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IN THE COMPANIES TRIBUNAL OF THE REPUBLIC OF SOUTH AFRICA

“The Tribunal”

 

Case Number: CT00264ADJ2019

 

In the matter between:

MPHO MARUMA                                                       APPLICANT

 

AND

 

THABO MARUMA                                                     RESPONDENT

 

IN RE: MARUMA FILLING STATION (PTY) LTD

DECISION

 

 

INTRODUCTION:

[1]          The applicant is Mpho Maruma (“the Applicant”), an adult female director and shareholder of Maruma Filling station (Pty) Ltd.

 

[2]          The Respondent is Thabo Maruma (“the Respondent”), an adult male director and shareholder of Maruma Filling station (Pty) Ltd.

 

THE APPLICATION

[3]          This is an application in terms of Section 71(8) of the Companies Act 71 of 2008 (“the Act”), for an administrative order determining the removal of the Respondent as a director of the Maruma Filling Station (Pty) Ltd (MFS), a family business.

 

[4]          In line with the Act, the relief sought from the Tribunal is based on the fact that the MFS only has two directors; the Applicant and the Respondent, and therefore the Tribunal enjoys jurusdiction in this regard.

 

[5]          The Applicant duly filed its application in terms of Regulation 142, which section requires that the Applicant file an application form CTR 142 and a supporting affidavit setting out the facts on which the application is based.

 

[6]          The application was served on the Respondent as contemplated in Regulation 142(2).

 

[7]          The Applicant has submitted proof of service of the application, by the Applicant’s attorneys, via email on the 20th December 2019.

 

[8]          The Respondent has failed to answer the application within 20 business days from date of being served with the application as contemplated in Regulation 143 of the Act.

 

[9]          The Applicant seeks a default order, as contemplated in Regulation 153, for the removal of the Respondent as the director of the Company based on the following submissions and supporting documentary evidence, as summarised:

 

9.1                         the Applicant holds 40% shareholding and the Respondent holds 40% shares in the company. The remainder of the shares (20%) is held in a testamentary trust on behalf of one Kgotso Maruma.

 

9.2                         The Applicant and the Respondent, who are siblings, became beneficiaries as directors and shareholders of their deceased mother’s business, Maruma filling station (Pty) Ltd, a Caltex Garage[1]. The Applicant became a shareholder on 13 February and the Respondent on 24 November 2018.

 

9.3                         the Applicant asserts that the Respondent has been derelict and negligent in his conduct, in that:

 

he unlawfully appropriated cash income of Maruma Filling Station (MFS) , utilising the income for his personal use and to finance his business; Tembisa Streetfood Market, which has caused financial harm to MFS and the shareholders. The Respondent did not get consent or disclose this to the shareholders or the executor. According to the minutes of the meeting of shareholders[2], the Respondent acknowledged owing MFS R1 466 152.73 utilised for personal use, while the applicant had to manage a business overdraft of over R700 000, as a consequence thereof. However, the trustee for the testamentary trust and the Respondent voted for him to remain a director, despite Respondent’s acknowlegdement.

 

9.4                         the Respondent did not convene a meeting of shareholders to agree on any remuneration and he did not get the shareholders’ consent to utilise the business income for his personal benefit.

 

9.5                         Pending the appointment of an executor for the deceased estate and to release the bank account under deceased’s name , the shareholders agreed that, in the interim, cash income was to be received into the Respondet’s account to pay the expenses of MFS. The income received into the Respondent’s account was not declared as MFS income and was used by the Respondent on a range of personal expenses.

 

9.6                         Respondent failed to act in the best interests of MFS, with the degree of care, skill and diligence that may be reasonably expected from a director, failure to follow proper accounting procedures and processes, wilful misconduct and breach of trust in the his performance of his duties as director of MFS.

 

APPLICABLE LAW

[10]       In considering the application and the relief sought by the applicant, one must have consideration to what the Act provides and what powers are conferred by the Act on the Tribunal. Where removal of directors is concerned, s.71 details the procedures that must be complied with. S.71(8) (b) particularly provides that if a company has fewer than three directors, any director or shareholder of the company may apply to the Companies Tribunal to make a determination regarding such removal. The Act provides that the Tribunal may consider the removal of a director on the following grounds, as contemplated in terms of S.71 (3) of the Act:

 

(I)            That the director is ineligible or disqualified in terms of section 69, other than on the grounds contemplated in section 69(8)(a); or

 

(II)          That the director is incapacitated to the extent that the director is unable to perform the functions of a director, and is unlikely to regain that capacity within a reasonable time; or

 

(III)         That the director has neglected or been derelict in the performance of the functions of director.

 

EVALUATION OF EVIDENCE

[11]       The Tribunal has had regard to the circumstances leading to the Applicant filing this Application, and further that although served with application papers and having been afforded sufficient time to respond to the Applicant’s submissions outlined in her affidavit, the Respondent has not responded to the application. Regulation 143(4) provides that an allegation of fact set out in an initiating document that is not specifically denied or admitted in an Answer must be regarded as having been admitted.

 

FINDINGS

[12]       The Tribunal is satisfied that the Respondent has been derelict in the performance of the functions of director of MFS.

 

[13]       In the premises, the Tribunal is therefore satisfied that the Applicant has shown good cause why she should be entitled to the relief sought.

 

ORDER

The Respondent is removed as a director of Maruma Filling Station (Pty) Ltd.

 

 

B. Zulu

MEMBER: COMPANIES TRIBUNAL

02 September 2020

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