Women in Capital Growth (Pty) Ltd and Another v Scott and Others

The appellants were shareholders of the third respondent (ALI) who, in February 2019, gave irrevocable undertakings to Messrs Scott and Ahmed (directors of ALI) to vote their shares in favour of certain resolutions. These included voting for the implementation of transaction agreements involving the sale of shares by OTS56 (controlled by ALI) to Glencore SA, and voting to remove Mr Ramano as a director of ALI. When the appellants indicated they would not honour their undertakings, particularly regarding Mr Ramano's removal, Messrs Scott and Ahmed brought an urgent application to enforce the undertakings before a shareholders' meeting scheduled for 4 April 2019. The high court granted the order on 3 April 2019. The meeting proceeded on 4 April 2019, where the special resolution for the sale of shares was passed, but the resolution to remove Mr Ramano was not voted upon. However, Mr Ramano was subsequently removed at the annual general meeting held on 27 February 2020. The irrevocable undertakings were binding for 18 months and would expire before this appeal could be determined.

• Whether the appeal had become moot as the decision sought would have no practical effect or result as contemplated in s 16(2)(a)(i) of the Superior Courts Act 10 of 2013
• Whether the irrevocable undertakings contravened s 58(8)(c) of the Companies Act (requiring proxy appointments not to be made irrevocable when a company invites shareholders to appoint persons named by the company as proxy)
• Whether the undertakings to vote to remove Mr Ramano as a director offended s 71(2)(b) of the Companies Act (requiring that a director must be heard before a vote to remove them)
• Whether the interests of justice warranted determining the appeal despite mootness

The appeal was dismissed with costs, including the costs of two counsel, to be paid by the appellants jointly and severally, the one paying, the other to be absolved.

An appeal will be dismissed as moot under s 16(2)(a)(i) of the Superior Courts Act 10 of 2013 where the decision sought will have no practical effect or result. Where the purpose of an order has been achieved—in this case, the implementation of transactions and the removal of a director—and the undertakings that were the subject of the dispute have expired, the appeal lacks practical effect regardless of potential relevance in other pending proceedings. The principle of judicial efficiency requires that courts not expend resources on advisory opinions or abstract legal propositions. Speculative potential consequences in separate proceedings, where the same issues might arise in different contexts and with different parties, do not render an otherwise moot appeal justiciable. Substantial costs incurred in the ordinary course of urgent commercial litigation do not constitute exceptional circumstances under s 16(2)(a)(ii) that would warrant entertaining a moot appeal.

While not binding, the court made observations about the high court's interpretation of ss 58(8)(c) and 71(2)(b) of the Companies Act. The court noted that the high court had found s 58(8)(c) applied only where a company issues an invitation to shareholders to appoint persons named by the company as proxy, which was not the case on the facts, and that the proxy provision was in any event severable. As to s 71(2)(b), the court noted the high court had held, citing established authority, that there is no prohibition on agreements between shareholders as to how they will vote at a general meeting. The SCA observed that the high court's judgment relied principally on factual matters of no precedential significance, and that its interpretation of s 71(2)(b) involved little novelty, being based on well-known principles. The court suggested that should another court consider these principles of less interpretative significance, it would be free to say so.

This case illustrates the application of s 16(2)(a) of the Superior Courts Act 10 of 2013, which empowers courts to dismiss appeals where the decision sought will have no practical effect or result. It emphasizes the principle that judicial resources should be efficiently employed and not used for advisory opinions or abstract propositions of law. The case demonstrates that where the relief originally sought has been achieved and the undertakings central to the dispute have expired, an appeal becomes moot regardless of potential collateral consequences in other pending proceedings. It also clarifies that substantial costs incurred in litigation do not constitute exceptional circumstances under s 16(2)(a)(ii) that would compel a court to entertain a moot appeal. The judgment reinforces the courts' approach to mootness even in complex commercial disputes involving shareholder undertakings and corporate governance.