Kaese v Schacht and Another ((P) A 311/07) ((P) A 311/07) [2009] NAHC 84 (02 February 2009);


Full judgment

CASE NO. (P) A 311/07


In the matter between:






Heard on: 01 December 2008

Delivered on: 02 February 2009


MANYARARA, A.J.: [1] This is a ruling on an interlocutory application made by the applicant in this matter. The applicant is represented by Mr. Vaatz and the respondents by Mr. Corbett.

[2] The applicant is a shareholder in the second respondent (the company), of which the first respondent is the sole director. In the main application, the applicant seeks an order terminating the first respondent’s directorship of the

company and ordering that an annual general meeting of shareholders of the company be held at the registered offices of the company under the chairmanship of the auditor of the company at which a new director, excluding the first respondent, would be elected by the shareholders present at such meeting.

[3] The applicant has filed an interlocutory application in the following terms;

"At the hearing of this matter the Applicant will make application to the Honourable Court requesting the Court to make an order in terms of Rule 6(5)(g) namely to refer to oral evidence the one important issue in dispute in these proceedings, namely whether or not the Second Respondent has sold all its cattle and livestock as alleged by the Applicant or only 80 head of cattle as alleged by the First Respondent. It is submitted that this factual dispute goes to the root of this application and at the same time it is relatively easy to place before the Court the oral evidence enabling the Court to resolve this factual dispute."

[4] The notice is founded on an allegation made in the affidavit founding the main application as follows:

"In May 2006 I heard rumours that the First Respondent was about to sell all the cattle of the Second Respondent. Such a sale would fall fairly and squarely within the provisions of Section 228 requiring a resolution by all shareholders to support the sale of the whole of the undertaking of the farming operation by selling all cattle. I accordingly caused a letter to be addressed to the attorneys of the First Respondent dated 29th of May, a copy of which I annex hereto marked Annexure "C". A similar letter was addressed on the 20th of June to the manager of the Second Respondent, Mrs Carola Eichler. In response to that I received a letter from the attorneys of the First Respondent, a copy of which I annex hereto marked Annexure "D" alleging that only 60 to 80 head of cattle would be sold."

[5] Annexure "C" is a letter addressed to the second respondent’s attorney by Mr Vaatz in the following terms:

"My client has now been informed that your client, Mr Schacht, intends selling all cattle and other animals on the farm. If he does so, it would impair the ability of the company to continue operating as a farming enterprise and thereby would take steps that are clearly in conflict with the main object of the company.

My instructions are to write to you and get a written confirmation from you that your client will not sell the cattle or any other domestic animals from the farm and will do nothing that prejudices the operation of the farm as a cattle farming enterprise. Any act in conflict with this proposal, my client will not hesitate to obtain an immediate interdict against any transaction that prejudices the business basis of the company."

[6] The first respondent’s attorneys replied thereto as follows:

"We confirm further that our clients have instructed us that a decision has been made to sell 60 to 80 head of cattle by way of auction conducted by Agra on Friday, 23 June 2006. These cattle represent only a part of the herd, which stands at 240 head of cattle. The reasons for the sale are, inter alia, firstly, that the company needs to generate cash to finance its ongoing operations, such as the payment of salaries and other running costs, which funds will be realized through the aforesaid sale; and secondly, since September 2005 approximately 80 head of cattle belonging to the company have been stolen, necessitating the company to reduce the head in order to have better control over it and to minimize future potential losses."

[7] It will be seen that the number of cattle which the first respondent intended to sell represented only a part of the herd. Ex abundante cautela the first respondent’s attorneys gave the reasons for the sale and explained that the decision fell entirely within the first respondent’s discretion as the managing director of the company.

[8] The following principle is enunciated in Ter Beek v United Resources CC & Another 1997 (3) SA 315, 336 C-E as follows:

"Although it is undesirable to endeavour to resolve disputes of fact on affidavit without the hearing of evidence and seeing and hearing witnesses before coming to a conclusion (see Plascon-Evans Paints Ltd v Van Riebeek Paints (Pty) Ltd 1984 (3) SA 623 (A) at 634 E) it is equally undesirable to accept disputes of fact at their face value, because if that were done an applicant could be frustrated by the raising of fictitious issues of fact by a respondent (see Petersen v Cuthbert & Co. 1945 AD 420 at 428). Accordingly a Court should in every case critically examine the alleged issues of fact in order to determine whether in truth there is a dispute of fact that cannot be satisfactorily determined without the aid of oral evidence (see Petersen v Cuthbert & Co Ltd (supra at 428); G v Superintendent, Groote Schuur Hospital, and Others 1993 (2) SA 255 (C) at 266 C-E)".

[9] Mr. Corbett submitted that the application for a referral to oral evidence should be dismissed because the referral is sought on grounds of "rumours", in respect of which the applicant requested a confirmation in writing, which he received, that the first respondent “will not sell (all) the cattle…”of the second respondent.

[10] In my view, the correspondence puts the matter squarely within the Ter Beek principle for refusing the referral to evidence requested by the applicant and that puts the matter at an end. In the premises, I need not deal with the other grounds raised by Mr. Corbett for dismissing the application.

[11] The application is dismissed with costs.




Instructed by: Andreas Vaatz & Partners


Instructed by: Chris Brandt Attorneys