THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Reportable
Case No: 1088/2020

In the matter between:
RALPH FARREL LUTCHMAN N.O.                                              FIRST APPELLANT
CLOETE MURRAY N.O.                                                           SECOND APPELLANT
TANIA OOSTHUIZEN N.O.

THIRD APPELLANT
MARIANNE OELOFSEN N.O.

FOURTH APPELLANT
In their capacities as the joint provisional liquidators of African Global Operations (Pty)
Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                                              FIFTH APPELLANT
CLOETE MURRAY N.O.                                                                SIXTH APPELLANT
SELBY MUSAWENKOSI NTSIBANDE N.O.                          SEVENTH APPELLANT
ANDRE BOTHA OCTOBER N.O.                                              EIGHTH APPELLANT
In their capacities as the joint provisional liquidators of Bosasa Properties (Pty) Ltd (in
liquidation)
RALPH FARREL LUTCHMAN N.O.                                               NINTH APPELLANT
CLOETE MURRAY N.O.                                                                TENTH APPELLANT
NURJEHAN ABDOOL GAFAAR OMAR N.O.                      ELEVENTH APPELLANT
In their capacities as the joint provisional liquidators of Global Technology Systems
(Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                                             TWELFTH APPELLANT
CLOETE MURRAY N.O.                                                       THIRTEENTH APPELLANT
ROYNATH PARBHOO N.O.                                           FOURTEENTH APPELLANT
LIZETTE OPPERMAN N.O.                                                FIFTEENTH APPELLANT
In their capacities as the joint provisional liquidators of Leading Prospect Trading 111
(Pty) Ltd (in liquidation)

RALPH FARREL LUTCHMAN N.O.                                     SIXTEENTH APPELLANT
CLOETE MURRAY N.O.                                                   SEVENTEENTH APPELLANT
OFENTSE ANDREW NONG N.O.                                    EIGHTEENTH APPELLANT
TSHEPO HARRY NONYANE N.O.                                  NINETEENTH APPELLANT
In their capacities as the joint provisional liquidators of Bosasa Youth Development
Centres (Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                                   TWENTIETH APPELLANT
CLOETE MURRAY N.O.                                                TWENTY-FIRST APPELLANT
TARYN VALERIE ODELL N.O.                                 TWENTY-SECOND APPELLANT
GORDON NOKHANDA N.O.                                        TWENTY-THIRD APPELLANT
In their capacities as the joint provisional liquidators of Black Rox Security Intelligence
Services (Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                               TWENTY-FOURTH APPELLANT
CLOETE MURRAY N.O.                                               TWENTY-FIFTH APPELLANT
MILANI BECKER N.O.                                                 TWENTY-SIXTH APPELLANT
In their capacities as the joint provisional liquidators of Bosasa Supply Chain
Management (Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                             TWENTY-SEVENTH APPELLANT
CLOETE MURRAY N.O.                                            TWENTY-EIGHTH APPELLANT
MARC BRADLEY BEGINSEL N.O.                              TWENTY-NINTH APPELLANT
In their capacities as the joint provisional liquidators of Bosasa IT (Pty) Ltd (in
liquidation)
RALPH FARREL LUTCHMAN N.O.                                     THIRTIETH APPELLANT
CLOETE MURRAY N.O.                                                 THIRTY-FIRST APPELLANT
MARIETTE BENADE N.O.                                            THIRTY-SECOND APPELLANT
In their capacities as the joint provisional liquidators of Rodcor (Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                               THIRTY-THIRD APPELLANT
CLOETE MURRAY N.O.                                                 THIRTY-FOURTH APPELLANT
JACOLIEN FRIEDA BARNARD N.O.                              THIRTY-FIFTH APPELLANT
In their capacities as the joint provisional liquidators of Watson Corporate Academy
(Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                               THIRTY-SIXTH APPELLANT
CLOETE MURRAY N.O.                                           THIRTY-SEVENTH APPELLANT
DEIDRE BASSON N.O.                                                THIRTY-EIGHTH APPELLANT

In their capacities as the joint provisional liquidators of ON-IT-1 (Pty) Ltd (in liquidation)
PARK VILLAGE AUCTIONEERS AND
PROPERTY SALES (PTY) LTD                                      THIRTY-NINTH APPELLANT
THE COMMISSIONER FOR THE SOUTH
AFRICAN REVENUE SERVICES                                          FORTIETH APPELLANT
and
AFRICAN GLOBAL HOLDINGS (PTY) LTD                              FIRST RESPONDENT
SUN WORX (PTY) LTD                                                         SECOND RESPONDENT
KGWERANO FINANCIAL SERVICES (PTY) LTD                    THIRD RESPONDENT

Case No: 1135/2020
In the matter between:
AFRICAN GLOBAL HOLDINGS (PTY) LTD                                 FIRST APPELLANT
SUN WORX (PTY) LTD                                                             SECOND APPELLANT
KGWERANO FINANCIAL SERVICES (PTY) LTD                       THIRD APPELLANT
and
RALPH FARREL LUTCHMAN N.O.                                             FIRST RESPONDENT
CLOETE MURRAY N.O.                                                         SECOND RESPONDENT
TANIA OOSTHUIZEN N.O.

THIRD RESPONDENT
MARIANNE OELOFSEN N.O.

FOURTH RESPONDENT
In their capacities as the joint provisional liquidators of African Global Operations (Pty)
Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                                            FIFTH RESPONDENT
CLOETE MURRAY N.O.                                                              SIXTH RESPONDENT
SELBY MUSAWENKOSI NTSIBANDE N.O.                        SEVENTH RESPONDENT
ANDRE BOTHA OCTOBER N.O.                                            EIGHTH RESPONDENT
In their capacities as the joint provisional liquidators of Bosasa Properties (Pty) Ltd (in
liquidation)
RALPH FARREL LUTCHMAN N.O.                                          NINTH RESPONDENT
CLOETE MURRAY N.O.                                                           TENTH RESPONDENT
NURJEHAN ABDOOL GAFAAR OMAR N.O.                  ELEVENTH RESPONDENT

In their capacities as the joint provisional liquidators of Global Technology Systems
(Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                                    TWELFTH RESPONDENT
CLOETE MURRAY N.O.                                                THIRTEENTH RESPONDENT
ROYNATH PARBHOO N.O.                                          FOURTEENTH RESPONDENT
LIZETTE OPPERMAN N.O.                                               FIFTEENTH RESPONDENT
In their capacities as the joint provisional liquidators of Leading Prospect Trading 111
(Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                                  SIXTEENTH RESPONDENT
CLOETE MURRAY N.O.                                              SEVENTEENTH RESPONDENT
OFENTSE ANDREW NONG N.O.                                  EIGHTEENTH RESPONDENT
TSHEPO HARRY NONYANE N.O.                                 NINETEENTH RESPONDENT
In their capacities as the joint provisional liquidators of Bosasa Youth Development
Centres (Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                                 TWENTIETH RESPONDENT
CLOETE MURRAY N.O.                                             TWENTY-FIRST RESPONDENT
TARYN VALERIE ODELL N.O.                              TWENTY-SECOND RESPONDENT
GORDON NOKHANDA N.O.                                       TWENTY-THIRD RESPONDENT
In their capacities as the joint provisional liquidators of Black Rox Security Intelligence
Services (Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                      TWENTY-FOURTH RESPONDENT
CLOETE MURRAY N.O.                                             TWENTY-FIFTH RESPONDENT
MILANI BECKER N.O.                                                TWENTY-SIXTH RESPONDENT
In their capacities as the joint provisional liquidators of Bosasa Supply Chain
Management (Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                    TWENTY-SEVENTH RESPONDENT
CLOETE MURRAY N.O.                                         TWENTY-EIGHTH RESPONDENT
MARC BRADLEY BEGINSEL N.O.                           TWENTY-NINTH RESPONDENT
In their capacities as the joint provisional liquidators of Bosasa IT (Pty) Ltd (in
liquidation)
RALPH FARREL LUTCHMAN N.O.                                  THIRTIETH RESPONDENT
CLOETE MURRAY N.O.                                               THIRTY-FIRST RESPONDENT
MARIETTE BENADE N.O.                                         THIRTY-SECOND RESPONDENT

In their capacities as the joint provisional liquidators of Rodcor Corporate Academy
(Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                            THIRTY-THIRD RESPONDENT
CLOETE MURRAY N.O.                                         THIRTY-FOURTH RESPONDENT
JACOLIEN FRIEDA BARNARD N.O.                          THIRTY-FIFTH RESPONDENT
In their capacities as the joint provisional liquidators of Watson Corporate Academy
(Pty) Ltd (in liquidation)
RALPH FARREL LUTCHMAN N.O.                            THIRTY-SIXTH RESPONDENT
CLOETE MURRAY N.O.                                        THIRTY-SEVENTH RESPONDENT
DEIDRE BASSON N.O.                                             THIRTY-EIGHTH RESPONDENT
In their capacities as the joint provisional liquidators of ON-IT-1 (Pty) Ltd (in liquidation)
PARK VILLAGE AUCTIONEERS AND
PROPERTY SALES (PTY) LTD                                  THIRTY-NINTH RESPONDENT
THE COMMISSIONER FOR THE SOUTH
AFRICAN REVENUE SERVICES                                       FORTIETH RESPONDENT

Neutral citation:
Lutchman N.O. and Others v African Global Holdings (Pty) Ltd
and Others; African Global Holdings (Pty) Ltd and Others v Lutchman N.O. and Others
(1088/2020 and 1135/2020) [2022] ZASCA 66 (10 May 2022)

Coram:
Saldulker, Molemela and Gorven JJA and Meyer and Smith AJJA

Heard:
07 March 2022

Delivered: 10 May 2022

Summary: Company law – business rescue – Companies Act 71 of 2008 – s 131(6) –
interpretation – s 131(6) provides for the suspension of liquidation proceedings at the
time a business rescue application is made – meaning of when business rescue
application is ‘made’ – business rescue application must be issued, served by the
sheriff on the company and the Commission, and each affected person must be
notified of the application in the prescribed manner, to meet the requirements of s
131(6) in order to trigger the suspension of the liquidation proceedings – practice –
judgments and orders – interpretation of order – applicable principles – determining
the manifest purpose of the order – to be determined by also having regard to the
relevant background facts which culminated in it being made.

______________________________________________________________

ORDER
______________________________________________________________

On appeal from:  The Gauteng Division of the High Court, Johannesburg (De Villiers
AJ sitting as court of first instance):
1.
The auction appeal (case no. 1088/2020) is upheld with costs, including those
of two counsel for the first to thirty-ninth appellants and the fortieth appellant.
2.
Paragraphs 7, 8, 9, 10 and 11 of the order of the high court are set aside and
replaced with the following:
‘The application under case no. 44827/19 is dismissed with costs, including
those of two counsel for the first to thirty-ninth respondents and the first
intervening party, the Commissioner for the South African Revenue Services.’
3.
Save to the extent reflected in paragraph 3.1 hereof, the first, second and third
appellants’ business rescue appeal (case no. 1135/2020) against paragraphs 16, 17
and 18 of the high court’s order is dismissed with costs, including those of two counsel
for the first to thirty-ninth respondents and the fortieth respondent.
3.1
Paragraph 16 of the order of the high court is set aside and replaced with the
following:

‘The business rescue application is struck from the roll.’
3.2
The first to thirty-ninth and the fortieth respondents’ appeals against paragraph
17 of the high court’s order are upheld.
3.3
Paragraph 17 of the order of the high court is set aside and replaced with the
following:
‘The applicants are ordered to pay the respondents’ costs of the business
rescue application, such costs are to include the costs of two counsel.’
______________________________________________________________

JUDGMENT
______________________________________________________________

Meyer AJA (Saldulker, Molemela and Gorven JJA and Smith AJA concurring):
[1] The sensational revelations made during the Zondo Commission of Enquiry into
Allegations of State Capture, inter alia by the former COO of Bosasa, Angelo Aggrizzi,

shocked the country. Bosasa is now known as Global Holdings (Pty) Ltd (Holdings).
This prompted the bankers of African Global Operations (Pty) Ltd (Operations) - a
wholly-owned subsidiary of Holdings that performed all the treasury functions of the
Bosasa Group of companies, including receiving payments and making payments on
behalf of the various operating companies in the Bosasa Group - to indicate that they
would be withdrawing Operations’ banking facilities and closing the banking accounts,
which was catastrophic for its continued business operations.

[2] After the Bosasa Group had failed to find another bank that would provide
Operations with banking facilities, the directors of Holdings and of Operations resolved
to place Operations and its ten wholly-owned subsidiaries1 under voluntary winding-
up in terms of section 351 of the Companies Act 61 of 1973 (the 1973 Companies
Act).2 However, when the joint provisional liquidators3 (the liquidators) started to
exercise their statutory powers, Holdings attempted to have the resolutions in which
the Bosasa companies were placed under voluntary winding-up (the special

1 The subsidiaries are Global Technology Systems (Pty) Ltd (GTS), Bosasa Properties (Pty) Ltd
(Properties), Rodcor Corporate Academy (Pty) Ltd (Rodcor), Watson Corporate Academy (Pty) Ltd
(WCA), On-IT-1 (Pty) Ltd (On-IT), Bosasa IT (Pty) Ltd (BIT), Bosasa Supply Chain Management (Pty)
Ltd (BCSM), Leading Prospect Trading 111 (Pty) Ltd (Leading Prospect), Bosasa Youth Development
Centres (Pty) Ltd (Youth Centres) and Black Rox Security Intelligence Services (Pty) Ltd (Black Rox),
all in liquidation.
2 I refer to Operations and its ten subsidiaries as ‘the Bosasa companies’, and to the directors of
Holdings, Operations and the Bosasa companies jointly as ‘the directors’.
3 They are: Mr Ralph Farrel Lutchman N.O., Mr Cloete Murray N.O.,Ms Tania Oosthuizen N.O. and Ms
Marianne Oelofsen N.O. in their capacities as the joint provisional liquidators of African Global
Operations (Pty) Ltd; Mr Ralph Farrel Lutchman N.O, Mr Cloete Murray N.O, Mr Selby Musawenkosi
Ntsibande N.O. and Mr Andre Botha October N.O. in their capacities as the joint provisional liquidators
of Bosasa Properties (Pty) Ltd;  Mr Ralph Farrel Lutchman N.O, Mr Cloete Murray N.O and Mr Nurjehan
Abdool Gafaar Omar N.O. in their capacities as the joint provisional liquidators of Global Technology
Systems (Pty) Ltd; Mr Ralph Farrel Lutchman N.O., Mr Cloete Murray N.O., Mr Roynath Parbhoo N.O.
and Ms Lizette Opperman N.O. in their capacities as the joint provisional liquidators of Leading Prospect
Trading 111 (Pty) Ltd; Mr Ralph Farrel Lutchman N.O., Mr Cloete Murray N.O., Mr Ofentse Andrew
Nong N.O. and Mr Tshepo Harry Nonyane N.O. in their capacities as the joint provisional liquidators of
Bosasa Youth Development Centres (Pty) Ltd; Mr Ralph Farrel Lutchman N.O., Mr Cloete Murray N.O.,
Ms Taryn Valerie Odell N.O. and Mr Gordon Nokhanda N.O. in their capacities as the joint provisional
liquidators of Black Rox Security Intelligence Services (Pty) Ltd; Mr Ralph Farrel Lutchman N.O., Mr
Cloete Murray N.O. and Ms Milani Becker N.O. in their capacities as the joint provisional liquidators of
Bosasa Supply Chain Management (Pty) Ltd; Mr Ralph Farrel Lutchman N.O., Mr Cloete Murray N.O.
and Mr Marc Bradley Beginsel N.O. in their capacities as the joint provisional liquidators of Bosasa IT
(Pty) Ltd; Mr Ralph Farrel Lutchman N.O., Mr Cloete Murray N.O. and Ms Mariette Benade N.O. in their
capacities as the joint provisional liquidators of Rodcor (Pty) Ltd; Mr Ralph Farrel Lutchman N.O., Mr
Cloete Murray N.O. and Ms Jacolien Frieda Barnard N.O. in their capacities as the joint provisional
liquidators of Watson Corporate Academy (Pty) Ltd; and Mr Ralph Farrel Lutchman N.O., Mr Cloete
Murray N.O. and Ms Deidre Basson N.O. in their capacities as the joint provisional liquidators of On-Lt-
1 (Pty) Ltd (in liquidation). It will be noted that Messrs Lutchman N.O. and Murray N.O. are amongst the
joint provisional liquidators of Operations and each of its ten subsidiaries.

resolutions) declared null and void. In addition, and as a consequence of the
aforementioned, Holdings attempted to have the appointment of the liquidators
declared null and void and of no force and effect. That was the beginning of a litigious
battle between the liquidators and Holdings.

[3] Holdings did that by initiating an application as a matter of extreme urgency in
the Gauteng Division of the High Court, Johannesburg (the high court). The case was
argued before Ameer AJ on 13 March 2019. The following day judgment was
delivered, granting Holdings the relief it had sought and ordering the liquidators to pay
the costs of the proceedings in their personal capacities.  However, the high court
granted the liquidators leave to appeal to this Court against that order. On 22
November 2019, this Court delivered its judgment, upholding the appeal and altering
the Ameer AJ order to one dismissing the application with costs, including those of two
counsel.4 Therefore, the effect of this Court’s order is that the Bosasa companies
remained in a creditor’s voluntary winding-up. On 3 December 2019, Holdings5 caused
an application to be issued by the Registrar of the high court. This was for an order
placing six of the eleven Bosasa companies6 (the six Bosasa companies) under
supervision and commencing business rescue proceedings in terms of s 131(1) of the
Companies Act 71 of 2008 (the Companies Act). During 4-6 December 2019, the
liquidators caused most of the assets of the six Bosasa companies to be sold by public
auction.

[4] Holdings7 responded by launching what is referred to as the ‘auction
application’.8 Therein they sought an order against the liquidators: (a) interdicting them
from selling any further assets owned by the six Bosasa companies before the final

4 Murray and Others NNO v African Global Holdings (Pty) Ltd and Others [2019] ZASCA 152; [2020] 1
All SA 64 (SCA); 2020 (2) SA 93 (SCA).
5 Sun Worx (Pty) Ltd (Sun Worx) and Kgwerano Financial Services (Pty) Ltd (Kgwerano) were cited as
the second and third applicants.
6 They are Operations, GTS, Properties, Leading Prospect, Youth Centres and Black Rox.
7 Again with Sun Worx and Kgwerano as the second and third applicants.
8 The liquidators of the eleven Bosasa companies in liquidation are cited as the first to thirty-eighth
respondents, the auctioneer, Park Village Auctioneers and Property Sales (Pty) Ltd (the auctioneer) as
fortieth respondent, and the Commissioner for the South African Revenue Services (SARS), the largest
third-party creditor of the Bosasa companies, was permitted to intervene as the first intervening party
in both the auction and business rescue applications. were cited as the respondents in the auction and
business rescue applications. was permitted to intervene. The business rescue and auction applications
only concern the six Bosasa companies in liquidation:

adjudication of the business rescue application and/or before the second meeting of
creditors, without the written consent of Holdings; (b) a declaration that the sale of
assets before the final adjudication of the business rescue application and/or before
the second meeting of creditors, without the written consent of Holdings, to be null and
void; and (c) interdicting them from delivering the movable assets to, and cause
transfer and registration of ownership of the immovable assets into the names of,
anyone who had purchased the assets of the six Bosasa companies before the final
adjudication of the business rescue application and/or the second meeting of creditors,
without the written consent of Holdings.

[5] The auction and business rescue applications (and another application which
is presently not relevant) were argued before the high court (De Villiers AJ) in a
consolidated hearing. In one judgment, the high court granted the relief sought in the
auction application and dismissed the business rescue application. It gave the
liquidators and SARS leave to appeal its order in the auction application. It also gave
Bosasa, Sun Worx, and Kgwerano leave to appeal its order in the business rescue
application. The liquidators and SARS were also granted leave to appeal one of the
costs awards made in the business rescue application. In each case, leave was given
to appeal to this Court.

[6] I now return to the pertinent contextual background facts from when the
liquidators were given leave to appeal the Ameer AJ order.9 Holdings sought and was
granted an order: (a) that the special resolutions placing the Bosasa companies in a
creditor’s voluntary winding-up had not been lawfully passed and were thus ‘null and
void ab initio and of no force and effect’; (b) that; as a result, the appointments of the
liquidators were not validly and lawfully made and were thus also ‘null and void ab
initio and of no force and effect’; and (c) for the liquidators to deliver control of the
Bosasa companies and all their assets to the directors.

9 As I have mentioned, the liquidators and SARS were the respondents in both the auction and business
rescue applications. The facts alleged by them, therefore, must be accepted ‘unless they constituted
bald or uncreditworthy denials or were palpably implausible, far-fetched or so clearly untenable that
they could safely be rejected on the papers’ and a ‘finding to that effect occurs infrequently because
courts are always alive to the potential for evidence and cross-examination to alter its view of the facts
and the plausibility of evidence’ (see   Media 24 Books (Pty) Ltd v Oxford University Press Southern
Africa (Pty) Ltd 2016] ZASCA 119; [2016] 4 All SA 311 (SCA); 2017 (2) SA 1 (SCA) para 36  and
National Scrap Metal (Cape Town) (Pty) Ltd and Another v Murray & Roberts Ltd and Others [2012]
ZASCA 47; 2012 (5) SA 300 (SCA) para 22). That test was not satisfied in both applications.

[7] Notwithstanding the pending appeal against the Ameer AJ order, the directors
did not accept that there had been a concursus creditorum in respect of any of the
Bosasa companies or that the liquidators held any rights or powers as ‘provisional
liquidators’. They maintained that the suspension of the Ameer AJ order as a result of
the pending appeal did not resolve the disputes between them and the liquidators,
whether the Bosasa companies had indeed been placed into liquidation and whether
the liquidators had the powers of provisional liquidators to take control of the assets
and affairs of the Bosasa companies. They asserted that they (and not the liquidators)
remained in control of the assets and affairs of the Bosasa companies, and they
refused to relinquish their control to the liquidators. The liquidators, on the other hand,
maintained that because of the appeal and through the operation of s 18 of the
Superior Courts Act 10 of 2013, the order setting aside the special resolutions and
their appointments as provisional liquidators was suspended pending the outcome of
the appeal and that the Bosasa companies, therefore, remained in liquidation and
under their control (the dispute).

[8] However, the liquidators and the directors agreed to implement a mechanism
through which they could, in consultation with one another, attend to the affairs of the
Bosasa companies despite the dispute between them to avoid further unnecessary
skirmishes and costly litigation pending the outcome of the appeal. That mechanism
included joint and mostly monthly meetings between them when they discussed
matters arising in connection with the affairs of the Bosasa companies and took joint
decisions in relation to the conduct of the Bosasa enterprise (the interim arrangement).

[9] On 2 April 2019, the high court (Tsoka J) granted an interim order extending
the powers of the liquidators in terms of s 386(5), read with s 388, of the 1973
Companies Act, authorising them to: (a) transact on the banking accounts of the
Bosasa companies; (b) continue to conduct their businesses; (c) institute or defend
legal proceedings; and (d) reach reasonable settlements with debtors and accept
payment of any such debts. Once the Tsoka J interim order had been made, Holdings
and the directors intervened in that first application to extend the liquidators’ powers.
The directors and the liquidators then agreed on inserting the following paragraphs 6
and 7 in the final order to be made:

‘6. The powers in paragraphs 4 and 5 above shall be exercised by the Applicants in
consultation with the board(s) of directors of the specific company or companies involved in
the transaction(s) and decisions and the Applicants shall at all times be obliged to give the
directors in question reasonable notice of the meeting at which it is sought to consult and of
the subject matter thereof.
7. This order shall lapse and be of no further force and effect immediately upon the grant of
an order by the Supreme Court of Appeal that the appeal against the order granted under
case number 2103/2019 has been successful. However, if the appeal is successful, then the
provisions in paragraph 6 shall lapse and be of no force or effect.’

[10] On 14 May 2019, Mudau J made the Tsoka J interim order final with the addition
of the above-quoted paragraphs 6 and 7. In support of such additional relief, the
directors stated the following in their founding affidavit in the intervention application:
‘25. None of Holdings or the Directors were included as Respondents but some of the latter
were given notice. The directors of Holdings and the Directors had considerable concerns
regarding the relief which was sought given that the Applicants were essentially seeking the
sanction of the Court of powers beyond those which vest in provisional liquidators in the
ordinary course and effectively to enable the Applicants to proceed post-haste with the winding
up of the companies in advance of the consideration of the appeal in the Supreme Court of
Appeal.
26. If that appeal is unsuccessful (and Holdings and the Directors have every reason to believe
that it will be), the effect will be that the resolutions implementing the winding up of the
companies will be declared to be void and the [liquidators] be directed to hand control of the
companies back to the Directors with all of their assets as at 21 February 2019.
27. The intention of the Applicants in seeking the relief they did, was to give them sole control
with extensive powers without the need to engage or consult with the Directors.
Notwithstanding that the Registrar of the Supreme Court of Appeal has been requested to
expedite the appeal, the final grant of the orders sought may well result in the winding up of
the companies being a fait accompli before that appeal is finalised.
. . .
30. In the event, from the perspective of Holdings and the Directors, the interim arrangement
whereby the powers granted to the Applicants in the interim Order and exercised in
consultation with the board(s) of directors of the specific company or companies involved in
the transaction(s) and decisions in question has been working well, and agree to the
continuation of that arrangement pending the outcome of the appeal.’

[11] The liquidators and the directors realised that the six Bosasa companies had
lost their substratum and that there was a need to dispose of their assets expeditiously.
The founding affidavit fully explained the need to support a further application to the
high court to extend the liquidators’ powers (the second application to extend the
liquidators’ powers). In short, the liquidators were advised that Cabinet decided that
‘all service level agreements between Departmental and State Owned Companies and
any companies related to African Global Operations (Bosasa) group of companies’
must be terminated. The six Bosasa companies were awarded lucrative income-
generating contracts, inter alia with the Department of Correctional Services, Airports
Company of South Africa and the Department of Social Development. Most such
agreements had already been terminated by the time the founding affidavit was
deposed. Those contracts were ‘the proverbial backbone of the group of companies’,
and their termination had significantly impacted the ability of the Bosasa companies to
continue with their business operations. The majority of the significant assets, movable
and immovable, of the six Bosasa companies were acquired to provide services in
terms of the then cancelled contracts. Their substantial but then redundant, movable
assets had to be kept in a safe location, guarded, under surveillance and insured. The
monthly insurance charges alone amounted to R150 000. Without the power to sell
the redundant assets, the situation would continue, and the six Bosasa companies
that no longer generated an income would have to keep on paying those substantial
expenses. The upkeep of the immovable properties also drained the financial
resources of Operations and Properties.

[12] The dilemma the liquidators and directors faced was thus articulated in the
founding affidavit of the liquidators in the second application to extend their powers:
‘87. In ordinary liquidation proceedings the Master of the High Court will convene a first
meeting of creditors, members and contributories to, amongst other things, enable creditors
to prove their claims and vote on the final appointment of liquidators. I stress the fact that in
accordance with section 364 of the Companies Act only the Master may convene a first
meeting and that it is beyond the powers of provisional liquidators to do so.
88. As soon as liquidators are finally appointed, they are empowered to convene a second
meeting of creditors. It is only at this second meeting where creditors are asked to consider
and adopt resolutions authorising liquidators to generally act in their best interest (by, for
example, appointing attorneys or selling assets).

89. Typically it takes anywhere between two to eight months for a second meeting of creditors
to take place. In the companies involved in this application this position is unfortunately much
worse, as the first creditors’ meetings will only be convened when the afore-mentioned
pending appeal is finalised.
90. I wish to point out that section 386(2B) of the Companies Act entitles the Master of the
High Court to authorise the sale of assets in situations like this. In the present instance the
Master indicated that it would prefer not to take a decision itself, and indicated that it regarded
an approach to court (i.e. the current application) as more appropriate. A true copy of the
Master’s relevant email is annexed hereto as “FA17”. In light thereof, the applicants have no
choice other than to seek an extension of our powers in terms of this application.’

[13] The founding affidavit inter alia deals with the dispute between the directors
and the liquidators and the interim arrangement they reached pending the finalisation
of the appeal; and the background to and the purpose of the Tsoka J interim order,
the intervention application and the interim arrangement reached between the
liquidators and the directors, which interim arrangement is reflected in paragraphs 6
and 7 of the Mudau J final order.

[14] It is necessary to refer to certain specific paragraphs in the founding affidavit of
the second application to extend the liquidators’ powers:
‘39. In acknowledgment of the interests which African Global Operations (Pty) Ltd (in
liquidation) (represented by the first to third applicants mentioned above), and the ultimate
holding company (African Global Holdings (Pty) Ltd, a solvent company to which  reference is
made in paragraph 48 that follows) have in the outcome of the sale of assets of the relevant
companies, the co-provisional liquidators have, [as was envisaged in the 2 April order (referred
to in paragraph 51 that follows) and the 14 May 2019 order (referred to in paragraph 53 that
follows)], agreed that the assets referred to in paragraphs 37 and 38 above will not be sold
other than in consultation with and with the consent of the boards of African Global Operations
(Pty) Ltd (in liquidation) and African Global Holdings (Pty) Ltd. The applicants are accordingly
supported in this application by the boards of directors of each of the seven companies
referred to above and by African Global Holdings (Pty) Ltd.
. . .
46. As a result of the appeal, and through the operation of section 18 of the Superior Courts
Act, 10 of 2013, the order setting aside the special resolutions is suspended pending the
outcome of the appeal. The Applicants are advised that the eleven companies remain in
liquidation and remain under the control of their respective co-provisional liquidators. As

appears more fully what I say here under, the boards of the companies in question and African
Global Holdings (Pty) Ltd hold a different view which has necessitated agreement on the
practical solution in terms of which the companies have been managed until now.
. . .

51. Substantial exchanges between Standard Bank and the co-provisional liquidators followed
but, notwithstanding attempts to explain our position, Standard Bank adopted the stance that
they would not allow the provisional liquidators to transact on the accounts unless a court
order was obtained, authorising us to do so. In consequence of the above the applicants
launched an urgent application for an interim order under case number 11954/2019. On 1 April
2019 the Applicants’ attorney received a letter from the attorneys representing African Global
Holdings (Pty) Ltd and the directors of the companies in respect of which the extensions of
powers were being sought. A copy of the letter is attached as “FA8” (“the Letter”). The said
attorneys recorded in the Letter that their client did not accept that there had been a concursus
creditorum in respect of any of the companies within the African Global Group or that the
applicants therein then held any rights or powers as “provisional liquidators”. The said
attorneys however made certain proposals in paragraphs (a) - (c) thereof, agreement to which
would preclude the necessity for their clients to intervene urgently and to oppose the
application. As a matter of practicality the Applicants agreed to the proposals, and on 2 April
2019 obtained a court order incorporating them and authorising us to, inter alia, transact on
the bank accounts. A true copy of the court order is annexed hereto as “FA9” (the 2 April
order).
. . .
53. The application for leave to intervene referred to in paragraph 6 of the 2 April order was
launched and an order granting leave to thirteen parties to intervene in the pending
proceedings was granted on 14 May 2019. However, given that the interim agreement
whereby the powers granted to the Applicants in the 2 April order are exercised in consultation
with the board(s) of directors of the specific company or companies involved in the
transaction(s) and decisions in question has been working well, agreement was reached upon
the continuation of that agreement pending the outcome of the appeal. A true copy of the order
reached by agreement is annexed hereto as “FA10” (the May order). Although the May order
substituted the April order, for all intents and purposes it had the same effect.’

[15] Once the draft second application to extend the liquidators’ powers had been
considered by Holdings and the directors, their attorneys, on 4 September 2019,
advised the liquidators’ attorneys as follows:

‘We refer to the correspondence exchanged between our respective offices regarding the
proposed application for the extension of the powers of your clients.
We represent African Global Holdings Proprietary Limited, the directors of that company as
well as the directors of the African Global Operations Proprietary Limited as well as those of
the various subsidiary companies of African Global Operations Proprietary Limited mentioned
in the proposed application as having supposedly been placed in provisional liquidation during
February 2019.
We refer to amongst others paragraph 51 of the draft affidavit and confirm the said paragraph
correctly records the position of our clients as does our letter of 1 April 2019 (attached to the
founding affidavit as annexure FA 8) regarding the status of the companies as well as the
basis upon which our clients agreed to both the April order and the May order.
We also confirm that by virtue of your clients agreeing that they will not exercise their powers
other than:
1.  in consultation with our clients; and
2. without the consent of our clients,
and as a matter of practicality (without conceding the legal position or rights) our clients
consent to the relief claimed in the notice of motion.’

[16] On 28 October 2019, Bhoola AJ granted the consent order sought for the
extension of the liquidators’ powers. It reads:
‘1. The applicants’ powers are extended in terms of section 386(5), read with section 388, of
the Companies Act, 61 of 1973 (the Companies Act), authorising them to sell all the movable
assets belonging to African Global Operations (Pty) Ltd, Global Technology Systems (Pty)
Ltd, Bosasa IT (Pty) Ltd, Leading Prospect Trading 111 (Pty) Ltd, Bosasa Development
Centres (Pty) Ltd, and Black Rox Security Intelligence Services (Pty) Ltd (all in liquidation), by
way of public auction, public tender or private contract, as contemplated in section 386(4)(h)
of the Companies Act.
2.  The applicants’ powers are extended in terms of section 386(5), read with section 388, of
the Companies Act authorising them to sell all of the immovable properties belonging to
Bosasa Properties (Pty) Ltd (in liquidation), by way of public auction, public tender or private
contract, as contemplated in section 386(4)(h) of the Companies Act.10
3.  The assets referred to in paragraphs 1 and 2 above shall be sold in consultation with and
with the consent of the board of African Global Holdings (Pty) Ltd, African Global Operations

10 Paragraph 2 of the Bhoola AJ order was subsequently varied by the insertion of the words ‘and
African Global Operations (Pty) Ltd (in liquidation)’ after the words ‘Bosasa Properties (Pty) Ltd (in
liquidation)’.

(Pty) Ltd (in liquidation) and the respective boards of its subsidiaries referred to in paragraphs
1 and 2 above.’

[17] The liquidators initially instructed the auctioneer to sell the majority of the six
Bosasa companies’ assets by way of public auction on 26 and 27 November 2019.
The dates of the intended auction sale were then changed to 4-6 December 2019.
Other than for the sale of certain movable assets,11 Holdings and the directors
objected to the sale of the other assets by public auction at the end of November or in
December, maintaining that they had not consented to the sale thereof as required in
terms of the Bhoola AJ order. The liquidators’ attorneys advised their attorneys that
there was no reason for the sale by public auction not to proceed and that they would
be proceeding with the advertisement and sale of the assets. The appeal was argued
in the Supreme Court of Appeal on 15 November 2019.

[18] On 20 November 2019, Holdings’ attorneys addressed a lengthy and
comprehensive letter to the liquidators’ attorneys, commencing by stating that they
‘address this letter on the instructions of the directors of African Global Holdings (Pty)
Ltd (“Holdings”)’. They referred to the Mudau J, and Bhoola AJ orders extending the
liquidators’ powers and the letter continued thus:
‘We are instructed that there is no plausible reason to rush the disposal of the remaining
assets. The liquidators first engaged our clients on the application for the extension of powers
in the first half of 2019. It was only after the master refused to grant his or her consent to the
extended powers by virtue of the pending SCA appeal that the liquidators approached the
directors for their consent granting such extension. The first drafts of the proposed application
only surfaced in July 2019 and the application itself was only issued on 12 September 2019.
The remaining assets have been preserved and secured since February 2019 and the
liquidators have given rational reasons for the sudden need to urgently dispose of the
remaining assets.
The appeal brought by the liquidators against the Order of Ameer AJ was heard by the
Supreme Court of Appeal on Friday 15 November 2019. In all likelihood, judgment will be
given by the appeal court before the end of this year. Once the judgment is handed down
either the liquidators, alternatively the directors, will be permitted to take control of the various

11 The directors consented to the sale of the firearms, equipment and furniture in respect of the
repatriation and youth centres, equipment to the Department of Correctional Services and the
shareholding in Ntsimbintle.

companies and make decisions regarding the disposal of the assets of those companies. The
liquidators may be permitted to dispose of the assets without the consent of the directors or
vice versa. The directors may be inclined to sell the assets in a different manner to that which
the liquidators have proposed (by way of auction) if the appeal is dismissed (such as sale to
private buyers and not by way of auction at a forced sale value). For this reason alone, it would
be unreasonable to insist that the sale take place this year before the judgment is handed
down.’

[19] On 22 November 2019, this Court delivered its judgment, upholding the appeal
and altering the Ameer AJ order to one dismissing the application with costs, including
those of two counsel, with the effect that the Bosasa companies remain in a creditor’s
voluntary winding-up. Holdings nevertheless demanded that the liquidators do not
proceed with the three-day public auction of the assets of the six Bosasa companies
scheduled to take place from 4 to 6 December 2019, maintaining that paragraph 3 of
the Bhoola AJ order remains operative and that it and the directors had not consented
to the scheduled public auction. The liquidators refused to accede to its demand. On
3 December 2019, Holdings, Sun Worx and Kgwerano caused the business rescue
application to be issued. Holdings still demanded that the public auction be cancelled,
also maintaining that that application had suspended the liquidation proceedings,
including the scheduled public auction in terms of s 131(6) of the Companies Act, but
the liquidators steadfastly refused to accede to the demand.

[20] The public auction commenced on 4 December 2019 and continued until 6
December 2019. The total value realised pursuant to the auction and sale of most of
the six Bosasa companies’ assets amounted to R113,048,407.00 in circumstances
where the estimated forced sale market value of the realised assets amounted to
R89,803,295.00. Holdings, Sun Worx and Kgwerano then brought the auction
application, wherein they sought and obtained the relief set out in paragraph 4 supra.

[21] The auction application and appeal are premised on two grounds: First, the
liquidators were statutorily prohibited from proceeding with the auction and any
subsequent sales of the assets of the Bosasa companies due to a suspension of the
Bosasa liquidation proceedings in terms of s 131(6) of the Companies Act, because
the application for business rescue was ‘made’ on 3 December 2019, which was prior

to the commencement of the auction on 4 December 2019. This ground raises two
questions: (a) when is a business rescue application ‘made’ within the meaning of s
131(6); and (b) whether the business rescue application in casu was indeed ‘made’
within the meaning of s 131(6). These questions raise the proper interpretation of s
13(6). The findings in respect of these questions may well be dispositive of the
business rescue appeal. The second ground upon which the auction application and
appeal are premised is that the liquidators were not clothed with the requisite power
or authority to sell the assets on auction at the time when the auction was held or
thereafter, because they were provisional liquidators, the directors have not consented
to the public auction as contemplated in paragraph 3 of the Bhoola AJ order and the
second meeting of creditors has not yet been held. This ground raises the
interpretation of paragraph 3 of the Bhoola AJ order.

[22] The high court held that the liquidators were legally prevented from proceeding
with the auction and any subsequent sales of the Bosasa assets due to the business
rescue application having been ‘made’ on 3 December 2019 prior to the auction, which
triggered the suspensions of the Bosasa companies’ respective liquidation
proceedings in terms of s 131(6) of the Companies Act. It also held that Holdings and
the directors did not consent to nor, on a proper interpretation of paragraph 3 of the
Bhoola AJ order, were the liquidators clothed with the requisite power or authority to
sell the assets on auction at the time when it was held. It accordingly granted the relief
sought in the auction application. The business rescue application was dismissed on
its merits.

[23] Section 131(1) of the Companies Act provides that ‘[u]nless a company has
adopted a resolution contemplated in section 129, an affected person may apply to a
court at any time for an order placing the company under supervision and commencing
business rescue proceedings’. Section 131(2) provides that ‘[a]n applicant in terms of
subsection (1) must – (a) serve a copy of the application on the Company and the
Commission; and (b) notify each affected person of the application in the prescribed
manner’.12 In addition, s 131(3) provides that ‘[e]ach affected person has a right to

12 The ‘Commission’ referred to is the Companies and Intellectual Property Commission established by
s 185. Affected persons are defined in s 128(1)(a)(i), (ii) and (iii) as a shareholder or creditor of that
company and include any registered trade union representing employees or each of the individual

participate in the hearing of an application in terms of this section’. Furthermore, s
131(6) provides that ‘[i]f liquidation proceedings have already been commenced by or
against the company at the time an application is made in terms of subsection (1), the
application will suspend those liquidation proceedings until (a) the court has
adjudicated upon the application; or (b) the business rescue proceedings end, if the
court makes the order applied for’. Moreover, s 132(1) provides that ‘[b]usiness rescue
proceedings begin when- (a) the company- (i) files a resolution to place itself under
supervision in terms of section 129(3); or (ii) applies to the court for consent to file a
resolution in terms of section 129(5)(b); (b) an affected person applies to the court for
an order placing the company under supervision in terms of section 131(1); or (c) a
court makes an order placing a company under supervision in terms of section
131(7).13

[24] There are conflicting high court judgments on when a business rescue
application is ‘made’ within the meaning of s 131(6) of the Companies Act. What some
considered constituting the ‘making’ of a business rescue application are the issue,
service and prescribed notification thereof,14 and others the mere lodging of the
business rescue application with the registrar and the issue thereof.15 For the reasons
that follow, I subscribe to the interpretation that a business rescue application must be
issued, served on the company and the Commission, and each affected person must
be notified of the application in the prescribed manner, to meet the requirements of s
131(6) in order to trigger the suspension of liquidation proceedings that have already
commenced.

employees. Regulation 124 of the Company Regulations, 2011, published under GN 351 in GG 34239
of 26 April 2011 provides that ‘[a]n applicant in court proceedings, who is required, in terms of either
section 130(3)(b) or 131(2)(c), to notify affected persons that an application has been made to a court,
must deliver a copy of the court application, in accordance with regulation 7, to each affected person
known to the applicant.
13 Emphasis added.
14 ABSA Bank Ltd v Summer Lodge (Pty) Ltd 2013 (5) SA 444 (GNP) para 16, Taboo Trading 232 (Pty)
Ltd v Pro Wreck Scrap Metal CC; Joubert v Pro Wreck Scrap Metal CC and Others 2013 (6) 141 (KZP)
paras 8-11, ABSA Bank Ltd v Summer Lodge (Pty) Ltd 2014 (3) SA 90 (GP) para 19, Standard Bank
of South Africa Ltd v Gas 2 Liquids (Pty) Ltd 2017 (2) SA 56 (GJ).
15 Blue Star Holdings (Pty) Ltd v West Coast Oyster Growers CC 2013 (6) SA 540 (WCC) para 29,
which was followed by the high court in this instance.

[25] Section 131(6), read with the provisions of ss 131(1) to (4) and 132(1)(b), must
be interpreted in accordance with the well-known principles of interpretation.16 Those
principles were recently thus summarised in Commissioner for the South African
Revenue Service v United Manganese of Kalahari (Pty) Ltd (264/2019) ZASCA 16 (25
March 2020):17
‘It is an objective unitary process where consideration must be given to the language used in
the light of the ordinary rules of grammar and syntax; the context in which the provision
appears; the apparent purpose to which it is directed and the material known to those
responsible for its production. The approach is as applicable to taxing statutes as to any other
statute. The inevitable point of departure is the language used in the provision under
consideration.’

[26] This Court elaborated further on the context for the interpretation of statutes,
thus:18
‘The difference in the genesis of statutes and contracts provides a different context for their
interpretation. Statutes undoubtedly have a context that may be highly relevant to their
interpretation. In the first instance there is the injunction in s 39(2) of the Constitution of the
Republic of South Africa, 1996 . . . that statutes should be interpreted in accordance with the
spirit, purport and objects of the Bill of Rights. Second, there is the context provided by the
entire enactment. Third, where legislation flows from a commission of enquiry, or the
establishment of a specialised drafting committee, reference to their reports is permissible and
may provide helpful context. Fourth, the legislative history may provide useful background in
resolving interpretational uncertainty. Finally, the general factual background to the statute,
such as the nature of its concerns, the social purpose to which it is directed and, in the case
of statutes dealing with specific areas of public life or the economy, the nature of the areas to
which the statute relates, provides the context for the legislation.’

[27] The word ‘made’ is the past participle of the word ‘make’. The dictionary
meaning of the verb ‘make’ includes ‘bring about or perform; cause’.19 But, as was

16 Natal Joint Municipality Pension Fund v Endumeni Municipality 2012 (4) SA 593 (SCA) para 18, and
approved by the Constitutional Court in inter alia Airports Company South Africa v Big Five Duty Free
(Pty) Ltd and Others 2019 (5) SA 1 (CC) para 29. Also see Bothma-Batho Transport (Edms) Bpk v S
Bothma & Seun Transport (Edms) Bpk 2014 (2) SA 494 (SCA) para 12.
17 Commissioner for the South African Revenue Service vv United Manganese of Kalahari (Pty)
Ltd  ZASCA 16 (25 March 2020), para 8. (Footnote omitted.)
18 Ibid para 17. (Footnotes omitted.)
19 Concise Oxford English Dictionary (Twelfth Edition).

said in Natal Joint Municipality Pension Fund v Endumeni Municipality,20 ‘[m]ost words
can bear several different meanings or shades of meaning and to try to ascertain their
meaning in the abstract, divorced from the broad context of their use, is an unhelpful
exercise’. And in Plaaslike Oorgangsraad, Bronkhortspruit v Senekal,21 ‘. . . dat mens
jou nie moet blind staar teen die swart-op-wit woorde nie, maar probeer vasstel wat die
bedoeling en implikasies is van dit wat gesê is. Dit is juis in hierdie proses waartydens die
samehang en omringende omstandighede relevant is’.22

[28] That is also true of the words ‘application is made’ in s 131(6), ‘apply’ in s 131(1)
and ‘applies’ in s 132(1)(b) of the Companies Act. However, on a proper interpretation
of the word ‘made’ in isolation, in the context of s 131 as a whole (especially
subsections 131(1) to (3)), in the context of the Companies Act as a whole (especially
the nature and purpose of business rescue proceedings vis-à-vis those of winding up
proceedings as well as s 132(1)(b)), and the apparent purpose to which s 131(6) is
directed, its meaning becomes clear: The business rescue application must be issued,
served on the company and the Commission, and all reasonable steps must have
been taken to identify affected persons and their addresses and to deliver the
application to them, to meet the requirements of s 131(6) in order to trigger the
suspension of the liquidation proceedings.

[29] Liquidation proceedings are strictly proceedings to constitute a concursus
creditorum. The liquidation process continues until the company's affairs have been
finally wound up, and the company is dissolved.23 Whereas, ‘[b]usiness rescue is a
process aimed at avoiding the liquidation of a company if it is feasible. There are two
routes through which a company may enter business rescue, namely, by way of a
resolution of its board of directors (s 129(1)) or by way of a court order (s 131(1))’.24
The purpose to which s 131(6) is directed is to suspend liquidation proceedings until

20 Natal Joint Municipal Pension Fund v Endumeni Municipality 2012] ZASCA 13; [2012] 2 All SA 262
(SCA); 2012 (4) SA 593 (SCA) para 25.
21 Plaaslike Oorgangsraad van Bronkhortspruit v Senekal 2001 (3) SA 9 (SCA) para 11.
22 See the case of Elan Boulevard (Pty) Ltd v Fnyn Investments (Pty) Ltd [2018] ZASCA 165; 2019 (3)
SA 441 (SCA) para 16 footnote 6 where it has been loosely translated as: ‘One should not stare blindly
at the black-on-white words, but try to establish the meaning and implication of what is being said. It is
precisely in this process that the context and surrounding circumstances are relevant.’
23 Richter v ABSA Bank Limited [2015] ZASCA 100; 2015 (5) SA 57 (SCA) para 10.
24 Panamo Properties (Pty) Ltd and Another v Nel N.O. and Others [2015] ZASCA 76; 2015 (5) SA 63
(SCA); [2015] 3 All SA 274 (SCA) para 8.

the court has adjudicated upon the business rescue application or the proceedings
end.

[30] Significant consequences ensue upon the commencement of liquidation
proceedings. As was said in Standard Bank of South Africa Ltd v Gas 2 Liquids (Pty)
Ltd:25
‘[22] Provisional liquidators have, in terms of the Act, those powers statutorily granted to them,
those which the Master may specially confer and those which they are granted by the court.
They cover a wide range of activities. These may include the carrying on of a business,
institution or defence of legal proceedings and the sale (or even the acquisition) of assets.
Pursuant to the exercise of such powers, the provisional liquidator may operate banking
accounts, receive and disburse funds, remunerate employees, conclude contracts and
generally carry out the duties of the directors of the company in liquidation.
[23] Where there is no service upon the provisional liquidator of the application for business
rescue, the provisional liquidator may have absolutely no knowledge of that business-rescue
application. In fact, knowledge alone would be insufficient. The provisional liquidator is entitled
to service in terms of section 131 of the Act. Absent such service, the provisional liquidator
does not officially know that he or she is “suspended” in his or her duties and powers, if such
suspension of the liquidation proceedings were to eventuate solely by reason of lodgement of
papers at court and the issue of a case number.
[24] It may be that service upon the company/liquidator, upon the Commissioner and
notification to affected parties may take quite some time. In fact, respondent’s counsel
informed me that such service and notification need only take place “in due course”. And while
the course time ebbs and flows, the provisional liquidator is carrying out his or her duties and
exercising his or her power in ignorance. Money may go in and out, employees may report for
duty or be sacked, and legal proceedings may be commenced or terminated. All this should
not be permitted or implemented by a provisional liquidator who is suspended because the
liquidation proceedings are suspended. . . . He or she may not do anything which may impact
upon the business rescue application. But the provisional liquidator would continue to carry
out his or her duties and exercise his or her powers where there has been no service of the
business rescue application upon the provisional liquidator. Lodgement of papers at court and
issue of a case number does not mean that anyone other than the applicant, the messenger
and the individual clerk in the office of the registrar has knowledge that the provisional
liquidator should do nothing further because the liquidation proceedings are suspended.

25 Standard Bank of South Africa Ltd v Gas 2 Liquids (Pty) Ltd 2017 (2) SA 56 (GJ).

[25] Such a situation cannot be allowed to eventuate. It cannot be that mere lodgement of
papers and issue of a case number is sufficient to trigger a suspension. As I have pointed out,
if that were the case, a provisional liquidator may be acting without authority (and perhaps
unlawfully) in a multiplicity of respects. That cannot have been the intention of the legislature.
The question would then also arise as to when. . . where. . . why and by whom these
unauthorised actions of a provisional liquidator are to be undone and with what consequences
to third parties or to the company whose liquidation is suspended but which is not yet (and
may never be) in business rescue.’26

[31] In Republikeinse Publikasies (Edms) Bpk v Afrikaanse Pers Publikasies (Edms)
Bpk,27 it was held that the purpose of a summons or notice of motion is to involve a
respondent in a lawsuit. Only when a provisional liquidator and the Commission are
served with a business rescue application and affected persons have been notified
thereof will they thus be involved in or drawn into the business rescue application
proceedings. Until then, they remain unaffected in law. It will give effect to the purpose
of s 131(6) to suspend liquidation proceedings only where the application for business
rescue has been publicly and formally (by its issue, service on the company and the
Commission, and notification to each affected person) been ‘made’. An interpretation
that the word ‘made’ in s 131(6) is used to denote the mere issuing of the business
rescue proceedings and thereby triggering the suspension of the liquidation
proceedings, in my view, results in absurdity, militates against logic, leads to an
insensible or unbusinesslike result, and undermines the purpose of the section.

[32] By analogy, in Tjeka Training Matters (Pty) Ltd v KPPM Construction (Pty) Ltd
and Others28 and in Pan African Shopfitters (Pty) Limited v Edcon Ltd and Others,29
the word ‘initiated’ used in s 129(2)(b) of the Companies Act, which provides that a
resolution to begin business rescue proceedings and place a company under
supervision ‘may not be adopted if liquidation proceedings have been initiated by or
against the company’, was interpreted to mean that the liquidation proceedings must
be served on the company, not merely issued, to meet the requirements of the section.

26 See also Taboo Trading 232 (Pty) Ltd v Pro Wreck Scrap Metal CC; Joubert v Pro Wreck Scrap Metal
CC and Others 2013 (6) 141 (KZP) para 11.
27 Republikeinse Publikasies (Edms) Bpk v Afrikaanse Pers Publikasies (Edms) Bpk 1972 (1) SA
773 (A) at 780E-F.
28 Tjeka Training Matters (Pty) Ltd v KPPM Construction (Pty) Ltd and Others 2019 (6) SA 185 (GJ).
29 Pan African Shopfitters (Pty) Ltd v Edcon Limited and Others [2020] ZAGPJC 158 (10 July 2020).

[33] In Finishing Touch 163 (Pty) Ltd v BHP Billiton Energy Coal South Africa Ltd
and Others,30 this Court interpreted the word ‘initiate’ used in a court order granting an
interdict pending certain review proceedings that were intended to be launched on
condition that it be initiated by no later than a certain date, to mean not only the filing
of the review application papers with the registrar and the issue thereof but also service
thereof. In reaching that conclusion, this Court inter alia placed reliance on Mame
Enterprises (Pty) Ltd v Publications Control Board,31 wherein it was held that it was
manifest from rule 6 of the Uniform Rules of Court and from the contents of Form 2(a)
thereof that the giving of notice to the respondent in a case in which relief is claimed
against him is an essential first step in an application on notice of motion; and on Tladi
v Guardian National Insurance Co Ltd,32 wherein it was held that an application, which
was required to have been made within a period of 90 days as contemplated in s 14(3)
of the Motor Vehicle Accidents Act 84 of 1986, could not be considered to have been
made if it had merely been issued but not served.

[34] In Taboo Trading 232 (Pty) Ltd v Pro Wreck Scrap Metal CC; Joubert v Pro
Wreck Scrap Metal CC and Others,33 it was held that the reasoning in judgments,
which held that applications contemplated in similar legislation governing claims for
damages arising from personal injuries caused by motor vehicle accidents could only
be considered to have been made within the time periods prescribed in such legislation
if such applications had been filed with the registrar and served, ‘is both relevant and
apposite to a consideration and interpretation of the words “apply”, “application is
made” and “applies” in s 131(1), s 131(6) and s 132(1)(b) of the Companies Act, with
reference to when a business rescue application may be considered to have been
made’.34

30 Finishing Touch 163 (Pty) Ltd v BHP Billiton Energy Coal South Africa Ltd and Others [2012] ZASCA
49; 2013 (2) SA 204 (SCA) paras 14-20.
31 Mame Enterprises (Pty) Ltd v Publications Control Board 1974 (4) SA 217 (W) at 220B.
32 Tladi v Guardian National Insurance Co Ltd 1992 (1) SA 76 (T) at 80B.
33 Taboo Trading 232 (Pty) Ltd v Pro Wreck Scrap Metal CC; Joubert v Pro Wreck Scrap Metal CC and
Others 2013 (6) 141 (KZP) para 9.
34 The authorities referred to are Fisher v Commercial Union Assurance Co Of SA Ltd, 1977(2) Sa 499
(C); Peters v Union and National South British Insurance Co Ltd, 1978(2) SA 58 (D) and Tladi v
Guardian National Insurance Co Ltd, 1992(1) SA 76 (T).

[35] This brings me to the question whether the business rescue application was
indeed ‘made’ within the meaning of s 131(6) as set out above, on 3 December 2019,
thereby suspending the liquidation proceedings prior to the auction. The answer is no.

[36] In Van Staden NO and Others v Pro-Wiz Group (Pty) Ltd,35 this Court said:
‘[10] Starting with basic principles, in terms of s 131(2)(a) of the Act an application for
business rescue must be served on the company or closed corporation. Where it is
already being wound up, whether provisionally or finally, that means that the persons
on whom it must be served, as representing the company, are its liquidators. That
necessarily follows from the fact that, upon the compulsory winding-up of a company,
its directors (read members in the case of a close corporation) are deprived of their
control of the company, which is then deemed to be in the custody or control of the
Master until the appointment of liquidators. Thereafter it is in the custody or control of
the liquidators.
[12] It is apparent from the provisions of s 131 that the company that is the subject of the
business rescue application is entitled to oppose it. At the time the application is made in
relation to a company under provisional or final winding-up, its affairs will be in the hands of
the liquidators. On ordinary principles it seems obvious that liquidators, whether provisional or
final, faced with such an application should be entitled either to support or oppose the
application depending upon their judgment as to the interests of the company and its creditors.
[13] Furthermore, as a matter of principle, when a party is cited in legal proceedings it is
entitled without more to participate in those proceedings. The fact that it was cited as a party
gives it that right. . . . ’

[37] The auction application and the business rescue application needed to have
been served on each of the joint liquidators of each of the six Bosasa companies. They
represent the Bosasa company in liquidation in respect of which they were appointed.
Furthermore, each of them was cited as a respondent in the auction application and
business rescue applications. They, in terms of s 382(1) of the 1973 Companies Act,
‘shall act jointly in performing their functions as liquidators and shall be jointly and
severally liable for every act performed by them’. Knowledge of the business rescue
application would be insufficient. The Commission is one of the regulatory agencies

35 Van Staden NO and Others v Pro-Wiz Group (Pty) Ltd [2019] ZASCA 7; 2019 (4) SA 532 (SCA).
(Footnote omitted.)

established under Ch 8 of the Companies Act and ‘has a direct and substantial interest
in any order that the court might make’.36 Hence, there is a statutory obligation on an
applicant to cause a business rescue application to be served on it.

[38] Each affected person – a shareholder or creditor of the company in liquidation,
any registered trade union representing employees of that company or each of the
individual employees – is entitled to oppose or support the business rescue
application. That necessarily follows from the right afforded to each of them in terms
of s 131(3) to participate in the hearing of the business rescue application. Each should
have been notified of the business rescue application in terms of s 131(1)(b) in the
prescribed manner.

[39] The service and notification requirements set out in s 131(2) of the Companies
Act are not merely procedural steps. According to Taboo, [t]hey are substantive
requirements, compliance with which is an integral part of making ‘an application for
an order in terms of s 131(1) of the Companies Act’.37 Strict compliance with those
requirements is required because business rescue proceedings can easily be abused.
As this Court noted in Pro-Wiz, ‘[i]t has repeatedly been stressed that business rescue
exists for the sake of rehabilitating companies that have fallen on hard times but are
capable of being restored to profitability or, if that is impossible, to be employed where
it will lead to creditors receiving an enhanced dividend. Its use to delay a winding-up,
or to afford an opportunity to those who were behind its business operations not to
account for their stewardship, should not be permitted’.38

[40] On a proper conspectus of the papers, it cannot be said that there has even
now been compliance, or even substantial compliance, with the service and
notification prescripts s 131(2) of the Companies Act and the Regulations. First, the
business rescue application ought to have been served by the sheriff on each joint
liquidator of each of the six Bosasa companies in the manner provided for in rule
4(1)(a) of the Uniform Rules of Court.39 It is a substantive Form 2(a) application, and

36 Engen Petroleum (Pty) Ltd v Multi Waste (Pty) Ltd and Others 2012 (5) SA 596 (GSJ) para 15.
37 Taboo, para 11.3.
38 Pro-Wiz para 22.
39 Rule 4(1)(a) of the Uniform Rules of Court provides that ‘[s]ervice of any process of the court directed
to the sheriff and subject to the provisions of paragraph (aA) any document initiating application

not an ancillary or interlocutory application, which, in terms of rule 4(1)(aA),40 may be
served upon an attorney representing a party in proceedings already instituted. In
general, rule 4(1)(aA) applies to proceedings already instituted so that it in effect
applies to ancillary and interlocutory applications.41  On 3 December 2019, the sheriff
only served it on Mr Cloete Murray, and a candidate attorney delivered it by hand to
Mr Ralph Lutchman, who are joint liquidators of each of the six Bosasa companies.
The sheriff did not serve it on the many other joint liquidators. Furthermore, it is not
the directors’ or Holdings’ case that Mr Murray N.O. (or Messrs Murray and Lutchman
N.N.O.) were authorised by each other liquidator to accept service of the business
rescue application on their behalf.

[41] Second, it is common cause that the Bosasa Group had approximately 4 500
employees as of 12 February 2019, when the directors of Holdings and the Bosasa
companies passed the special resolutions, which were filed with the Commission on
14 February 2019, when the creditors’ voluntary winding-up of each of the Bosasa
companies commenced. Its workforce was thereafter reduced to 50 employees as at
29 November 2019. On 3 December 2019, only 29 employees were notified by
electronic means of the business rescue application. It is not stated that all the
employees of the Bosasa companies have been notified of the business rescue
application, nor is any explanation proffered why the full staff compliment of 50
employees was not notified. Third, it is not stated what steps, if any, were taken to
identify affected persons and their addresses and to deliver the business rescue
application to them in order for the high court to have considered whether all
reasonable steps had been taken to identify affected persons and their addresses and
to deliver the application to them.

[42] I conclude, therefore, that the business rescue application was not ‘made’ within
the meaning of s 131(6) of the Companies Act, and the suspension of the liquidation

proceedings shall be effected by the sheriff . . ..’ It continues to provide ways in which this is to be
achieved (Rule 4(1)(a)(i)-(ix).
40 Rule 4(1)(aA) provides that ‘[w]here the person to be served with any document initiating application
proceedings is already represented by an attorney of record, such document may be served upon such
attorney by the party initiating such proceedings.’
41 BHP Billiton Energy Coal South Africa Limited v Minister of Mineral Resources and Other 2011 (2)
SA 536 (GNP) para 25; Finishing Touch para 24; ABM Motors v Minister of Minerals and Energy and
Others 2018 (5) SA 540 (KZP) para 26.

proceedings, including the public auction and any subsequent sales, was not triggered
in terms of the section. My findings and conclusions thus far are dispositive of the
business rescue appeal. Instead of dismissing it, the high court ought to have struck
the business rescue application from the roll; it was not made.

[43] I now turn to the second ground upon which the auction application is premised.
That is the contention that the liquidators did not have the consent of the directors or
were not clothed with the requisite power or authority to sell the assets of the six
Bosasa companies by public auction at the time when the auction was held or at any
time thereafter. As I have mentioned, this question calls for the proper interpretation
of the Bhoola AJ order.

[44] Very recently, this Court in HLB International (South Africa) v MWRK
Accountants and Consultants,42 held that the now well established test on the
interpretation of court orders is that the starting point is to determine the manifest
purpose of the order, and that in interpreting the order the court’s intention is to be
ascertained primarily from the language of the order in accordance with the usual well-
known rules relating to the interpretation of documents. As in the case of a document,
the order and the court’s reasons for giving it must be read as a whole in order to
ascertain its intention. The manifest purpose of the order is to be determined by also
having regard to the relevant background facts which culminated in it being made.

[45] The proper interpretative analysis leads to the inevitable conclusion that,
although the Bhoola AJ order did not expressly state that its paragraph 3 shall lapse
and be of no further force and effect immediately upon the granting of an order by the
Supreme Court of Appeal in the liquidators’ appeal against the Ameer AJ order, the
intention of the high court in granting the Bhoola AJ order by consent between the
liquidators and the directors was to extend the powers of the liquidators by authorising
them to sell the movable and immovable assets of the six Bosasa companies, but
subject to consultation with and the consent of the directors pending the outcome of
the appeal. The order and the high court’s reasons for giving it cannot be read as a

42 HLB International (South Africa) v MWRK Accountants and Consultants [2022] ZASCA 52 paras 26-
27.

whole to ascertain its intention since it was a consent order. But its manifest purpose
becomes crystal clear when the order is placed in proper perspective, and the context
in which it was made is considered.43

[46] When the purpose of and the context within which the Bhoola AJ order was
made is considered - the dispute between the directors the liquidators and the interim
arrangement pending the finalisation of the appeal agreed upon as a result thereof;
the Tsoka J interim order; the directors’ own version set out in their founding affidavit
in the intervention application; the Mudau J order; the consensus reached amongst
the liquidators and the directors that the assets of the six Bosasa companies should
be sold expeditiously and that the sale thereof could not await the final appointment of
liquidators and the second meeting of creditors should the liquidators’ appeal be
successful; the liquidators’ approach to the Master to extend their powers and to
authorise them to sell the assets of the six Bosasa companies and the Master’s refusal
to entertain their request by virtue of the pending appeal; the liquidators’ subsequent
approach to the directors for their consent to such an order being obtained from the
high court (which they gave subject to the assets being sold in consultation with them
and subject to their consent); the liquidators’ assertions in their affidavit in support of
the second application to extend their powers which were met with the approval  of the
directors; and the letter of the attorneys representing the directors of Holdings dated
20 November 2019 setting out the purpose and intention of the order - it becomes
manifestly clear that paragraph 3 of the Bhoola AJ order was at all material times
intended to lapse when the Supreme Court of Appeal gave judgment in the appeal,
which it did on 22 November 2019. The fundamental raison d’être for paragraph 6 of
the Mudau J order and paragraph 3 of the Bhoola AJ order had then fallen away.

[47] Clearly, it could never have been the intention of the high court, as the directors
would have it, to have ordered the liquidators never to sell the assets of the six Bosasa
companies without consultation with and without obtaining the directors’ consent
should the liquidators be successful in their appeal. Indeed, such a conclusion would

43 Finishing Touch 163 (Pty) Ltd v BHP Billiton Energy Coal South Africa Ltd and Others [2012] ZASCA
49; 2013 (2) SA 204 (SCA) para 14; Van Rensburg and Another NNO v Naidoo and Others NNO;
Naidoo and Others NNO v Van Rensburg NO and Others [2010] 4 All SA 398 (SCA); 2011 (4) SA 149
(SCA) paras 43 et seq.

be absurd. It would ignore the extended powers granted to the liquidators and the
statutory prescripts applicable to the liquidation process that ultimately results in the
company's demise. The auction appeal, therefore, should be upheld.

[48] What remains to decide is the award of costs made by the high court in the
business rescue application. It awarded the successful respondents (first to thirty-ninth
respondents in this appeal) only 50% of their costs. In doing so, the high court stated
that ‘they crossed the line in the litigation and they acted unlawfully in two major
respects (disregarding the Bhoola AJ order and the business rescue application)’. In
departing from the general rule that costs should follow the event and that the
successful party is awarded costs as between party and party44 and depriving them of
50% of their costs, the high court failed to exercise its discretion judicially. First, the
liquidators attempted to establish that the sudden business rescue application was
issued merely to stifle the liquidation proceedings and thus constitutes abuse. Second,
they did not act unlawfully in either of the two respects mentioned by the high court;
their interpretation of the Bhoola AJ order turned out to be correct, and the business
rescue application was not ‘made’ and, therefore, did not trigger the suspension of the
liquidation proceedings as contemplated in s 131(6) of the Companies Act. Therefore,
the high court should not have deprived the liquidators of 50% of their costs of
opposing the business rescue application.

[49] In the result, the following order is made:

1.
The auction appeal (case no. 1088/2020) is upheld with costs, including those
of two counsel for the first to thirty-ninth appellants and the fortieth appellant.
2.
Paragraphs 7, 8, 9, 10 and 11 of the order of the high court are set aside and
replaced with the following:
‘The application under case no. 44827/19 is dismissed with costs, including those of
two counsel for the first to thirty-ninth respondents and the first intervening party, the
Commissioner for the South African Revenue Services.’
3.
Save to the extent reflected in in paragraph 3.1 hereof, the first, second and
third appellants’ business rescue appeal (case no. 1135/2020) against paragraphs 16,

44 See LAWSA 2 (ed) Vol 3 Part 2 paras 292 and 320.

17 and 18 of the high court’s order is dismissed with costs, including those of two
counsel for the first to thirty-ninth respondents and the fortieth respondent.
3.1
Paragraph 16 of the order of the high court is set aside and replaced with the
following:
‘The business rescue application is struck from the roll.’
3.2
The first to thirty-ninth and the fortieth respondents’ appeals against paragraph
17 of the high court’s order are upheld.
3.3
Paragraph 17 of the order of the high court is set aside and replaced with the
following:
‘The applicants are ordered to pay the respondents’ costs of the business rescue
application, such costs are to include the costs of two counsel.’

________________________
P.A. MEYER
ACTING JUDGE OF APPEAL

Appearances:

Appeal (case no. 1088/2020)
1st to 39th Appellants’ counsel:
KW Lüderitz SC (assisted by P Lourens)
Instructed by:

MacRobert Attorneys, Brooklyn, Pretoria

C/o Lovius Block Inc., Bloemfontein
40th Appellant’s counsel:

HGA Snyman SC (assisted by K Kollapen)
Instructed by:

VZLR Inc., Pretoria

C/o MacIntire Van der Post, Bloemfontein

1st to 3rd Respondents’ counsel: F Joubert SC (assisted by J de Vries)
Instructed by:

Goodes & Seedat Attorneys,
Sandton, Johannesburg
C/o Honey Attorneys, Bloemfontein

Appeal (case no. 1135/2020)
1st to 3rd Appellants’ counsel:
F Joubert SC (assisted by J de Vries)
Instructed by:

Goodes & Seedat Attorneys,
Sandton, Johannesburg
C/o Honey Attorneys, Bloemfontein

1st to 39th Respondents’ counsel: KW Lüderitz SC (assisted by P Lourens)
Instructed by:

MacRobert Attorneys, Brooklyn, Pretoria

C/o Lovius Block Inc., Bloemfontein’
40th Respondent’s counsel:
HGA Snyman SC (assisted by K Kollapen)
Instructed by:

VZLR Inc., Pretoria

C/o MacIntire Van der Post, Bloemfontein

THE SUPREME COURT OF APPEAL OF SOUTH AFRICA

MEDIA SUMMARY OF JUDGMENT DELIVERED IN THE SUPREME COURT OF
APPEAL
From:
The Registrar, Supreme Court of Appeal
Date:
10 May 2022
Status:
Immediate
The following Summary is for the benefit of the media in the reporting of this case and
does not form part of the judgments of the Supreme Court of Appeal.
Lutchman N.O. and Others v African Global Holdings (Pty) Ltd and Others; African
Global Holdings (Pty) Ltd and Others v Lutchman N.O. and Others (1088/2020 and
1135/2020) [2022] ZASCA 66 (10 May 2022)

Today the Supreme Court of Appeal (SCA) handed down judgment in three appeals that were
heard together: One has been referred to by all the parties as the ‘auction’ appeal; one as the
‘business rescue’ appeal; and one as the ‘liquidators’ and SARS’ costs’ appeal. The SCA
upheld the auction appeal with costs, including those of two counsel, it dismissed the business
rescue appeal with costs, including those of two counsel, and it upheld the liquidators’ and
SARS’ costs appeal.
The sensational revelations made during the Zondo Commission of Enquiry into Allegations
of State Capture, inter alia by the former COO of Bosasa, Angelo Aggrizzi, shocked the
country. Bosasa is now known as Global Holdings (Pty) Ltd (Holdings). This prompted the
bankers of African Global Operations (Pty) Ltd (Operations), a wholly-owned subsidiary of
Holdings that performed all the treasury functions of the Bosasa Group of companies, to
indicate that they will be withdrawing Operations’ banking facilities and closing the banking
accounts, which was catastrophic for its continued business operations. After the Bosasa
Group had failed to find another bank that would provide Operations with banking facilities,
the directors of Holdings and of Operations resolved to place Operations and its ten wholly-

owned subsidiaries (the Bosasa companies), under voluntary winding-up in terms of section
351 of the Companies Act 61 of 1973 (the 1973 Companies Act). However, when the joint
provisional liquidators of the Bosasa companies (the liquidators) started to exercise their
statutory powers, Holdings attempted to have the resolutions in which the Bosasa companies
were placed under voluntary winding-up (the special resolutions) declared null and void and
to have the appointments of the liquidators declared null and void and of no force and effect.
That was the beginning of a litigious battle between Holdings and the liquidators. It did that by
initiating an application as a matter of extreme urgency in the high court. On 14 March 2019
judgment was delivered, granting Holdings the relief it had sought and ordering the liquidators
to pay the costs of the proceedings in their personal capacities (the Ameer AJ order).
However, the high court granted the liquidators leave to appeal to the SCA against that order.
Notwithstanding the pending appeal against the Ameer AJ order, Holdings and the directors
of the Bosasa companies (the directors) did not accept that there had been a concursus
creditorum in respect of any of the Bosasa companies or that the liquidators held any rights or
powers as ‘provisional liquidators’. They maintained that the suspension of the order as a
result of the pending appeal did not resolve the disputes between them and the liquidators
whether the Bosasa companies had indeed been placed into liquidation and whether the
liquidators had the powers of provisional liquidators to take control of the assets and affairs of
the Bosasa companies. They asserted that they (and not the liquidators) remained in control
of the assets and affairs of the Bosasa companies, and they refused to relinquish their control
to the liquidators. The liquidators, on the other hand, maintained that because of the appeal
and through the operation of s 18 of the Superior Courts Act 10 of 2013, the Ameer AJ order
setting aside the special resolutions and their appointments as provisional liquidators was
suspended pending the outcome of the appeal. The Bosasa companies, according to them,
remained in liquidation and under their control (the dispute). However, the liquidators,
Holdings, and the directors agreed to implement a mechanism through which they could, in
consultation with one another, attend to the affairs of the Bosasa companies despite the
dispute between them to avoid further unnecessary skirmishes and costly litigation pending
the outcome of the appeal. That mechanism included joint and mostly monthly meetings
between them when they discussed matters arising in connection with the affairs of the Bosasa
companies and took joint decisions in relation to the conduct of the Bosasa enterprise (the
interim arrangement).
By agreement between them, the high court (Mudau J) granted an order on 14 May 2019,
extending the powers of the liquidators in terms of s 386(5), read with s 388, of the 1973
Companies Act, authorising them to: (a) transact on the banking accounts of the Bosasa
companies; (b) continue to conduct their businesses; (c) institute or defend legal proceedings;

and (d) reach reasonable settlements with debtors and accept payment of any such debts.
Paragraphs 6 and 7 of the consent order read as follows:
‘6. The powers in paragraphs 4 and 5 above shall be exercised by the Applicants in consultation with
the board(s) of directors of the specific company or companies involved in the transaction(s) and
decisions and the Applicants shall at all times be obliged to give the directors in question reasonable
notice of the meeting at which it is sought to consult and of the subject matter thereof.
7. This order shall lapse and be of no further force and effect immediately upon the grant of an order by
the Supreme Court of Appeal that the appeal against the order granted under case number 2103/2019
has been successful. However, if the appeal is successful, then the provisions in paragraph 6 shall
lapse and be of no force or effect.’ (The Mudau J order.)
The liquidators, Holdings and the directors realised that six of the Bosasa companies had lost
their substrata and that there was a need to dispose of their assets expeditiously. By
agreement between them, the high court (Bhoola AJ) granted an order on 28 October 2019,
extending the powers of the liquidators and authorising them to sell the assets of the six
Bosasa companies. The consent order reads thus:
‘1. The applicants’ powers are extended in terms of section 386(5), read with section 388, of the
Companies Act, 61 of 1973 (the Companies Act), authorising them to sell all the movable assets
belonging to African Global Operations (Pty) Ltd, Global Technology Systems (Pty) Ltd, Bosasa IT (Pty)
Ltd, Leading Prospect Trading 111 (Pty) Ltd, Bosasa Development Centres (Pty) Ltd, and Black Rox
Security Intelligence Services (Pty) Ltd (all in liquidation), by way of public auction, public tender or
private contract, as contemplated in section 386(4)(h) of the Companies Act.
2.  The applicants’ powers are extended in terms of section 386(5), read with section 388, of the
Companies Act authorising them to sell all of the immovable properties belonging to Bosasa Properties
(Pty) Ltd (in liquidation), by way of public auction, public tender or private contract, as contemplated in
section 386(4)(h) of the Companies Act.
3.  The assets referred to in paragraphs 1 and 2 above shall be sold in consultation with and with the
consent of the board of African Global Holdings (Pty) Ltd, African Global Operations (Pty) Ltd (in
liquidation) and the respective boards of its subsidiaries referred to in paragraphs 1 and 2 above.’ (The
Bhoola AJ order.)
Paragraph 2 of the Bhoola AJ order was subsequently varied by the insertion of the words
‘and African Global Operations (Pty) Ltd (in liquidation)’ after the words ‘Bosasa Properties
(Pty) Ltd (in liquidation)’.
On 22 November 2019, the SCA delivered its judgment, upholding the appeal against the
Ameer AJ order and replacing it with an order dismissing the application with costs, including
those of two counsel. The effect of the SCA’s order is that the Bosasa companies remain in a
creditor’s voluntary winding-up. Holdings nevertheless demanded that the liquidators do not
proceed with the three-day public auction of the assets of the six Bosasa companies
scheduled to take place from 4 to 6 December 2019, maintaining that paragraph 3 of the
Bhoola AJ order remained operative and that the liquidators still required its consent and that

of the directors to sell the assets of the six Bosasa companies, and they had not consented to
the scheduled public auction. The liquidators refused to accede to Holdings’ demand. On 3
December 2019, Holdings and two other companies (Holdings) caused an application for an
order placing the six Bosasa companies under supervision and commencing business rescue
proceedings in terms of s 131(1) of the Companies Act 71 of 2008 (the Companies Act) to be
issued by the Registrar of the high court. It still demanded that the scheduled public auction
be cancelled, also maintaining that the issue of the business rescue application had
suspended the liquidation proceedings in terms of s 131(6) of the Companies Act, including
the scheduled public auction, but the liquidators steadfastly refused to accede to the demand.
During 4-6 December 2019, the liquidators caused most of the assets of the six Bosasa
companies to be sold by public auction. Holdings responded by launching the auction
application. Therein it sought an order against the liquidators: (a) interdicting them from selling
any further assets owned by the six Bosasa companies before the final adjudication of the
business rescue application and/or before the second meeting of creditors, without the written
consent of Holdings; (b) a declaration that the sale of assets before the final adjudication of
the business rescue application and/or before the second meeting of creditors, without the
written consent of Holdings, was null and void; and (c) interdicting the liquidators from
delivering the movable assets to, and causing the transfer and registration of ownership of the
immovable assets into the names of, anyone who had purchased the assets of the six Bosasa
companies before the final adjudication of the business rescue application and/or the second
meeting of creditors, without the written consent of Holdings.
The auction and business rescue applications were argued before the high court in a
consolidated hearing. In one judgment, the high court granted the relief sought in the auction
application and dismissed the business rescue application. It gave the liquidators and SARS,
an intervening creditor, leave to appeal its order in the auction application. It gave Holdings
leave to appeal its order in the business rescue application. It also gave the liquidators and
SARS leave to appeal one of the costs awards made in the business rescue application. In
each case, leave was given to appeal to the SCA. The primary issues before the SCA concern:
(a) the interpretation of the word ‘made’ in s 131(6) of the Companies Act, which section
provides for the suspension of liquidation proceedings at the time a business rescue
application is ‘made’; and (b) the interpretation of paragraph 3 of the Bhoola AJ order.
The SCA held that a business rescue application must be issued, served by the sheriff on
each joint liquidator of each of the six Bosasa companies and on the Commission in the
manner provided for in rule 4(1)(a) of the Uniform Rules of Court, and each affected person
must be notified of the application in the prescribed manner, to meet the requirements of
section 131(6) of the Companies Act in order to trigger the suspension of the liquidation
proceedings. It held that on a proper conspectus of the papers it cannot be said that there had

even then been compliance, or even substantial compliance, with the service and notification
prescripts of section 131(2) of the Companies Act and the Regulations. First, on 3 December
2019 the sheriff only served it on one of the joint liquidators and a candidate attorney delivered
it by hand to another joint liquidator, who are both joint liquidators of each of the six Bosasa
companies. The sheriff did not serve it on the many other joint liquidators.  Second, it is
common cause that the Bosasa Group had approximately 4 500 employees as at 12 February
2019, when the directors of Holdings and the Bosasa companies passed the special
resolutions, which were filed with the Commission on 14 February 2019, when the creditors’
voluntary winding-up of each of the Bosasa companies commenced. Its workforce was
thereafter reduced to 50 employees as at 29 November 2019. On 3 December 2019, only 29
employees were notified by electronic means of the business rescue application. It is not
stated that all the employees of the Bosasa companies have been notified of the business
rescue application, nor is any explanation proffered why the full staff compliment of 50
employees was not notified. Third, it is not stated what steps, if any, were taken to identify
affected persons and their addresses and to deliver the business rescue application to them
in order for the high court to have considered whether all reasonable steps had been taken to
identify affected persons and their addresses and to deliver the application to them. The SCA
concluded that the application had not been ‘made’ as envisaged in s 131(6) of the 2008
Companies Act. Accordingly, the issue of the business rescue application did not suspend the
liquidation proceedings. Instead of dismissing it, the high court ought to have struck the
business rescue application from the roll; it was not made.
The SCA held that in departing from the general rule that costs should follow the event and
that the successful party is awarded costs as between party and party, by depriving the
successful liquidators of 50% of their costs of opposing the business rescue application, the
high court failed to exercise its discretion judicially. It should not have deprived them of 50%
of their costs.
The SCA re-affirmed the now well established test on the interpretation of court orders: The
starting point is to determine the manifest purpose of the order. In interpreting the order, the
court’s intention is to be ascertained primarily from the language of the order in accordance
with the usual well-known rules relating to the interpretation of documents. As in the case of a
document, the order and the court’s reasons for giving it must be read as a whole in order to
ascertain its intention. The manifest purpose of the order is to be determined by also having
regard to the relevant background facts which culminated in it being made.
The SCA held that a proper interpretative analysis leads to the inevitable conclusion that,
although the Bhoola AJ order extending the powers and authorising the liquidators to sell the
assets of the Bosasa companies did not expressly state that its paragraph 3 shall lapse and
be of no further force and effect immediately upon the granting of an order by the SCA in the

liquidators’ appeal against the Ameer AJ order, the intention of the high court in granting the
Bhoola AJ order by consent between the liquidators, Holdings and the directors was to extend
the powers of the liquidators by authorising them to sell the movable and immovable assets
of the six Bosasa companies, but subject to consultation with and the consent of the directors
pending the outcome of the appeal. The Bhoola AJ order and the high court’s reasons for
giving it cannot be read as a whole to ascertain its intention since it was a consent order. But,
the SCA held, its manifest purpose becomes crystal clear when the order is placed in proper
perspective, and the context in which it was made is considered. The SCA held that paragraph
3 of the order was at all material times intended to lapse when the Supreme Court of Appeal
gave judgment in the appeal, which it did on 22 November 2019. The fundamental raison
d’être for paragraph 6 of the Mudau J order and paragraph 3 of the Bhoola AJ order had then
fallen away. Clearly, the SCA held, it could never have been the intention of the high court, as
Holdings and the directors would have it, to have ordered the liquidators never to sell the
assets of the six Bosasa companies without consultation with and without obtaining the
consent of Holdings and the directors should the liquidators be successful in their appeal.
Indeed, the SCA held, such a conclusion would be absurd. It would ignore the extended
powers granted to the liquidators and the statutory prescripts applicable to the liquidation
process that ultimately results in the company's demise. It concluded that the liquidators were
thus clothed with the requisite power or authority to sell the assets of the six Bosasa
companies by public auction at the time when the auction was held and thereafter. The auction
application ought accordingly to have been dismissed.

~~~~ends~~~~