Judicial Management re: Approach, Confirmation or Discharge of Provisional Judicial Management Order

HB74-10 : REBECCA SIZIBA vs BAMSLOVE INVESTMENTS (PVT) LTD and MARTIN SIMMONS and REGISTRAR OF COMPANIES
Ruled By: MATHONSI J

The first respondent employs 105 employees on a fulltime basis and its mines must be doing well. I am of the view that its problems, and in particular its inability to declare a dividend for all these years, is attributable to maladministration. While most of the applicant's concerns may be founded they point to a ...

HB82-13 : ELLINGBARN TRADING (PRIVATE) LIMITED vs ASSISTANT MASTER OF THE HIGH COURT and PEOPLE'S OWN SAVINGS BANK
Ruled By: MUTEMA J

In order for the avid reader to fully comprehend the outcome of this proceeding, I find it in order to start by briefly outlining, in its chronological order, the path which it has trodden. The applicant was incorporated on 13 March, 2007. It is essentially a restaurant whose speciality is traditional food. In case number HC3829/11, the ...

In order for the avid reader to fully comprehend the outcome of this proceeding, I find it in order to start by briefly outlining, in its chronological order, the path which it has trodden.

The applicant was incorporated on 13 March, 2007. It is essentially a restaurant whose speciality is traditional food. In case number HC3829/11, the second respondent, as plaintiff, issued summons against the applicant and three other defendants on 20 April, 2011, for the recovery of money lent and advanced in the sum of $18,761=68 plus interest and costs. The second respondent also sought and obtained an order declaring the mortgaged property, namely, Stand 14475 Bulawayo Township of Stand 150038 Bulawayo Township, registered in the name of Samuel Ncube (the fourth defendant), specially executable. The second respondent did obtain judgment against the applicant, its co-principal debtors and guarantors in their personal capacities on 25 November 2011.

When the second respondent sought to execute the writ of execution against movable and immovable property, the applicant and its co-defendants filed an application for the suspension of the sale of the dwelling in terms of Order 40 Rule 359 of the High Court Rules, 1971. This application was dismissed by this Court on 7 May, 2012. Realising that the sale in execution of the immovable property was to go ahead, the applicant was undaunted and it applied for provisional judicial management via an urgent chamber application on 22 June, 2012. On 5 July, 2012 NDOU J…, granted the provisional order couched in the following terms:

“TERMS OF THE FINAL ORDER SOUGHT

That you show cause to this Honourable Court, if any, why a final order should not be made in the following terms:

(1) That Applicant, Ellingbarn Trading (Private) Limited be and is hereby placed under judicial management until such time as this order may be discharged.

(2) Whilst the Judicial Management order is in force, all actions, executions of writs, summons and other proceedings against the Applicant and all its Directors and/or guarantors or other legal persons and or legal persona who have underwritten Applicant's debtors shall be stayed and not proceeded with without leave of this Honourable Court.

(3) That Michael Batandi Mpofu of Mimosa Income Tax Consultants, 27 Bon Accord Road Westondale, Bulawayo be and is hereby appointed the Judicial Manager of Applicant on such terms and conditions as to remuneration as may be approved by the Assistant Master of the High Court.

(4) That the Applicant's Directors and other persons hitherto vested with powers of management of Applicant be and are hereby divested of such powers.

(5) That all powers as described in 4 above be and are hereby invested in the Judicial Manager in (3) above in terms of section 306(a) to (m) of the Companies Act [Chapter 24:03].

(6) The costs of this Application shall be paid by the Applicant through the Judicial Manager.

INTERIM RELIEF GRANTED

Pending confirmation or discharge of this provisional order,

(i) Whilst the Judicial Management is in force, all actions, executions of writs, summons and other proceedings against the Applicant and all its directors and or guarantors or other legal persons and/or other legal persona who have underwritten Applicant's debtors shall be stayed and not proceeded with without leave of this Honourable Court.

(ii) The Assistant Master shall forthwith appoint a Provisional Judicial Manager in terms of Section 302 (1)(b)(i) of the Companies Act [Chapter 24:03].

(iii) All interested parties may appear before this Honourable Court on the 18^th day of October 2012 at 10:00 am or so soon thereafter as they may be heard, should they wish to oppose the confirmation of this Provisional order.”

When the applicant finally sought confirmation of the provisional judicial management order – it having flouted procedures on several return dates, for instance by failing to publish the provisional order in the Chronicle newspaper and the Government Gazette and convening of creditors meeting by the provisional judicial manager (both of which have not been done to date) - the second respondent opposed the confirmation sought….,.

On the merits, counsel for the second respondent submitted that the applicant, in fact, used a wrong procedure in bringing the application for provisional judicial management.

As already stated above, the application to place the applicant under provisional judicial management order was made by way of an urgent chamber application. There is nowhere in the Companies Act [Chapter 24:03] is it provided that an application of this nature can be made via the Chamber Book. Sections 299 and 300 of the Companies Act [Chapter 24:03] are apposite. They are clear in their wording that the application for judicial management shall be a court application. The sections provide:

“Judicial Management Instead of Winding up

299 Circumstances in which provisional judicial management may be obtained

(1) Subject to section three hundred, the court may -

(a) On an application being made to it for such an order by any person who would be entitled to apply for the winding up of the company, grant a provisional judicial management order; or

(b) On an application being made to it for the winding up of the company, grant instead a provisional judicial management order.

(2) …,.

300 Requirements for provisional judicial management order

The court may grant a provisional judicial management order in respect of a company -

(a) On an application referred to in paragraph (a) of subsection (1) of section two hundred and ninety nine, if it appears to the court -

(i) That by reason of mismanagement or for any other cause the company is unable to pay its debts or is probably unable to pay its debts and has not become or is prevented from becoming a successful concern; and

(ii) That there is a reasonable probability that if the company is placed under judicial management it will be enabled to pay its debts or meet its obligations and become a successful concern; and

(iii) That it would be just and equitable to do so; or

…,.”

In view of the foregoing statutory provisions which admit of no other canon of statutory interpretation except their ordinary grammatical meaning it is clear that the correct procedure of obtaining a provisional judicial management order is not by way of a chamber application to a judge but by way of a court application. The provisions of Order 32 Rule 226(2)(a) which allow a chamber application where the matter is urgent and cannot wait to be resolved through a court application are not applicable in casu for the following reasons:

1. The application was made ex parte yet in HC3829/11 the other four interested parties therein were not served with it; and

2. The matter was, with respect, clearly not urgent since it is clear that the application was designed to shield Samuel Dube's immovable property from being sold in execution and nothing else; and

3. The application was also clearly designed to frustrate the 2^nd respondent who had obtained a judgment against the applicant and its fellow defendants as far back as November, 2011 and a writ of execution in February, 2012.

Summons was issued in April 2011 when the applicant had failed to pay its debt to the second respondent. Surely, if the need for judicial management became apparent at that time, the applicant would not have waited until 22 June 2012 to file the purported urgent ex parte chamber application for its placement under provisional judicial management.

Also, the fact that the applicant instituted a chamber application instead of a court application is fatal and Rule 229C(b) or Rule 4C cannot come to the applicant's rescue because the second respondent was clearly prejudiced by the applicant's mala fides and is still being prejudiced. It is therefore not in the interests of justice to condone such non-compliance….,.

The other relevant issue to consider is whether there is a reasonable probability that the applicant will be a successful concern. The requirements for confirmation of a provisional order for judicial management are provided for in Section 305 of the Companies Act [Chapter 24:03] as follows:

“305 Return day of provisional judicial management order

(1) On the return day fixed in the provisional judicial management order, or on the day to which the court or a judge may have extended it, the court, after considering -

(a) The opinion and wishes of the creditors and members of the company; and

(b) The report of the provisional judicial manager prepared in terms of Section three hundred and three; and

(c) The number of creditors who did not prove claims at the first meeting of creditors and the amounts and nature of their claims; and

(d) The report of the Master; and

(e) The report of the Registrar;

may grant a final judicial management order if it appears to the court that there is a reasonable probability that the company concerned, if placed under judicial management, will be enabled to become a successful concern and that it is just and equitable to grant such an order, or it may discharge the provisional judicial management order or make any other order that it thinks just.”

In Feigenbaum and Another v Germanis and Others 1998 (1) ZLR 286 (HC) it was held that judicial management is an extraordinary procedure available to a company in special circumstances and for statutorily prescribed purposes and is only adopted when the court is satisfied that there is a reasonable possibility that, if placed under judicial management, a company which is unable to pay its debts will be able to do so in full, meet its obligations and became a successful concern.

In Tenowitz v Tenny Investments (Pty) Ltd 1979 (2) SA 680 SMALLBERGER J clearly underscored the position…, when he said:

“Judicial management is clearly not an experiment to determine whether a company can extricate itself from financial difficulties…, and the fact that it would have to continue for at least a number of years before [it] could hope to pay its debts suggests that it is not capable of becoming a successful concern within a reasonable time.”

The concept of judicial management is premised on the pedestal that a company has failed to be viable due to mismanagement which can be corrected by a judicial manager. In the instant case, the applicant has not alleged mismanagement in its application. It alleged lack of capital, the liquidity crunch and competition. These are problems no judicial manager can arrest. The onus is on the applicant to show that the company's misfortunes can be turned around by a judicial manager. This onus can only be discharged, inter alia, through the factors to be considered by the court which are listed in paragraphs (a) – (e) in section 305(1) of the Companies Act [Chapter 24:03] supra. In the instant case, none of all those factors was filed in this application and consequently the court is hamstrung to determine whether there is a reasonable probability that the applicant, if placed under judicial management, will be able to become a successful concern and that it is just and equitable to grant an order for judicial management.

The above immediate finding brings me to the exercise of discretion reposed in the court by section 305(1) of the Companies Act [Chapter 24:03] that the court, on the return day, “may discharge the provisional judicial management order or make any other order that it thinks just.”…,.

Such other order includes a winding up order.

Section 206 of the Companies Act [Chapter 24:03] empowers a court to wind up a company where, inter alia, the company is unable to pay its debts or if the court is of the opinion that it is just and equitable that the company be wound up. In Rag (Pvt) Ltd v Huizenga NO 1986 (2) ZLR 203 (SC) the Supreme Court held that where a company is commercially insolvent, its winding up would be justified on the additional ground that it is just and equitable if that is the only means by which a creditor can obtain payment. The discretion being dealt with here was also exercised in the Tenowitz v Tenny Investments (Pty) Ltd 1979 (2) SA 680 case where the court, inter alia, discharged a provisional judicial management order and substituted it with an order for provisional liquidation.

In casu, the applicant has clearly been unable to pay its debt owed to the second respondent as far back as 2011. It has abused court process by employing several delaying tactics in an endeavour to avoid payment. It cannot be conscionable for the court to make a creditor wait so long before being paid by a dilly dallying debtor. Where a company is unable to pay its debts, as is the position in the present case, an unpaid creditor has a right ex debito justitiae to have it placed in liquidation. It is just and equitable that the applicant be wound up. In the result, I make the following order;

The provisional judicial management order granted by this Court on 5 July 2012 and the order staying execution in respect of the applicant's Directors and guarantors be and are hereby discharged and be substituted with an order for the applicant's winding up.

HB83-13 : ZIMBABWE INTERNATIONAL TRADE FAIR COMPANY vs VIKING PLASTICS (PVT) LTD and BONGANI NDLOVU N.O.
Ruled By: MUTEMA J

Economic challenges, liquidity crunch, viability problems, competition – the list is not exhaustive for these and other phenomena which have conspired to hamstring a lot of business entities in this country with the consequent result of threatening their very existence. Too ghastly to contemplate are the possible consequences. But is the flagrant abuse of court ...

It is my considered view that it certainly is not. It only provides temporary refuge.

On 12 April 2012, under case number HC3387/11, the applicant obtained summary judgment in an opposed application in an amount in excess of US$16,591=. This judgment was closely followed by a writ of execution issued on 17 April 2012. The Deputy Sheriff proceeded to attach the first respondent's movables on 7 May 2012. On 14 May 2012, the first respondent, in HC1528/12, filed an urgent chamber application seeking an order for provisional judicial management which was granted on 22 May 2012. That provisional judicial management order contained the following notable features:

(a) The 2^nd respondent volunteered to be appointed provisional judicial manager;

(b) 26 July 2012 was set as the return date for the confirmation of the provisional order;

The applicant has lodged the current application in terms of section 301(2) of the Companies Act [Chapter 24:03]. That section provides:

“301 (2) The court or a judge may at any time, and in any manner, on the application of creditor, a member, the provisional judicial manager, the Master, or any person who would have been entitled to apply for the provisional judicial management order concerned, vary the terms of a provisional judicial management order, including the date of the return day, or discharge it.”

The following pertinent issues are material to the outcome of this application:

(i) The return date for the provisional judicial management order was pegged at 26 July 2012. On that date, the order was further extended to 15 November 2012. Thereafter, there was no further extension made which means that the provisional order is lying dormant.

(ii) On 26 July 2012, the applicant's current legal practitioners wrote to the second respondent lodging the applicant's claim as per the judgment in HC3387/11. The letter fell on deaf ears prompting another follow up correspondence dated 8 August 2012. On 24 September 2012, the second respondent replied advising that he was aware of the applicant's claims but the provisional order had been extended to 15 November 2012 to allow for time to advertise and file a statement of affairs. He undertook to keep the applicant informed of new developments.

It should be noted that on 9 July 2012, the applicant's legal practitioners of record had also written to the first respondent's erstwhile legal practitioners requesting for an update of the judicial management and any reports filed with the Master's office.

Nothing was provided.

(iii) The provisional judicial manager has not, to date, been issued with a certificate of appointment by the Master. He also has not lodged a bond of security with the Master.

(iv) The provisional judicial management order has not yet been advertised;

(v) No meeting of creditors has been convened by the second respondent.

The bottom line here is that the process of provisional judicial management has clearly failed to take off; not because of the applicant's fault but that of the respondents.

Over and above the foregoing, it is pertinently laughable (excuse the pun) that in the founding affidavit by Zenzo Moyo, the first respondent's Managing Director, in the urgent chamber application for provisional judicial management order, in annexure “H”, he gave a list of the applicant's creditors and what it owed each as follows:

1. Zesa Pension Fund– Rent =$ 92,920=71 (which, as at May 2012, stood at $126,952=60)

2. Applicant – Rentals = $16,591=

3. Zesa = $ 5,900=

4. Bulawayo City Council = $ 1,301=67

5. Legal Costs = $ 1,200=__

Total = $117,913=38

It is settled law that the object of a judicial management order is not an experiment of jiggling around to see whether any judicial manager might be able to turn around a distressed company's fortunes at his/her leisure. It is to avoid the drastic remedy of winding up when a company is in financial difficulties due to mismanagement or some other cause, and there is a reasonable probability that under carefully controlled management it will surmount its difficulties. Section 300(a)(ii) of the Companies Act [Chapter 24:03] expressly requires such a reasonable probability to be established in an application for a provisional judicial management order. Under Section 299(i)(a) of the Companies Act [Chapter 24:03], lack of opposition does not entitle the court to dispense with this requirement: R H CHRISTIE, Business Law in Zimbabwe, Juta & Company Ltd 1998…,.

This is so even in casu where there is lack of opposition on account of failure to file notices of opposition and heads by the respondents. In spite of that, it goes without quarrel that in view of the foregoing circumstances surrounding the first respondent's precarious financial position, coupled with failure to put even the provisional judicial management machinery into motion, there is nothing to suggest that a reasonable probability exists that the company can at all be enabled to pay its debts and become a successful concern or that it is just and equitable to let it continue wallowing in its current dormant state of provisional judicial management. The conduct by the respondents in this matter points to only one thing, viz that the provisional judicial management order was not applied for in good faith. It was simply designed to frustrate the applicant who was on the verge of recovering what is duly owed to it thereby delaying execution. I find such conduct to amount to abuse of court process. In this regard, the words of MACDONALD ACJ in Beresford Land Plan (Pvt) Ltd v Urquhart 1975 (1) RLR 260…., bear useful repetition for driving the point home. The learned ACTING CHIEF JUSTICE said:

“There are numerous ways in which the legal process in civil cases may be abused by unscrupulous litigants, and, of these, by far the most common, persistent and deleterious in its adverse effect on the administration of justice is the use of such process to delay the enforcement of just claims. It is this aspect of the administration of the civil law which more than any other has tended to bring it into disrepute and there can scarcely be a more important duty imposed upon the courts than to suppress firmly and without delay any manifestation of this all too common abuse. The greater the law's delays, the greater the temptation for unscrupulous litigants to defend claims solely to gain time and, in the result the evil, unless it is eliminated at its first appearance, tends to escalate.”

I found similar abuse of court process along similar lines in Ellingbarn Trading (Pvt) Ltd v Assistant Master and Another HB82-13, a matter I also heard on the same day. I do not know how many more such cases have found their way into the system but such conduct has to be nipped whenever it rears its pernicious head for the sake of smooth and credible administration of justice. A warning must be sounded to both the legal practitioners who institute such litigation as well as those who rush to certify the litigation as being urgent that in future they may find themselves being visited with costs on attorney-client scale de bonis propriis.

In the result, I make the following order:

(1) The provisional judicial management order granted in favour of the 1^st respondent on 22 May 2012 be and is hereby discharged in its entirety;

(2) The 1^st respondent shall pay the applicant's costs of suit on the scale of legal practitioner and client.

HH48-14 : WINSLEY MILITALA N.O. and QV PHARMACIES PRIVATE LIMITED (Under Provisional Judicial Management) vs MUTUAL FINANCE PRIVATE LIMITED and MESSENGER OF COURT and SHINGIRAI USHEWOKUNZE
Ruled By: CHIGUMBA J

The first applicant's rights, conferred by operation of statute, pose a different dilemma. The matter could be disposed of by simply finding that on 8 January 2014, when the second applicant was placed under provisional judicial management, the Borrowdale Shop was no longer its asset and therefore not capable of being managed by the ...

The first applicant's rights, conferred by operation of statute, pose a different dilemma.

The matter could be disposed of by simply finding that on 8 January 2014, when the second applicant was placed under provisional judicial management, the Borrowdale Shop was no longer its asset and therefore not capable of being managed by the first applicant in terms of the Companies Act [Chapter 24:03]. Another way of looking at the matter would be to consider the unlawfulness of ignoring a provisional judicial management order. In other words, to consider whether the order of the Magistrates Court was superceded and trumped by a subsequent order by a superior court which ought to have been complied with.

In order to establish whether the first applicant met the requirements of spoliation on 24 January 2014, the date of the eviction, the court must have regard to the provisions of the Companies Act [Chapter 24:03] and to the terms of the provisional judicial management order. The court must consider whether any rights conferred on the first applicant by the Companies Act [Chapter 24:03] can accrue where the second applicant no longer derives any benefit from the asset. Was the first applicant in peaceful and undisturbed possession of the Borrowdale Shop as from the date of provisional judicial management? Was the eviction of the second applicant, under provisional judicial management, unlawful because the provisional judicial management order stayed all actions and applications and the execution of all writs and processes without the leave of the court?

The provisional judicial management order contained a provision that all actions and proceedings be stayed and that the leave of the court was required before proceeding. It follows then that I must find that, on 23 January 2014, when the letter was delivered to the first respondent's counsel of record advising of the provisional judicial management order, and then at that stage, the first respondent could no longer proceed with eviction without the leave of the court first being sought or obtained. The reason for that would be that the Companies Act [Chapter 24:03] required that the leave of the court be sought and obtained first, not as submitted by counsel for the applicants that possession had been restored to the second applicant and now vested in the first applicant by operation of statute. I respectfully find that argument baseless and am not convinced by it especially when regard is had to the elements of possession.

It is my considered view that once under provisional judicial management the question of possession no longer arose, the second applicant's assets fell under the authority of the first applicant by operation of statute. I have already made a finding that the Borrowdale property ceased to be an asset of the second applicant on 3 January 2014 when it consented to vacate forthwith. It follows that neither the Companies Act nor common law could confer rights on the provisional judicial manager to secure non-assets by taking possession and control of them. For that reason, I find that the first applicant is not entitled to spoliation.

The matter should rest here but I will proceed to interrogate the defences raised by the first respondent for expediency.

HH170-14 : ZIMBABWE TEXTILE WORKERS UNION vs DAVID WHITEHEAD TEXTILES LTD and DWT HOLDINGS and DWT SPINNING and DWT COTTON WOOLS and DWT FABRICS and DWT HOSEIRY and MASTER OF HIGH COURT
Ruled By: MAKONI J

This is an application for the confirmation of a provisional order granted on 1 December 2010 for the placement of the respondent companies under judicial management. Between that date and the 17^th of July 2013 a lot happened which culminated in an order by consent of all the parties involved extending the return date for confirmation or discharge of the provisional order to 17 July 2013. A notice to that effect was advertised in The Government Gazette and The Herald, the relevant part of which read as follows:

“Any interested person who wishes to oppose the confirmation of the provisional judicial management order of the companies shall file a notice of opposition with the Registrar of the High Court within ten days from the date of this advert…, and shall serve a copy of the notice on the applicant. He shall then appear before the High Court at Harare at the hearing of the matter on the 17^th day of July 2013 to show cause why the companies should not be placed under judicial management.”

On the return date, the matter was postponed to 24 July 2013 on which date it was referred to the opposed roll to be set down for hearing in terms of the Rules of this Honourable Court. The parties are not agreed as to exactly what happened on the return date.

The matter was set down for hearing on 23 January 2014 on the opposed roll. On that date, Mr Ruzengwe appeared for the applicant whilst Messrs C. Nhemwa and Associates and Messrs C.N. Mlotswa and Company appeared - both purporting to represent the companies. The legal practitioners appeared before me in chambers and two issues arose;

a) Whether C. Nhemwa and Associates have any authority to represent the companies on the return date.

b) Whether this Honourable Court can exercise its jurisdiction in the absence of a return date.

I directed that the parties file heads of argument addressing the above two issues.

Issue Number 1

Mr Nhemwa submitted that the Directors of the companies have the locus standi, instead of the Provisional Judicial Manager, to represent the companies on the return date. He further submitted that on the granting of a provisional judicial management order, Directors of a company are stripped of their power and the Provisional Judicial Manager assumes all the powers of a company. However, the Directors retain some residual powers to prosecute the matter placing their company under final provisional judicial management. He referred to a number of South African and English cases one of which is ABSA Bank Limited v Rhebokskloof (Pvt) Limited and Ors 1993 (4) SA 436 (C). In that matter, it was held that the South African law position was stated in the matter of Wolhurter Steel (Welkom) (Pvt) Ltd v Jatu Construction (Private) Limited (in provisional liquidation)1983 (3) SA 815 (O) where the court held that:

“To hold that after the granting of a provisional liquidation order the Directors of a company which has been provisionally liquidated by virtue of such order have lost their locus standi in judicio to oppose the granting of a final order would fly in the face of the very object and purpose of the rule nisi and it would therefore be quite wrong to emasculate such object and purpose by a finding that the Directors have lost their residual power to show cause why the company should not be wound up or for that matter to anticipate the return date of the rule nisi. It would be quite ludicrous to hold that a Director of a company, or a company acting through its Directors, is not an interested party, when it comes to deciding whether it or they have the right to be heard on the return day of the rule nisi.”

Mr Nhemwa also referred to some cases in our jurisdiction; that of Mzwimbi and Ors v Reserve Bank of Zimbabwe and Ors 2005 (1) ZLR 132…, and Ex parte Lion Transport Company (Private) Limited 1954 SRLR 135.

He submitted that the position of our law is exactly the same with the English and South African law. He concluded by saying that the Directors of a company under provisional judicial management have an interest in the affairs of the company. The placement of a company under final judicial management may affect their personal status, especially their personal liabilities in terms of company law. To deny them an opportunity to be heard is contrary to the tenets of the principal of natural justice especially the audi alteram partem rule.

On the other hand, Mr Mlotshwa submitted that the authorities cited by Mr Nhemwa relate only to those instances where the Directors of a company wish to oppose the confirmation of a provisional liquidation order. No single authority was cited relating to the position in relation to provisional judicial management. He referred to the case of Alpha Bank BPK & Anor v Registrar of Banks & Anor 1996 (1) SA 330 (A); which is authority for the contrary proposition to the effect that the Directors of a company under provisional judicial management have no residual powers whatsoever.

He further submitted that there are separate provisions in the Companies Act dealing with provisional liquidation, provisional judicial management and final judicial management. Provisional liquidation and provisional judicial management are two distinct processes. In terms of secton 303(a) of the Companies Act, a Provisional Judicial Manager assumes the management of the company. There is no such corresponding provision in relation to provisional liquidation. Further, the matters and reports to which a Court shall have consideration to on the return date, in terms of section 305(1) of the Companies Act, do not include anything required from the Directors of the company. He concluded by submitting that there is no legal or logical basis upon which Messrs C. Nhemwa and Company can claim any right or insist to represent the respondent companies.

In reply, Mr Nhemwa conceded that the cases he cited related to provisional liquidation but argued that the same principles apply to judicial management. He further submitted that the question of residual powers is not provided for statutorily but is a common law position.

In Boka Investments (Pvt) Ltd v Third Line Trading (Pvt) Ltd and Ors HH104-13, PATEL J…, made a very pertinent observation when he stated:

“Although applications for winding up and judicial management are similar in nature, they are not necessarily identical in terms of the processes involved and their objectives.”

This is borne out by the Companies Act where there are separate provisions relating to judicial management and liquidation. The provisions relating to liquidation do not provide for a return date as is the position with provisional judicial management in terms of section 305(1) of the Companies Act. The Provisional Judicial Manager, in terms of section 303(a) of the Companies Act assumes the management of the company upon the granting of the judicial management order. There is no such corresponding provision in relation to liquidation.

I would agree with the submissions by Mr Mlothwa that it would be misleading to cite cases relating to liquidation in relating to the process of judicial management. There is no authority that has been cited by Mr Nhemwa to support the contention that Directors of a company under provisional judicial management have residual powers which enable them to oppose or consent to the placement of a company under judicial management or otherwise. There is clear authority to the contrary in Alpha Bank BPK and Anor v Registrar of Banks and Anor 1996 (1) SA 330 A where it was held that:

“The question whether the Board of Directors had retained residual powers of control after the placement under curatorship could best be answered by asking whether the Board of Directors had such powers before placement under curatorship. This question had to be answered in the negative; shareholders control a company; the Board manages it. What the placement under curatorship brought about was to transfer the management of the bank to the curator, so that no residual powers of control could thereafter have vested in the Board…,.”

Analogous to this position are the provisions of section 303 of the Companies Act which provide that upon a company being placed under provisional judicial management, the provisional judicial management assumes management of the company.

In my view, section 305(1) of the Companies Act is the determining provision. It clearly spells out matters and reports to which the court shall give consideration to on the return date of the provisional judicial management order. It does not include anything required from the Directors of the company.

From the above, it is clear that the Directors, as represented by Mr Nhemwa, have no locus standi to appear in court at this stage of the process of provisional judicial management. In terms of section 305(1)(b) of the Companies Act, the court shall, inter alia, consider the report of the provisional judicial manager made in terms section 303 of the Companies Act. Therefore, the provisional judicial manager, as represented by Mr Mlotshwa has locus standi to appear on the return date.

Issue No. 2

Mr Mlotshwa submitted that it was not competent for this court to deal with any of the matters set out in section 305 of the Companies Act, in particular the confirmation of a provisional order, in the absence of a valid and existing return date. The return date lapsed on 14 July2013 and was not extended. Such an extension can be effected in terms of section 305(2) of the Companies Act. Such proceedings would be irregular, particularly in those instances where those creditors who have not proved their claims are not afforded the opportunity to do so in terms of sectiom 305(1)(c) of the Companies Act on the return date.

Mr Ruzengwe and Mr Nhemwa's common position is that the setting down of sequestration or winding up of companies is done in terms of the Companies Act and Order 32 Rule 247(3). They submitted that the return date was advertised and all interested parties given an opportunity to present their positions. No party can file papers after the return date other than those already before the court.

As I have already stated, the parties are not agreed on exactly what transpired on the return date which resulted in the matter being returned to the opposed roll. The return date was not specifically extended.

I believe the starting point is the Companies Act itself. Section 305 of the Companies Act provides:

“Return day of provisional judicial management order

(1) On the return day fixed in the provisional judicial management order, or on the day which the court or a judge may have extended it, the court, after considering -

(a) The opinion and wishes of the creditors and members of the company; and

(b) The report of the provisional judicial manager prepared in terms of section three hundred and three; and

(c) The number of creditors who did not prove claims at the first meeting of creditors and the amounts and the nature of their claims; and

(d) The report of the Master; and

(e) The report of the Registrar;

May grant a final judicial management order if it appears to the court that there is a reasonable possibility that the company concerned, if placed under judicial management, will be enabled to become a successful concern and that it is just and equitable to grant such an order, or it may discharge the provisional judicial management order or make any other that it thinks just.” …,.

In terms of the underlined part, the court, on the return date, may make any other order it thinks just. In casu, the court, seeing that the matter was now opposed, referred the matter to the opposed roll where it would be properly ventilated and determined. Thereafter, Order 32 Rule 247(3)(4) comes into operation. Rule 247(4) provides:

“Rules 238 and 240 shall apply, mutantis mutandis, to the hearing of a matter consequence upon the issue of a provisional order referred to in subrule (3).”

Mr Mlotshwa's concerns are addressed by the provisions of Rule 247(3). The provisional order issued by the court must specify the date and place at which the court will hear argument on confirmation of the order. It must also specify the manner in which it will be published and the persons on whom the copies of the order are to be served.

In casu, the provisional order was advertised and it had a clause which invited persons who wished to oppose the confirmation of the provisional judicial management order to file notices of opposition with the Registrar and to appear before the court on the return date.Those who filed their papers by, or appeared in court on, 17 September 2013, will be notified of the set down dates. As a result, there will be no prejudice to any of the interested parties.

The other approach to the issue is that adopted by PATEL J…., in Boka Investments (Pvt) Ltd v Third Line Trading (Pvt) Ltd and Ors HH104-13. He considered the circumstances of the matter before him and concluded;

“To take the view that the failure to extend the return date of the provisional order should not be regarded as being fatal to its continuing validity. Accordingly, to deem it appropriate to exercise my discretion under Rule 4C to condone that failure and to proceed with this matter on the basis that the provisional order remains in full force until it is confirmed or discharged.”

In casu, I have considered that the companies have remained under provisional judicial management for 36 months now. The provisional judicial manager has issued his reports, and the members and creditors have held their meetings and expressed their wishes. The Master has also compiled his report. As was stated in the Boka Investments (Pvt) Ltd v Third Line Trading (Pvt) Ltd and Ors HH104-13 case, this court should be less inclined to interfere, at a late stage, in the judicial management of the respondent companies and hold that the general balance of convenience is overwhelmingly in favour of treating the provisional order as having remained operational up to the time of hearing. It is in the interests of all parties concerned to know where they stand.

I will, therefore, deem that the provisional order remain in full force.

HH170-14 : ZIMBABWE TEXTILE WORKERS UNION vs DAVID WHITEHEAD TEXTILES LTD and DWT HOLDINGS and DWT SPINNING and DWT COTTON WOOLS and DWT FABRICS and DWT HOSEIRY and MASTER OF HIGH COURT
Ruled By: MAKONI J

Whether the provisional order should be confirmed or discharged The requirements for confirmation or discharge of a provisional judicial order are set out in section 305 of the Companies Act. For a court to arrive at a decision it must consider: (i) The opinion and wishes of the creditors and members of the company. (ii) The report of the ...

Whether the provisional order should be confirmed or discharged

The requirements for confirmation or discharge of a provisional judicial order are set out in section 305 of the Companies Act. For a court to arrive at a decision it must consider:

(i) The opinion and wishes of the creditors and members of the company.

(ii) The report of the provisional judicial manager.

(iii) The number of creditors who did not prove claims at the first meeting of creditors and the amounts and the nature of their claims.

(iv) The report of the Master.

(v) The report of the Registrar of Companies.

After considering the above, the court may confirm the order -

“If it appears to the court that there is a reasonable probability that the company concerned, if placed under judicial management, will be enabled to become a successful concern and that it is just equitable to grant such an order…,.”

The purpose of judicial management was clearly spelt out in International Capital Corporation (Pvt) Ltd v Clarison (Pvt) Ltd 2000 (1) ZLR 585 H….:

“Generally, a company should not be permitted to be dissipated by winding up and dissolution because it has suffered a set back with regard to the repayment of its debts or the performance of its obligations, which if it were to be given time, it would be able to surmount and become successful.

The procedure of judicial management is intended to be a means for affording it such time. Judicial management should not be instituted or continued merely on the basis that while it subsists the company's assets maybe sold more advantageously than they would be in winding-up: judicial management is not intended to be an alternative method of liquidation: see Millman NO v Swartland Huis Meubileerders (Edms) Bpk 1972 (1) SA 741 (C0 at 744-45 and Tenowitz v Tenny Investments (Pty) Ltd 1979 (2) SA 680 (E) at 684 and Henochsberg on the Companies Act Vol. 1,5 ed by PM MESKIN, p 923.

Judicial management is a special dispensation which can be granted to a company only in exceptional cases – see Silverman v Doorhoek Mines Ltd 1935 TPD 349 at 353; Bahnenn v Fritzmore Exploration (Pvt) Ltd 1963 (2) SA 249 (T) at 250 – 251; Ladybrand Hotel (Pty) Ltd 1963 (2) SA 249 (T) at 250-251; Ladybrand Hotel (Pty) Ltd v Seal & Nor 1975 (2) SA 357 (O) at 359. Judicial management implies that there be a temporary reconciliation of conflicting interests – those of the company in being unable, despite its difficulties, to continue its operations in the ordinary course and those of its creditors, in not being prevented from enforcing their rights, including the way of winding-up. It is because of these conflicting interests that the Act requires the court to be satisfied both that there is a reasonable probability were that there to be judicial management the company would be able to achieve the goals envisaged by s300(a) and that it is just and equitable to afford it the opportunity to attempt to do so. As such, judicial management cannot be instituted merely on the ground that it would improve the efficiency of the company's management or increase the profitability of its operation – see Henochsberg on the Company Act supra at p924 and Makuvha & Ors v Lukoto Bus Service (Pty) Ltd and Ors 1987 SA 376 (VSC) at 397.”

The issue, therefore, is whether if the company is placed under final judicial management it will be enabled to become a successful concern and whether it will be just and equitable to do so. To arrive at the appropriate decision, I considered the reports by provisional judicial manager, the Master and the submissions made by the applicant who is one of the creditors.

The Provisional Judicial Manager's Report

The companies have been in difficulties since 2001. In 2006, they were placed under provisional judicial management and later final judicial management until June 2008, when an investor, Elgate (Pvt) Ltd, offered to invest US$5.4 million.18 months later, the companies were placed under provisional judicial management again.

The provisional judicial manager's opinion is that the respondent companies are hopelessly insolvent. His basis for saying so is that the Master had provisionally accepted claims worth US$13,871,678=56. To this amount is to be added a recent claim by Agribank, secured by a mortgage bond, in the amount of US$5.8 million. The total liabilities of the company will amount to US$19,671,678=56. The debt might rise to US$20 million when costs of judicial management are factored in including those of the Master.

The huge debt figure always the combined assets valued at US$5,979,219=.

The biggest creditor to the companies is Parrogate Zimbabwe (Pvt) Ltd whose claim is for US$3,000,000=. Although the amount is the subject of pending litigation, the amount is secured by a bond of US$3 million over the assets of the companies i.e. their immovable property.

The companies do not, therefore, have free immovable assets.

There is no single shareholder who is prepared to support the judicial management by proposing injection of capital into the companies. There is no indication, in the turnaround proposed by Aurifin, of an investor or financial institution ready or willing to provide the working capital. In any event, such capital will not be forthcoming because the companies assets are encumbered, and, in some of the instances, to financial institutions. He also commented on the unfavourable conditions in the textile industries due to competition from cheaper imports and ageing equipment which requires replacement. He concluded by saying that the only prospect for creditors getting paid is for the companies to be placed under provisional liquidation, where, outside of the secured creditors, a potential investor might be willing to make a palatable offer to the unsecured creditors.

Master's Report

Various creditors and members meetings were held where the provisional judicial manager would present reports. The final meeting was held on 17 April 2013 where the provisional judicial manager's reports were discussed to conclusion. The provisional judicial manager presented his position per his report above. The issue was put to vote. A total of 13 creditors, whose total claims amount to US$6 million, voted for final judicial management. Their reasons for doing so were:

i) Workers wanted to save their jobs and the communities they lived in.

ii) Unsecured creditors felt that they might not get anything upon liquidation due to ranking of creditors.

iii) They had hope in the turnaround strategy presented by Aufin (Pvt) Ltd.

Creditors, whose total claims were US$5,536,758=, voted for liquidation. Their reasons were:

i) There was no hope that an investor will be found.

ii) The ageing equipment which needed replacement.

iii) They had waited for too long for payment and they could accept whatever comes from liquidation.

The members who were present voted for final judicial management. Their reasons were that:

i) There were prospects of a turnaround contained in the Aurifin Report.

ii) There will be proper management.

iii) There would be a conducive environment for investors after the 2013 harmonised elections.

According to the provisional judicial manager's report, a total of 135 creditors claims amounting to US$13,871,078= were provisionally accepted.

The Applicant's Position

After the meeting of the 17 March 2013, where the provisional judicial manager had recommended liquidation, the members and the creditors sought an independent opinion from Aurifin (Pvt) Ltd.

The members, and some of the creditors, also believed that the provisional judicial manager had grossly undervalued the companies' immovable properties to paint a picture of insolvency and cause liquidation of the companies. They filed an evaluation report of the Chegutu property which was done before the placement of the companies under the provisional judicial management. The value was placed at US$13. 2 million. It was the applicant's opinion that the companies can be turned around as illustrated by the following:

(i) The provisional judicial manager was able to enter into a toll manufacturing contract with Kithra Enterprises (Pvt) Ltd which was producing army wear.

(ii) The respondent companies supplied uniforms to the police and prison services.

(iii) The respondents were major producers of hosiery material, especially school socks, which were imported.

The applicant commended that the companies were the major producers of yarn, both for the local and export market. Their demise affects not only the shareholders and creditors but the collapse of all downstream and upstream industries such as cotton production, ginning, textile and clothing industries. The towns of Kadoma and Chegutu have borne the brunt of the closure of the companies. All aspects of development have been affected since revenues from the companies, their workforce and downstream industries have dried up.

The Aurifin Report was of the view that it is possible to revive the fortunes of the companies. It puts forward the following measures -

(i) Shareholding restructuring.

(ii) Implementation of scheme of arrangements.

(iii) Capital raising.

(iv) Production.

Long term, the companies can then consider identifying institutional investors and re-listing on the Zimbabwe Stock Exchange. It concluded by saying that, on a balance of probabilities, the continuation of judicial management could result in the restoration of normalcy as opposed to liquidation.

Analysis

The provisional judicial manager's report paints a dim picture about the respondent companies' situation. According to his report, the companies have debts of just under US$20 million against assets valued at US$979,219=. The immovable properties are encumbered. The biggest creditor is Parrogate (Pvt) Ltd with a claim for US$3 million.

The Masters Report reflects that creditors who are owed the larger amount voted for final judicial management. Amongst these creditors are the workers of the companies who are owed about 42% of the total creditors claim, in respect of salary arrears and proposed retrenchment packages.These workers are members of the applicant. They are prepared to enter into payment arrangements with the companies if the companies are placed under judicial management.

Of those creditors who voted for liquidation, the bulk of the amount is claimed by Parrogate (Pvt) Ltd. This amount is the subject of court proceedings as it is disputed. If this amount is subtracted from the total of those who voted for liquidation, only an amount of US$2,536,755= will remain as claims of those who voted against judicial management compared to total claiming of about US$6,500,000= who voted in favour of final judicial management.

There is an amount of US$5.4 million which is owed to Agribank. The claim had not been accepted at the time the Master's Report was filed. From the papers filed on record, it appears an amicable solution is likely to be revealed in respect of this amount.

There is also the issue of Elgate Investments (Pvt) Ltd. This entity was meant to inject an amount of US$5,4 million as investment in the companies. The provisional judicial manager was still investigating whether this amount was injected. It affects only 1 million was injected. There is litigation to compel Elgate Investments (Pvt) Ltd to produce proof that it paid the amount in full.

The provisional judicial manager, in his report date 2 February 2011, put the value of the respondent's companies' immovable properties in Harare, Kadoma, Chegutu and Gweru at US$4.2million dollars. The applicant puts this value in issue. They described it as undervaluation. In support of their contention, they produced a valuation report on the Chegutu property which put the value at US$13,2 million dollars.

What comes out from all the above is that the provisional judicial manager's report contains some discrepancies which are not explained; I will deal with them hereunder.

1. If a property was valued at US$13.2 million dollars just before the placement of the companies under judicial management; how can all the immovable properties, with one located in Harare, be valued at US$4.2million dollars?

2. If one were to subtract the amount being claimed by Parrogate (Pvt) Ltd and that is owed to the workers, in the sum of US$4,816,187=25, it would leave an amount of US$3,787,259=. The total remaining amount includes amounts owed to such institutions as ZESA, NSSA and ZIMRA. Could the companies not be able to be turned around and pay this amount?

3. The issue of Agribank's claim was not properly ventilated. It appears from the papers that the debt to Agribank is owed by FSI and the respondent's companies guaranteed the debt. There are indications from FSI that it is in some discussions with the bank which might result in the security being released.

On the other hand, there are some sound turnaround strategies put forward by Aurifin (Pvt) Ltd. These will prevent the company from being dissipated by winding up and dissolution. My view is that the respondent's companies should be given time to pursue the proposals put forward by Aurifin (Pvt) Ltd and the applicants. They will be able to surmount the current difficulties and become a successful concern again.

The creditors who voted for the placement of the companies under judicial management proposed that Knowledge Hofisi of Aurifin Capital (Pvt) Ltd be appointed the judicial manager.

I would agree with their proposal since he is the one who came up with the turnaround strategy. The provisional judicial manager does not believe in final judicial management but in liquidation. It is therefore in the best interest of all concerned that Knowledge Hofisi be appointed the final judicial manager.

In the result, I make the following order;

1) 1^st, 2^nd, 3^rd, 4^th, 5^th and 6^threspondents are herby placed under Final Judicial Management.

2) Subject to the provisions of section 305 of the Companies Act [Chapter 24:03], the Master shall appoint Knowledge Hofisi of Aurifin Capital (Private) Limited as final judicial manager with the powers and duties set out in section 306 and section 307 of the Companies Act [Chapter 24:03] and subject to the supervision of this court.

3) From the date of that appointment and upon completion of the Bond of Security, in accordance with section 274 of the Companies Act [Chapter 24:03], the Final Judicial Manager shall forthwith take over the management of the 1^st, 2^nd, 3^rd, 4^th, 5^th and 6^th respondent companies and shall prepare and submit reports in accordance with section 306(i) of the Companies Act [Chapter 24:03].

4) The Final Judicial Manager shall have the powers set out in sub paragraph (a) to (m) of section 306 of the Companies Act [Chapter 24:03] of the Companies Act [Chapter 24:03], and, without the consent of the creditors or the shareholders, may raise money on the security of the 1^st,2^nd,3^rd, 4^th, 5^th and 6^th respondent companies assets, or, with the consent of the creditors and shareholders dispose off part of the assets of the respondent companies to raise working capital or to enter into a scheme of arrangement of resuscitate the respondent companies.

5) All actions and applications and the execution of all Writs, Summons and other process against the 1^st, 2^nd, 3^rd,4^th,5^th and 6^th respondent companies shall be stayed and not proceed without the leave of this court.

6) The Final Judicial Manager shall, in terms of section 308 of the Companies Act [Chapter 24:03], be entitled, from the assets of the respondent companies, to the payment of remuneration at a rate to be determined by the Master of the High court and to reimbursements for all out of pocket expenses incurred in the course of his duties.

7) The Provisional Judicial Manager, Winsley Militala of Petwin Executor and Trust Company (Private) Limited, shall handover all matters and shall account to the Final Judicial Manager and is hereby discharged in terms of section 305(2)(a) of the Companies Act [Chapter 24:03].

8) The Final Judicial Manager shall pay both the applicants and respondents costs of these proceedings out of the assets of the companies.

HB194-11 : ZIMBABWE TEXTILE WORKERS UNION vs MERLIN (PRIVATE) LIMITED t/a MERSPIN and ASSISTANT MASTER OF THE HIGH COURT OF ZIMBABWE
Ruled By: MATHONSI J

That the first respondent is a troubled company in serious financial dire straits is self-evident. It was suspended from the Zimbabwe Stock Exchange. It has not paid its employees at all since January 2010 when it employs about 200 employees. It has not engaged in any production since September 2010 and the factory from ...

In this application, the applicant seeks an order placing the first respondent under provisional judicial management.

The applicant has advanced the argument that, by reason of mismanagement, the first respondent is unable to pay its debts as symbolised by its failure to pay its employees for almost two (2) years resulting in a wage bill which stood at US$891,903=01 as at August 2011. It has also failed to pay statutory dues, as shown by the ballooning debt owed to the applicant which stood at US$35,757= as at August 2011. The applicant argues, further, that the first respondent, which is a textile manufacturing concern whose line is spinning, weaving, dying and making napkins, towels and juvets, has not embarked on any form of manufacturing since August 2010 - even though the factory is fully equipped with machinery for the undertaking. It is stated that the financial books of the enterprise have not been audited for a considerable period of time as management neglects its duties. Faced with these insurmountable financial problems, the management of the first respondent has not even retrenched employees and has not come up with any measures to harness the situation at all; content to let the situation continue unabated.

In its opposing affidavit, sworn to by its Director, Danisa Nkomo, the first respondent admits most of the allegations levelled against it. On the issue of its inability to pay its debts and the failure to produce goods, it states…,;

“Per 7.2. First respondent admits owing its workers some salary arrears, but denies the amount alleged, averring instead that the aforesaid amount includes statutory payments due to statutory authorities, and for which the applicant has no locus standi to claim. Even so, the amount includes monies for days the workers were not at work.

Per 7:3 First respondent admits that it is not producing goods at the moment but denies that this is so in spite of machinery that (is) in good working order.

…,.

Per 7:5 First respondent admits that when it faced viability problems, as a result of frequent machine breakdowns and lack of spares, it sought to retrench applicant's members - they refused. The first respondent then sought to introduce a shorter working week – again, the workers refused.”

The first respondent denies that the problems of the company are attributable to poor management and claims that with financial backing, the company can be a successful concern.

It matters not that what the first respondent owes includes statutory deductions due to various statutory bodies. The first respondent remains owing both the wages due to employees and the deductions due to statutory bodies. It is unable to pay those debts. While admitting its inability to engage in any form of production for well over a year, the first respondent attributes this to breakdowns in machinery. It has not been explained why the machines are breaking down and why they have not been repaired. It is unthinkable that since September 2010, management has been trying to source for spares. Management would also want the court to believe that while retrenchment was a viable option, it has not been undertaken because the workers refused. There is nothing to suggest that management is aware of the procedure for retrenchment as they can still submit an application to the Retrenchment Board - even without the co-operation of the workers.

Section 299(1) of the Companies Act [Chapter 24:03] provides:

“Subject to s300, the court may –

(a) On an application being made to it for such an order by any person who would be entitled to apply for the winding up of the company, grant a provisional judicial management order; or

(b) On an application being made to it for the winding up of the company, grant, instead, a provisional judicial management order.”

Persons who may apply for a winding up order are set out in section 207 of the Companies Act [Chapter 24:03] and they include “any creditor or creditors” of the company. Therefore, the applicant, in its capacity as a creditor and as a representative of employees, who are also creditors of the first respondent, is entitled to make an application for a provisional judicial management order.

The next issue to be determined is whether a good case has been made for the relief sought. Section 206 of the Companies Act [Chapter 24:03] sets out the grounds upon which a company may be wound up and they include where it is unable to pay its debts. Section 300 of the Companies Act [Chapter 24:03] sets out the requirements for a provisional judicial management order. It reads;

“The court may grant a provisional judicial management order in respect of a company –

(a) On an application referred to in paragraph (a) of subsection (1) of section 299, if it appears to the court –

(i) That by reason of mismanagement, or for any other cause, the company is unable to pay its debts or is probably unable to pay its debts and has not become or is prevented from becoming a successful concern; and

(ii) That there is a reasonable probability that if the company is placed under judicial management it will be enabled to pay its debts or meet its obligations and become a successful concern; and

(iii) That it would be just and equitable to do so.”

I have already alluded to the fact that the first respondent is a troubled enterprise which is unable to pay its debts. I have also made reference to the inexplicable conduct of its management to stand akimbo, doing virtually nothing about the ballooning wage bill, which continues to accumulate, from as far back as January 2010. Management has also not given any satisfactory explanation for its failure to retrench some of the employees or the failure to engage in any form of production for well over a year. The story that production was halted by the breakdown of machinery and that spares are still being sourced, 15 months later, is simply disingenuous. Even after according management an opportunity to place before me further affidavits to address what exactly they propose to do for the future of the company, they failed to do so. The only reasonable conclusion to be made is that poor management has contributed to the problems of the company.

In any event, section 300(a)(i) of the Companies Act [Chapter 24:03] provides that a court may grant the order if it appears that “by reason of mismanagement or for any other cause.” Even if I am wrong that mismanagement is to blame, I am of the view that this is a case where someone else should be given the stewardship of the enterprise to try and breathe in fresh ideas. Therein lies “any other cause” for granting the order.

The applicant has already approached Cecil Madondo of Tudor House Consultants (Pvt) Ltd who has agreed to take up the responsibility. The first respondent has not suggested that he is not a fit and proper person to assume the task. In fact, he has, in the past, acted in that capacity.

In conclusion, I am satisfied that a good case has been made for the relief sought. Accordingly, I grant an order for provisional judicial management in terms of the draft order filed of record as amended.

Appealed
SC30-16 : STAND FIVE FOUR NOUGHT (PRIVATE) LIMITED vs SALZMAN ET CIE SA
Ruled By: ZIYAMBI JA, GOWORA JA and UCHENA JA

WHETHER IT IS JUST AND EQUITABLE FOR THE APPELLANT TO BE PLACED INTO FINAL JUDICIAL MANAGEMENT Counsel for the appellant and for the respondent agreed that this issue should be resolved by considering the provisions of section 305 of the Companies Act. Counsel for the appellant submitted that final judicial management should have been granted because ...

WHETHER IT IS JUST AND EQUITABLE FOR THE APPELLANT TO BE PLACED INTO FINAL JUDICIAL MANAGEMENT

Counsel for the appellant and for the respondent agreed that this issue should be resolved by considering the provisions of section 305 of the Companies Act.

Counsel for the appellant submitted that final judicial management should have been granted because Myramar Farming (Pvt) Ltd may, in future, be able to pay the debt.

In response, counsel for the respondent submitted that the appellant is seeking judicial management to avoid paying a due debt. He further submitted that the appellant's offer to pay the debt while under final judicial management, if Myramar Farming (Pvt) Ltd fails to pay, would not be just and equitable as the appellant would pay the debt over a period of about 30 years from its rentals of US$15,000= per year when the appellant had contracted to pay on Myramar's Farming (Pvt) Ltd's failure to do so.

The appellant's appeal must, as a result of its success on the first two grounds of appeal, be determined on the merits of its own case.

The common cause facts on which such determination should be made are:-

1. The appellant bound itself as a surety and co-principal debtor to the respondent for a loan of US$1,245,000= advanced by the respondent to Myramar Farming (Pvt) Ltd.

2. Myramar Farming (Pvt) Ltd is the appellant's sister company. The deponent to the appellant's founding affidavit, Serish Pershotam Ranchod, is the common denominator between the two sister companies. He holds a 20 percent shareholding in Myramar Farming (Pvt) Ltd and a 50% shareholding in the appellant. He thus has interests in both companies.

3. The appellant registered a mortgage bound against its property, Stand Five Four Nought, as security for the payment of the loan advanced to Myramar Farming (Pvt) Ltd.

4. Myramar Farming (Pvt) Ltd failed to pay the debt and placed itself beyond immediate execution by obtaining an order of judicial management.

5. The respondent turned to the appellant for payment of the debt in terms of the suretyship and mortgage agreements.

6. The appellant, being privy to the avoidance of the debt by Myramar Farming (Pvt) Ltd, sought to employ the same trick against the respondent.

7. It initially succeeded and was granted a provisional judicial management order.

8. On the return day, the court a quo identified the appellant's trickery and dismissed the provisional judicial management order. Right from the outset, on page 1 of its judgment…, the court reasoned as follows;

“The basis for seeking that order is contained in paragraph 10 of the founding affidavit of Serish Pershotam Ranchod, a Director of the applicant. He says:

'10. The application is made on the following basis:

10.1 Applicant company registered a mortgage bond over its sole immovable property as security for a loan extended to an affiliate company, Myramar Farming (Pvt) Ltd by Salzman ET CIE SA, a company registered in Panama.

10.2 Myramar Farming (Pvt) Ltd has since been placed under judicial management under case no. HC5914/14 because it is currently unable to pay its debts although it has high prospects of discharging its debts under judicial management. (Refer to Annexure D). Consequently, Applicant's property faces execution by Salzman ET CIE SA.

10.3 Execution of applicant's sole property will result in applicant plunging into certain liquidation as it will no longer be able to conduct its main objective of holding and managing the immovable property.

10.4 It is therefore just and equitable that the applicant be placed under provisional judicial management as a moratorium granted by judicial management will prevent execution of applicant's property whilst Myramar Farming (Pvt) Ltd, the principal debtor to Salzman ET CIE SA, liquidates its debt under judicial management.'

One should give credit to the applicant; at least it is brutally honest.

Judicial management is not being sought for any other reason than to circumvent the consequences of a suretyship which the applicant went into wherein it secured a huge loan taken by its sister company from a creditor who has been unable to realise any outlay from the principal debtor because it has also sought and obtained a judicial management order under case number HC5914/14. It is therefore not paying the debt of $750,000= which it owes to the creditor. Although the applicant stood as surety for the due settlement of that debt, and registered a surety mortgage bond over its immovable property, being Stand 540 Salisbury Township in favour of the creditor, it has no intention whatsoever to pay the debt.

It is for that reason that it has elected to shelter under judicial management for no other reason than to ensure that its property is safe from execution while Myramar Farming (Pvt) Ltd, the principal debtor, hopefully, pays the debt owed to the creditor. It has not escaped my gaze that the deponent of the founding affidavit is the common denominator in all this in that he holds a 20% shareholding in Myramar Farming (Pvt) Ltd, the principal debtor, which benefitted from the loan. He also has an interest in the applicant hence he has already avoided paying the debt under Myramar Farming (Pvt) Ltd by obtaining a provisional judicial management order. Using the same modus operandi he has moved quickly to avoid paying the same debt under the present applicant by securing a provisional order for judicial management for all the wrong reasons; that way a creditor which entrusted a large sum of money to these companies has to be left without a remedy when Ranchod and his associates have fully benefitted from the loan.

Is that the reason why the procedure for judicial management was invented?”

The court a quo was alive to what is an apparent abuse of the judicial management procedure. It chronicled the history of the debt. The appellant secured the debt to enable Myramar Farming (Pvt) Ltd to be granted the loan. It promised the creditor payment secured by mortgaging its only property, Stand 540 Salisbury Township. The eventuality for which the bond was registered arrived. The appellant now wants to avoid doing what it contracted to do. It now argues that Stand 540 Salisbury Township is its only property when it has always been its only property. The appellant now seeks to shift goal posts. That is a clear violation of its contract with the respondent.

The courts cannot assist a party to avoid its liability.

The court a quo posed the question is this why judicial management was invented? An answer to that question will determine this appeal. The court a quo, on page 2 of its judgment, answered its question by considering what the court should consider in an application for provisional judicial management. It considered the provisions of section 300 of the Companies Act [Chapter 24:03] which provides as follows:

“The court may grant a provisional judicial management order in respect of a company -

(a) On an application referred to in paragraph (a) of subsection (1) of section two hundred and ninety-nine, if it appears to the court -

(ii) That there is a reasonable probability that if the company is placed under judicial management it will be enabled to pay its debts or meet its obligations and become a successful concern; and

(iii) That it would be just and equitable to do so; or

(b) On an application referred to in paragraph (b) of subsection (1) of section two hundred and ninety-nine, if it appears to the court that -

(i) If the company is placed under judicial management the grounds for its winding up may be removed and that it will become a successful concern; and

(ii) That it would be just and equitable to do so.”

In terms of section 300 of the Companies Act [Chapter 24:03], a provisional judicial management order can be granted, if it appears to the court; that due to mismanagement or other cause the company is unable to pay its debts and is being prevented from becoming a successful concern, and there is hope that judicial management will enable it to pay its debts, meet its obligations and become a successful concern; and that it would be just and equitable to do so.

Or, if it appears to the court that; placing it under judicial management may remove the grounds of its being wound up and it will thereafter become a successful concern; and that it would be just and equitable to do so.

The court should therefore carefully consider an application for provisional judicial management before making a determination. If the court which granted the provisional judicial management order had carefully considered the application it would not have granted it because it was apparent that the appellant was merely seeking shelter from having to pay a due debt in terms of suretyship and mortgage bond agreements. There was no allegation of mismanagement being the cause of its failure to pay the debt. The appellant's business is simply to maintain and rent out its property and receive rentals. No explanation was given as to why such a simple operation needed the involvement of a judicial manager for it to succeed. All the applicant was asking for was a moratorium to hide under judicial management until Mayramar Farming (Pvt) Ltd pays its own debt. The court a quo correctly assessed this when it said;

“To grant such relief would therefore be contrary to all notions of security for debt and the principles of freedom and sanctity of contract. In addition, the application constitutes an abuse of court process in order to frustrate and/or delay a just claim while not laying out a proper case for the grant of a judicial management order.”

This answers counsel for the appellant's submission that the court a quo did not consider the equitability of the appellant's application. The above proves that it did and found that it was not just and equitable to grant the appellant's application.

Section 305 of the Companies Act [Chapter 24:03] provides for the circumstances under which final judicial management can or cannot be granted. It provides as follows:

“(1) On the return day fixed in the provisional judicial management order, or on the day to which the court or a judge may have extended it, the court, after considering –

(a) The opinion and wishes of the creditors and members of the company; and

(b) The report of the provisional judicial manager prepared in terms of section three hundred and three; and

(c) The number of creditors who did not prove claims at the first meeting of creditors and the amounts and nature of their claims; and

(d) The report of the Master; and

(e) The report of the Registrar;

In terms of section 305 of the Companies Act [Chapter 24:03], the court should, on the return day, take the following into consideration; opinions of creditors and the company's members; report of the provisional judicial manager; the number of creditors who did not prove their claims; the Master's report; and the Registrar's report.

These should enable the court to decide whether or not to grant a final judicial management order. It will grant a judicial management order if it appears to it that, if placed under judicial management, the company will be enabled to become a successful concern and that it is just and equitable to grant such an order. If not, it should discharge the provisional judicial management order or make such other order as it thinks just.

THE OPINION AND WISHES OF THE CREDITORS AND MEMBERS OF THE COMPANY

It is apparent from the appellant's frantic efforts to hide under judicial management that the respondent has called upon it to pay after Mayramar Farming (Pvt) Ltd's failure to pay the debt. Its knowledge of the creditor's intention to sue for the debt is disclosed in paragraphs 21 to 29 of its founding affidavit where the appellant details the predicament into which its debt to the respondent has placed it. It seeks a moratorium through judicial management. Its conduct is indicative of a debtor who had to resort to underhand dealings to avoid meeting its creditor in court. It made an ex parte application for provisional judicial management when it was aware that the creditor had made demands for payment and issued summons. It did so without even citing the respondent. The mortgage bond agreement makes it clear why the appellant did not want to meet its creditor in court. It states, in paragpraph 8:-

“Default and Breach

vi. Should the Mortgagor at any time;

commence proceedings for its liquidation, judicial management, scheme of arrangement or winding up; then and in any of those events the full amount of the Capital Sum and interest then outstanding under this Bond shall become immediately due and payable and lawfully claimable without the necessity of prior demand to the Mortgagor and the Mortgagee shall have the right forthwith to proceed for the recovery thereof.”

The ex parte provisional application for judicial management was therefore made to deliberately avoid this clause. The appellant was, through an abuse of process, circumventing contractual obligations. It therefore cannot be just and equitable to grant it a final judicial management order….,.

THE REPORT OF THE PROVISIONAL JUDICIAL MANAGER

The report of the provisional judicial manager on record thoroughly discredits the appellant's appeal. It gives the value of buildings on Stand 540 as $650,000=. This contradicts the value of $1,900,000= given in the appellant's Statement of Financial Position as at 30 June 2014. The wide discrepancy in the value of the same buildings given within three and half months of each other betrays an intention to mislead the court into granting a final judicial management order on the pretext that the proceeds of the sale of the property will not be sufficient to pay off the creditor when in actual fact it can, leaving the appellant with a healthy balance from which it can pick its pieces and move on.

Commenting on the general state of the company, the provisional judicial manager said:

“No proper handover takeover has been conducted. The members have been very difficult in meeting appointments for the exercise.”

This suggests that the members of the company, after obtaining the provisional judicial management order, were not cooperating with the judicial manager to advance the recovery of the company to a successful concern. The provisional judicial management order was granted on 10 September 2014. The provisional judicial manager's report is dated 13 October 2014. This means the members of the company were deliberately delaying handing over the operations of the company to the provisional judicial manager, when in view of their having applied for the order, they should be co-operating and assisting him to take over the management of the company. The above confirms the court a quo's view that judicial management is not being sought for genuine reasons.

As to the circumstances preventing the company from being a successful concern, the judicial manager commented as follows:-

“The company is not involved in serious trading other than simply managing the rentals from its sole asset. The company had found itself in dire straights because of the mortgage bond it extended to an offshore bank on behalf of a sister company, Myramar.”

This confirms that the company's operations are simple and need no judicial manager to turn the company around. It also shows that the company does not have other debts or problems necessitating the appointment of a judicial manager. Its only problem is the creditor whom it does not want to pay in terms of the suretyship and mortgage bond agreements.

Regarding the measures intended to be taken in order to turn round the company's fortunes, the judicial manager further commented:-

“There is not much that the provisional judicial manager can do in the premises other than taking control of the property management that the members seem to be dragging their feet on. The company's fate is determined by the success of Myramar's judicial management which it has no control over.”

This demonstrates the hopelessness of the appellant's application for a final judicial management order. The provisional judicial manager said it all; “there is not much that he can do.” He is further hampered by the members who, over and above not co-operating with him as earlier said, are dragging their feet showing signs of not wanting to give him control. He then says all depends on the judicial management of Mayramar Farming (Pvt) Ltd. This proves the appellant does not genuinely need judicial management.

The following are the recommendations of the provisional judicial manager:-

“The company is more of an asset holding company and survives from the rentals it receives. The rentals will remain constant for a while under the prevailing environment and to imagine that the company can realize enough to settle the Salzman dues would be farfetched. The company's survival from the jaws of liquidation is highly dependent on the prospects of Myramar. In my opinion, the company should be placed into final judicial management until the picture at Myramar is clearer.”

I find this recommendation to be both frank and misleading.

It says nothing about what the judicial manager will do to turn the appellant around. He acknowledges his limitations and hopelessness due to the current economic environment. His recommendation for judicial management until the picture at Mayramar Farming (Pvt) Ltd is clearer is not what judicial management is about. His comment that; “to imagine that the company can realize enough to settle the Salzman dues would be farfetched” confirms counsel for the respondent's submission that it would take about 30 years for the appellant to pay the debt through rentals.

That makes the appellant's last resort offer to pay through rentals while under judicial management, if Mayramar Farming (Pvt) Ltd fails to pay, unjust and inequitable.

Section 300 of the Companies Act [Chapter 24:03] provides that the purpose of judicial management is to take a company from mismanagement into proper management with a view to turning around the company and enabling it to become a successful concern which will be able to pay its debts. The provisional judicial manager does not explain how this can be done. He merely pleads for the appellant's placement under judicial management pending the outcome of Myramar Farming (Pvt) Ltd's judicial management.

Judicial management's prospects of success, or lack of it, should be based on the circumstances of the applicant and not that of a third party.

In this case, the court a quo correctly found that judicial management was being sought for the wrong reasons. This has been confirmed by the appellant's own papers. There is no need to inquire into the other requirements of section 305 of the Companies Act [Chapter 24:03]. The application was an abuse of process. It was correctly dismissed by the court a quo.

The appeal is accordingly devoid of merit.

View Appeal
HH767-15 : IN RE: STAND FIVE FOUR NOUGHT (PVT) LTD (Under Provisional Judicial Management) FOR AN ORDER FOR FINAL JUDICIAL MANAGEMENT vs x
Ruled By: MATHONSI J

This application, for a judicial management order, made in terms of section 299(1)(a) as read with section 207(1) and section 242(b) of the Companies Act [Chapter 24:03], makes for very interesting reading indeed. The basis for seeking that order is contained in paragraph 10 of the founding affidavit of Serish Pershotam Ranchod, a Director ...

The basis for seeking that order is contained in paragraph 10 of the founding affidavit of Serish Pershotam Ranchod, a Director of the applicant. He says:

“10. The application is made on the following basis:

10.2 Myramar Farming (Pvt) Ltd has since been placed under provisional judicial management, under case no. HC5914/14, because it is currently unable to pay its debts although it has high prospects of discharging its debts under judicial management. (Refer to Annexure D). Consequently, Applicant's property faces execution by Salzman ET CIE SA.

10.4 It is therefore just and equitable that the applicant be placed under Provisional Judicial Management as the moratorium granted by judicial management will prevent execution of applicant's property whilst Myramar Farming, the principal debtor to Salzman ET CIE SA liquidates its debt under judicial management.”

One should give credit to the applicant, at least it is brutally honest.

Judicial management is not being sought for any other reason than to circumvent the consequences of a suretyship which the applicant went into wherein it secured a huge loan taken by its sister company from a creditor who has been unable to realise any outlay from the principal debtor because it has also sought, and obtained, a judicial management order under case number HC5914/14. It is therefore not paying the debt of $750,000= which it owes to the creditor. Although the applicant stood as surety for the due settlement of that debt and registered a surety mortgage bond over its immovable property, being Stand 540 Salisbury Township, in favour of the creditor, it has no intention whatsoever to pay the debt.

It is for that reason that it has elected to shelter under the cloak of judicial management for no other reason than to ensure that its property is safe from execution while Myramar Farming (Pvt) Ltd, the principal debtor, hopefully pays the debt owed to the creditor.

It has not escaped my gaze that the deponent of the founding affidavit is the common denominator in all this in that he holds a 20 per cent shareholding in Myramar Farming (Pvt) Ltd, the principal debtor, which benefited from the loan. He also has an interest in the applicant; hence, he has already avoided paying the debt under Myramar Farming (Pvt) Ltd by obtaining a judicial management order. Using the same modus operandi, he has moved quickly to avoid paying the same debt under the present applicant by securing a provisional order for judicial management for all the wrong reasons. That way a creditor which entrusted a large sum of money to these companies has to be left without a remedy when Serish Pershotam Ranchod and his associates have fully benefited from the loan.

Is that the reason why the procedure for judicial management was invented?

In terms of section 300 of the Companies Act [Chapter 24:03]:

“The court may grant a provisional judicial management order in respect of a company -

(a) On an application referred to in paragraph (a) of subsection (1) of section two hundred and ninety-nine, if it appears to the court -

(i) That by reason of mismanagement, or for any other cause, the company is unable to pay its debts and had not become or is prevented from becoming a successful concern; and

(ii) That there is a reasonable probability that if the company is placed under judicial management it will be enabled to pay its debts or meet its obligations and become a successful concern; and

(iii) That it would be just and equitable to do so;

(b) On an application referred to in paragraph (b) of subsection (1) of section two hundred and ninety-nine, if it appears to the court that -

(i) If the company is placed under judicial management, the grounds for its winding up may be removed and that it will become successful a concern; and

(ii) That it would be just and equitable to do so.”

Section 299(1) of the Companies Act [Chapter 24:03] allows the court, on an application being made by a person entitled to do so, for the winding up of a company, to grant a provisional judicial management order instead. Section 242(b) of the Companies Act [Chapter 24:03] provides that a company may be voluntarily wound up if it resolves, by special resolution, that it be wound up voluntarily….,.

Before I determine the merits of the application, I have to deal with the preliminary points taken by counsel for the applicant. He has taken two (2) points in limine, namely;

(i) That the deponent of the opposing affidavit does not have valid authority to oppose the application on behalf of the creditor because the power of attorney and company resolution relied upon are defective; and

(ii) Secondly, that the notice of opposition filed on behalf of the creditor was filed after the creditor was barred.

It has not escaped my attention that counsel for the applicant has assigned sixteen (16) pages of his heads of argument to the two (2) points in limine that have been taken while reserving only 3½ pages for the merits of the application.

It is not without reason that this is so.

In all fairness to counsel for the applicant, I take judicial notice that the applicant's heads of argument were not prepared by him but his instructing attorney - probably before he was briefed….,.

On the merits of the application, it was argued, half-heartedly, in support of confirmation…, that I must consider the interests of both the creditor and the shareholders in deciding whether it is just and equitable to grant the order; that there are other sureties that can discharge the debt instead of the applicant; and that the illiquidity of the applicant is temporary - even though throughout the application the applicant does not propose to pay the debt at all. In fact, the thrust of the application is that the applicant should be sheltered by the order while someone else pays the debt at a later date. Reliance was placed on the authority of Repp v Ondundu Goldfields 1937 CPD 375; Millman v Swartland Huis Meulbileerdere (Edms) Bpk 1972 (1) SA 741; and Gutman v Sunlands Township (Pvt) Ltd 1962 (2) SA 348 (C).

In terms of section 305 of the Companies Act [Chapter 24:03]:

“The court [….,.] may grant a final judicial management order if it appears to the court that there is a reasonable probability that the company concerned, if placed under judicial management, will be enabled to became a successful concern and that it is just and equitable to grant such an order.”

Earlier in this judgment I alluded to the main reasons for seeking judicial management, as set out in the founding affidavit, as being a moratorium to prevent execution against the mortgaged property of the applicant. Clearly, therefore, it has nothing to do with the acceptable grounds provided for in the Companies Act [Chapter 24:03]. It has nothing to do with enabling the applicant to be a successful concern. In fact, it has not even been shown that it is not a successful concern or that whatever problems it faces are a result of mismanagement to be cured by the involvement of a judicial manager.

Counsel for the applicant relied solely on 'the just and equitable' provision.

The applicant simply does not want to pay a debt which has benefited its shareholders who appear to have taken a loan in the name of one company in which they have beneficial interest and secured it by virtue of a property of another company in which they have beneficial interest. When the time to pay came they did not do so, in fact, they probably have no desire to pay, but rushed to shelter under judicial management - both for the principal debtor and the surety.

An abuse of court process has never been so crass. The use of court process for the purpose for which it was never meant; that is abuse.

I therefore have no hesitation in concluding that it is not just and equitable to grant the final order. The authorities relied upon cannot serve the applicant. It has proceeded in bad faith and this court cannot be seen to lend assistance to a bad debtor who contemptuously does not intend to settle a debt lawfully owed but wants to use the process of the court as a shield against foreclosure.

In the result, it is ordered that:

1. The provisional order for judicial management, granted on 10 September 2014, be and is hereby discharged.

2. The application is hereby dismissed.

3. The applicant shall bear the costs of suit.

HB117-16 : BENNY HLATSHWAYO & 14 OTHERS vs GEOZING PAWNBROKERS (PVT) LTD and PHILIP NDLOVU N.O. and MATSHOBANA NCUBE N.O. and THE ASSISTANT MASTER OF THE HIGH COURT
Ruled By: TAKUVA J

Lack of opposition does not entitle the court to dispense with the requirements set out in section 305(1) of the Companies Act [Chapter 24:03].

Appealed
SC05-19 : TETRAD INVESTMENT BANK LTD (Under Judicial Management) vs BINDURA UNIVERSITY OF SCIENCE EDUCATION and THE SHERIFF OF ZIMBABWE
Ruled By: GWAUNZA JA, GUVAVA JA and MAVANGIRA JA

It is not in dispute that where a company is under judicial management, all processes which defeat the purpose of judicial management should be avoided. Judicial management is defined, in Feigenbaum Anor v Germanis N.O. Ors 1998 (1) ZLR 286 (H)…, in the following terms: “Judicial management is an extraordinary procedure made available to a company by ...

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HH319-17 : BINDURA UNIVERSITY OF SCIENCE EDUCATION vs TETRAD INVESTMENT BANK LTD (Under Provisional Judicial Management) and THE SHERIFF OF ZIMBABWE (N.O.)
Ruled By: ZHOU J

The power of the court to grant an order of judicial management is a creature of statute and the circumstances in which that power is exercisable are provided for in the Companies Act [Chapter 24:01]. See section 299 and section 300 of the Companies Act; TETT CHADWICK, Zimbabwe Company Law 2nd ed….,. The effect of ...

The effect of a judicial management order is to take away the management of the company from its directors and place the company under the management, first of a provisional, and then of a final judicial manager if the provisional order is confirmed. See TETT & CHADWICK, Zimbabwe Company Law 2nd ed….,.; PRETORIUS et al, Hahlo's South African Company Law Through the Cases 6th ed….,.

The Companies Act provides for the contents of a provisional judicial management order as follows in section 301(1):

“A provisional judicial management order shall contain –

(a) The date of the return day, which shall not be less than sixty days from the date of the grant of the provisional judicial management order;

(b)…,.

(c)…,.

And may contain directions that while the company is under judicial management all actions and proceedings and the execution of all writs, summonses and other processes against the company be stayed and be not proceeded with without the leave of the court.”…,.

As was held in Millman NO v Swartland Huis Meubeleerders (Edms) Bpk: Repfin Acceptances Ltd Intervening 1972 (1) SA 741 (C)….., (per BAKER AJ):

“The objectives of a judicial management order are to postpone a liquidation of a company which is in difficulties and to provide a moratorium for that company for a period long enough…, to enable that company to meet its obligations and to become a successful concern.”…,.

The purpose of judicial management, as noted above, is to enable companies suffering a temporary setback due to mismanagement or other special circumstances, to once more become successful concerns. Silverman v Doorndoek Mines Ltd 1935 TPD 349; CILLIERS et al, Corporate Law 3rd ed…,.. Put in other words, the object of that “special and extraordinary procedure” of judicial management is to obviate a company's being liquidated where there is a reasonable probability that by proper management or by proper conservation of its assets it may be able to overcome its challenges and become a successful concern. See Le Roux Hotel Management (Pty) Ltd & Anor v E Rand (Pty) Ltd (FBC Fidelity Bank Ltd (Under Curatorship) Intervening) 2001 (2) SA 727 (C)…,.; VISSER et al, Gibson South African Mercantile & Company Law 8th ed…,.

SC100-21 : PARKHAM ENTERPRISES (PVT) LTD and NYASHA MOTSI vs ADHESIVE PRODUCTS MANUFACTURES (PVT) LTD and THE MASTER OF THE HIGH COURT N.O.
Ruled By: CHITAKUNYE JA

This is an opposed chamber application for reinstatement of an appeal in terms of Rule 70(2) of the Supreme Court Rules 2018.The intended appeal is against the whole judgment of the High Court sitting at Bulawayo, handed down on 17 December 2020 in case number HC1314/20 judgment number HB12-21.THE FACTSOn ...

This is an opposed chamber application for reinstatement of an appeal in terms of Rule 70(2) of the Supreme Court Rules 2018.

The intended appeal is against the whole judgment of the High Court sitting at Bulawayo, handed down on 17 December 2020 in case number HC1314/20 judgment number HB12-21.

THE FACTS

On 1 March 2016, the first applicant was placed under Provisional Judicial Management. The second applicant was appointed as the Judicial Manager.

On 20 August 2020, the first respondent filed an application for the discharge of the provisional judicial management order.

The application was anchored on the argument, that, four (4) years after the provisional management order was granted, no meaningful progress was made and the first respondent sought the discharge of the order, as it believed the order was a sham designed to shield the first applicant from paying its debts.

The applicants did not file any papers in opposition to the first respondent's application, as a consequence thereof, the applicants were automatically barred and the matter was placed on the unopposed roll.

On the date of hearing of the application, counsel for the applicants appeared in court as counsel for the then respondent. He was informed that the first applicant (as respondent) was barred for failing to file opposing papers.

Instead of applying for the upliftment of the bar, counsel contended that he could still be heard.

The judgment of the court a quo shows, that, despite advice on the existence of the bar, counsel persisted in addressing the court on other issues not related to the bar.

The court a quo proceeded to grant a default judgment.

Aggrieved by the decision, the applicants noted an appeal to the Supreme Court.

Some problems arose, administratively, leading to their appeal being deemed abandoned for failure to pay costs of preparation of the record. When they indicated that they had in fact paid the costs, they were advised to apply for reinstatement of the appeal in terms of the Rules hence this application.

The application is opposed.

In its opposition, the first respondent raised some points in limine. These included;

(i) Firstly, that the intended appeal is incompetent as one cannot appeal against a default judgment.

(ii) Secondly, that the deponent to the first applicant's founding affidavit had no requisite authority, as, at the time he was appointed director of the first applicant, the first applicant was under judicial management, and, so, his appointment was a nullity or tainted with illegality. The same fate befell the person who signed the letter of authority as he was also appointed director when the first applicant was under judicial management.

Counsel for the applicants contended, that, the judgment was not a default judgment but was premised on the fact that he appeared in court and argued his client's case.

ISSUES FOR DETERMINATION

1. Whether or not the judgment of the court a quo was a default judgment or was a judgment on the merits.

2. Whether the deponent to the founding affidavit, Richard Nyatsoka, had authority to represent the first applicant....,.

The first point in limine is upheld with the finding that the judgment is a default judgment. The purported appeal is therefore a nullity.

This disposes of the matter, and I am of the view, that, it is unnecessary to consider the other point in limine.

HB31-15 : TAMIRA OVERSEAS S.A. vs AQUIRIUM TRADING (PVT) LTD
Ruled By: TAKUVA J

The applicant applied for an order placing the respondent under provisional liquidation in terms of sections 207, 206(f)(g) as read with section 205(c) of the Companies Act [Chapter 24:03].

This Court, per MAKONESE J, on 18 September 2014, issued the following provisional order:

“1. The respondent, Aquirium Trading (Pvt) Ltd is provisionally wound up, pending the grant of an order in terms of paragraph 3 or the discharge of this order.

2. Subject to subsection (1) of section 274 of the Companies Act [Chapter 24:02], Mr Knowledge Hofisi of Aurifin Capital (Pvt) Ltd is appointed as provisional liquidator of the respondent company with the powers set out in section 221(2)(a) to (g) of the Act.

3. Any interested party may appear before the court, sitting at Bulawayo on 11th December 2014, to show cause why a final order should not be made placing respondent company in liquidation and ordering that the costs of these proceedings shall be costs of liquidation.

4. This order shall be published once in the Zimbabwe Government Gazette and once in the Herald newspaper. Publication shall be in the short form annexed to this order.

5. Any person intending to oppose or support the application on the return day of this order shall -

(a) Give due notice to the applicant at care of its legal practitioners, Messrs G. N. Mlotshwa & Company c/o Majoko and Majoko Legal Practitioners, 1st Floor, Triumphant House, 111a Josiah Tongogara Street, between 11th and 12th Avenue Bulawayo.

(b) Serve on the applicant a copy of an affidavit which he files with the Registrar of the High Court.”

The respondent filed a notice of opposition on 18 October 2014. It also filed its heads of argument on 28 November 2014 and its legal representative appeared in court on 11 December 2014 and opposed the confirmation of the provisional order....,.

The respondent's opposition is based on a number of grounds. Perhaps, it would be instructive to state the brief background facts before I consider the respondent's grounds for opposing the matter.

The respondent company was incorporated in 2004 by one Taleb Mohamad and Sandra Van Rooyen, to, among other things, pursue mining interests in the Midlands Province.

Sometime in 2012, the applicant company, Tamira Overseas SA, sought to invest in Acquirium Trading (Pvt) Ltd. In pursuant of that quest, various tentative agreements were entered into subject to the fulfillment of certain conditions.

On or about the 28th of August 2014, the applicant filed for the respondent's liquidation alleging that the respondent was heavily indebted to the applicant. On 18 September 2014, the applicant obtained the order referred to earlier in this judgment.

Let me come back to the notice of opposition and the grounds thereof. They are as follows:

1. The order for provisional liquidation was improperly prayed for and granted and must be set aside. The respondent submitted, that, it was not served in terms of the Rules before this provisional order was granted.

2. That, Messrs G.N. Mlotshwa and Company Legal Practitioners are conflicted out in this matter.

3. That, the application has not been properly brought before the court.

4. That, on the facts, the respondent company should not be placed under liquidation as there are no proper grounds for the placement of the respondent company under liquidation.

5. That, at the very least, the respondent should be placed under judicial management.

In respect of the first ground, it was submitted, on the respondent's behalf, that, before the provisional order was granted, the application for the provisional order was not served on the respondent at its registered address. The application was purportedly served on Heena Joshi who is not a director of respondent.

The notice of set down was not served on anyone.

Further, there was no affidavit of service filed with the court before the order was obtained.

The respondent also contended, that, the manner in which the applicant proceeded under the circumstances is in breach of section 5(2) of the Companies (Winding Up) Rules 1972 which provides;

“Except where the petition is presented by the company itself, a copy of the petition and the notice of set down for hearing shall be served upon the company by delivering of such copy at its registered office or to a responsible person at its place of business, failing such service, to a director or secretary of the company, or, if the company is in voluntary liquidation, to the liquidator. An affidavit of service shall be filed with the petition.”

Reliance was placed on the principle set out in African Gold (Zimbabwe) (Pvt) Ltd v Modest (Pvt) Ltd 1999 (2) ZLR 61 (SC)…, where the court observed as follows:

“A respondent company must not be deprived of the opportunity to put forward its opposition to the grant of an order which will have the effect of causing it to suffer an immediate diminution in personal status and a removal of control over all its assets.

The manifestly serious consequences flow from the issue of a provisional winding up order.

The provisional liquidator is almost invariably vested by the court with the wide powers set out in paragraphs (a) to (h) of section 221(2) of the Companies Act [Chapter 24:03]: see the remarks of HOFMEYER J in Mackay v Cahi 1962 (4) SA 193 (O) at 203G-H, which, though referring to sequestration proceedings, are nonetheless apposite and Walsh v Kugar 1965 (2) SA 756 (E) at 760B.

A fortiori, so it seems to me, the present appellant, being the victim of an inexcusable breach of procedure, the High Court ought to have afforded it the opportunity to oppose the application for the provisional order by the only means available, namely, by setting aside of the order that had been improperly obtained.”…,.

See also Reserve Bank of Zimbabwe v Trust Bank Corporation Ltd HC1070/13.

For this reason, the respondent prayed for the discharge of the provisional order with costs without even considering any other issues.

As pointed out above, the applicant did not file any heads of argument despite having been served with the respondent's heads.

Also, the applicant's principal legal practitioners did not attend and no explanation for their absence was proffered.

Counsel for the applicant submitted, that, he was a mere corresponding legal practitioner who was not versed with the facts of the matter. He indicated that he would stand by the papers filed of record.

There is no proof of service of the application for a provisional order in the record.

Consequently, the only inference is that it was granted on an ex parte basis.

This is irregular and I would discharge the provisional order for this reason.

Had the respondent not prayed for an order that the respondent be placed under judicial management the matter would have ended here.

It was submitted, on behalf of the respondent, that, one way of protecting the interests of both parties is to place the respondent under judicial management.

The court has a discretion in ordering that a company be placed under judicial management.

Generally, where a court has been required to place a company under liquidation, it may, using its discretion, or, if requested to do so, place the company under judicial management if it is of the opinion that the company will be able, during the period of judicial management, to recover from the difficulties and that it has reasonable opportunity to do so.

In Lief N.O. v Western Credit (Africa) (Pvt) Ltd 1966 (3) SA 344 and 348, SUYMAN J stated the following:

“A winding up order, in its nature, is intended to bring about the dissolution of the company whereas the purpose of a judicial management order is to save the company from dissolution.

An important feature of a winding up order is that upon such an order being granted there is a concursus creditorium.

A judicial management order, on the other hand, usually provides for a moratorium in respect of the company's debts in the hope that it will lead, ultimately, to the payment of all its creditors and the resumption by it of normal trading.

Furthermore, it is true, that, for judicial management orders, provision is made, in the section of the order, in which payments to creditors are to be effected, and that preference is given to older creditors over later ones. But, this is the result of equitable consideration because of the moratorium.

It is clear from all authority, that, it is not a form of concursus creditorium as in winding up orders.

A winding up order is usually granted where a company is in fact insolvent, whereas, judicial management order is granted where a solvent company has run into financial difficulties because of mismanagement and because there is hope, that, with better management, it will overcome its difficulties.”…,.

Section 299 of the Companies Act [Chapter 24:03] stipulates circumstances in which a provisional judicial management order may be obtained. It states:

“(1) Subject to section three hundred, the court may –

(a)…,.

(b) On an application being made to it for the winding up of the company, grant a provisional judicial management order.”

Section 300 of the Companies Act sets out the requirements for a provisional judicial management order. It states:

“(1) The court may grant a provisional judicial management order in respect of a company –

(a)…,.; or

(b) On an application referred to in paragraph (b) of subsection (1) of section two hundred and ninety-nine, if it appears to the court that –

(i) If, the company is placed under judicial management, the grounds for its winding up may be removed and that it will become a successful concern; and

(ii) That it would be just and equitable to do so.”

In casu, the respondent's submissions show, that, there are no good and sufficient reasons for the court to grant a winding up order.

From a reading of the founding affidavit, it is not clear on which ground the applicant seeks to rely. Also, the grounds are raised without substantiation.

What comes up from the deponent of the founding affidavit is that the applicant advanced money which was invested in the respondent. However, it was not disputed that the respondent's mineral deposits are enormous. Further, it has also not been disputed that investors are on hand to chip in and put funds for the continued operations of the respondent.

Quite clearly, the applicant wants its money repaid, and, for that reason, it would not be in its interests that the respondent wound up.

In my view, one way of protecting the interests of all parties is to allow the respondent to continue operating under judicial management.

Accordingly, it is ordered that:

1. The provisional order placing the respondent under provisional liquidation, granted by this honourable court on 24th of September 2014, be and is hereby discharged.

2. The respondent company, Aquirium Trading (Pvt) Ltd, be and is hereby placed under provisional judicial management.

3. The Master of the High Court, Bulawayo be and is hereby directed to appoint a provisional judicial manager within ten (10) days of the service of this order upon him.

4. The provisional liquidator, Mr Knowledge Hofisi, of Aurifin Capital (Pvt) Ltd, be and is hereby discharged from being the respondent's provisional liquidator.

5. The applicant is to pay the costs of Taleb Mohamad and Sandra Van Rooyen on an ordinary scale.

HB12-21 : ADHESIVE PRODUCTS MANUFACTURERS (PVT) LTD vs PARKAM ENTERPRISES (PVT) LTD (Under provisional judicial management of N. Motsi) and ASSISTANT MASTER OF THE HIGH COURT N.O.
Ruled By: DUBE-BANDA J

This application was set down during vacation, i.e. on the Motion Court for 17 December 2020.

When this matter was called, Mr Moyo, counsel for the applicant rose and made a submission that the papers were in order, and he prayed for an order in terms of the draft order. Mr Mazibiko stood up and said he was representing the first respondent.

I noted that the first respondent was not served with the notice of set down. Mr Mazibuko might have only become aware of the application because the matter was called out in his presence in the Motion Court.

I pointed out to Mr Mazibuko that the first respondent was barred and the application was not opposed.

He was not deterred.

He attacked the validity of the service of the application on the first respondent and attacked the competence of the application itself. Notwithstanding that he was further advised that the first respondent was barred, he argued that he was raising points of law, and, in his view, a court cannot grant such an order as sought by the applicant.

On his part, Mr Moyo contended that the first respondent was barred for want of filing a notice of opposition, and the application was not opposed, and he submitted that his papers were in order and prayed for an order in terms of the draft.

After briefly hearing both counsel, I granted the order sought, couched in the following terms:

“1. The provisional judicial management order issued on the 1st day of March by this court, under cover of HC3455/15 be and is hereby discharged.

2. Nyasha Motsi, in his personal capacity, be and is hereby directed to pay applicant's costs of suit on an attorney and client scale.”...,.

The brief relevant facts of this matter are, on the 1st of March 2016, the first respondent was placed under provisional judicial management. This is an application for the discharge of the provisional judicial management order.

The anchor of this application is that the order was obtained fifty-six months ago, and, it has not been confirmed.

It is contended, that, the order is a sham designed and calculated to shield the first respondent from paying its debts.

The applicant then sued out this court application on 12 August 2020. A copy of the application was served by the Sheriff, on the first respondent, on 9 September 2020. Again, another copy of the application was served by a clerk in the employ of the applicant's legal practitioners on 8 October 2020.

There is proof that the Assistant Master of the High Court was served with a copy of the application.

The first respondent, on the papers before me, had not filed a notice of opposition.

The Assistant Master filed a report, and made the point, that, she was not opposed to the order sought by the applicant, and made the point that the provisional judicial management order must be taken by the court as dead.

I then took the view that the first respondent was barred for failure to file a notice of opposition and opposing affidavit within the time allowed by the rules of court, then, the application was not opposed.

The bar against the first respondent, in such circumstances, is automatic and brings about a default: Rule 233(3) of the High Court Rules 1971 provides that a respondent who has failed to file a notice of opposition and opposing affidavit in terms of subrule (1) shall be barred.

I took the view, that, in this application, Mr Mazibuko had no right of audience before court, because the first respondent was barred. The effect of a bar is that while it is in operation, the party barred shall not be permitted to appear personally, or through a legal practitioner, in any subsequent proceedings in the action or suit; except for the purpose of applying for the removal of the bar: see Rule 83(b) of the High Court Rules 1971.

It is clear from Rule 83(b) of the High Court Rules, that, once a party is barred, the matter is treated as unopposed unless the party so barred makes an application before that court for the upliftment of the bar.

It is also clear, that, in making the application to uplift the bar, the party that has been barred can either file a chamber application to uplift the bar, or, where this has not been done, the party can make an oral application at the hearing: see Grain Marketing Board v Muchero SC59-07.

Mr Mazibuko was not applying for the removal of the bar. He was attacking the application.

In fact, I found his conduct somehow unacceptable, that, after I had pointed out to him that the first respondent was barred, and that the application was therefore not opposed, he persisted in argument.

After considering a number of factors, I refrained from calling him to order.

I take the view, that, such conduct is a deviation from the normal practice; it is inappropriate and unnecessarily belligerent towards the court, and it serves no useful purpose in litigation.

In the result, in deciding this application for default judgement, I did not factor into the equation Mr Mazibuko's submissions. I concluded, that, the respondents, having been duly barred in terms of the rules of the court, and not having made an application for the upliftment of the bar, the application was unopposed.

I took the view, that, the papers before me were in order, and the order sought was competent, I then felt inclined to grant the order in terms of the draft.

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Law Portal
Zimbabwe

Judicial Management re: Approach, Confirmation or Discharge of Provisional Judicial Management Order

HB74-10 : REBECCA SIZIBA vs BAMSLOVE INVESTMENTS (PVT) LTD and MARTIN SIMMONS and REGISTRAR OF COMPANIES
Ruled By: MATHONSI J

HB82-13 : ELLINGBARN TRADING (PRIVATE) LIMITED vs ASSISTANT MASTER OF THE HIGH COURT and PEOPLE'S OWN SAVINGS BANK
Ruled By: MUTEMA J

HB83-13 : ZIMBABWE INTERNATIONAL TRADE FAIR COMPANY vs VIKING PLASTICS (PVT) LTD and BONGANI NDLOVU N.O.
Ruled By: MUTEMA J

HH48-14 : WINSLEY MILITALA N.O. and QV PHARMACIES PRIVATE LIMITED (Under Provisional Judicial Management) vs MUTUAL FINANCE PRIVATE LIMITED and MESSENGER OF COURT and SHINGIRAI USHEWOKUNZE
Ruled By: CHIGUMBA J

HH170-14 : ZIMBABWE TEXTILE WORKERS UNION vs DAVID WHITEHEAD TEXTILES LTD and DWT HOLDINGS and DWT SPINNING and DWT COTTON WOOLS and DWT FABRICS and DWT HOSEIRY and MASTER OF HIGH COURT
Ruled By: MAKONI J

HH170-14 : ZIMBABWE TEXTILE WORKERS UNION vs DAVID WHITEHEAD TEXTILES LTD and DWT HOLDINGS and DWT SPINNING and DWT COTTON WOOLS and DWT FABRICS and DWT HOSEIRY and MASTER OF HIGH COURT
Ruled By: MAKONI J

HB194-11 : ZIMBABWE TEXTILE WORKERS UNION vs MERLIN (PRIVATE) LIMITED t/a MERSPIN and ASSISTANT MASTER OF THE HIGH COURT OF ZIMBABWE
Ruled By: MATHONSI J

Appealed
SC30-16 : STAND FIVE FOUR NOUGHT (PRIVATE) LIMITED vs SALZMAN ET CIE SA
Ruled By: ZIYAMBI JA, GOWORA JA and UCHENA JA

View Appeal
HH767-15 : IN RE: STAND FIVE FOUR NOUGHT (PVT) LTD (Under Provisional Judicial Management) FOR AN ORDER FOR FINAL JUDICIAL MANAGEMENT vs x
Ruled By: MATHONSI J

HB117-16 : BENNY HLATSHWAYO & 14 OTHERS vs GEOZING PAWNBROKERS (PVT) LTD and PHILIP NDLOVU N.O. and MATSHOBANA NCUBE N.O. and THE ASSISTANT MASTER OF THE HIGH COURT
Ruled By: TAKUVA J

Appealed
SC05-19 : TETRAD INVESTMENT BANK LTD (Under Judicial Management) vs BINDURA UNIVERSITY OF SCIENCE EDUCATION and THE SHERIFF OF ZIMBABWE
Ruled By: GWAUNZA JA, GUVAVA JA and MAVANGIRA JA

View Appeal
HH319-17 : BINDURA UNIVERSITY OF SCIENCE EDUCATION vs TETRAD INVESTMENT BANK LTD (Under Provisional Judicial Management) and THE SHERIFF OF ZIMBABWE (N.O.)
Ruled By: ZHOU J

SC100-21 : PARKHAM ENTERPRISES (PVT) LTD and NYASHA MOTSI vs ADHESIVE PRODUCTS MANUFACTURES (PVT) LTD and THE MASTER OF THE HIGH COURT N.O.
Ruled By: CHITAKUNYE JA

HB31-15 : TAMIRA OVERSEAS S.A. vs AQUIRIUM TRADING (PVT) LTD
Ruled By: TAKUVA J

HB12-21 : ADHESIVE PRODUCTS MANUFACTURERS (PVT) LTD vs PARKAM ENTERPRISES (PVT) LTD (Under provisional judicial management of N. Motsi) and ASSISTANT MASTER OF THE HIGH COURT N.O.
Ruled By: DUBE-BANDA J

Categories

Law Portal Zimbabwe

Judicial Management re: Approach, Confirmation or Discharge of Provisional Judicial Management Order

HB74-10 : REBECCA SIZIBA vs BAMSLOVE INVESTMENTS (PVT) LTD and MARTIN SIMMONS and REGISTRAR OF COMPANIES Ruled By: MATHONSI J

HB82-13 : ELLINGBARN TRADING (PRIVATE) LIMITED vs ASSISTANT MASTER OF THE HIGH COURT and PEOPLE'S OWN SAVINGS BANK Ruled By: MUTEMA J

HB83-13 : ZIMBABWE INTERNATIONAL TRADE FAIR COMPANY vs VIKING PLASTICS (PVT) LTD and BONGANI NDLOVU N.O. Ruled By: MUTEMA J

HH48-14 : WINSLEY MILITALA N.O. and QV PHARMACIES PRIVATE LIMITED (Under Provisional Judicial Management) vs MUTUAL FINANCE PRIVATE LIMITED and MESSENGER OF COURT and SHINGIRAI USHEWOKUNZE Ruled By: CHIGUMBA J

HH170-14 : ZIMBABWE TEXTILE WORKERS UNION vs DAVID WHITEHEAD TEXTILES LTD and DWT HOLDINGS and DWT SPINNING and DWT COTTON WOOLS and DWT FABRICS and DWT HOSEIRY and MASTER OF HIGH COURT Ruled By: MAKONI J

HH170-14 : ZIMBABWE TEXTILE WORKERS UNION vs DAVID WHITEHEAD TEXTILES LTD and DWT HOLDINGS and DWT SPINNING and DWT COTTON WOOLS and DWT FABRICS and DWT HOSEIRY and MASTER OF HIGH COURT Ruled By: MAKONI J

HB194-11 : ZIMBABWE TEXTILE WORKERS UNION vs MERLIN (PRIVATE) LIMITED t/a MERSPIN and ASSISTANT MASTER OF THE HIGH COURT OF ZIMBABWE Ruled By: MATHONSI J

Appealed SC30-16 : STAND FIVE FOUR NOUGHT (PRIVATE) LIMITED vs SALZMAN ET CIE SA Ruled By: ZIYAMBI JA, GOWORA JA and UCHENA JA

View Appeal HH767-15 : IN RE: STAND FIVE FOUR NOUGHT (PVT) LTD (Under Provisional Judicial Management) FOR AN ORDER FOR FINAL JUDICIAL MANAGEMENT vs x Ruled By: MATHONSI J

HB117-16 : BENNY HLATSHWAYO & 14 OTHERS vs GEOZING PAWNBROKERS (PVT) LTD and PHILIP NDLOVU N.O. and MATSHOBANA NCUBE N.O. and THE ASSISTANT MASTER OF THE HIGH COURT Ruled By: TAKUVA J

Appealed SC05-19 : TETRAD INVESTMENT BANK LTD (Under Judicial Management) vs BINDURA UNIVERSITY OF SCIENCE EDUCATION and THE SHERIFF OF ZIMBABWE Ruled By: GWAUNZA JA, GUVAVA JA and MAVANGIRA JA

View Appeal HH319-17 : BINDURA UNIVERSITY OF SCIENCE EDUCATION vs TETRAD INVESTMENT BANK LTD (Under Provisional Judicial Management) and THE SHERIFF OF ZIMBABWE (N.O.) Ruled By: ZHOU J

SC100-21 : PARKHAM ENTERPRISES (PVT) LTD and NYASHA MOTSI vs ADHESIVE PRODUCTS MANUFACTURES (PVT) LTD and THE MASTER OF THE HIGH COURT N.O. Ruled By: CHITAKUNYE JA

HB31-15 : TAMIRA OVERSEAS S.A. vs AQUIRIUM TRADING (PVT) LTD Ruled By: TAKUVA J

HB12-21 : ADHESIVE PRODUCTS MANUFACTURERS (PVT) LTD vs PARKAM ENTERPRISES (PVT) LTD (Under provisional judicial management of N. Motsi) and ASSISTANT MASTER OF THE HIGH COURT N.O. Ruled By: DUBE-BANDA J

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Law Portal
Zimbabwe

HB74-10 : REBECCA SIZIBA vs BAMSLOVE INVESTMENTS (PVT) LTD and MARTIN SIMMONS and REGISTRAR OF COMPANIES
Ruled By: MATHONSI J

HB82-13 : ELLINGBARN TRADING (PRIVATE) LIMITED vs ASSISTANT MASTER OF THE HIGH COURT and PEOPLE'S OWN SAVINGS BANK
Ruled By: MUTEMA J

HB83-13 : ZIMBABWE INTERNATIONAL TRADE FAIR COMPANY vs VIKING PLASTICS (PVT) LTD and BONGANI NDLOVU N.O.
Ruled By: MUTEMA J

HH48-14 : WINSLEY MILITALA N.O. and QV PHARMACIES PRIVATE LIMITED (Under Provisional Judicial Management) vs MUTUAL FINANCE PRIVATE LIMITED and MESSENGER OF COURT and SHINGIRAI USHEWOKUNZE
Ruled By: CHIGUMBA J

HH170-14 : ZIMBABWE TEXTILE WORKERS UNION vs DAVID WHITEHEAD TEXTILES LTD and DWT HOLDINGS and DWT SPINNING and DWT COTTON WOOLS and DWT FABRICS and DWT HOSEIRY and MASTER OF HIGH COURT
Ruled By: MAKONI J

HH170-14 : ZIMBABWE TEXTILE WORKERS UNION vs DAVID WHITEHEAD TEXTILES LTD and DWT HOLDINGS and DWT SPINNING and DWT COTTON WOOLS and DWT FABRICS and DWT HOSEIRY and MASTER OF HIGH COURT
Ruled By: MAKONI J

HB194-11 : ZIMBABWE TEXTILE WORKERS UNION vs MERLIN (PRIVATE) LIMITED t/a MERSPIN and ASSISTANT MASTER OF THE HIGH COURT OF ZIMBABWE
Ruled By: MATHONSI J

Appealed
SC30-16 : STAND FIVE FOUR NOUGHT (PRIVATE) LIMITED vs SALZMAN ET CIE SA
Ruled By: ZIYAMBI JA, GOWORA JA and UCHENA JA

View Appeal
HH767-15 : IN RE: STAND FIVE FOUR NOUGHT (PVT) LTD (Under Provisional Judicial Management) FOR AN ORDER FOR FINAL JUDICIAL MANAGEMENT vs x
Ruled By: MATHONSI J

HB117-16 : BENNY HLATSHWAYO & 14 OTHERS vs GEOZING PAWNBROKERS (PVT) LTD and PHILIP NDLOVU N.O. and MATSHOBANA NCUBE N.O. and THE ASSISTANT MASTER OF THE HIGH COURT
Ruled By: TAKUVA J

Appealed
SC05-19 : TETRAD INVESTMENT BANK LTD (Under Judicial Management) vs BINDURA UNIVERSITY OF SCIENCE EDUCATION and THE SHERIFF OF ZIMBABWE
Ruled By: GWAUNZA JA, GUVAVA JA and MAVANGIRA JA

View Appeal
HH319-17 : BINDURA UNIVERSITY OF SCIENCE EDUCATION vs TETRAD INVESTMENT BANK LTD (Under Provisional Judicial Management) and THE SHERIFF OF ZIMBABWE (N.O.)
Ruled By: ZHOU J

SC100-21 : PARKHAM ENTERPRISES (PVT) LTD and NYASHA MOTSI vs ADHESIVE PRODUCTS MANUFACTURES (PVT) LTD and THE MASTER OF THE HIGH COURT N.O.
Ruled By: CHITAKUNYE JA

HB31-15 : TAMIRA OVERSEAS S.A. vs AQUIRIUM TRADING (PVT) LTD
Ruled By: TAKUVA J

HB12-21 : ADHESIVE PRODUCTS MANUFACTURERS (PVT) LTD vs PARKAM ENTERPRISES (PVT) LTD (Under provisional judicial management of N. Motsi) and ASSISTANT MASTER OF THE HIGH COURT N.O.
Ruled By: DUBE-BANDA J