SWAZILAND HIGH COURT
FELDMANN Roy Frank
U & R AGENCIES (PTY) LTD
Civ. Case No. 2582/2002
Coram Sapire, CJ
For Petitioner Mr. P. Flynn
For Respondent Mr. M.V.
One R.F. Feldmann presented this petition for liquidation. He seeks the liquidation of the company on the grounds that it is just and equitable that the company should be wound up.
Section 114 of the Companies Act (quoted hereunder) provides that all or any creditor or creditors, contributory or contributories may together or separately present application to the court for the winding up of a company.
114. (1) An application to the Court for the winding-up of a company shall be by petition, presented (subject to the provisions of this section) by the company, or by any creditor or creditors (including any contingent or prospective creditor or creditors), contributory or contributories, or by all or any of those parties, together or separately:
Provided that -
(a) a contributory shall not be entitled to present a petition for winding-up a company, unless -
(i) the number of members is reduced in the case of a private company, below two, or in the case of any other company, below seven; or
the shares in respect of which he is a contributory, or some of them either were originally allotted to him or have been held by him, and registered in his name for at least six months during the eighteen months before the commencement of the winding-up, or have developed upon him through the death of a former holder; and
a petition for winding-up a company on the ground of default in lodging the statutory report or in holding the statutory meeting shall not be presented by any person except a shareholder, and not before the expiration of fourteen days after the last day on which the meeting ought to have been held; and
(c) the Court shall not give a hearing to a petition for winding-up a company by a contingent or prospective creditor until such security for costs has been given as the Court thinks reasonable and until a prima facie case for winding-up has been established to the satisfaction of the Court.
(2) Where a company is being wound up voluntarily or subject to supervision, a petition may be presented by the Master, or by any other person authorised in that behalf under the other provisions of this section, but the Court shall not make a winding-up order on the petition unless it is satisfied that the voluntary winding-up subject to supervision cannot be continued with due regard to the interests of the creditors or contributories.
Meaning of "contributory ".
108. The term "contributory" shall mean every person liable to contribute to the assets of a company in the event of its being wound up, and in all proceedings for determining and in all proceedings prior to the final determination of the persons who are to be deemed contributories, shall include any person alleged to be a contributory.
I raised the point during the argument that the petitioner was not one of those persons
or categories of persons who has locus standi to bring this application. He is not a
creditor, or a contributory, and is not one of those who may bring the application for
The applicant argued at some length that although his name does not appear in the
share register and had no share certificate showing himself to be a shareholder or
member of the company he was nevertheless, by reason of some contract, entitled to a
shareholding in the company. That is not sufficient.
He, the applicant would have to enforce his rights to be registered as a member of the
company before he could bring this application and until that is done, and until he
could allege he was a contributory as defined he does not have any locus standi to
bring the present application.
Reference to the Companies Act will show that a member is a person who is
registered as such and nobody can be a contributory unless he is a member.
The Companies Act is only seven years short of its century. Company law has
developed during that period. The countries whose companies' acts formed the model
for local legislation have long since and on a number of occasions amended or replaced their legislation to accommodate developments. Corresponding sections in such legislation have afforded locus standi to a wider range of applicants for liquidation. The meaning of "just and equitable" to denote a deadlock, or oppression of minority interests situation in the present context has received interpretation which is inapplicable to the local act as it remains framed. Unless a member or shareholder is a contributory he has no locus standi.
Because of the petitioner's lack of locus standi no consideration need be given to the merits of the matter. The petition is therefore dismissed with costs. The fees of counsel will be certified in terms of Rule 68.
SAPIRE, C J