South Africa Case Law

Smyth and Others v Investec Bank Ltd and Another, In re: Standard Bank Nominees (TVL) Pty Ltd and Others (19269/2011)

Smyth and Others v Investec Bank Ltd and Another, In re: Standard Bank Nominees (TVL) Pty Ltd and Others (19269/2011) [2015] ZAGPPHC 1144; 2016 (4) SA 363 (GP) (17 September 2015)

Court

North Gauteng High Court, Pretoria

Case number

19269/2011

Judge

C.P. Rabie

The High Court held that only registered members have standing under section 252 of the Companies Act, not beneficial owners whose shares are held by nominees.

• Locus Standi
• Minority Shareholder Remedy
• Section 252 Companies Act
• Nominee Shareholding
• Intervention Application
• Locus-standi

Bhagwandas and Others v Dr Goolam Omar Inc and Another, Bhagwandas and Others v GMO Imaging (Pty) Ltd and Others (2009/7655, 09/07656)

Bhagwandas and Others v Dr Goolam Omar Inc and Another, Bhagwandas and Others v GMO Imaging (Pty) Ltd and Others (2009/7655, 09/07656) [2011] ZAGPJHC 138 (10 August 2011)

Court

South Gauteng High Court, Johannesburg

Case number

2009/7655, 09/07656

Judge

F Kathree-Setiloane

High Court granted final winding-up orders for two radiology companies after finding an irretrievable breakdown in relations and rejecting a buy-out counter-application.

• Just And Equitable Winding Up
• Deadlock Between Shareholders
• Fiduciary Duties
• Buy Out Remedy
• Section 344 Companies Act
• Section 252 Companies Act

Clarke and Others v Kwezi Mining (Pty) Ltd and Others (2010/47125)

Clarke and Others v Kwezi Mining (Pty) Ltd and Others (2010/47125) [2011] ZAGPJHC 240 (17 June 2011)

Court

South Gauteng High Court, Johannesburg

Case number

2010/47125

Judge

C G Lamont

The court found unfairly prejudicial shareholder conduct and ordered the second respondent to buy out the applicants’ shares at fair value determined by auditors.

• Minority Shareholder Protection
• Unfair Prejudice
• Section 252 Companies Act
• Share Valuation
• Shareholder Disputes
• Minority-shareholder-protection

Louw and Others v SA Mohair Brokers Ltd and Others (3682/09)

Louw and Others v SA Mohair Brokers Ltd and Others (3682/09) [2010] ZAECPEHC 53 (19 August 2010)

Court

Eastern Cape High Court, Port Elizabeth

Case number

3682/09

Judge

Y Ebrahim

The Court found that the issues raised in the application for leave to appeal were complex and unique, involving important questions of law regarding directors' fiduciary duties, the interpretation and application of section 252 of the Companies Act, and the law of meetings. Given the reasonable prospect that another court may reach a different conclusion on these matters, leave to appeal was granted to the first respondent. The Court accepted that the statutory remedy under section 252 was properly interpreted and applied, but acknowledged that the arguments presented were substantial enough…

Source excerpt

• Fiduciary Duty Of Directors
• Section 252 Companies Act
• Law Of Meetings
• Unfair Prejudice
• Statutory Remedy For Shareholders

Ferreira v Executors of Estate Late Halse NO and Others (1461/2009, 1200/2010)

Ferreira v Executors of Estate Late Halse NO and Others (1461/2009, 1200/2010) [2010] ZAKZDHC 62 (25 June 2010)

Court

Kwazulu-Natal High Court, Durban

Case number

1461/2009, 1200/2010

Judge

Motala AJ

Minority shareholder sought winding up and alternative relief under section 252, but the court found his own conduct caused the deadlock and dismissed the application.

• Just And Equitable Winding Up
• Minority Shareholder Rights
• Section 252 Companies Act
• Deadlock
• Company Substratum
• Shareholder Oppression

Bayly and Others v Knowles (174/09)

Bayly and Others v Knowles (174/09) [2010] ZASCA 18; 2010 (4) SA 548 (SCA) ; [2010] 3 All SA 374 (SCA) (18 March 2010)

Court

Supreme Court of Appeal

Case number

174/09

Judges

Harms, Nugent, Heher, Leach, Seriti

The SCA held that a fair offer for a minority shareholder’s shares can defeat an oppression claim under section 252 of the Companies Act, and dismissed the application.

• Shareholder Oppression
• Section 252 Companies Act
• Minority Protection
• Fair Offer
• Company Management
• Just And Equitable Liquidation

Hickman v Oban Infrastructure (Pty) Ltd and Others (2008/18332)

Hickman v Oban Infrastructure (Pty) Ltd and Others (2008/18332) [2010] ZAGPJHC 9 (3 March 2010)

Court

South Gauteng High Court, Johannesburg

Case number

2008/18332

Judge

B S Spilg

The court found that the applicant was unfairly excluded from management of both the holding and operating companies, contrary to the implicit understanding among the shareholders that each would participate in management. The exclusion was effected through pre-determined decisions and notices, amounting to unfairly prejudicial conduct under section 252(3) of the Companies Act. The court rejected the respondents' reliance on majority rule and found that the applicant's legitimate expectations, evidenced by the draft shareholders agreement and the structure of the companies, entitled him to re…

Source excerpt

• Minority Shareholder Oppression
• Just And Equitable Winding Up
• Shareholder Buy Out
• Fair Valuation
• Section 252 Companies Act

Molokoane v Diversified Power & Systems Integration (Pty) Ltd (3235/09)

Molokoane v Diversified Power & Systems Integration (Pty) Ltd (3235/09) [2009] ZAKZDHC 70 (18 November 2009)

Court

Kwazulu-Natal High Court, Durban

Case number

3235/09

Judge

Marais AJ

The court dismissed an opposed just-and-equitable winding-up application, finding no prima facie case and no basis to refer factual disputes to oral evidence.

• Just And Equitable Winding Up
• Shareholder Disputes
• Deadlock In Management
• Section 344 Companies Act
• Arbitration Clauses
• Section 252 Companies Act

McMillan NO v Pott and Others (11125/08)

McMillan NO v Pott and Others (11125/08) [2009] ZAWCHC 96; 2011 (1) SA 511 (WCC) (18 June 2009)

Court

Western Cape High Court, Cape Town

Case number

11125/08

Judge

A G Binns-Ward

The court found that the exclusion of McMillan from management and employment in Tygerberg Minolta (Pty) Ltd was directly relevant to the Trust's position as shareholder, given the underlying joint venture understanding. The majority shareholders failed, within a reasonable time, to offer the Trust an opportunity to withdraw its capital after McMillan's exclusion, which constituted unfairly prejudicial conduct under section 252(1) of the Companies Act. The court held that even if McMillan was at fault for his exclusion, the equity-based nature of the remedy did not preclude relief. The articl…

Source excerpt

• Unfair Prejudice Remedy
• Section 252 Companies Act
• Shareholder Buy Out
• Quasi Partnership
• Legitimate Expectation
• Minority Shareholder Protection