Imobrite (Pty) Ltd v DTL Boerdery CC

Imobrite (Pty) Ltd lent R2 750 000 to DTL Boerdery CC and its sole member, Mr Kotze, under an acknowledgement of debt signed on 15 May 2018. Repayment was to occur in annual instalments, with the first due on 7 May 2019. The debt was secured by a special and general notarial bond over the respondent’s movable assets and a first mortgage bond over its farm. The respondent failed to pay the first instalment. After letters of demand, Imobrite served a statutory demand in terms of s 69 of the Close Corporations Act 69 of 1984. The respondent did not pay, secure, or compound the debt within 21 days and disputed only the calculation of interest and fees, not the capital amount. Imobrite applied for the winding-up of the respondent on the basis of inability to pay its debts. The High Court dismissed the application, holding that the winding-up constituted an abuse of process because the creditor was fully secured. Imobrite appealed to the Supreme Court of Appeal.

The appeal was upheld. The High Court’s order was set aside and replaced with an order placing DTL Boerdery CC under provisional winding-up, issuing a rule nisi, directing service on interested parties, and ordering that costs be costs in the winding-up.

The case clarifies that secured creditors are not barred from invoking the statutory deeming provision of inability to pay debts under s 69 of the Close Corporations Act. It reinforces the principle that winding-up is available ex debito justitiae to unpaid creditors and that the mere existence of sufficient security does not, without more, justify refusing a winding-up order. The judgment provides authoritative guidance on abuse of process and the limited discretion to refuse liquidation.