INTRODUCTION

On 10 March 2025, the Deputy Judge President of the High Court of South Africa, Gauteng Division, Johannesburg released a notice announcing the piloting of a dedicated Insolvency Court for insolvency matters.

RENT A TANK JHB (PTY) LTD V FUELGIANTS (PTY) LTD [2025] ZAGPJHC 517 (19 MAY 2025)

Shortly after the Insolvency Court began filling its rolls, the Honourable Gilbert AJ released a judgment giving reasons for striking a number of matters from the roll and standing others down during hearing for non-compliance with legislation and proper service. In total, 9 matters were struck from the roll before hearing, and several more were stood down for improper service on employees. The eight matters dealt with in the Reasons are the only ones that made it to the hearing, though all were removed or dismissed without an order for costs.

The reasons focus mainly on compliance with the provisions of the sections 346(4A) and 346A Companies Act 61 of 1973 (the “Companies Act”) relating to liquidations, and sections 9(4A) and 11 the Insolvency Act 24 of 1936 (the “Insolvency Act”) dealing with sequestrations, which prescribe the service of liquidation and sequestration applications, as well as provisional and final orders, on all employees and trade unions of the respondents in such matters.

The Insolvency Act and the Companies Act are worded similarly in the abovementioned sections in terms of liquidations and sequestrations. It is for this reason that this article will only deal with the Insolvency Act furthermore however, the same principals are similarly applied to services on employees and trade unions of a company in a liquidation.

Section 9(4A) (a) provides as follows:

“(a) When a petition is presented to the court, the petitioner must furnish a copy of the petition –

(i) to every registered trade union that, as far as the petitioner can reasonably ascertain, represents any of the debtor’s employees; and
(ii) to the employees themselves-

(aa) by affixing a copy of the petition to any notice board to which the petitioner and the employees have access inside the debtor’s premises; or
(bb) if there is no access to the premises by the petitioner and the employees, by affixing a copy of the petition to the front gate of the premises, where applicable, failing which to the front door of the premises from which the debtor conducted any business at the time of the presentation of the petition;

(iii) to the South African Revenue Service; and
(iv) to the debtor, unless the court, at its discretion, dispenses with the furnishing of a copy where the court is satisfied that it would be in the interest of the debtor or of the creditors to dispense with it.”

Gilbert AJ observed that these provisions were not being properly complied with.

The first point of contention was that employees and trade unions were, in many cases, not being served with the applications at all. Such matters were pre-emptively struck from the roll in their entirety before their hearing dates.

The second point, and perhaps a more controversial one, concerned the manner of service. Gilbert AJ held that liquidation and sequestration applications must not merely be served by affixing them to the business premises in terms of Rule 4 of the Uniform Rules of Court, but must be furnished by the Sheriff of the High Court to the employees, and only thereafter affixed in a place where they can reasonably be viewed by employees.

The cases of Bravura Capital (Pty) Ltd v Drive Path Trade & Invest (Pty) Limited t/a Southern Energy (2021) ZAGP JHC 3 (1 February 2021) (the “Bravura Capital Case”) and EB Steam Company (Pty) Limited v Eskom Holdings SOC Limited 2015 (2) SA 526 (SCA) (the “EB Steam Company Case”) are specifically referenced by the Acting Judge, with the following takeaways.

• The Bravura Capital Case: where the Court held that a party cannot rely on a return of service reflecting only affixing to the respondent’s principal door unless supported by an affidavit (or confirmatory affidavit) from the serving Sheriff, as required by section 346(4A)(b) of the Companies Act.
• The EB Steam Company Case: which confirmed that where the Court is not satisfied with service on employees or trade unions, it may grant a provisional winding-up order with directions that proper service be effected before a final order is sought.

Opposed v Unopposed Matters

The judgment also clarified the distinction between opposed and unopposed matters:

• In unopposed matters, non-compliance with service requirements requires the matter to be struck from the roll immediately, as the Court cannot be satisfied that affected employees and trade unions had notice or opportunity to oppose.
• In opposed matters, some leniency may be exercised, as it is clear that the application has come to the attention of at least the employer. In such cases, a provisional winding-up order may be granted with directions that the application and provisional order be properly served on employees and trade unions before the return date. This approach “cures” the non-compliance while curbing abuse of process and preventing respondents from raising service defects merely as a delaying tactic.

Costs and Professional Accountability

The implications for practitioners were stark. Gilbert AJ emphasised that where service requirements are not met, costs orders may be granted in favour of respondents. Moreover, attorneys and counsel for applicants would be precluded from recovering any fees for matters struck from the roll. This serves as a strong deterrent against bringing incomplete or non-compliant applications before the Insolvency Court.

CONCLUSION

With multiple matters struck from the roll in a single sitting, the judgment is a clear warning that applications before the Insolvency Court will not be entertained where statutory requirements are simply disregarded.