South Africa Case Law

Afgri Agri Services (Pty) Ltd v Muller and Others (39063/2022)

Afgri Agri Services (Pty) Ltd v Muller and Others (39063/2022) [2025] ZAGPPHC 616 (17 June 2025)

Court

North Gauteng High Court, Pretoria

Case number

39063/2022

Judge

Kooverjie

The court held that the first and second grounds of exception were without merit. It is sufficient to plead that the company is in the process of winding up and unable to pay its debts to invoke Section 424 of the Companies Act 61 of 1973. Section 424 applies to both natural and juristic persons, provided that the necessary allegations regarding knowledge and participation through the directing mind are made. However, the particulars of claim failed to plead material facts showing that the first defendant, through its directors or other controlling individuals, had the requisite knowledge and…

Source excerpt

• Reckless Trading
• Personal Liability Of Directors
• Winding Up Of Insolvent Companies
• Exceptions To Pleadings
• Section 424 Liability

Makasi and Others v Radebe and Another (2019/29559)

Makasi and Others v Radebe and Another (2019/29559) [2025] ZAGPJHC 493 (20 May 2025)

Court

South Gauteng High Court, Johannesburg

Case number

2019/29559

Judge

Engelbrecht

The High Court declared the Second Respondent a delinquent director and guilty of an offence under the Companies Act, and dismissed his counter-application.

• Delinquent Director
• Companies Act Section 162
• Reckless Trading
• Fraudulent Misrepresentation
• Director Liability
• Settlement Agreement

Eckhoff N.O and Others v Van Den Heever and Others (16404/23)

Eckhoff N.O and Others v Van Den Heever and Others (16404/23) [2025] ZAWCHC 47 (11 February 2025)

Court

Western Cape High Court, Cape Town

Case number

16404/23

Judge

Thulare

The High Court referred disputed section 424 claims to trial, dismissed the section 31 motion relief with costs, and found prescription was not fully established.

• Collusive Disposition
• Reckless Trading
• Personal Liability Of Directors
• Prescription
• Motion Vs Action Proceedings
• Setting Aside Property Transfer

Badenhorst v De Kock (13372/2023)

Badenhorst v De Kock (13372/2023) [2024] ZAWCHC 427; [2025] 1 All SA 597 (WCC); 2025 (4) SA 540 (WCC) (18 December 2024)

Court

Western Cape High Court, Cape Town

Case number

13372/2023

Judge

M W Janisch

The High Court held a sole director personally liable under section 424 for a company debt incurred recklessly, but limited the amount to the sum in the court order.

• Director Liability
• Reckless Trading
• Personal Liability
• Companies Act Section 424
• Director-liability
• Reckless-trading

Tayob v Lifestyle Furnishers CC (In Liquidation) (14835/2020)

Tayob v Lifestyle Furnishers CC (In Liquidation) (14835/2020) [2024] ZAGPPHC 1283 (29 November 2024)

Court

North Gauteng High Court, Pretoria

Case number

14835/2020

Judge

MPN Mbongwe

The High Court granted a business rescue practitioner's Rule 47 application for security for costs against a liquidated close corporation in litigation over alleged reckless trading.

• Security For Costs
• Close Corporation Liability
• Reckless Trading
• Business Rescue
• Liquidation
• Impecuniosity

Tayob v Lifestyle Furnishers CC (14835/2020)

Tayob v Lifestyle Furnishers CC (14835/2020) [2024] ZAGPPHC 1132 (4 November 2024)

Court

North Gauteng High Court, Pretoria

Case number

14835/2020

Judge

Mbongwe

The High Court ordered a liquidated close corporation to furnish security for costs in an action against a business rescue practitioner, finding it impecunious and funded by a creditor.

• Security For Costs
• Close Corporation Liability
• Reckless Trading
• Business Rescue
• Liquidation Procedure
• Security-for-costs

Tiger Consumer Brands Limited v Sandragasan and Others (1955/2023P)

Tiger Consumer Brands Limited v Sandragasan and Others (1955/2023P) [2024] ZAKZPHC 99 (31 October 2024)

Court

Kwazulu-Natal High Court, Pietermaritzburg

Case number

1955/2023P

Judge

Mlaba

The court found that the plaintiff's amended particulars of claim, together with the overcharge schedule, identified the products, periods, amounts charged, and estimated overcharges with sufficient particularity. The defendants, being intimately involved in the transactions and industry, are able to reasonably assess the quantum and respond to the claim. The court distinguished this case from Boxer Superstores, noting that the plaintiff here provided more detail and specificity. The exceptions raised by the defendants were found to be repetitive and not sustainable, as the pleadings were not…

Source excerpt

• Contractual Damages
• Fraud And Corruption
• Reckless Trading
• Close Corporations Act
• Pleading Requirements
• Quantification Of Damages

Lluivia Trade Division CC v Stassen and Others (2023/055569)

Lluivia Trade Division CC v Stassen and Others (2023/055569) [2024] ZAGPJHC 960 (30 September 2024)

Court

South Gauteng High Court, Johannesburg

Case number

2023/055569

Judge

S Van Nieuwenhuizen

The High Court held two close-corporation members personally liable under section 64 after they sold unapproved face masks and acted recklessly; condonation was refused.

• Personal Liability Of Members
• Reckless Trading
• Close Corporations Act Section 64
• Regulatory Non Compliance
• Condonation
• Summary Judgment

Venator Africa (Pty) Ltd v Watts and Another (053/2023)

Venator Africa (Pty) Ltd v Watts and Another (053/2023) [2024] ZASCA 60; 2024 (4) SA 539 (SCA) (24 April 2024)

Court

Supreme Court of Appeal

Case number

053/2023

Judges

Mothle, Mabindla-Boqwana, Molefe, Baartman, Keightley

The Supreme Court of Appeal held that section 218(2) of the Companies Act does not create a general right of action against directors for losses suffered by creditors due to reckless trading by the company. Section 22(1) imposes duties on the company, not its directors, and liability for directors is specifically regulated by section 77(3)(b), which provides for liability to the company itself. The appellant failed to identify any provision of the Act breached by the directors that would trigger liability under section 218(2). The Court rejected the reasoning in Rabinowitz and related cases,…

Source excerpt

• Director Liability
• Reckless Trading
• Companies Act
• Exception Procedure

Jumalu Fencing (Pty) Ltd v Boyise (956/2021)

Jumalu Fencing (Pty) Ltd v Boyise (956/2021) [2024] ZANWHC 50 (29 February 2024)

Court

North West High Court, Mafikeng

Case number

956/2021

Judge

Petersen

The High Court granted summary judgment for a reduced liquidated debt after finding no bona fide defence to the claim and relying on an acknowledgment of debt.

• Summary Judgment
• Liquidated Claim
• Acknowledgment Of Debt
• Fiduciary Duties
• Reckless Trading
• Summary-judgment