Maritz and Another v Maritz & Pieterse Incorporated (in liquidation)

Maritz & Pieterse Incorporated, a professional company of attorneys, was placed under final liquidation after it was found that its directors, Maritz and Pieterse, had allowed the company’s trust account to be used as a conduit for a pyramid scheme, causing investors to suffer losses. Certain investors proved contractual claims in the liquidation. The company’s memorandum, as required by s 23(1)(a) of the Attorneys Act 53 of 1979, provided that directors were jointly and severally liable with the company for its debts. The liquidators sought to recover from the former directors the amounts of the proved creditors’ claims, relying on this statutory and memorandum-based liability.

The appeal was upheld with costs. The order of the High Court was set aside and replaced with an order dismissing the liquidators’ application with costs.

The case clarifies that the statutory joint and several liability of directors of professional companies under the Attorneys Act is enforceable by creditors, not by the company or its liquidators. It delineates the limits of a liquidator’s powers and confirms that such director liability does not constitute an asset of the insolvent estate.