was granted in accordance with the provisions of section 115 of the Companies Act 61of 1973 (hereinafter referred to as “the Act”).

It is indeed so that in order for this Court to grant leave to appeal it should first be satisfied inter alia that there exists a reasonable prospect of success on appeal1.

The main basis upon which this appeal is based 2 is that the Court erred in not finding that there is a genuine dispute of fact between the parties relating to the terms of the oral agreement, and in not resolving the said dispute on the papers in favour of the respondents.

I have carefully considered the competing contentions of the parties herein and am unable to agree that there exists a reasonable possibility of another Court coming to a different conclusion from the one arrived at.

As stated the English letter dated 11 November 2009 contain the following:

“… The shares of Zwelethu Environment Services Rustenburg will be held by Zwelethu Environment Services until such a date and time as the purchase price of the business, referred to above, have (sic) been paid in full on which date same will be transferred to Dave Cumming.”

The Afrikaans letter dated 6 November 2009 contains a similar term.

It common cause that Zwelethu Environment Services Rustenburg referred to in the correspondence is the second respondent.

A written agreement was subsequently executed by the parties at Rustenburg 25 November 2009.

As stated in the judgment, there is no suggestion that the first respondent has, prior to the institution of the proceedings, disputed the content of the above correspondence and sought to correct same on the basis that it did not contain the accurate recordal of what was agreed at the applicant’s attorneys offices. Indeed, the first respondent when forwarding the English version of the correspondence to RCF referred thereto as the formal agreement and contract between the parties.

In the circumstances I arrive at the conclusion that there exists no possibility of another Court coming to a different conclusion.

The above finding obviates the need to consider the Rule 49(11) application which was brought conditionally upon this Court granting leave to appeal.

In the result, the application for leave to appeal is refused.

______

L G NKOSI-THOMAS

ACTING JUDGE

OF THE HIGH COURT

1Van den Heerden v Cronwright 1985(2)SA 342 (T)

2In this regard it is noteworthy that this is the only basis addressed dealt with in the respondents’ heads of argument

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Authorities

Authorities used by the court

Cases, legislation, regulations, and constitutional provisions identified in the available record.

Van den Heerden v Cronwright 1985(2) SA 342 (T)

Case cited

Companies Act 61 of 1973, section 115

Legislation

Legislation referenced in the available case record.

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