Mosebo v Angel Diamonds (Pty) Ltd (C of A (CIV) 28 of 2011) [2012] LSCA 24 (27 April 2012)

IN THE COUR T OF AP PE AL OF LE S OTH O HE LD AT MAS E R U In Th e m a t ter b etween :- C OF A (CIV) NO.2 8 / 2 0 1 1 TS OAKINYE P E TE R MOSE BO Ap p ella n t a n d ANGE L DIAMONDS (P TY) LIMITE D Res p on d en t COR AM : R AMODIBE DI, P S COTT, J A F AR LAM, J A HE AR D : 1 6 APR IL 2 0 1 2 DE LIVE R E D: 2 7 APR IL 2 0 1 2 S UMMAR Y Com p a n y La w – Prov is ion a l w in d in g-u p ord er d is ch a rged – pe tition er n ot es ta b lis h in g e n title m e n t to brin g a p p lica tion . J UDGME NT F a r la m , J A [1 ] Th e a p p ella n t a p p ea ls a ga in s t a n or d er gr a n ted b y Mo n a p a t h i J in t h e High Cou r t on 1 9 Ma y 2 0 1 1 d is ch a r gin g wit h cos t s a p r ovis ion a l win d in g-u p or d er gr a n ted b y Ma ja r a J on 8 Oct ob er 2 0 1 0 in r es p ect of t h e r es p on d en t , An gel Dia m on d s (Pty) Lt d . [2 ] Mo n a p a t h i J d id n ot fu r n is h a n y r ea s on s wh en h e d is ch a r ged t h e p r ovis ion a l win d in g-u p or d er , n or h a s h e d on e s o s in ce. Th is Cou r t h a s on t h e n u m er ou s occa s ion s in t h e p a r t s tr on gly d ep r eca ted t h e fa ilu r e b y J u d ges of t h e High Cou r t t o give r ea s on s for t h eir d ecis ion s : s ee, e.g. Qh o be la a n d An o t h e r v Ba s u t o la n d Co n gr e s s Pa r t y a n d An o t h e r LAC (2 0 0 0 - 2 0 0 4 ) 2 8 a t 3 8 C-D; Hla le le a n d An o t h e r v Dir e c t o r o f P u b lic P r o s e c u t io n s a n d An o t h e r LAC (2 0 0 0 - 2 0 0 4 ) 2 3 3 a t 2 3 7 H – 2 3 8 A; R v Ma s ik e LAC (2 0 0 0 - 2 0 0 4 ) 5 5 7 a t 5 5 9 G-5 6 0 B, a n d Ot u b a n jo v Dir e c t o r o f Im m igr a t io n a n d An o t h e r LAC (2 0 0 5 -2 0 0 6 ) 3 3 6 a t 3 4 3 F – 3 4 6 C. [3 ] Wh a t wa s s a id b y F r ie d m a n J A in Qh o b e la ’s ca s e a p p lies t o t h is ca s e a ls o. Th e p a s s a ge t o wh ich I r efer r ea d s a s follows : ‘It is n eces s a ry for th e p rop er a d m in is tra tion of ju s tice th a t cou rts give re a s on s for ju d gm en t. A litiga n t h a s ev ery righ t to k n ow w h y a ca s e h a s bee n w on or los t. An d a low e r cou rt is a ls o obliged to fu rn is h re a s on s s o th a t a Cou rt of Ap pe a l w ill b e prope rly in form ed a s to w h a t prom p te d th e cou rt a q u o to a rrive a t its d ecis ion . In th e pres e n t ca s e n o re a s on s a re giv en b y th e le a rn ed ju d ge a q u o e ith e r for h is ord er con firm in g for h is s u bs equ e n t “ru lin g”. His con d u ct in th is re ga rd is to be d e p lored .’ th e ru le or [4 ] Des p ite t h e a b s en ce of r ea s on s I a m s a tis fied t h a t t h e p r ovis ion a l win d in g-u p or d er wa s cor r ectly d is ch a r ged . [5 ] Th e a p p ella n t h a d s ou gh t t h e win d in g-u p of t h e com p a n y on t h e gr ou n d s t h a t it wa s u n a b le to p a y its d eb t s a n d wa s fa ct u a lly a n d com m er cia lly in s olven t a n d t h a t it wa s ju s t a n d equ it a b le t h a t it b e wou n d u p . He a lleged t h a t h e wa s en titled t o s eek a win d in g-u p or d er b eca u s e t h e com p a n y wa s in d eb t ed t o h im , s o h e s a id , ‘in a n a m ou n t in exces s of M1 6 0 ,0 0 0 .0 0 , b ein g in r es p ect of m on ey len t a n d a d va n ced a n d u n p a id r em u n er a tion d u e’. [6 ] Th e a p p lica tion for t h e win d in g-u p wa s a n u n u s u a l on e b eca u s e t h e com p a n y wa s a t t h e tim e t h e s u b ject of a cou r t or d er gr a n ted on 1 5 J u n e 2 0 1 0 u n d er ca s e n u m b er CIV/ APN/ 3 3 3 / 2 0 1 0 in ter m s of wh ich t h e com p a n y’s d ir ect or s wer e d ives ted of t h e con tr ol a n d m a n a gem en t of th e com p a n y, wh ich wa s en tr u s ted b y t h e cou r t or d er to t h e a p p ella n t a n d on e E n gelb r ech t , wh o a r e m in or ity s h a r eh old er s in t h e com p a n y. [7 [ In con s equ en ce of t h is t h e con fir m a tion of t h e p r ovis ion a l win d in g-u p or d er wa s n ot op p os ed b y t h os e in con tr ol of t h e com p a n y of t h e tim e, n a m ely t h e a p p ella n t a n d E n gelb r ech t, b u t b y a n u m b er of ‘in ter es t ed p a r t ies ’, in clu d in g Th a b ex Lt d , t h e m a jor ity s h a r eh old er in t h e com p a n y, Ma r iu s Welt h a gen , t h e m a n a gin g d ir ect or of t h e com p a n y a n d t h e ch ief execu tive of Th a b ex Lt d , Dr J oh n An t h on y Cr u is e, wh o is a tr u s tee of t h e CAJ S h a r e Tr u s t , s h a r eh old er in t h e com p a n y, a n d Iza k Ben ja m in va n Ton d er , a n ot h er s h a r eh old er . [8 ] In t h e m a in a ffid a vit filed in op p os ition t o t h e con fir m a tion of t h e p r ovis ion a l or d er , wh ich wa s d ep os ed t o b y Welt h a gen , it wa s a lleged t h a t t h e in ter es ted p a r ties r ep r es en t 7 8 .0 3 % of t h e s h a r eh old in g in t h e com p a n y. Th is a llega tion a n d m a n y of t h e ot h er a llega tion s in Welt h a gen ’s a ffid a vit a r e d is p u ted b y th e a p p ella n t in h is r ep lyin g a ffid a vit b u t in view of t h e con clu s ion t o wh ich I h a ve com e t h a t t h e p r ovis ion a l win d in g-u p or d er wa s cor r ectly d is ch a r ged it is u n n eces s a r y t o d is cu s s t h es e d is p u t es fu r t h er . [9 ] In m y view t h e or d er h a d t o b e d is ch a r ged on t h e s im p le gr ou n d t h a t t h e a p p ella n t fa iled t o es t a b lis h t h a t t h e com p a n y wa s in d eb ted to h im a s h e a llege d a n d t h a t h e wa s a ccor d in gly en titled to a p p ly for t h e its win d in g-u p . [1 0 ] In Welt h a gen ’s op p os in g a ffid a vit h e s p ecifica lly d en ied t h a t a n y a m ou n t wa s owin g b y t h e com p a n y to t h e a p p ella n t . He s a id t h a t t h e a llega tion in t h e p etition t o wh ich I h a ve r efer r ed wa s ‘in s ta r k con flict wit h wh a t wa s con ta in ed in t h e m a in a p p lica tion [i.e. t h e a p p lica tion for t h e or d er gr a n t ed on 1 5 J u n e 2 0 1 0 ] in t h a t n o r efer en ce wa s m a d e in t h e m a in a p p lica tion t o a n a m ou n t in exces s of M1 6 0 ,0 0 0 .0 0 b ein g owed t o t h e [a p p ella n t]’. [1 1 ] He p oin ted ou t t h a t t h e a p p ella n t h a d n ot p r ovid ed a n y s u p p or tin g d ocu m en ta tion r ega r d in g h is a lleged cla im a n d t h a t , t h ou gh m on eys owin g t o E n gelb r ech t wer e m en tion ed in wh a t h e ca lled t h e m a in a p p lica tion , n o m en tion wa s m a d e in t h a t a p p lica tion of t h e a m ou n t of ‘in exces s of M1 6 0 ,0 0 0 .0 0 ’ a lleged ly owed t o t h e a p p ella n t . [1 2 ] Welt h a gen a n n exed wh a t h e d es cr ib ed a s t h e a n n u a l fin a n cia l s ta tem en t s of t h e com p a n y, wh ich d id n ot r eflect a n y m on eys owin g t o t h e a p p ella n t . [1 3 ] In h is r ep lyin g a ffid a vit t h e a p p ella n t s a id t h a t t h e fin a n cia l s t a t em en t s a n n exed to Welt h a gen ’s a ffid a vit wer e wh a t h e d es cr ib ed a s ‘r ecen t fa b r ica tion s ’ a n d h e a n n exed in s u p p or t a n a ffid a vit d ep os ed t o b y t h e m a n a ger of t h e La d yb r a n d offices of a fir m of a ccou n ta n ts , wh o s ta ted t h a t h e wa s ‘r es p on s ib le to lia s e’ wit h t h e r egis ter ed fir m of in d ep en d en t a ccou n ta n ts in Les ot h o wh o a r e t h e com p a n y’s a u d it or s a n d t h a t h e h a d p er for m ed p r eviou s a ccou n tin g a n d a u d itin g s er vices in r es p ect of t h e com p a n y. He s u p p or ted t h e a p p ella n t’s a llega tion t h a t t h e fin a n cia l s ta tem en t s a n n exed to Welt h a gen ’s a ffid a vit wer e n ot gen u in e. [1 4 ] Th e a p p ella n t d id n ot , h owever , exp la in wh y n o m en tion wa s m a d e in t h e m a in a p p lica tion of m on eys owin g t o h im wh ile m on eys owin g t o h is co-a p p lica n t E n gelb r ech t wer e m en tion ed . He con clu d ed t h is p a r t of h is a ffid a vit b y s a yin g t h a t h is cla im wa s ‘s u p p or ted b y p r op er d ocu m en ta tion a n d vou ch er s t oo n u m er ou s t o a t ta ch to t h e p a p er s ’ a n d t h a t h e wou ld h a ve ‘t h e s ou r ce d ocu m en ts a va ila b le for in s p ection a t t h e h ea r in g of t h e p etition ’. Th ey wer e n ot . [1 5 ] Cou n s el for t h e a p p ella n t con ten d ed , h owever , t h a t t h is ga p in t h e a p p ella n t’s ca s e wa s cu r ed b y a d ocu m en t a lleged ly given in J a n u a r y 2 0 1 0 b y Welt h a gen t o Vis s er Cor n eliu s d u Ples s is , a s h a r eh old er a n d cr ed itor of t h e com p a n y a n d of Th a b ex Lim it ed . Th is d ocu m en t p u r p or ts to b e a ‘tr ia l b a la n ce’ of t h e com p a n y a s a t 3 1 Decem b er 2 0 0 9 . It r eflects a loa n of M5 ,0 0 0 .0 0 a lleged ly owed t o t h e a p p ella n t . [1 6 ] Th is d ocu m en t wa s p u t b efor e t h e cou r t t oget h er wit h t h e a p p ella n t’s r ep lyin g a ffid a vit. Th e in ter es t ed p a r ties wer e n ot a ffor d ed a n op p or t u n ity to d ea l wit h it , n or wa s t h eir a t t en tion d r a wn to t h e s t a t em en t in qu es tion . I d o n ot t h in k t h a t t h e a p p ella n t ca n r ely on it a t t h is s ta ge of t h e p r oceed in gs . [1 7 ] Fu r t h er m or e wh en on e b ea r s in m in d th a t t h e a p p ella n t a n d E n gelb r ech t h a ve b een in con t r ol of t h e com p a n y s in ce 1 5 J u n e 2 0 1 0 it is d ifficu lt t o u n d er s t a n d wh y, if t h e a p p ella n t is in d eed a cr ed it or of t h e com p a n y, n o d ocu m en t a t ion es ta b lis h in g t h is fa ct h a s b een p u t b efor e t h e cou r t . [1 8 ] I a m a ccor d in gly s a tis fied t h a t t h e p r ovis ion a l win d in g- u p or d er wa s cor r ectly d is ch a r ged a n d t h a t t h e a p p ea l m u s t b e d is m is s ed wit h cos ts t o b e p a id t o t h e in ter es t ed p a r ties . [1 9 ] Th e followin g or d er is m a d e : Th e a p p ea l is d is m is s ed wit h cos t s . I. G. F AR LAM J US TICE OF AP PE AL I a gr ee M. M. R AMODIBE DI PR E SIDE NT OF COUR T OF AP PE AL I a gr ee : D. G. S COTT J US TICE OF AP PE AL For t h e a p p ella n t : Ad v . C. E d e lin g For t h e in ter es t ed p a r ties : Mr Q. 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