389 by k5lAdOT

VIEWS: 3 PAGES: 14

									                IN THE HIGH COURT OF SOUTH AFRICA
                  (TRANSVAAL PROVINCIAL DIVISION)


                                                             Date: 2008-12-04


                                                    Case Number: A567/2007


In the matter between:


FRED GEORGE KINNEAR                                             First Appellant
PROTOURS ISLE OF MAN LTD                                     Second Appellant
EAGLE CREEK INVESTMENTS (PTY) LTD                              Third Appellant
TIMOTHY MPOPOLI MATHEBULA                                     Fourth Appellant
PATRICIA NORA ZENANI FAKUDE-NKUNA N.O.                          Fifth Appellant
COACHCOR (PTY) LTD                                             Sixth Appellant


and


TRAVICO (PTY) LTD                                                  Respondent




                                JUDGMENT




SOUTHWOOD J



[1]   The first to fifth appellants appeal against the order of the court below,

      made on 13 April 2007, that –



      (1)    the first to fifth appellants forthwith and with immediate effect

             restore the respondent’s possession and control over and in
                                       2


             Coachcor SA (Pty) Ltd (‘Coachcor’ or ‘the company’) and its

             business and assets;



      (2)    the first to fifth appellants are prohibited from taking control of

             and/or interfering with the management and/or business

             activities of Coachcor without a valid court order empowering

             them to do so;



      (3)    that the first to fifth appellants, jointly and severally, pay the

             costs of the application, such costs to include the costs

             consequent upon the employment of two counsel.



[2]   The respondent applied for a mandament van spolie against the first to

      fifth appellants alleging that since 31 March 2006 (the ‘effective date’

      referred to in the share sale agreement referred to below), through its

      representatives, it had control of the management of Coachcor and its

      day to day business activities;      that one Cornelius Francois Marais

      (‘Marais’) (who was cited as the sixth respondent) acted as the

      respondent’s representative in managing the affairs of the company

      and that on 8 February 2007 the fifth appellant, acting on behalf of the

      first to fifth appellants, unlawfully took possession of the company and

      its business.      The first to fifth appellants denied all these

      allegations and pertinently put in issue whether the mandament van

      spolie was an appropriate remedy. The court below found that the

      application was a classic spoliation application.
                                         3




[3]   ‘It is a fundamental principle that no man is allowed to take the law into

      his own hands; no-one is permitted to dispossess another forcibly or

      wrongfully and against his consent of the possession of property

      whether movable or immovable.          If he does so, the Court will

      summarily restore the status quo ante, and will do that as a preliminary

      to any inquiry or investigation into the merits of the dispute‘ – see Nino

      Bonino v De Lange 1906 TS 120 at 122; Sillo v Naude 1929 AD 21

      at 26;    Yeko v Qara 1973 (4) SA 735 (A) at 739D-H.           In certain

      circumstances there can be a spoliation of an incorporeal right – see

      Nienaber v Stuckey supra 1946 AD 1049 at 1055;               Bon Quelle

      (Edms) Bpk v Munisipaliteit van Otavi 1989 (1) SA 508 (A) at 514I;

      Telkom SA Ltd v Xsinet (Pty) Ltd 2003 (5) SA 309 (SCA) para 9.

      For a mandament van spolie there must be proof that –



      (1)      the applicant enjoyed peaceful and undisturbed possession of

               the thing or right; and



      (2)      the applicant was dispossessed forcibly or wrongfully and

               without his consent.



      Reck v Mills en ‘n Ander 1990 (1) SA 751 (A) at 755F-J.



[4]   It is trite that an applicant who seeks the relief of the mandament van

      spolie seeks final relief and that, generally, such relief may be granted
                                       4


      only if the allegations of fact made by the applicant which are admitted

      by the respondent together with the allegations of fact made by the

      respondent justify the grant of such relief – see Nienaber v Stuckey

      1946       AD   1049   at   1053-1054:   Moloisane    v   West       Rand

      Administrative Board and Another 1980 (1) SA 372 (W) at 375G-H;

      Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd 1984 (3)

      SA 623 (A) at 633E-634C. The court below decided this case on the

      affidavits and the general rule applies. Neither party sought leave to

      cross-examine any of the other party’s deponents and there was no

      request that the court reject the evidence of any witness on the papers

      – see Plascon-Evans Paints supra at 633H-634B.



[5]   The relevant facts which are common cause and the respondent’s

      allegations of fact which must be accepted may be summarised as

      follows:



      (1)    The respondent is a South African company which was

             incorporated in 2005. The respondent’s shareholders acquired

             the company for the purpose of acquiring the shares in

             Coachcor;



      (2)    The first appellant is an Isle of Man company which carries on

             business at Summerhill, Isle of Man. The first appellant holds

             (and at all material times has held) 51 shares in Coachcor;
                               5


(3)   The second appellant is a South African company which carries

      on business in Pretoria. The second appellant holds (and at all

      material times has held) 15 shares in Coachcor;



(4)   The third appellant is a businessman who lives in Nelspruit. The

      third appellant is a director of Coachcor and holds (and at all

      material times has held) 10 shares in the company;



(5)   The fifth appellant is a trustee of the Zenani Trust, which holds

      (and at all material times has held) 14 shares in Coachcor, and

      is a director of the company;



(6)   The fifth appellant is a businessman who holds (and at all

      material times has held) 5 shares in Coachcor and is the

      managing director of the company;



(7)   Marais is a businessman and lives in Pretoria. Until 8 February

      2007 he was employed by Coachcor as its general manager.



(8)   Coachcor charters coaches and has conducted business in the

      overland transport of passengers for more than 15 years. It is

      an important undertaking in the transport industry;



(9)   On 30 March 2006 the first to fifth appellants and Marais, who

      together held 100 % of the shares in Coachcor, and the
                          6


respondent entered into a written agreement (‘the share sale

agreement’) in terms of which the appellants and Marais sold to

the respondents all their shares in the company. In terms of the

share sale agreement –



(i)     the respondent undertook to pay R10 000 000 for the

        shares on the effective date of 31 March 2006 ‘or as soon

        as reasonably possible’;



(ii)    the respondent undertook to pay the first appellant’s loan

        account of R9 431 329,27 ‘as soon as reasonably

        possible’;



(iii)   no variation of or modification to the share sale

        agreement would be of any force or effect unless in

        writing and signed by the parties;



(iv)    the effective date was defined as 31 March 2006; and



(v)     the agreement was silent as to any obligation to be

        performed on or before the effective date. In particular no

        provision was made for the transfer of the shares before

        payment of the purchase price;
                                  7


(10)   On 30 March 2006 and at all material times thereafter, the

       company’s shareholders were:



       (i)     first appellant (Protours Isle of Man Ltd)   51 shares;



       (ii)    second appellant (Eagle Creek

               Investments (Pty) Ltd)                       15 shares;



       (iii)   third appellant (Timothy Mpopoli

               Mathebula)                                   10 shares;



       (iv)    fourth appellant (Patricia Nora

               Zenani Fakude-Nkuna N.O.: the

               Zenani Trust)                                14 shares;



       (v)     fifth appellant (Fred George Kinnear)         5 shares;



       (vi)    Cornelius Francois Marais (sixth

               respondent in the court below)                5 shares



       and the directors were the third, fourth and fifth appellants and

       Marais. At all material times the fifth appellant has been the

       managing director of the company;
                                8


(11)   After entering into the share sale agreement the respondent

       unsuccessfully attempted to arrange finance for the purchase of

       the shares. By the middle of 2006 the appellant’s attorney had

       called upon the respondent to pay the amounts owing in terms

       of the share sale agreement and by 5 February 2007 the

       respondent had paid only the sum of R9 431 329,27 to the first

       appellant.    The respondent had not paid the appellants the

       R10 million as the purchase price of the shares. (On 5 February

       2007, on its own version, the respondent still had not paid

       approximately R7,5 million for the purchase price of the shares);



(12)   At no time did the respondent demand transfer of the shares

       and the sellers (the five appellants and Marais) in terms of the

       sale agreement have not transferred their shares to the

       respondent.     (In paragraph 18 of its replying affidavit the

       respondent expressly disavows reliance on such a transfer).

       There is no evidence that the shareholders of the company or

       the company itself appointed new directors;



(13)   After the share sale agreement was concluded on 30 March

       2006 and until 8 February 2007 –



       (i)   Marais continued to be a director as well as the general

             manager of Coachcor;
                                 9


       (ii)    Coachcor continued to pay Marais’ salary;



       (iii)   Marais performed his duties under the control and

               supervision of the fifth appellant, the managing director,

               and the board of directors;



(14)   On 8 February 2007 the fifth appellant and Marais entered into

       an agreement in terms of which Marais’ employment as general

       manager was terminated and Coachcor undertook to pay to

       Marais R886 068 as a severance package and R115 902,67 for

       his accumulated leave. On the same date the fifth appellant and

       Marais entered into another agreement in terms of which the

       fifth appellant purchased Marais’s shares in Coachcor for a

       purchase price of R500 000. On 8 and 9 February 2007 the

       aforementioned amounts were paid to Marais with funds

       obtained from Buscor (Pty) Ltd, a company in which the fifth

       appellant has a controlling interest. After resigning as a director

       of Coachcor Marais left the premises.         All this was done

       voluntarily;



(15)   On 7 February 2007 and 8 February 2007 the fifth appellant

       informed a director of the respondent’s shareholder and the staff

       of Coachcor respectively that he, the fifth appellant, was taking

       over the management of the company.
                                     10


[6]   In summary, the share sale agreement did not affect the management

      of Coachcor or its business and assets. The shareholding remained

      the same, in accordance with Article 60 of the company’s Articles of

      Association, the management of the company remained with the

      directors who did not change.       The business and assets of the

      company remained vested in it. The respondent did not become the

      shareholder and therefore obtain control of the company.



[7]   The respondent alleges that it was spoliated by the fifth appellant’s

      actions on 8 February 2007. It was in possession of Coachcor and

      Coachcor’s business because of Marais’ presence at the company

      premises and the fifth appellant unlawfully deprived the respondent of

      possession.



[8]   On the affidavits there were three insurmountable difficulties facing the

      respondent:



      (1)   legally, Marais was the general manager of Coachcor and was

            performing his duties as general manager.         Nowhere in the

            affidavits does the respondent explain how his position vis-à-vis

            the company changed. In law, Marais was simply a functionary

            of Coachcor who was employed to further its interests.          He

            possessed nothing;
                                        11


       (2)      factually, there is a sharp dispute about who Marais represented

                which cannot be resolved on the affidavits. Since this is the

                essential fact for the respondent to establish the respondent

                failed to discharge the onus of proving that it was in possession

                of Coachcor and its business.



       (3)      factually, there is no evidence to show that the appellants acted

                unlawfully in any way.       The mandament of spolie should

                therefore not have been granted.



[9]    As shareholders and directors of Coachcor the appellants were entitled

       to attend shareholders and directors meetings and take decisions

       relating to the management of the company.          As purchaser of the

       shares who had not performed in terms of the share sale agreement

       and became the sole shareholder the respondent had no locus standi

       to seek the relief in terms of prayer 3 of the notice of motion. The relief

       sought and granted was in conflict with the basic principles of company

       law. In argument the respondent’s counsel was unable to support this

       order.



[10]   The court below therefore erred in granting the relief and the appeal

       must be upheld.



       Order
                                      12


[11]   I   The appeal is upheld with costs. The orders granted on 13

           April 2007 are set aside and substituted with the following

           order:



                    ‘The application is dismissed with costs’.




                                                ________________________
                                                        B.R. SOUTHWOOD
                                               JUDGE OF THE HIGH COURT

I agree




                                                ________________________
                                                        W.R.C. PRINSLOO
                                               JUDGE OF THE HIGH COURT

I agree




                                                ________________________
                                                         N.M. MAVUNDLA
                                               JUDGE OF THE HIGH COURT
                             13


CASE NO: A567/2007


HEARD ON: 3 December 2008


FOR THE 1st TO 6th APPELLANTS: ADV. S.J. MARITZ SC


INSTRUCTED BY: Mr. A. de Klerk of André de Klerk Attorneys


FOR THE RESPONDENT: ADV. J.G. CILLIERS SC
                    ADV. M.T. SHEPHERD


INSTRUCTED BY: Mr. P. Fouché of Van Huyssteens Commercial
               Attorneys


DATE OF JUDGMENT: 4 December 2008
14

								
To top