South Africa Case Law

Land and Agricultural Development Bank of South Africa v Lazercore Eight(Pty) Ltd and Others (15688/2020)

Land and Agricultural Development Bank of South Africa v Lazercore Eight(Pty) Ltd and Others (15688/2020) [2024] ZAWCHC 109; [2024] 3 All SA 273 (WCC); 2024 (6) SA 267 (WCC) (24 April 2024)

Court

Western Cape High Court, Cape Town

Case number

15688/2020

Judge

Pillay AJ

The court held that the Trust and Mr Smith lacked locus standi to seek relief against the business rescue practitioner, as only the companies themselves could claim for loss or fees paid. The relief sought for forfeiture or repayment of business rescue practitioner fees was not competent in law, as the Companies Act does not provide for such orders absent gross negligence, which was not established on the evidence. The application for costs de bonis propriis was dismissed, as the prior settlement order resolved costs and no gross negligence was found. The application for rescission failed, as…

Source excerpt

• Business Rescue
• Locus Standi
• Remuneration Of Business Rescue Practitioner
• Costs De Bonis Propriis
• Reflective Loss
• Rescission Of Judgment

Nedbank Limited v Master of the High Court and Another (43581/16)

Nedbank Limited v Master of the High Court and Another (43581/16) [2019] ZAGPJHC 393 (31 October 2019)

Court

South Gauteng High Court, Johannesburg

Case number

43581/16

Judge

P.A. Meyer

The court held that the Supreme Court of Appeal and Constitutional Court judgments in Diener are binding and dispositive of the central issue. Sections 135(4) and 143(5) of the Companies Act 71 of 2008 do not create a super-preference for the business rescue practitioner’s claim for remuneration and expenses over secured creditors. Instead, the BRP’s claim is a preferential claim against the free residue, ranking ahead of post-commencement financiers and unsecured creditors, but not ahead of pre-business rescue secured creditors. The Master’s reliance on the Murgatroyd judgment was misplaced,…

Source excerpt

• Business Rescue Proceedings
• Liquidation Preference
• Remuneration Of Business Rescue Practitioner
• Companies Act 71 Of 2008
• Insolvency Act 24 Of 1936

Diener N.O. v Minister of Justice and Others (926/2016)

Diener N.O. v Minister of Justice and Others (926/2016) [2017] ZASCA 180; [2018] 1 All SA 317 (SCA); 2018 (2) SA 399 (SCA) (1 December 2017)

Court

Supreme Court of Appeal

Case number

926/2016

Judges

Navsa, Bosielo, Majiedt, Plasket, Schippers

The SCA held that a business rescue practitioner has no super-preference over secured creditors on liquidation, must prove a claim, and liquidation runs from the winding-up application date.

• Business Rescue
• Remuneration Of Business Rescue Practitioner
• Creditor Preferences
• Statutory Interpretation
• Liquidation Proceedings
• Business-rescue

Absa Bank Limited v Golden Dividend 339 (Pty) Ltd and Others (70637/13)

Absa Bank Limited v Golden Dividend 339 (Pty) Ltd and Others (70637/13) [2014] ZAGPPHC 1048; 2015 (5) SA 272 (GP) (19 December 2014)

Court

North Gauteng High Court, Pretoria

Case number

70637/13

Judge

Lazarus

The court held that joinder of all creditors was not required as notification and participation rights under the Companies Act were sufficient. The extension for publication of the business rescue plan was validly granted by the majority creditor, and a meeting was not strictly required for such extension. However, the business rescue plan failed to comply with the substantive requirements of section 150(2) as it did not provide adequate information regarding available property, conditions for implementation, or a realistic prospect of paying creditors. The plan was found to be a superficial…

Source excerpt

• Business Rescue
• Company Liquidation
• Joinder Of Creditors
• Remuneration Of Business Rescue Practitioner
• Compliance With Companies Act

Murgatroyd v Van Den Heerver N.O. and Others (20456/2014)

Murgatroyd v Van Den Heerver N.O. and Others (20456/2014) [2014] ZAGPJHC 142; [2014] 4 All SA 89 (GJ); 2015 (2) SA 514 (GJ) (29 July 2014)

Court

South Gauteng High Court, Johannesburg

Case number

20456/2014

Judge

P.A. Meyer

The court held that the business rescue practitioner is entitled to reimbursement for expenses and disbursements incurred during business rescue proceedings, provided they are reasonably necessary to carry out his functions and facilitate the conduct of the proceedings. The engagement of external professionals such as Nimble Risk Services and Accountants at Law was justified by the dysfunctional management and unreliable internal data at Sanyati, and the magnitude and complexity of the rescue process. The court rejected the liquidators’ argument that the practitioner could not delegate functi…

Source excerpt

• Business Rescue Proceedings
• Companies Act 71 Of 2008
• Remuneration Of Business Rescue Practitioner
• Preferential Claims
• Delegation Of Functions