De Wet and Another v Khammissa and Others

Duro Pressing (Pty) Ltd was voluntarily wound up by special resolution on 27 February 2014 and converted to compulsory winding-up on 25 July 2014. The respondents and CF De Wet were appointed as joint final liquidators on 8 April 2014. CF De Wet died on 23 May 2017. On 29 August 2017, a creditors' meeting was held where the appellants (the deceased liquidator's brother and another) were nominated as additional joint liquidators. On 31 August 2017, the Master made a decision not to appoint the appellants (the first decision) and issued a certificate appointing only the respondents as joint liquidators. Following a request from creditors' attorneys, the Master reconsidered and on 25 October 2017 made a second decision appointing the appellants as co-liquidators and issued an amended certificate. The respondents applied to review and set aside the second decision on grounds that it was ultra vires, procedurally unfair, arbitrary and irrational. The appellants opposed on the basis that respondents lacked locus standi, section 371 of the Companies Act was not complied with, and section 151 of the Insolvency Act did not apply.

• Whether the Master was functus officio after making the first decision and therefore lacked power to make the second decision
• Whether the respondents had locus standi to challenge the Master's second decision
• Whether section 371 of the Companies Act 61 of 1973 was the exclusive remedy for challenging the Master's appointment of liquidators
• Whether section 151 of the Insolvency Act 24 of 1936 applied to the review of the Master's decision
• Whether PAJA (Promotion of Administrative Justice Act 3 of 2000) was applicable
• Whether the second decision by the Master was invalid

The appeal was dismissed with costs, including costs of two counsel. The second decision of the Master appointing the appellants as additional joint liquidators was reviewed and set aside, and the Master's certificate of appointment in respect of the second decision was revoked.

The binding legal principle is that the Master of the High Court becomes functus officio once a decision regarding the appointment (or non-appointment) of liquidators has been communicated to the affected parties through overt acts such as written communication, issuance of certificates, and notification of rights. Finality is achieved when the decision passes into the public domain. In the absence of express statutory authority permitting revocation, the Master has no power to revoke a final decision and replace it with a different decision. Neither the Companies Act 61 of 1973 nor the Insolvency Act 24 of 1936 confers such power on the Master. A second decision purporting to revoke and replace a final decision is therefore invalid and a nullity. Furthermore, persons directly affected by an administrative decision have locus standi at common law to challenge that decision, without necessarily having to rely on specialized statutory remedies.

The Court declined to express any view on the correctness of the court a quo's interpretation of section 371 of the Companies Act or section 151 of the Insolvency Act, or on the correctness of the provincial division decisions (Janse Van Rensburg v The Master, Geduldt v The Master and Others, and Patel v The Master of the High Court) that dealt with who qualifies as an 'aggrieved person' under section 371. The Court stated that such considerations were irrelevant to the true issue and that its silence should not be considered as endorsement or rejection of those conclusions. The Court also made important observations about the role of courts in identifying legal issues, emphasizing that this task should never be left solely to parties or their legal representatives, and that courts must exercise independent judgment in characterizing the true nature of disputes before them.

This case is significant in South African administrative law for its clear articulation of the functus officio doctrine as applied to decisions of the Master of the High Court. It establishes that once the Master makes a decision that passes into the public domain through communication and formal acts, that decision becomes final and irrevocable in the absence of statutory authority to the contrary. The case also emphasizes the importance of proper identification of legal issues by courts, cautioning against uncritically accepting parties' characterization of disputes. It clarifies that challenges to administrative decisions may be based on common law locus standi principles without necessarily relying on specialized statutory remedies. The judgment reinforces the principle that administrative finality is achieved when decisions are communicated to affected persons through overt acts, and that administrative officials cannot simply revoke and replace decisions once finality is achieved.