[44]        The Applicant argued that he sought to review the decision of the First Respondent under sections 6(1) and 6(2)(a)(iii) and/or 6(2)(c) and/or 6(2)(e)(iii) and/or 6(2)(h) and/or 6(2)(e)(vi)37 of PAJA on the grounds that such decisions constitutes an administrative action.

[45]        The Applicant further contended that the decision of the Master to authorise an Enquiry as per sections 417 and 418 of the Companies Act constitutes an administrative action in terms of the provisions of section 1 of PAJA. Consequently, they argued that the First Respondent’s denial that this is an administrative action is misplaced.

[46]        Furthermore, the Applicant argued that the decision of the First Respondent that the Applicant is a person capable of giving information about the affairs and trading of the Sixth Respondent under sections 417 and 418 of the Companies Act, also costitutes administrative action under PAJA.

[47]        Additionally, the Applicant contended that the decision of the First Respondent not to uphold the Applicant’s objections about the relevance of the questions posed including the documents that the Applicant was required to furnish constitute administrative action under PAJA.

[48]        The Applicant further sought relief in terms of section 151 of the Insolvency Act and further based his ground of review on the principle of legality. Without being specific, the Applicant submitted that there are sufficient facts set out in the Applicant's founding affidavit to find a cause of action based on section 151 of the Insolvency Act and the principle of legality. The Applicant supported his submission with reference to the case of Rabinowitz v Van Graan and Others[9] where it was held that:

“it is not necessary to refer to a specific section in a statute provided that the pleader formulates his case clearly or, put differently, it is sufficient if the facts are pleaded from which the conclusion can be drawn that the provisions of the statute apply”.

[49]        The Applicant further argued that the decisions of the First Respondent were subject to being reviewed and set aside based on several facts and events. To this end, the Applicant provided comprehensive details inter alia about himself ranging from being a 40% shareholder of Okapi Farming up to that the Applicant and Okapi Farming did not receive any money from the MMR Trust or Mr. Mashaba. 

[50]        Further, the Applicant contended that he was not involved in the preparation of the CM100 statement of affairs insofar as it inter alia showed Okapi Farming as a debtor of the Sixth Respondent. The Applicant further contended that he has never been engaged in businesses that involved Mr. Mashaba. 

[51]        In light of the above submissions, the Applicant argued that it was evident that he was not a person capable of providing information into the dealings and affairs of the Sixth Respondent. Furthermore, the Applicant argued that the documents that he was ordered to furnish by the First Respondent had nothing to do with the trade or dealings of the Sixth Respondent.

[52]        Relying on Pretorius and Others v Marais and Others[10], the Applicant argued that it can only be matters of a company in liquidation such as the Sixth Respondent that can be investigated in an enquiry, not something else that does not affect the affairs of the Sixth Respondent. Accordingly, the Applicant argued that the information sought through the questions and the documents sought have nothing to do with the dealings or affairs of the Sixth Respondent. Therefore, the Applicant submitted that First Respondent erred in overruling his objections about “the relevance of the questions in issue and documents in issue”.[11]

[53]        Further, the Applicant argued that the first Respondent did not apply his mind when he issued the summons and that the First Respondent did not inter alia independently exercise his discretion when he decided to issue the summons.

[54]        Furthermore, the Applicant contended that the answers sought by the First Respondent could have incriminated him. Consequently, the Applicant submitted that self-incriminating answers could only be given when there was a prior consultation with the National Director of Public Prosecutions.

[55]        The Applicant sought a punitive costs order against the Second Respondent on the basis that he was not only opposing the costs order but also opposing the merits.

[56]        Ultimately, the Applicant also sought a cost order against the liquidators of the Sixth Respondents on the ground that they opposed the application.

FIRST AND SECOND RESPONDENT’S SUBMISSIONS 

[57]        The Respondents commenced their case by narrating the purpose of the Enquiry including the powers of the Commissioner of the Enquiry to summon certain persons who may know about the affairs of a company to testify at the Enquiry.

[58]        The Respondents argued that the CM100 statement of affairs of 10 December 2018 read with a company search on Okapi Farming indicates that the Applicant is a person who is capable of giving information at the Enquiry about the Sixth Respondent. The Respondents further contended that the basis for the aforesaid submission is that CM100 confirms that there was a relationship between Okapi and the Sixth Respondent. In addition, the Respondents argued that Okapi owes the Sixth Respondent an amount of R24,000,000.00 and that the Applicant has been a director of Okapi Farming since 26 May 2005.

[59]        The Respondents further submitted that the First Respondent did explain the basis for him to subpoena the Applicant as the CM100 statement of affairs that was launched with the Master of the High Court somehow shows that there was a relationship between the Applicant and the affairs of the Sixth Respondent. Consequently, the Respondents argued that such a decision was not merely a “rubber-stamping exercise as alleged by the Applicant” because the reasons were furnished to the Applicant laying the basis for the issuing of a summons.[12]

[60]        Relying on the matter of Pretorius v Marais and others,[13] the Respondents contended that the review application was dismissed on the grounds that the Magistrate had correctly exercised his discretion when he opted to issue the subpoenas based on the information that was provided before him. Based on this, the Respondents argued that the liquidators had, in their request for the subpoena of the Applicant to testify at the Enquiry, provided persuasive reasons as to why they regarded the Applicant as someone capable of giving information regarding the affairs of the Sixth Respondent as per section 417(1) of the Companies Act.

[61]        Additionally, the Respondents submitted that before the issuing of summons, a former director of the Sixth Respondent had confirmed that Okapi Farming is indebted to the Sixth Respondent for the amount  more than R24,000,000.00.

[62]        In light of the above, the Respondents argued that there were reasonable grounds for the First Respondent to issue summons to the effect that the Applicant is capable of giving the information that is sought.

[63]        With regards to whether the questions posed to the Applicant are relevant to the trade or dealing of the Sixth Respondent as per sections 417(1) and 418(1)(c) of the Companies Act, the Respondents answered this question in the affirmative. They further stated that the Applicant has now through his affidavit provided the information (such as Okapi Farming acquired the farm for a purchase price of R6,000,000.00, and he sold ordinary shares in the capital of Okapi Farming to the Mamoroko Makolele Trust for the sum of R600.00) that was sought at the Enquiry. As a result, the Respondents submit that the relief sought has become academic and therefore the review application falls to be dismissed.

[64]        Regarding the applicability of section 417(2)(b) of the Companies Act and whether the answers sought could incriminate the Applicant, the Respondents argued that the said provision is applicable and that the Applicant was required to answer the questions even though the answers would incriminate him. However, the Respondents further argued that the Applicant was not obliged to answer the questions as the First Respondent had not consulted with the National Director of public Prosecutions.

[65]        The Respondents further argued that the Applicant had only answered certain questions before the Applicant’s attorney intervened and stated that he had to caution his client about answering certain questions that may incriminate him and that the First Respondent had to obtain the consent of the National Director of Public Prosecutions. Based on this, the Respondents are of the view that the Applicant’s attorney prevented a “potential incrimination problem and while attempting to avoid it – uncovered it”.[14]

[66]        The Respondents argue that the preliminary questions posed to the Applicant were in no way intended to incriminate the Applicant but were directed at establishing the Applicant’s shares and sales in Okapi Farming, including the Applicant’s knowledge of one Mr. Mashaba.

[67]        Furthermore, the Respondents argued that the Applicant had misunderstood the provisions of section 417(2)(b) of the Companies Act as it does not permit a witness to refuse to answer a question on the basis that it would lead to self-incrimination. However, if the witness so refuses, the Master or the Court may after consulting with the National Director of Public Prosecutions require the witness to answer the question. Consequently, the Applicant had to first refuse to answer the question posed to him before the First Respondent could consult with the National Director of Public Prosecutions. According to the Respondents’, this opportunity did not arise because of the Applicant’s repeated interjections. Therefore, the Respondents contended that this should also fail.

[68]        The Respondents further contended that the Applicant’s case as per the founding affidavit was based on section 6(1) of PAJA that authorises a person to institute review proceedings of an administrative decision.

[69]        The Respondents argued that, for the first time, the Applicant in their heads of argument also sought to rely on section 151 of the Insolvency Act and/or the principle of legality. To this end, the Respondents argued that the Applicant relied on selective portions of the decision which states that:

“It is not necessary to refer to a specific section in a statute provided that the pleader formulates his case clearly, or put different, it is sufficient if the facts are pleaded from which the conclusion can be drawn that the provision of the statute apply”[15].

The Respondents also pointed out that the Applicant has failed to refer to the same case where it provides that “in this matter it is abundantly clear from the facts pleaded in the particulars of claim that the plaintiff relies on all the provisions in the Act…”[16]

[70]        According to the Respondents, the reliance on the aforesaid case is misplaced, and the omission of the portion that states that the case was pleaded in the particulars of claim has not been explained. As a result, the Respondents argue that the Applicant has failed to set out any grounds of review under PAJA or in the founding affidavit.

[71]        The Respondents submitted that the Applicant relied on the case of FirstRand Bank[17] to contend that PAJA is the appropriate remedy even though their notice of motion did not make mention of the delivery of the record. To counter this, the Respondents relied on Nedbank Ltd v Master of the High Court Witwatersrand Local Division and others[18], where the court inter alia found that the institution of an enquiry pursuant to section 417 of the Companies Act was purely investigative and therefore not subject to review.

[72]        Further, the Respondents argued that the Applicant failed to show the factual basis upon which he relies on his review application but resorted to unsubstantiated grounds for review.

[73]        Concerning costs, the Respondents contended that there was no justification whatsoever for the Applicant to seek a personal costs against the Second Respondent.

[74]        Ultimately, the Respondents argued that the Applicant’s case was unfounded and sought to be dismissed with punitive costs.

THIRD TO SIXTH RESPONDENT’S SUBMISSIONS 

[75]        The Respondents submitted various documents that showed that the Applicant is involved in the affairs of Okapi Farming insofar as they relate to the Sixth Respondent. Based on this relationship between the two companies, the Respondents argued that the Applicant is the relevant person to give information at the Enquiry, especially with regards to whether the Sixth Respondent has a sound claim against Okapi Farming.

[76]        Furthermore, the Respondents submitted that the Applicant through his founding and answering affidavits has shown that he has “material information” about the affairs of the Sixth Respondent, Eleventh Respondent, and Mamoroko Makolele Trust. According to the Respondents, they do not understand why all of a sudden the Applicant has provided the information that was required at the Enquiry to the effect that the Eleventh Respondent and Mamoroko Makolele Trust were “recipients of large amounts of funds from the monies Swifano (the Sixth Respondent) received from PRASA”.[19]

[77]        The Respondents further contended that the Applicant instituted these review proceedings to derail the Enquiry, something that is tantamount to abuse of the court process.

[78]        The Respondents also contended that the Applicant, through his founding affidavit, based his review application on PAJA. As a result, the Respondents argued that the Applicant’s “belated” reliance on section 151 of the Insolvency Act and the principle of legality did not assist the Applicant’s case as these were only raised in the heads of argument.[20]

[79]        Relying on Wade and Forsyth[21] who state that when subjecting some administrative act or order to judicial review, the court is concerned with its legality: is it within the limits of the powers granted? … the question is lawful or unlawful? Therefore, the Respondents argued that the Applicant has failed to disclose any discernible cause of action under PAJA or on the principle of legality.

[80]        According to the Respondents, the Applicant failed to fully and satisfactorily deal with the factual basis upon which his case is based but echoes the grounds of review as provided in PAJA that the First Respondent was inter alia biased or reasonably suspected to be biased, acted procedurally unfair, and acted unreasonably.

[81]        The Respondents contend that the Applicant has relied on various legislation without “demonstrating a ground for review of any of the impugned decisions”.[22] To this end, the Respondents argued that the Applicant has not shown that the First Applicant was inter alia biased, or made decisions that were based on irrelevant considerations. To illustrate their point, the Respondents argued that all the aforesaid allegations were dealt with in the recusal application.

[82]        The Respondents further argued that the Applicant’s challenge about the issuing of the summons is based on speculation as there is no factual basis advanced to the effect that the information presented before the First Respondent to “issue summons for the Applicant was not such that the Commissioner could not do so lawfully”.[23]

[83]        The Respondents argued that it cannot be said that the Applicant does not have material information about the Sixth Respondent’s affairs in so far as it relates to the debt owed by Okapi Farming to the Sixth Respondent.

[84]        All in all, the Respondent’s case is that the First Respondent had sufficient and relevant information before him before he could issue the summons. Consequently, the Respondents argued that the relief sought in prayers 1 and 2 should be dismissed.

[85]        The Respondents argued that the Applicant’s challenge to the decision of the First Respondent in ordering the Applicant to furnish the financial statements and supporting documents had no merit because the Applicant did not provide any reason in the founding affidavit to the effect that the decision is wrong. In addition, the Respondents argued that the Applicant only attempts to provide a reason in the heads of the argument in that the required documents are not relevant to the affairs of the Sixth Respondent. Based on this, the Respondents contended that a case for the review of that decision has not been made.

[86]        Furthermore, the Respondents contended that the restated statement of affairs form CM100 of the Sixth Respondent which lists Okapi Farming as a debtor of the Sixth Respondent, including the sale and NNP agreements wherein in the Sixth Respondent’s funds were allegedly expended in a manner that involves Okapi Farming, show that financial statements of Okapi Farming are relevant to prove or disprove the statements made under oath in the restated CM100 statement of affairs by Mr. Mashaba. Based on this, the Respondents contended that the Applicant cannot claim that he has nothing to do with the preparation of the statement of affairs. According to the Respondents, whether the Applicant prepared or confirmed the statement, this ought to be investigated by the liquidators and the First Respondent was duty bound to direct the Applicant to provide the documents.

[87]        The Respondents also contended that the Sixth Respondent’s auditor provided different explanations about the amounts paid from the account of the Sixth Respondent to his firm’s account. Consequently, the Respondents argued that the said explanation raised more questions instead of providing answers and this led the liquidators to seek information from the Applicant who is the sole director and shareholder of Okapi Farming when the amounts were paid. According to the Respondents, this shows that it was necessary to investigate the Sixth Respondent’s alleged claim against Okapi Farming and by virtue of being a sole director, the Applicant is the person who can provide the required information as per section 417(1) of the Companies Act. >

[90]        With regards to obtaining the consent of the Director of Public Prosecutions before certain questions are asked in terms of section 417(2)(b) of the Companies Act, the Respondents argued that the Applicant had misunderstood the aforesaid provision as it only comes into play after the question has been asked to the Applicant not before the question is posed.

[91]        Furthermore, the Respondents argued that the Applicant has failed to identify the decisions or ruling made by the Commissioner.

[92]        The Respondents further contended that there is no ground provided for the review of the First Respondent’s decision except that the questions were irrelevant to the affairs of the Sixth Respondent.

[93]        Consequently, the Respondent’s argued that the Applicant’s application had no merit and had to be dismissed.

EVALUATION OF SUBMISSIONS

[94]        With regards to the Applicant’s relief sought in terms of section 151 of the Insolvency Act and/or the principle of legality, this was not pleaded in the founding affidavit but somehow found its way into the Applicant’s heads of argument. The Applicant conceded this aspect. In essence, this was an attempt by the Applicant to introduce a completely new case. In Man Financial Services (Pty) (RF) Ltd v Elsologix (Pty) Ltd and Others[24] Van Nieuwenhuizen AJ, as she was then, said:

“…It is of course trite that not must an applicant in motion proceedings make out a proper case in the founding papers and that an applicant is bound to the case made out therein and may not make out a new case in the replying affidavit [or heads of argument] (emphasis added).”

[95]        I agree with the above legal position. The Applicant must stand or fall by averments made in his founding affidavit. Accordingly, the Applicant’s sudden reliance on the aforesaid grounds must fail. The same applies to the issue of the Applicant concerning the ruling to produce certain documents. The explanation only found its way into the Applicant’s heads of argument.

[96]        Concerning the Applicant’s contention that the questions that he was required to answer and the documents sought in respect of Okapi Farming were not relevant to the trade and affairs of the Sixth Respondent, I agree with all the Respondent’s submissions that the answers provided for by the Applicant in his founding affidavit that Okapi Farming inter alia acquired the farm for a purchase price of R6,000,000.00, and that he sold ordinary shares in the capital of Okapi to the Mamoroko Makolele Trust for the sum of R600.00 show that the questions are relevant to the dealings and affairs of the Sixth Respondent. The information provided by the Applicant shows that the answers and documents sought from him are sufficient proof to show that “were reasonable grounds for believing that the documents were relevant”[25] in the investigation of the affairs of the Sixth Respondent.

[97]        I need not take this further as the provision of answers by the Applicant has clearly shown that the questions are relevant. In any event, it has already been established that it is not up to the Applicant to determine which questions are relevant and/or not relevant but that the First Respondent may do so as per the provisions of section 417(1) of the Companies Act. The Respondents were correct in that the matter has become moot. Consequently, this ground also has to fail.

[98]        With regards to the First Respondent’s decision to issue the summons, the Applicant argued that the First Respondent did not inter alia independently exercise his discretion when he decided to issue the Summons. However, the Applicant did not justify the basis for his assertion. To this end, the First and Second Respondents argued that the Applicant did not advance any factual basis to the effect that the information presented before the First Respondent to issue summons for the Applicant was not such that the Commissioner could not do so lawfully. On the contrary, a former director of the Sixth Respondent has confirmed that Okapi Farming is indebted to the Sixth Respondent for the amount of more than R24,000,000.00. Further, the rationale for the issuing of summons is comprehensively dealt with in the First Respondent’s Report.[26]

[99]        This court asserted that:

“I fail to understand why the Applicant contends that the summons was issued with bold statements that are not backed up by any documentation. I say so because a careful reading of the transcript of the Enquiry shows that there are documents that reveal that certain amounts may have come from the Sixth Respondent...”[27]

[100]     In my view, the issuing of summons triggers the crux of this case. Without the summons, there would have been no questions posed to the Applicant. Accordingly, the overwhelming evidence before this Court which shows that the summons was not issued outside the perimeters of the law, largely weakens the Applicant’s case as a whole.

[101]     With regards to the Applicant being the relevant person to provide information at the Enquiry, the Applicant sought to convince the Court that even though he was inter alia a former director of Okapi Farming and a current shareholder, he was not a person capable of giving information about the trade and affairs of the Sixth Respondent. The Applicant says so even though a former director of the Sixth Respondent had confirmed that Okapi Farming is indebted to the Sixth Respondent for the amount of more than R24,000.000.00 before the issuing of a summons. Further, the Respondents pointed out various documents that show that the Applicant is involved in the affairs of Okapi Farming in so far as they relate to the Sixth Respondent.[28] This evidence is indisputable.

[102]     In light of the above, it cannot be accepted that the Applicant is not the relevant person to provide information at the Enquiry. The Applicant has provided useful information in these proceedings that was required from him at the Enquiry.

[103]     Concerning the averment that the Applicant provided self-incriminating testimony at the Enquiry, there is no doubt that section 417(2)(b) of the Companies Act is applicable and that the Applicant may not refuse to answer such a question that might incriminate him. However, there is an exception. Further reading of the section provides that the Applicant may refuse to answer on the basis that such information will amount to self-incrimination. Once this occurs, the First Respondent will be required to consult with the National Director of Public Prosecutions to compel the Applicant to answer the questions. Therefore, it means that the Applicant is not obliged to answer any questions where the answers sought could incriminate the Applicant until such time that the First Respondent has consulted with the National Director of Public Prosecutions. Indeed, the First Respondent has correctly pointed out that the Applicant is not obliged to answer the questions as the First Respondent has not consulted with the National Director of Public Prosecutions.

[104]     It has long been settled in Ferreira v Levin NO and Others’ Vryenhoek and Others v Powell NO and Others[29] where Ackermann J, as he was then, said:

“… no incriminating answer given pursuant to the provisions of section 417(2)(b) of the Companies Act on or after 27 April 1994 shall be used against the person who gave such answer, in criminal proceedings against such person…”.

[105]     This matter has become moot because the Applicant has in any event provided the answers that were sought in the Enquiry. The Respondent’s assertion that there is no possibility of an incriminating answer is sound. Accordingly, the Applicant’s argument has no merit.

[106]     With regards to the Applicant’s contention that he was not involved in the preparation of the CM100 Statement of Affairs and that he has never been involved in businesses that had to do with Mr. Mashaba, the Applicant appears to be missing the point. An Enquiry is a fact-finding mission aimed at investigating the affairs and dealings of the insolvent company. It is at the Enquiry where the Applicant can confirm and/or deny his involvement in the preparation of the statement including the knowledge and/or lack of knowledge about Mr. Mashaba.

[107]     Having carefully considered the transcript of the Enquiry, Applicant’s, First and Second Respondent’s, Third to Sixth Respondent’s written and oral submissions, I am of the view that the Applicant has failed to make a case for judicial review under PAJA, the Insovency Act and the principle of legality.

[108]     I, therefore, conclude that the Applicant’s application falls to be dismissed in its entirety.

COSTS

[109]     The courts are often reluctant to award punitive costs except in exceptional circumstances where the conduct of a party to a litigation is found to be objectionable.[30] In Mribatsi v Minister of Police and Others[31] Molahlehi J correctly indicated that:

“the consideration behind punitive costs is to punish a litigant who is in the wrong due to the manner in which he or she approached litigation or to deter would-be inflexible and unreasonable litigants from engaging in such inappropriate conduct in the future”. I need to stop and ask myself whether the conduct of the Second Respondent, in this case, was objectionable and warrants punitive costs?”

[110]     In my view, the conduct of the Second Respondent is justifiable in defending the personal cost order sought against him. I find it difficult to comprehend why the Applicant would want a personal cost order against someone who was performing an official duty. There is no evidence whatsoever that has been placed before this court to justify unwanting conduct on the part of the Second Respondent.  

[111]     The same applies to the liquidators of the Sixth Respondent, they have provided useful information to this Court. I do not see the basis of a cost order against them.

[112]     On the contrary, the Applicant brought this case inter alia on the basis that the questions posed to him were not relevant and that the answers sought from him were self-incriminating. Surprisingly, the Applicant voluntarily answered the very same questions that he was not at liberty to give before the Enquiry. Is this conduct not objectionable? In my view, the answer is in the affirmative. The Applicant’s case is all over the place. It is difficult to understand. At times, the Applicant even invented a completely new case in the heads of argument. I do not think that this application was bona fide.

[113]     I am therefore of the view that the circumstances of this case justify the awarding of punitive costs against the Applicant.

[114]     The First and Second Respondents and the Third to Sixth Respondents have been largely successful parties in this matter. The costs should therefore follow the result.[32]

ORDER

[115]     I, therefore, make the following order:

(a)       The application is dismissed:

(b)       The Applicant is ordered to pay the costs of this application on an attorney and client scale and such costs include the costs of two counsels.

M R PHOOKO AJ

ACTING JUDGE OF THE HIGH COURT,

GAUTENG DIVISION, PRETORIA

Delivered:  This judgment was prepared and authored by the Judge whose name is reflected and is handed down electronically by circulation to the Parties/their legal representatives by email and by uploading it to the electronic file of this matter on CaseLines. The date for hand-down is deemed to be 12 August 2022.

APPEARANCES:

Counsel for the Applicant:                         Adv L. Hollander

Instructed by:                                            John Joseph Finlay Cameron

Counsel for the First and                           Adv JE Smith and Adv Booyse

Second Respondents:

Instructed by:                                             Tintingers Incorporated

Counsel for the Third to                             Adv Terblanche SC and Adv H Struwig

Sixth Respondents:

Instructed by:                                             Tintingers Incorporated

Counsel for the Third to Sixth                    Adv F.H. Terblance SC

Respondents:                                            Adv H. Strung

Instructed by:                                             Schabort Potgieter Incorporated 

Date of Hearing:                                        17 March 2022

Date of Judgment:                                     12 August 2022