Case Law[2025] ZAWCHC 186South Africa
Anweskus Eiendome en Beherende Primere Kooperasie Beperk and Others v Agenbag and Others (2025/035918) [2025] ZAWCHC 186 (30 April 2025)
High Court of South Africa (Western Cape Division)
30 April 2025
Headnotes
the special general meeting to appoint new directors for the first applicant, replacing the first to the fourth respondents in their current roles as directors of the first applicant. The first and third respondents contest the validity of the special general meeting held on 23 November 2024. They do not accept the outcomes of the proceedings conducted at that meeting, which resulted in their removal as directors of the first applicant. [2] In this application, the applicants seek a declaratory order confirming that the special general meeting of the first applicant, held on 23 November 2024, was validly constituted. In addition, the applicants seek an
Judgment
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## Anweskus Eiendome en Beherende Primere Kooperasie Beperk and Others v Agenbag and Others (2025/035918) [2025] ZAWCHC 186 (30 April 2025)
Anweskus Eiendome en Beherende Primere Kooperasie Beperk and Others v Agenbag and Others (2025/035918) [2025] ZAWCHC 186 (30 April 2025)
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IN
THE HIGH COURT OF SOUTH AFRICA
WESTERN
CAPE DIVISION, CAPE TOWN
Case No:
2025-035918
In the matter between:
ANWESKUS
EIENDOME EN BEHERENDE
PRIMERE
KOOPERASIE BEPERK
First
Applicant
CHRISTIAAN
JACOBUS RICHTER
Second
Applicant
MARTHINUS
THEUNIS STEYN CALITZ
Third
Applicant
HENDRIK
JOHANNES JAKOBUS HANEKOM
Fourth
applicant
DANIEL
JOHANNES GROVE
Fifth
Applicant
and
GERT
HERMIAS AGENBAG
First
Respondent
TREVOR
HAYES
Second
Respondent
CAREL
JOHANNES WARNICH
Third
Respondent
GERHARDUS
PETRUS BRITS
Fourth
Respondent
FIRST
NATIONAL BANK LIMITED
Fifth
Respondent
Heard
on: 25 March 2025
Delivered Electronically
on: 30 April 2025
JUDGMENT
LEKHULENI
J
Introduction
[1]
On 23 November 2024, the second to fifth applicants were elected as
directors of the
first applicant during a special general meeting
called by the applicants. The applicants held the special general
meeting to appoint
new directors for the first applicant, replacing
the first to the fourth respondents in their current roles as
directors of the
first applicant. The first and third respondents
contest the validity of the special general meeting held on 23
November 2024.
They do not accept the outcomes of the proceedings
conducted at that meeting, which resulted in their removal as
directors of the
first applicant.
[2]
In this application, the applicants seek a declaratory order
confirming that the special
general meeting of the first applicant,
held on 23 November 2024, was validly constituted. In addition, the
applicants seek an
order to confirm that the respondents were
properly removed from their positions as directors of the first
applicant at the special
general meeting convened on 23 November
2024. Furthermore, the applicants request that the second, third,
fourth, and fifth applicants
be officially recognised as directors of
the first applicant.
[3]
In summary, the subject matter of this application concerns the
respondents’
alleged failure to vacate their office as the
board of directors of the first applicant and to hand over the
management of the
first applicant to the new directors (the second to
the fifth applicants) elected at a special general meeting held on 23
November
2024. The respondents opposed this application save for the
fifth respondent. The fifth respondent did not take part in these
proceedings.
Background
Facts
[4]
The first applicant is Anweskus Eiendome en Beherende Primere
Kooperasie Beperk, a
primary Co-operative constituted and registered
in terms of the Co-operatives Act 14 of 2005
(‘the
Co-operatives Act&rsquo
;)
with the CIPC under registration number
2016/001839/24, and having its registered address at Byneslaagte
Farm, Luztville, Matzikama
Municipality, Western Cape.
[5]
The background of the first applicant as explained in the respective
affidavits, is
that it began with a group of independent thinking
Afrikaners seeking freedom, and a place to provide a haven for
themselves and
their families. The intention was to establish a
community where these Afrikaners could thrive alongside like-minded
pioneers,
allowing them the opportunity to live freely and
collectively pursue their aspirations in a peaceful and supportive
environment.
[6]
The concept emerged in July 2015 with a small group of Afrikaners,
who later became
members of the first applicant. In October 2015,
several farms were selected as viable options for the establishment
of the community
of the Afrikaner group, and after numerous visits to
these farms, it was decided to put the options to a vote by
individuals who
were members of the group at the time. Pursuant
thereto, the first applicant, a Co-operative was then officially
registered on
4 March 2016 in terms of the
Co-operatives Act. Its
objectives are to purchase agricultural land and offer its Afrikaner
members a self-sustaining community.
[7]
Subsequent thereto, the first applicant's members decided that it
should purchase
Byneslaagte farm, which was registered in the first
applicant's name on 1 August 2016. In October 2016, the first member
of the
first applicant took up permanent residence on the farm,
followed soon by other members and their families. All members of the
first applicant are subject to the Constitution and the first
applicant's internal rules and regulations. These relevant documents
formed part of this application. In addition, members of the first
applicant agreed to adhere to the first applicant's code of
conduct,
which is part of the applicant's governing documents.
[8]
In terms of clause 25 of the first applicant's Constitution, the
first applicant has
three spheres of government, with the result that
the directors' powers are split into the administrative
(Gemeenskapraad), legislative
(Kongres) and judicial powers
(Heemraad). The President of the first applicant is the Head of the
Co-operative and the Head of
the Gemeenskapraad. Among other things,
the President is responsible for assenting Bills, referring Bills to
the Kongress for reconsideration
of the Bill's constitutionality or
referring Bills to the Heemraad for a decision on the Bill's
constitutionality. The Kongres
serve as the legislative body of the
first applicant. The Kongres has the power to make laws and
regulations provided they are
not repugnant to the Constitution or
any laws of the Republic of South Africa. The judicial authority of
the first applicant vests
in the Heemraad. The Heemraad is entrusted
with the judicial function to interpret the laws and regulations made
by the Kongres
and must determine that they are not in breach of the
first applicant's Constitution or any laws of the Republic of South
Africa.
The Heemraad also decides issues of discipline where the
members violate the governing documents of the first applicant.
[9]
The first applicant as a Co-operative has directors who are the Head
and the deputy
head of the Kongres as well as the Head and deputy
head of the Heemraad. Each division within the institutional
structure of the
first applicant operates independently and functions
separately from the others. In terms of the first applicant's
constitution,
the board of directors and members of the Co-operative
must perform and adhere to the laws made by the Kongres, the
legislative
body of the first applicant.
[10]
The first applicant's Constitution was duly registered with CIPC on
12 April 2018. By joining
as members of the applicant, members of the
Co-operative agree to comply with and are contractually bound by the
Constitution of
the first applicant, any amendments made to it, and
any bylaws established by the Kongres. Members are bound to make
financial
contributions to the first applicant as determined by the
Kongres. The Constitution of the applicant provides that once a
member's
membership is terminated, the member's shares must be
cancelled by resolution of the board. A member forfeits his shares in
the
first applicant upon such cancellation. Complaints against any
member for violation of the Constitution of the applicant or any
governing documents of the first applicant are dealt with by the
judicial body of the applicant, the Heemraad. Against this backdrop,
I turn to consider the respective parties' cases.
The
Applicants’ Case
[11]
The applicants aver that Byneslaagte farm was purchased in October
2016, and many of the first
applicant's members permanently reside on
the farm. These residents rely on the first applicant for the
provision of basic delivery
service. According to the applicants, the
first applicant is governed meticulously in alignment with the
guidelines set forth by
the
Co-operatives Act, as
well as the
principles enshrined in its Constitution. The applicants posit that
the first to fourth respondents registered the
Constitution of the
first applicant with CIPC on 12 April 2018. However, that happened
without the member's oversight or approval.
[12]
The applicants assert that during the past two years, the first
applicant's members and the first
to fourth respondents (the
directors) were embroiled in constant disputes. According to the
applicants, the respondents, as directors
of the first applicant
ruled the first applicant's affairs with complete autocracy. The
applicants further averred that the respondents
did not conduct the
applicant's affairs in accordance with the
Co-operatives Act or
the
first applicant's Constitution. The applicants stated that the
respondents, particularly the first respondent, did not tolerate
members questioning his leadership and summarily terminated their
membership.
[13]
Mr Eben Oosthuizen, the deponent of the applicants' founding
affidavit, stated that on 13 June
2022, he was appointed as the first
applicant's internal auditor. During his tenure as an internal
auditor, he discovered irregular
spending concerning a company,
K2018234593 (South Africa) (Pty) Ltd t/a De Anker Boerdery. It became
clear that the respondents'
conduct and the lack of members'
oversight was the root of the problem with the management of the
first applicant. Mr Oosthuizen
stated further that the first
applicant has not convened an annual general meeting since February
2023, allowing the respondents
(the first applicant's directors) to
rule with impunity. Furthermore, its auditors have not signed off on
the first applicant's
annual financial statements for the 2023 or
2024 financial years.
[14]
Mr Oosthuizen mentioned that he then resolved to request the first to
fourth respondents to call
an annual general meeting to address these
concerns. On 4 September 2024, he formally requested, in writing,
that the respondents
convene an annual general meeting as required by
the first applicant's Constitution. That notice included a request to
elect a
new board of directors. According to Mr Oosthuizen, he and Mr
Fourie, both members of the first applicant, signed the letter
petitioning
the directors to convene an annual general meeting.
Accordingly, Mr Oosthuizen asserted that 17 of the first applicant's
seventy-two
members supported the request for an annual general
meeting, constituting support in excess of 20%.
[15]
According to Mr Oosthuizen, the respondents, as directors of the
first applicant, did not accede
to the request for an annual general
meeting. Instead, the respondents issued an unsigned notice on 18
September 2024 informing
Mr Oosthuizen that his membership was
terminated immediately. The directors also issued Mr Fourie with a
similar notice terminating
his membership. Mr Oosthuizen asserted
that the respondents adopted the tradition of meeting descent with
expulsion. As a result
of the respondent's failure to convene the
general meeting as requested in the letter dated 4 September 2024, Mr
Oosthuizen stated
that he and Mr Fourie proceeded to issue two
notices convening a special general meeting and with an agenda.
[16]
This notice informed members that the respondents failed to convene a
general meeting after a
request from members holding 20% voting
rights and that the special general meeting would be held on
Saturday, 23 November 2024,
at Stella Winery, Kys Halte, R362,
Vredendal. The notice also informed members that they were welcome to
attend the meeting virtually
and that a link for that meeting would
be provided to the members before the meeting.
[17]
On 11 November 2024, Mr Oosthuizen emailed those notices to the first
applicant's members including
the first to fourth respondents as
directors of the first applicant. The directors did not circulate
these notices to the members
on the first applicant's WhatsApp group
platform. Accordingly, Mr Oosthuizen created a new WhatsApp group,
invited the first applicant's
members and the respondents, and
circulated those notices on that WhatsApp platform. The request for a
special general meeting
did not find favour with the respondents. The
respondents, through their legal representatives, addressed a
correspondence to Mr
Oosthuizen requesting an undertaking that
members will not convene a special general meeting.
[18]
In response, Mr Oosthuizen insisted that the notice for the special
general meeting was validly
issued. Furthermore, he indicated that
the respondents' notice convening an annual general meeting on 28
November 2024 is ill-conceived
as it does not accommodate the first
applicant's members' needs, particularly in that it is only available
online, excluding most
of the first applicant’s members. On 15
November 2024, the respondent's legal representative circulated a
letter to the applicants'
members urging them to disregard the
special general meeting of 23 November 2024 and informing them that
the respondents have convened
an annual general meeting that will
take place on 28 November 2024.
[19]
In the letter, the respondents' legal representative informed members
of the first applicant
that the respondents did not authorise the
meeting of 23 November 2024 and urged the members of the first
applicant to disregard
the special general meeting of 23 November
2024. The respondents proceeded to show their discontent with the
dissenting members'
intention to proceed with the special general
meeting on Saturday, 23 November 2024, by issuing an urgent
application under case
number 24954/2024 on 21 November 2024 seeking
to interdict the dissenting members from convening a special general
meeting.
[20]
On 22 November 2024, Slingers J dismissed the respondents' urgent
application. In light of this
court's dismissal of the respondents'
application, the dissenting members proceeded to convene a special
general meeting on 23
November 2024. The special general meeting was
attended by 22 members and three proxies. According to Mr Oosthuizen,
at the meeting,
four members, namely the second to the fourth
applicant, were proposed and unanimously accepted to serve as the
first applicants'
directors.
[21]
Subsequent thereto, the newly appointed directors addressed a letter
dated 28 November 2024 to
the former directors informing them of the
business conducted at the special general meeting and that they are
to vacate their
offices. The former directors did not vacate their
offices and convened an annual general meeting on 28 November 2024.
On 5 February
2025, the newly elected directors submitted the change
of directors to CIPC. On 7 February 2025, CIPC issued the certificate
of
registration confirming the adoption of the newly elected
directors.
[22]
The applicants asserted that the respondents refused to assist the
new leadership with a peaceful
leadership transition. Accordingly,
the new directors cannot access strategic information, bank accounts,
software systems, information
system, keys, and other infrastructure
vital to the directors’ effective management of the first
applicant's interests. On
10 February 2025, the new chair of the
board of directors addressed a letter to the respondents (the alleged
former directors)
requesting them to hand over the keys for all
office vehicles and tractors to the new directors. The new chair of
the board also
instructed the respondents to stop representing to
third parties, that they represent the first applicant, or to
conclude transactions
on behalf of the first applicant or provide
false information to members of the applicant. The respondents
refused to comply with
the new directors' request.
[23]
On 11 February 2025, the respondents, particularly Mr Agenbag, the
first respondent herein, addressed
a letter to the members of the
first applicant and informed them that the respondents do not regard
the newly elected directors
as legitimate. Instead, it is a hostile
takeover of the first applicant. In the letter, Mr Agenbag pointed
out that they (former
directors) reported the matter to the South
African Police Services (SAPS) and CIPC. He also mentioned that
pending the investigation
of SAPS, they will not provide any
documents or minutes to any person until the finalisation of that
investigation. Mr Agenbag
stated that the respondents are not obliged
to accept or cooperate with the newly elected directors. SAPS
declined to investigate
this matter as it alleged it does not fall
within the domain of SAPS.
[24]
Pursuant thereto, the applicants' attorneys addressed a letter to the
respondents and urged them
to cease to represent to third parties
that they represent the first applicant or provide false information
to members of the first
applicant. Additionally, the applicant's
attorney requested the respondents to comply with the request of the
new chair of the
board of directors contained in the letter dated 10
February 2025. The applicant’s legal representative stated that
legal
actions would follow if the respondents failed to comply with
the request. In response, Mr Agenbag maintained that Slingers J, in
her order dismissing the respondents' application for interdict,
ruled that the special general meeting of 23 November 2024 was
null
and void. Mr Agenbag also stated in the letter that he had lodged
complaints concerning the newly elected directors with CIPC,
SAPS and
the National Prosecuting Authority.
[25]
The applicants asserted that in February 2025, the new directors
became aware that the respondents
not only represented to third
parties that they represent the first applicant but are also
effecting payments from the first applicant's
bank account. The
applicants asserted that the new directors cannot effectively manage
the applicant's affairs when the respondents
refuses to vacate their
offices and provide the new directors with access to the necessary
infrastructure and information. On 7
February 2025, the new board of
directors convened a meeting with FNB and explained the unusual
circumstances in which the first
applicant found itself. Since that
meeting, the first applicant's bank accounts held with FNB have been
frozen.
[26]
In addition, the first applicant established a general store on the
farm, providing its residents
with all necessary household and
agricultural supplies as the town is 60 km away from the farm. Many
of the residents rely on the
shop for all their household needs. The
general store supplies agricultural needs that residents rely on for
their family endeavours.
According to the applicants, since the
special general meeting, Mr Agenbag, one of the former directors,
refused to open the shop.
The applicants also mentioned other
inconveniences caused by the respondents not handing over leadership
to them, like not having
access to the water scheme diagram to ensure
sufficient water. The applicants implored this court to grant the
relief sought in
the notice of application to enable them to manage
the first applicant accordingly.
The
Respondents’ Case
[27]
The respondents stated that members of the first applicant agreed to
adhere to and are both contractually
and by law bound by the
Constitution of the first applicant as well as any amendments thereto
and any by-laws made by the Kongres
of the first applicant. The
respondents stated that as with any governing body, the board of
directors of the first applicant has
experienced overtime
dissatisfaction from members, both individually and in small splinter
groups. According to the respondents,
this is not uncommon, nor does
it indicate that the first applicant is mismanaged or that the powers
of the board of directors
are being abused.
[28]
The respondents asserted that for the past three years, the first
applicant has faced recurring
challenges from a splinter group of
members led by Mr Oosthuizen. Mr Agenbag, the deponent of the
answering affidavit and the director
of the first applicant, asserted
that these challenges include the refusal by the splinter group to
pay for services, including
membership fees, water charges, internet
services, and growth fund levies relating to the provision of
services. Mr Agenbag further
propounded that since November 2022,
members of the splinter group have engineered various frivolous
disputes against the board
of directors. These ongoing disputes have
created tension between members, particularly since many of these
disputes do not have
any merit or foundation.
[29]
According to Mr Agenbag, as a result of the disregard for the
Constitution, the internal rules
and regulations, and the code of
conduct of the first applicant, one of the first applicant's members,
Mr Stroebel, was on 15 December
2022, found guilty of all complaints
lodged against him and was removed as a director by the first
applicant's judicial sphere,
the Heemraad. The member was instructed
on 28 December 2022 to vacate the farm by 31 March 2023, which he
failed or refused to
do.
[30]
In addition, Mr Agenbag stated that Mr Fourie, who, together with Mr
Oosthuizen, called the special
general meeting, was also expelled as
a member of the first applicant by the Heemraad, following a full
internal disciplinary hearing.
Mr Fourie resigned as a director of
the first applicant and as the chairperson of the Kongres on 21
December 2022. The Heemraad
terminated his membership of the first
applicant on 3 May 2023, when he was also officially removed as a
director. Mr Agenbag further
stated that Mr Oosthuizen who deposed to
the founding affidavit in this application, is no longer a member of
the first applicant
and has not been one at any relevant time,
contrary to what he claims in his founding affidavit.
[31]
According to Mr Agenbag, Mr Oosthuizen has also been expelled by the
Heemraad as a member of
the first applicant. His membership was
terminated on 18 September 2024 due to his repeated violations of the
Constitution and
the first applicant's code of conduct,
inter
alia,
for disrespecting the first applicant's board of directors
and leadership, publishing confidential details of disputes,
spreading
false information and failing to act in the first
applicant's best interest. A copy of Mr Oosthuizen's termination
letter was also
attached to the answering affidavit supporting this
averment.
[32]
Mr Agenbag refuted Mr Oosthuizen's accusations of the autocratic
leadership style of the board
and asserted that he was not
responsible for disciplining members. The Heemraad, of which Mr
Agenbag was not a member, is responsible
for matters of discipline,
misconduct and contravention of the provisions of the first
applicant's Constitution and other governing
documents. In Mr
Agenbag’s view, the Heemraad followed the process of applying
the principles of the
audi alteram partem
principle. When a
complaint is received from a member, the Heemraad would consider the
complaint and address communication with
the accused person to inform
him or her of the complaint and the allegations, giving that person
the opportunity to reply to the
allegations. The Heemraad will then
consider the evidence and the versions of the parties before making
any ruling or coming to
any decision.
[33]
The respondents asserted that the special general meeting convened by
the applicants was null
and void. The respondents stated that in
terms of the first applicant's Constitution, a special general
meeting can only be convened
either by at least two directors of the
first applicant, alternatively, by five or more members of the first
applicant, provided
that the members in number constitute at least
20% of all members of the first applicant, having petitioned the
directors to convene
such meeting and the meeting is not convened
within 21 days.
[34]
According to the respondents, if consideration is given to Mr
Oosthuizen's declaration under
oath, he unilaterally resolved to call
a special general meeting. Although Mr Oosthuizen may have
subsequently canvassed the support
of his fellow expelled members and
a few other disgruntled members, the respondents asserted that the
directors of the first applicant
were not petitioned by two of the
directors or by five or more members, alternatively, members in good
standing, who, at the time,
in numbers constituted 20% of the total
members.
[35]
In addition, the respondents pointed out that both Mr Oosthuizen and
Mr Fourie's membership of
the first applicant have been terminated.
In addition, 2 other members who supported the petition to the
directors to convene a
special general meeting had been expelled. As
such, of the remaining 13 people, only 7 were, at any relevant time,
in good standing
and in full compliance with the Constitution and
other governing documents. Thus, the petition and request for a
special general
meeting were, in fact, supported by less than 10% of
the members in number, falling short of the threshold set in the
first applicant's
Constitution.
[36]
The respondents submitted that the obstructive and rebellious actions
of Mr Oosthuizen and Mr
Fourie, as well as the spreading of negative
propaganda amongst the members, is driven by Mr Oosthuizen and, in
all likelihood,
Mr Fourie's personal vendettas and does not portray
the general consensus or intention of the majority of the members
that are
in good standing. The respondents asserted that the notice
sent by Mr Oosthuizen petitioning for a special general meeting was
also conveniently signed by Mr Oosthuizen and Mr Fourie. None of the
other members have at any stage confirmed their support for
the call
of a special general meeting in writing or otherwise, other than for
Mr Oosthuizen's uncorroborated claim that they supported
him.
[37]
Furthermore, the respondents asserted that the notice was only
distributed a mere 12 days before
the said special general meeting
was to be held. The respondents opined that having regard to the
provisions of the first applicant’s
Constitution, at least 14
days’ notice was required. The respondents contended that the
notice and agenda disseminated to
the members by Mr Oosthuizen and Mr
Fourie in respect of this special general meeting are materially
defective and did not comply
with the terms of the first applicant’s
Constitution.
[38]
The respondents further pointed out that the board of directors did
not authorise the convening
of the meeting and formally recorded
their objection to it. They contended that at the time Mr Oosthuizen
sent his notice of a
special general meeting to members of the first
applicant, the directors had already sent out a notice on 8 November
2024 that
the annual general meeting would be held on 28 November
2024. Accordingly, the respondent stated that the special general
meeting
held on 23 November 2024 was not and under no circumstances
can it be regarded as a proper and validly convened special meeting
where any business of the first applicant could lawfully have been
conducted.
[39]
In the circumstances, the respondents prayed that the application be
dismissed with costs on
an attorney and client scale.
Principal
Submissions by the parties
[40]
Mr Nöthling, the counsel for the applicant, argued that the new
directors (the second to
the fifth applicants) were appointed
following an election held on 23 November 2024. On 28 November 2024,
the new directors informed
the respondents (the former directors) of
the business conducted at the special general meeting. However, the
respondents failed
to vacate their office. Counsel submitted that the
applicants addressed a letter to the respondents requesting access to
the assets
and information to enable them to manage the first
applicant’s affairs. However, the respondents made it clear
that they
would not accede to the new directors' request.
[41]
On the question of urgency, counsel submitted that the newly
appointed directors cannot effectively
manage the first applicant's
affairs without the former directors handing over control of the
first applicant’s affairs.
Mr Nöthling submitted that the
first applicant cannot pay its creditors and is running the risk of
compromising service delivery
to the members of the Co-Operative.
Counsel pointed out that 39 of the first applicant’s members,
currently live on the first
applicant’s property with their
families. The first applicant cannot operate the general store it
established on the farm,
which is a vital facility for its members'
existence.
[42]
Most concerningly, so the contention proceeded, the water
infrastructure on the farm cannot be
managed without access to the
first applicant’s water infrastructure diagram. The first
applicant's farm, Bysneslaagte, is
located in an arid region, and the
first applicant’s members are at risk of not having access to
water and increasing the
risk of fire damage. In counsel's view, the
ongoing nature of the harm flowing from the respondents' conduct
makes this matter
deserving of this Court's urgent attention.
[43]
On the merits of the matter, the applicants' counsel argued that the
former directors had not
convened an annual general meeting since
February 2023. The first applicant’s members have expressed
their difficulty with
the Co-Operative's management and resorted to
other avenues in an attempt to resolve the matter. Ultimately, some
of the first
applicant’s members addressed a letter to the
former directors on 4 September 2024 requesting the directors to call
a special
general meeting.
[44]
Counsel further submitted that following the former directors'
failure to convene the Annual
General Meeting, the members issued two
notices on 11 November 2024 informing the members of the upcoming
special general meeting.
These notices were circulated by email and
through the WhatsApp platform. Mr Nöthling submitted that
members who attended
the special general meeting compiled
comprehensive minutes of the business conducted at the special
general meeting. At that meeting,
the members in attendance adopted a
unanimous resolution, removing the former directors (the respondents)
from their office and
appointing the new directors. Mr Nöthling
submitted that once removed from office, the former directors are
duty-bound to
hand over the affairs of the first applicant to the new
directors.
[45]
Counsel submitted that Mr Fourie and Mr Oosthuizen's membership were
terminated on 18 September
2024. Accordingly, Mr Fourie and
Oosthuizen were still members on 4 September 2024, the date of
requesting the board of directors
to convene a special general
meeting. According to counsel, before convening their special general
meeting, the petitioning members
satisfied the 20% requirement
contained in clause 50.2(b) of the Co-Operative's constitution.
[1]
[46]
Mr Nöthling further asserted that the applicants have no other
remedy to ensure the effective
management of the first applicant’s
affairs, pending the final adjudication of the dispute. The harm
caused by the former
directors' conduct is significant. According to
counsel, the former directors do not stand to suffer if the
applicants' relief
is granted. Counsel implored the court to grant
the relief sought in the notice of motion.
[47]
On the other hand, Mr Engela, the respondents' counsel, impugned the
urgency with which this
application was brought. Counsel submitted
that the matter is not urgent. According to Mr Engela, even if the
matter is urgent,
the urgency is self-created, and the application
was launched with a degree of urgency that is completely unwarranted.
Mr Engela
asserted that the matter is not urgent because it relates,
in the first instance, to a meeting that took place more than four
months
ago, on 23 November 2024. Despite the applicants having been
told unequivocally by the respondents since 23 November 2024 that
they dispute the validity of the special general meeting, the
applicants chose not to institute action at any time until 14 March
2025, when this application was eventually issued.
[48]
Mr Engela contended that the respondents had, from the outset,
stated, in no uncertain terms,
that the appointment of the so-called
"new directors" was disputed and that their authority to
act as such was rejected.
This was the situation more than four
months ago. In all the circumstances, the disputes between the
parties manifested themselves
as early as November 2024, more than
four months ago. Notwithstanding, the applicants gave the respondents
a mere 24 hours to oppose
and another 24 hours to prepare and file
their opposing affidavit.
[49]
Counsel further noted that, despite the passage of nearly four months
since the special general
meeting on 23 November 2024, and more than
four weeks since their belated letter of demand issued on 10 February
2025, the respondents
were requested to prepare and file their
opposing affidavits within a very short timeframe. Mr Engela
submitted that no case had
been made out whatsoever of the extreme
departure from the rules. Counsel prayed the court to strike this
application off the roll.
[50]
As far as the merits of the application are concerned, Mr Engela
contended that the rule nisi,
which the applicants are seeking,
includes certain prayers for interdictory relief which are
far-reaching. According to counsel,
they are to the effect that the
respondents must hand over to the applicants all the assets and/or
information of the first applicant.
In addition, they are to the
effect that the respondents be restrained from interfering with the
management of the first applicant's
affairs, and of representing
themselves as directors of the first applicant. Considering that once
the interdict is granted, the
matter may take time to resolve whilst
the respondents are excluded in the administration of the first
applicant, counsel submitted
that it would be proper for this court
to approach the application as one in which a final relief is being
sought.
[51]
Mr Engela challenged the validity of the meeting of 23 November 2024
and submitted that of the
22 members and the 3 proxies present at the
meeting, 9 members were behind with their membership fees, and
another 5 memberships
had been suspended or terminated, and they were
expelled as members of the first applicant. Counsel submitted that
these members
did not have the right to vote nor to be elected as the
"new" directors of the first applicant. They were a
splinter
group, whose decisions do not bind the other members of the
first applicant. According to Mr Engela, the special general meeting
was a sham if regard is had to the way it was conducted. In all the
circumstances, so the argument went, the matter should either
be
struck from the roll with costs due to a lack of urgency or dismissed
with costs due to the failure on the part of the applicants
to make
out a case for the relief sought in the notice of motion.
Issues
to be decided
[52]
From the above discussion, two primary issues arise for determination
in this matter. The
first
issue is whether the applicants'
application was brought with the requisite degree of urgency as
envisaged in Rule 6(12) of the
Uniform Rules or whether the urgency
pleaded by the applicants is self-created.
Secondly,
whether
the special general meeting that was called on 23 November 2024 was
validly convened and constitutionally compliant with
the governing
documents of the first applicant including its Constitution.
Relevant
legal principles and discussion
[53]
As foreshadowed above, the respondents took issue with the urgency
with which this application
was brought. The respondents asserted
that the urgency with which this application was brought is
egregiously self-created. In
the interest of diligence, I will
address the two disputed issues
ad seriatim.
Urgency
[54]
The legal principles applicable to the question of urgency are
well-established in our law. Urgency
in applications involves mainly
the abridgement of times prescribed by the rules and, secondarily,
the departure from established
filing and sitting times of the
court.
[2]
Rule 6(12) of the
Uniform Rules of Court confers courts with a wide discretion to
decide whether an application justifies enrolment
on the urgent court
roll based on the facts and circumstances of each case.
[3]
An application is urgent when an applicant cannot obtain substantial
redress in due course.
[4]
The
degree of departure from the modes of service and time frame in the
Uniform Rules must be commensurate with the urgency in
each case.
[5]
[55]
It is common cause in the present matter that the applicants brought
this application with extreme
urgency. The applicants gave the
respondents a mere 24 hours to oppose and another 24 hours to prepare
and file their opposing
affidavit. The reasons advanced by the
applicants for the said urgency is that the respondents are
interfering and stifling the
new directors' ability to manage the
first applicant's affairs. The applicants asserted, among other
things, that the new directors
cannot manage the applicant's software
systems, banking systems, and infrastructure. The members of the
first applicant risk having
no access to water due to the
respondents' conduct.
[56]
As further grounds of urgency, the applicants stated that the first
applicant is precluded from
managing the general store on which the
residents rely and lastly that the first applicant's members risk
having no access to water,
which is a risk to property or life if
fires cannot be adequately maintained.
[57]
Rule 6(12)(b) requires two things of an applicant in an urgent
application.
First,
the applicant must explicitly state the circumstances that he avers
render the matter urgent and,
secondly,
why he claims that he would not be afforded substantial redress at a
hearing in due course. Expressed differently, it is peremptory
in
Rule 6(12) that applicants set out explicitly the circumstances on
which they rely to render the matter urgent and why they
claim that
they cannot be afforded substantial relief at a hearing in due
course.
If they do not do so, their application is fatally flawed. An
applicant is not allowed to create its own urgency.
[6]
[58]
In the present matter, I have considered the grounds of urgency
raised by the applicants, and,
in my view, they are deficient of the
threshold envisaged in Rule 6(12) of the Uniform Rules. It is
important to remind ourselves
that a matter is urgent because of the
imminence and depth of harm the applicant will suffer if relief is
not given. As pointed
out by Mr Engela, the respondents told the
applicants, unequivocally, since 23 November 2024, that the validity
of the special
general meeting convened by Mr Oosthuizen and Mr
Fourie was disputed.
[59]
The respondents made it clear that they would not hand over the
leadership of the first applicant
to the applicants at the end of
2024. Furthermore, the applicants knew that the respondents were not
accepting the validity of
the meeting on 23 November 2024. To that
end, the respondents brought an application in this court to
interdict the applicants
to hold the meeting on 23 November 2024.
However, that application was dismissed. Intelligibly, the applicants
knew that the respondents
did not vacate their office as directors of
the first applicant and after the meeting of 23 November 2024, the
respondents completely
disregarded the special general meeting and
convened an annual general meeting on 28 November 2024. The
respondents unequivocally
refused to hand over the leadership of the
first applicant to the applicants and conveyed that stance to the
applicants.
[60]
In the founding affidavit, the applicants mentioned that Mr Agenbag
refuses to assist the new
leadership with a peaceful leadership
transition. The applicants asserted that the new directors do not
have access to strategic
information, bank accounts, software
systems, information system accounting systems, and other
infrastructure vital to the director's
effective management of the
applicants' interests. Evidently, they knew about this in November
2024. The applicants waited and
did nothing to compel the directors
of the first applicant to hand over the necessary document for the
management of the first
applicant.
[61]
Most importantly, on 5 February 2025, the alleged newly appointed
directors submitted a change
of directors to CIPC. On 7 February
2025, CIPC issued the certificate of registration confirming the
adoption of the newly elected
directors. On 10 February 2025, Mr
Hanekom, the new board chair, addressed a letter to the respondents
requesting, among other
things, keys for all offices, store warehouse
and other items for the effective management of the first applicant.
[62]
On 11 February 2025, Mr Agenbag addressed a letter to the members of
the first applicant and
stated that the directors of the first
applicant do not regard the newly elected directors as legitimate.
Instead, he noted that
it was a hostile takeover of the applicant and
that they reported the matter to the police. Among others, Mr Agenbag
stated that
the respondents will not provide any documents or minutes
to any person until the investigation is finalised. From the
chronology
of these events, it is abundantly clear that the
respondents were not going to hand over the leadership to the
applicants from
November 2024. The suggestion by the applicants that
they intended to resolve the matter internally is implausible and
unsustainable.
At the very least, they knew in February 2024, when Mr
Agenbag sent a letter to all members of the first applicant, that
they did
not recognise the newly appointed board.
[63]
Notwithstanding all this information at their disposal, the
applicants chose not to institute
action at any time since then until
14 March 2025, when this application was eventually issued. Instead,
they waited for a period
of almost four months to bring this
application. When they went ahead with the application, they did so
with the utmost urgency,
providing the respondents with a mere 24
hours to file an opposition and an additional 24 hours to prepare and
submit their opposing
affidavit.
[64]
In summary, despite almost four months having lapsed since the
special general meeting on 23
November 2024 was held, and more than
four weeks since the letter of demand of 10 February 2025, the
applicants failed to bring
this application timeously. Belatedly, the
respondents brought this application with extreme urgency and called
upon the respondents
to file their opposing affidavits within a
matter of hours. In my view, no case has been made whatsoever for
this extreme departure
from the rules. The urgency asserted by the
applicants, in my view, is entirely self-created.
[7]
There is no justification for the applicants’ failure to bring
this application earlier after they were notified that the
respondents are not recognising their leadership.
Accordingly,
the
applicants’ application must ordinarily fail due to their
decision to wait almost four months to approach the urgent court.
[65]
Generally, the above finding regarding urgency would lead to the
applicants' application being
struck off the roll. However, I am
mindful that the disputed issues in this matter are critical and
affect a number of families.
I believe both parties need certainty on
the validity of the meeting held on 23 November 2024 when the new
board of directors was
appointed. Striking this matter from the roll
without a determination on the validity of the meeting of 23 November
2024, may leave
the parties uncertain about the leadership of the
first applicant. For completeness, I will address the remaining issue
regarding
the validity of the meeting held on 23 November 2024.
Was
the special general meeting held on 23 November 2024 validly
convened?
[66]
It is common cause that the first applicant is governed in terms of
its Constitution and relevant
rules that apply to all its members.
The governing instruments of the applicant bind all the members of
the first applicant. Members
of the first applicant agreed to be
bound contractually by the Constitution and any amendments thereto
made by the Kongres, the
legislative sphere of the first applicant.
In terms of section 26 of the Constitution of the first applicant,
the management of
the first applicant vests with the board of
directors. Clause 27 of that Constitution sets out the powers of and
restrictions on
the board of directors.
[67]
From the affidavits and documents filed, the members of the current
board have been expelled
as members of the first applicant in terms
of the Constitution of the first applicant. Mr Fourie and Mr
Oosthuizen, who petitioned
the directors and called the special
general meeting, were expelled as members of the first applicant by
the Heemraad, the judicial
authority of the first applicant. Mr
Fourie was expelled as a member of the first applicant by the
Heemraad following a full internal
disciplinary hearing. Notably, the
Heemraad of the first applicant found Mr Fourie to have violated the
code of conduct, the regulations
and the Constitution of the first
applicant. In a letter dated 18 September 2024, addressed by the
Heemraad, Mr Fourie was informed
that his membership was terminated
with immediate effect.
[68]
Mr Oosthuizen, the deponent of the founding affidavit of the
applicants, has also been expelled
as a member of the first applicant
by the Heemraad. From the Heemraad decision filed in these
proceedings, Mr Oosthuizen's membership
was terminated on 18
September 2024 due to his repeated violations of the Constitution of
the first applicant and the code of conduct.
Mr Oosthuizen was
expelled for disrespecting the applicant's board and leadership, and
for spreading false information and failing
to act in the first
applicant's best interest. At the time the meeting was held on 23
November 2024, Mr Fourie and Mr Oosthuizen
were no longer members of
the first applicant. In my view, they had no locus standi as
directors of the first applicant or to attend
and participate in the
meeting of the first applicant.
[69]
It must be stressed that Mr Oosthuizen and Mr Fourie were not forced
to join or take membership
with the first applicant. They voluntarily
committed themselves to be loyal members of this Co-operative and are
thus bound by
the decisions that are taken by the established
structures of this institution. There are remedies available at their
disposal
for any decision that goes against them or for any decision
that they feel was arbitrary. In my view, Mr Oosthuizen does not have
the locus standi to institute these proceedings on behalf of the
first applicant because he is not a member of the first applicant.
The Heemraad of the first applicant expelled him, and his membership
was not reinstated. The decision made by the newly elected
board of
directors, which grants Mr Oosthuizen the authority to initiate these
proceedings, holds no significance. This is due
to the fact that Mr
Oosthuizen is not a member of the first applicant, rendering the
resolution moot and inconsequential.
[70]
If the two members were aggrieved by the decision of the Heemraad,
they should have exhausted
internal remedies to challenge the
validity of their expulsion as members of the first applicant.
Alternatively, if the Mr Oosthuizen
and Mr Fourie were not happy with
their expulsion, they should and could have challenged or instituted
review proceedings against
the decision of the Heemraad to expel them
as members of the first applicant. On that score alone, the
applicant’s application
is bound to fail. Against this
backdrop, I turn to consider the validity of the meeting that was
held on 23 November 2024.
[71]
I must emphasise that in terms of the first applicant's Constitution,
the special general meeting
could only be convened either by at least
2 directors of the first applicant, alternatively, by 5 or more
members of the first
applicant provided that the members in number
constitute at least 20% of all members of the first applicant, having
petitioned
the directors to convene such a meeting and the meeting is
not convened within 21 days. In this case, Mr Oosthuizen called the
meeting and was supported by Mr Fourie. The other members who
supported the call to petition the directors did not constitute 20%
as required by the Constitution of the first applicant.
Conspicuously, the Constitution unequivocally requires not only that
a
special general meeting be petitioned by five or more members,
constituting 20% of all the members, but that such members shall
also
convene the special general meeting.
[72]
As correctly pointed out by Mr Engela, the notice convening the
special general meeting was only
signed by Mr Oosthuizen and Mr
Fourie, who were no longer members of the first applicant. The notice
was not signed or issued by
any of the other members who allegedly
supported the initial petition. This, in my view, offended the
Constitution of the first
applicant. These notices allegedly sent to
members were therefore not issued by 5 or more members, constituting
20% of all the
members, resulting in the special general meeting not
being convened by such members.
[73]
Significantly, the Constitution sets out the time frame that is
required to convene a special
general meeting. In fact, the
Constitution of the first applicant requires a period of 14 days’
notice to be given for the
sitting of a special general meeting.
Paragraph 51.1 of the applicant’s Constitution provides that a
general meeting shall
be convened by at least 14 days’ notice
in writing to each member of the Co-operative. The notice issued by
Mr Oosthuizen
and Mr Fourie for the special general meeting of 23
November 2024 was only distributed a mere 12 days before the special
general
meeting was to be held contrary to the prescripts of the
first applicant’s Constitution.
[74]
What I find very concerning, which, in my view, is fatal to the
applicants’ case, is that
the board of directors of the first
applicant did not authorise the convening of the meeting of 23
November 2024 and vociferously
objected to it. Notwithstanding that
the board of directors had already on 8 November 2024 called for a
special general meeting
to be held on 28 November 2024, Mr Oosthuizen
and his splinter group still sent out a notice on 11 November 2024
that the annual
general meeting shall be held on 23 November 2024.
[75]
In other words, even though the board of directors of the first
applicant had set a date for
the annual general meeting for 28
November 2024, Mr Oosthuizen and his splinter group continued to call
a meeting for 23 November
2024. In my opinion, the actions taken by
Mr Oosthuizen and Mr Fourie proverbially bear resemblance to an
attempted
coup d'état
. Their decision to convene a
special general meeting, despite the prior scheduling of an Annual
General Meeting, fundamentally
compromised and invalidated the
legitimacy of the purported meeting held on 23 November 2024.
[76]
In my view, there was no need for another meeting as the board of
directors had already called
for the Annual General Meeting for which
the applicants sought. Expressed differently, as from 8 November
2024, when the directors
issued the notice for the meeting on 28
November 2024, the applicants did not have the right to proceed with
convening a special
general meeting of their own accord. The board of
directors, an institutional structure of the applicant, had already
set a date
for the meeting. The applicant acted in defiance and
intransigently to the decision of the board of directors that the
members
of the first applicant duly and legitimately appointed.
[77]
To make matters worse, Mr Oosthuizen and Mr Fourie chose the date of
the proposed special meeting
to be 23 November 2024. In other words,
they chose a date which was five days before the Annual General
Meeting. Evidently, this
lead me to an ineluctable conclusion that
the special general meeting was convened purely to circumvent the
proceedings of the
Annual General Meeting, where the applicants would
have been free to voice their concerns and to vote, in the normal
fashion, for
the appointment of new directors. I am mindful of the
allegations of exclusion alluded to by the applicants in their
application.
However, I believe that such issues could be addressed
by the Heemraad, their judicial body, which the members of the first
applicant
unanimously established to address such problems.
[78]
To this end, I agree with the views expressed by the respondents’
counsel that the way
the special general meeting was convened and
conducted shows that it was called to undermine the upcoming Annual
General Meeting,
which was held on 28 November 2024, a mere five days
later. Indeed, the evidence shows that the special general meeting
was a complete
sham. The applicants flagrantly flaunted the
procedural requirement set out in the first applicant’s
Constitution. No proper
process was followed with regard to the
nomination and election of the proposed members as directors, and
members’ concerns
were simply ignored.
[79]
In my view, Mr Oosthuizen and Mr Fourie's conduct offended the Code
of Conduct, the Regulations
and the Constitution of the first
applicant. Clause 11.2 of the applicant's Constitution sets out its
members' obligations. Amongst
other things, members must adhere to
the Constitution, any amendment thereto, and any by-laws made by the
Kongres. Furthermore,
all members must conduct themselves in the
values and ethical values of the Constitution and always act in the
best interests of
the Co-operative. The conduct of the respondents
offended the governing documents of the first applicant and that
cannot be countenanced.
[80]
Thus, the applicants have failed to meet the first requirement for
the relief they seek, namely,
to prove the "clear right" on
which they purport to rely. Furthermore, the deponent of the founding
affidavit does not
have the authority to bring this application on
behalf of the first applicant.
[81]
Pursuant to the view I take, I deem it unnecessary to deal with the
other requirements of an
interdict. The purported meeting of the 23
November 2024 was a sham. It is invalid and not binding. Any
decisions taken at that
meeting are null and void, and of no
consequence. The respondents are the incumbent directors of the first
applicant, and they
are entitled to continue managing the first
applicant's day-to-day operations until they are removed by a valid
decision taken
in terms of the first applicant's Constitution, or by
order of Court.
Order
[82]
Given all these considerations, the following order is granted:
82.1
The applicants’ application is hereby dismissed with costs,
including the costs of counsel on scale
B.
LEKHULENI JD
JUDGE OF THE HIGH
COURT
APPEARANCES
For
the Applicants: Mr Nöthling
Instructed
by: Sune Van der Merwe Attorneys
For
the Respondents: Mr Engela
Instructed
by: Morne Binedell Attorney and Conveyancer
[1]
Clause 50.2 provides as follows: ‘A special general meeting
shall be convened –
(a)
By at least two Directors of the Co-operative; or(b) By five or more
members of the Co-operative Constituting in number at
least 20%
(twenty percent) of all the members of the Co-operative: Provided
that such members shall not be entitled to convene
an special
general meeting unless they have forehand in writing petitioned the
Directors to convene such a meeting and the meeting
is not convened
within 21 (twenty one) days reckoned from the date the petition was
lodged, or unless for any reason there are
no Directors to whom such
a petition can be addressed.’
[2]
See Rule 6(12) (a) and (b) of the Uniform Rules.
[3]
Mogalakwena Local Municipality v Provincial Executive Council,
Limpopo [2014] 4 AII 67 (GP) at para 63; Caledon Street Restaurants
CC v D’ Aviera 1998 JDR 0116 (SE) at 8.
[4]
Dlamini v City Manager of the City of Ekurhuleni Metropolitan
Municipality [2023] ZAGPJHC 147 at para 27.
[5]
Republikeinse Publikasie (Edms) Bpk v Afrikaanse Pers Publikasie
(edms) Bpk
1972 (1) SA 773
(A) at 782A-G.
[6]
Venter
v Els
2024
(4) SA 305
(WCC) para 19.
[7]
Big
Blue Marketing CC v King Sabata Dalindyebo Local Municipality
2017 JDR 0302 (ECM) at para 10;
Windsor
Hotel (Pty) Ltd v New Windsor Properties (Pty) Ltd
2013 JDR 1989 (ECM) at para 9.
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