Wills v Seed to Plant Properties (PTY) Limited and Others (2024/095821) [2025] ZAGPJHC 1337 (23 July 2025)

begin wrapper begin container begin header begin slogan-floater end slogan-floater - About SAFLII About SAFLII - Databases Databases - Search Search - Terms of Use Terms of Use - RSS Feeds RSS Feeds end header begin main begin center # South Africa: South Gauteng High Court, Johannesburg South Africa: South Gauteng High Court, Johannesburg You are here: SAFLII >> Databases >> South Africa: South Gauteng High Court, Johannesburg >> 2025 >> [2025] ZAGPJHC 1337 | Noteup | LawCite sino index ## Wills v Seed to Plant Properties (PTY) Limited and Others (2024/095821) [2025] ZAGPJHC 1337 (23 July 2025) Wills v Seed to Plant Properties (PTY) Limited and Others (2024/095821) [2025] ZAGPJHC 1337 (23 July 2025) Download original files PDF format RTF format make_database: source=/home/saflii//raw/ZAGPJHC/Data/2025_1337.html sino date 23 July 2025 REPUBLIC OF SOUTH AFRICA IN THE HIGH COURT OF SOUTH AFRICA GAUTENG LOCAL DIVISION, JOHANNESBURG CASE NO : 2024-095821 (1)  REPORTABLE: NO (2)  OF INTEREST TO OTHER JUDGES: NO (3)  REVISED: NO In the matter between: LORRAINE JEAN WILLS Applicant and SEED TO PLANT PROPERTIES (PTY) LIMITED First Respondent RICHARD KEAY POLLOCK N.O. Second Respondent VHONANI DENGA RAMUEDZISI N.O. Third Respondent FIRST NATIONAL BANK LIMITED Fourth Respondent THE COMPANIES AND INTELLECTUAL PROPERTY COMMISSION Fifth Respondent THE MASTER OF THE HIGH COURT Sixth Respondent Neutral Citation : Delivered: By transmission to the parties via email and uploading onto Case Lines the Judgment is deemed to be delivered . JUDGMENT Introduction [1] This is an application to place Seed to Plant Properties (Pty) Ltd (in liquidation) under supervision per section 131(1) of the Companies Act 71 of 2008 (the Act). Section 131(1) [1] allows this if certain conditions are met. The applicant, Lorraine Jean Wills, qualifies as an affected person under section 128. [2] [2] The application was brought in the ordinary course and the fourth respondent, First Rand Bank Limited (First Rand Bank), after anticipating the applicant to the urgent this court, per Dosio J, struck the matter from the roll, on 3 October 2024 and reserved judgment on costs. [3] First Rand Bank (originally cited as First National Bank Ltd) opposes the application as the fourth respondent. The company is in liquidation, with the second and third respondents that are cited as liquidators. The fifth and sixth respondents are included due to possible interest in the outcome, though no relief is sought against them. Background [4] The company, which owns property but does not trade, owes First Rand Bank over R3.7 million. Due to this debt, First Rand initiated liquidation on 18 April 2023. A settlement agreement was concluded on 7 July 2023 required the company and its sureties, including Ms Wills, to repay the amount owed, but they defaulted. The company was liquidated on 16 November 2023. Liquidators are managing assets and planned to auction the immovable property on 27 August 2024. The Applicant was notified of the auction date on 30 July 2024. [5] After she became aware of the auction, the Applicant launched the business rescue application on 26 August 2024 which has the effect of suspending all the legal proceedings including the liquidation and disposal of the property of the company. The application was initiated in the ordinary course and First Rand, tried, without success to deal with application in the urgent court. The basis of First Rand’s urgent application was that the application by Ms Willis was done in bad faith because, so it was argued, once the business rescue application was launched, it had the effect of suspending all litigation including liquidation and amounted to abuse of process to stave off the sale of the only immovable property of the company. [6] This court is required to determine the business rescue application and Ms Wills contends that there is a good chance that the company will be turned around. Issue [7] The issue to be determined at this stage is whether based on the papers before this court, there is a possibility that the company can recover from its financial distress. Legal Principles [8] The concept of ‘business rescue’ had been introduced into our law for the first time in Chapter 6 of the 2008 Companies Act (the Act), which came into operation on 1 May 2011. . [3] 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”. [4] In addition, Section 131(3) provides that: “ [e]ach affected person has a right to participate in the hearing of an application in terms of this section”. Furthermore, Sections 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, Sections132(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). ” [5] [9] Although there have been conflicting high courts judgments on when a business rescue application is ‘made’ within the meaning of section 131(6) of the Companies Act, The Supreme Court of appeal finally resolved the conflict in L utchman 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 [6] and held 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 section 131(6) [7] in order to trigger the suspension of liquidation proceedings that have already commenced. [8] [10] It is therefore undoubtedly so that the objective of business rescue is to avoid liquidation. There must be on merits, a business case for the avoidance of liquidation. Unlike liquidation which is final. Business rescue is a temporary respite to assist the company to overcome its financial distress through supervision by the business rescue practitioner if there is a compelling business plan voted for by the affected persons which includes secured creditors like First Rand. [11] The court seized with the application for business rescue exercises its discretion which must be done judiciously. The test is not whether the court arrives at its conclusion correctly, but whether it exercises its discretion in a proper manner. [9] Differently put, the court applies value judgment based on the papers before it. [10] Accordingly, the court is entitled to have regard to a variety of diverse and contrasting considerations in reaching a conclusion. But in the end, that conclusion will be either right or wrong. [11] [12] In Media Workers Association of South Africa and others v Press Corporation of South Africa Ltd (Perskor) [12] , Grosskopf JA sought to explain the concept of a discretion in the loose sense with reference to the threefold distinction between matters of fact, matters of law and matters of discretion. The third category would therefore include all those issues arising in litigation which cannot be classified as either questions of fact or questions of law. These would include, for example, the question whether the defendant acted reasonably in the circumstances; or whether the legal convictions of the community require the imposition of delictual liability for the purpose of defining wrongfulness; or whether the applicant for an interdict has an alternative remedy. [13] [13] The applicant contends that she will inject R300 000 of her own money to ensure that the company is turned around for the benefit of its creditors. The question is therefore whether the requirement of ‘rescuing the company’ as contemplated in section 131(4) (a) is satisfied where it is clear from the outset that the company can never be saved from immediate liquidation and that the only hope is for a better return than that which would result from liquidation. [14] In A G Petzetakis International Holdings Ltd v Petzetakis Africa (Pty) Ltd [14] this question was answered in the negative. The reason for this decision appears to be captured in para 2 of the judgment which reads: “ Section 131(4) does not incorporate the alternative object of the . . . rescue plan, which is referred to in s 128 , namely a plan which could result in a better return for creditors or shareholders than would result from immediate liquidation. It seems that the intention of the legislature on this point is as follows: [17.1] The requirements for the granting of a s 131 rescue order include that the company under consideration must have a reasonable prospect of recovery. [17.2] Once a company is under business rescue, its rescue plan may be aimed at the alternative object, namely a better return than the return of immediate liquidation.” [15] The applicant for a business rescue of a company bears the onus to prove there is a reasonable prospect that the plan, if implemented has a prospect of succeeding and getting the company out of financial distress. The plan must be based on reasonable grounds and mere speculation will not be enough. [15] In considering this requirement, in Propspec Investments v Pacific Coasts Investments 97 Ltd, [16] Van Der Merwe J said the following: “ I agree that vague averments and mere speculative suggestions will not suffice in this regard. There can be no doubt that, in order to succeed in an application for business rescue, the applicant must place before the court a factual foundation for the existence of a reasonable prospect that the desired object can be achieved. But with respect to my learned colleagues, they place the bar too high.” He continued thus [17] : “ In my judgment it is not appropriate to attempt to set out general minimum particulars of what would constitute a reasonable prospect in this regard. It also seems to me that to require, as a minimum, concrete and objectively ascertainable details of the likely costs of rendering the company able to commence or resume its business, and the likely availability of the necessary cash resource in order to enable the company to meet its day-to-day expenditure, or concrete factual details of the source, nature and extent of the resources that are likely to be available to the company, as well as the basis and terms on which such resources will be available, is tantamount to requiring proof of a probability, and unjustifiably limits the availability of business rescue proceedings.” Analysis [16] The applicant states that the company had concluded the settlement agreement with First Rand in terms of which it had to repay a minimum amount of R44 000 to First Rand from July 2023 as well as two equal payments of R 258 552.35 from 31 July 2023 and 31 August 2023. She furthermore concedes that the company failed to make any of the payment due to its financial distress. [17] The applicant in her founding affidavit states that there is a reasonable prospect that the company will trade itself out of financial distress because, her son and herself have experience in nursery business and that the nursery operation will be sustainable enough to meet its rental obligations. [18] I do not agree with the submissions by the applicant. Firstly, the trading company which operated the nursery business, was a related entity operated by the applicant’s spouse. It is hardly surprising that it could not meet its rental obligations because of the obvious conflict of interest. Secondly, the applicant sought to persuade me that the company will trade for its own benefit on the property by operating the nursery business. I do not see how this will change the financial distress of the company because both the applicant and her spouse bound themselves as sureties in favour of First Rand and it can hardly at this late state of liquidation be argued that the conversion of the liquidation to business rescue will alter the already precarious state the company finds itself. [19] Even if my I am not correct with my view, it can hardly be believed that somehow, Miss Willis will be able to raise the R300 000 she referred to in papers. This is so because she has not provided this court this source of the capital or even proof that in fact such amount is available. More importantly, if she has such an amount available at her disposal, she would have used it to pay First Rand instead of launching the present application because of the suretyship agreement she bound herself to for the fulfilment of the obligations of the company to First Rand . I am of the considered view that the amount she claims she has, is simply a stratagem to stall liquidation to frustrate the auctioning of the only asset that the company has as part of the liquidation process. The permutations that are referred to in the founding affidavit, are in my view, speculations and stand to be rejected. [20] The costs for the anticipation of the application by First Rand were reserved by Dosio J. Having considered the facts of this application, I am of the view that each party should bear its or her own costs as far as that application was concerned. Conclusion [21] Therefore it follows that the application for business rescue must fail. Order [22] Having considered the papers and the submissions by counsels for both parties, the following order is made: a) The application for business rescue is dismissed with costs including the costs of counsel. b) The applicant is ordered to pay the costs on Scale B. ML SENYATSI JUDGE OF THE HIGH COURT OF SOUTH AFRICA GAUTENG DIVISION, JOHANNESBUR G DATE APPLICATION HEARD : 14 April 2025 DATE JUDGMENT HANDED DOWN : 23 July 2025 APPEARANCES Counsel for the Applicant:                         Adv E Coleman Instructed by:                                            EW Van Zyl Attorneys Counsel for the FourthRespondent:          Adv C Petersen Instructed by:                                            Cox Yeats Attorneys [1] Companies Act 71 of 2008 [2] Companies Act 71 of 2008 ## [3]Oakdene Square Properties (Pty) Ltd and Others v Farm Bothasfontein (Kyalami) (Pty) Ltd and  Others (609/2012) [2013] ZASCA 68; 2013 (4) SA 539 (SCA); [2013] 3 All SA 303 (SCA) para [3] Oakdene Square Properties (Pty) Ltd and Others v Farm Bothasfontein (Kyalami) (Pty) Ltd and  Others (609/2012) [2013] ZASCA 68; 2013 (4) SA 539 (SCA); [2013] 3 All SA 303 (SCA) para [4] 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 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. [5] Emphasis added. ## [6][2022] ZASCA 66; [2022] 3 All SA 35 (SCA); 2022 (4) SA 529 (SCA) (10 May 2022) para 24 [6] [2022] ZASCA 66; [2022] 3 All SA 35 (SCA); 2022 (4) SA 529 (SCA) (10 May 2022) para 24 [7] Companies Act 71 of 2008 [8] Emphasis added. [9] Mabaso v Law Society of the Northern Provinces [2004] ZACC 8 ; 2005 (2) SA 117 (CC) para 20 ## [10]Oakdene Square Properties (Pty) Ltd and Others v Farm Bothasfontein (Kyalami) (Pty) Ltd and Others (609/2012) [2013] ZASCA 68; 2013 (4) SA 539 (SCA); [2013] 3 All SA 303 (SCA) para 18. [10] Oakdene Square Properties (Pty) Ltd and Others v Farm Bothasfontein (Kyalami) (Pty) Ltd and Others (609/2012) [2013] ZASCA 68; 2013 (4) SA 539 (SCA); [2013] 3 All SA 303 (SCA) para 18. [11] Footnote 7 above para 20. [12] [1992] ZASCA 149 ; 1992 (4) SA 791 (A) at 795-796, quoted with approval in Farm Bothasfontein above, footnote 7 para 20. [13] [14] 2012 (5) SA 515 (GSJ) para 2 [15] Farm Bothasfontein above para 29. [16] 2013 (1) SA 542 (FB) para 11 [17] Para 15 sino noindex make_database footer start