IN THE HIGH COURT OF SOUTH AFRICA 
(WESTERN CAPE HIGH COURT, CAPE TOWN)

In the matter between:
Case No. 15757/2007

and 

JUDGMENT DELIVERED ON 15 APRIL 2010

BINNS-WARD J:

[1] In an application launched on 5 November 2007 under case no. 15757/07, the applicants claimed various heads of relief, of which only the following need to be mentioned at this stage:
1.	A declaration that the first, alternatively the second applicant is entitled to a 31% direct equity shareholding in the first respondent. (I shall hereafter refer to the first respondent, Seena Marena Investments (Pty) Ltd, as 'SMI'.)
2.	An order directing the second, third and fifth respondents to render a full and proper account to the second applicant in respect of the first, alternatively the second applicant's investment in Spearhead Property Holdings Limited linked units ('the applicant's Spearhead investment') and to provide a statement of account, duly supported by all relevant vouchers, dealing with at least, but not limited to, how, when, by whom and for what purposes the first, alternatively the second applicant's funds of R4 040 250,00 deposited into the fourth respondent's First National Bank trust account between February and June 2005, were utilised by any of the said respondents or any other party.
3.	An order 'that there be a debate of the said accounts and payment by the first, second, third, fifth, sixth seventh eighth and/or ninth respondents to the first, alternatively the second applicant of whatever amounts appear to be due to either of them upon such debatement'.
4.	An order directing the third respondent to pay to the first, alternatively second applicant the sums of
1. R2 314 197,72 plus interest thereon from 5 December 2006; and

2. R988 416,66 plus interest thereon from 11 February 2005.

[2] By 1 April 2008, that application, to which I shall hereafter refer as 'the principal proceedings', had generated a record consisting of founding, answering and replying papers running in all to 592 pages, including annexures.

[3] On 9 March 2009, by agreement, the parties sought an order in the principal proceedings, which was granted by the Acting Judge President, and which, insofar as currently relevant, determined the relief described in para.s [1]1,[1]2, [1]3 and [1]4.2, above. The relief sought in the notice of motion, described in para. [1]2, above, was granted in terms of para. 3 of the order.

[4] A debatement of the account to be rendered is still to occur. The issues that might arise in this context are no doubt to some extent adumbrated in the papers in the principal proceedings, but in the ordinary course their actual definition would occur after the applicants have had the opportunity to consider the account rendered in compliance with the order, and to privately debate with the respondents any issues arising out of such consideration.

ACCOUNT BY D C M GIHWALA; L.N. MANALA & D.C.M. GIHWALA N.O. AS REQUIRED IN TERMS OF PARAGRAPH 3 OF THE DEED OF SETTLEMENT UNDER CPD CASE NO. 15757/07

Paid Ngatana Properties Investments (Pty) Limited

Paid Dines Gihwala Family Trust

	R4,040,250.00

NOTES
1.	The total amount paid by Montague Goldsmith ("MG")/ Grancy Property Limited ("Grancy") in relation to the Spearhead transaction is R3 040 250.00 and not R4 040 250.00.
2.	The relevant cheques are attached hereto.
3.	The cheques drawn in favour of Ngatana are:
3.1.	In part L.N. Manala's capital requirement to participate in the Spearhead transaction of which MG / Grancy agreed to fund 50% in terms of a loan agreement;
3.2.	In part Grancy's capital requirement to acquire the 630 000 Spearhead units originally intended for Bonitas in the Spearhead transaction through Ngatana;

4.	The cheque drawn in favour of DGFT was for MG's investment in the Scharrig Mining matter, which has been fully accounted for separately.
5.	Seena Marena Investments (Pty) Limited ("SMI") invested R6 657 673.00 directly into Ngatana being the costs to acquire the 2,030,000 Spearhead linked units.
6.	The aforesaid payments do not include the agreed R75 000.00 pre-transaction costs MG is liable for.

[6] Annexed to the aforementioned account were copies of three cheques, each of them drawn on the fourth respondent's trust account. Two of the cheques, dated 16 February 2005 and 6 June 2005, respectively, were drawn in favour of Ngatana Property Investments (Pty) Ltd ('Ngatana') in the amounts of R1 800 000,00 and R1 240 250,00, respectively. The other cheques was drawn in favour of the Dines Gihwala family Trust ('the Trust') in the sum of R1 000 000,00.

[7] The applicants contend that the accounting rendered as aforesaid is inadequate. They allege that the second, third and fifth respondents have failed to comply with the order granted on 9 March 2009. In an interlocutory application brought before me the applicants now seek orders:

1.  'Declaring that the "account" rendered by the second, third and fifth respondents (annexure "GVL1" to the annexed affidavit of Gert Johannes van der Linde) in purported compliance with paragraph 3 of the order of this Honourable Court made on 9 March 2009 ("the court order") is inadequate and does not constitute compliance with the court order.
2. Directing the second, third and fifth respondents to render a due and proper account in accordance with the provisions of paragraph 3 of the court order, within 14 (fourteen) days of the date of this order.'
(The application is interlocutory because the statement and debatement of accounts aspect of the relief sought in the principal proceedings is still pending. The application is opposed because the second, third and fifth respondents say that the account which has been provided is an adequate account, which complies with the court order.)

[8] It is appropriate at the outset to rehearse briefly the principles applicable to a consideration of this type of application.

(iii) the correctness of an account. The correctness of an account is a question falling to be addressed at the debatement stage. It may nevertheless be convenient in a particular case to address the issues of adequacy and correctness together at debatement stage. The correctness of an account rendered may, however, conceivably not be amenable to a properly directed debate by reason of the inadequacy of the information contained in it. In such cases it will be preferable to require the amplification of an inadequate account before any debatement thereof is entertained.

'1.      The plaintiff should aver -
a) his right to receive an account, and the basis of such right, whether by contract or by fiduciary relationship or otherwise;
b) any contractual terms or circumstances having a bearing on the account sought;
c) the defendant's failure to render an account.
2. On proof of the foregoing, ordinarily the Court would in the first instance order only the rendering of an account within a specified time. The degree or amplitude of the account to be rendered would depend on the circumstances of each case. In some cases it might be appropriate that vouchers or explanations be included. As to books or records, it may well be sufficient, depending on the circumstances, that they be made available for inspection by the plaintiff. The Court may define the nature of the account.
3. The Court might find it convenient to prescribe the time and procedure of the debate, with leave to the parties to approach if for further directions if need be. Ordinarily the parties should first debate the account between themselves. If they are unable to agree upon the outcome, they should, whether by pre-trial conference or otherwise, formulate a list of disputed items and issues. These could be set down for debate in Court. Judgment would be according to the Court's finding on the facts.
4. The Court may, with the consent of both parties, refer the debate to a referee in terms of sec. 19 bis (1)(b) of the Supreme Court Act, 59 of 1959.
5. If it appears from the pleadings that the plaintiff has already received an account which he avers is insufficient, the Court may enquire into and determine the issue of sufficiency, in order to decide whether to order the rendering of a proper account.
6. Where the issue of sufficiency and the element of debate appear to be correlated, the Court might, in an appropriate case, find it convenient to undertake both enquiries at one hearing, and to order payment of the amount due (if any).
7. In general the Court should not be bound to a rigid procedure, but should enjoy such measure of flexibility as practical justice may require.'

[15] The basis for the accounting claimed was the role of Mr Dines Gihwala, who is cited as the second respondent in his personal capacity and as a director of the firm of attorneys joined as the fourth respondent and as the fifth respondent in his representative capacity as a trustee of the Dines Gihwala Family Trust ('the Trust'). In all these capacities Mr Gihwala is joined on the basis that he is alleged to dealt as the applicants' agent, as it were, with the investment of what I shall for convenience refer to as 'the applicants' funds' in so-called 'linked units' in Spearhead Property Holdings Limited. As the fifth respondent, Mr Gihwala's duty to account appears to arise out of the Trust's role as an alleged joint venturer with the first applicant, represented by the second applicant, and with the third respondent in the Spearhead investment.

[16] The third respondent is Mr Lancelot Manala. The duty to account imposed on the third respondent in terms of the 9 March 2009 court order

[17] Some space is taken up in the papers in respect of the second respondent's contention and that of the managing director of Ngantana, Mr lain Brodie, about the absence of any duty by SMI or Ngantana to account to the applicants. It unnecessary to deal with these contentions because the obligation to account imposed in terms of paragraph 3 of the applicable court order pertains only to the second, third and fifth respondents. That said, it would be inappropriate, having regard to the second respondent's role in dealing with the applicants' funds and the insight afforded to him as a director of SMI, to artificially limit the extent of his accounting by reason of the interpositioning of the two corporate entities in the execution of the investment on behalf of the applicants. I say this because it is evident that SMI's only business appears to be the holding of Ngatana shares and it is through Ngatana that the investment scheme entered into by the applicants, the Trust and Mr Manala was to acquire and hold the Spearhead units. Similar considerations pertain in respect of the third respondent's position as a director of Ngatana.

[27] As a result of the Spearhead investment made in terms of the subscription agreement Ngatana duly acquired 3,5 million linked units. SMI has a 58% equity interest in Ngatana which equates to an indirect beneficial interest in 2 030 000 of the Spearhead units acquired by Ngatana. If regard is had to the ratio of the respective shareholdings of the parties in SMI, the latter company's indirect holding of Spearhead units represents a beneficial economic interest in the units by the Trust in 700 000 units, third respondent as to 700 000 units, and second applicant as to 630 000 units. The second applicant's 18% beneficial interest in the Spearhead investment is therefore now effectively represented by the 31% equity interest which it holds in SMI.

Ngantana on 16 February 2005 was applied in respect of 'L.N. Manala's capital requirement' and which part in respect of Grancy's so-called 'capital requirement'. The reasons why this should be dealt with expressly in the circumstances of this matter are apparent from the concerns of the applicants articulated in, for example, paragraphs 40 and 41 of the founding affidavit in the principal proceedings.

'From time to time our clients received from you broker's notes purporting to have bought and sold shares. Our clients now require you to give the following information to them: -
(a)	the names and addresses of the persons from whom you bought or sold the shares on our clients' behalf;
(b)	the dates when such shares were bought or sold and the dates when delivery of the shares were effected to you or by you, as the case may be;
(c)	the prices paid for the shares by you and the prices received for the shares by you;

The furnishing of broker's notes is required by law as each transaction is completed, but the broker's note itself does not purport to be an account but merely records that the broker has bought for the principal or sold on his behalf, as the case may be, a particular number of shares in named companies at a particular price with the brokerage and stamp duty. That is not an account of the transaction. A full and true account of the transaction certainly involves all the particulars which are asked for in this letter 'C of the petition.'
The learned judge made a further remark (at 517), which bears some relevance in the context of the respondents' assertion that a perusal of the papers exchanged thus far in the course of litigation in this matter is sufficient to give the applicants all the information they might reasonably require by way of an account. He noted that it was not sufficient for the stockbroker to say 'Here are my books and here are my vouchers, you are at liberty to go through them and make up an account for yourself.

b)	The second, third and fifth respondents are directed to furnish the second applicant with an improved account in compliance with the requirements of the court order of 9 March 2009, construed with regard to the reasons for judgment in this application, within 15 days of the date of this order;
c)	The second, third and fifth respondents are directed to pay the second applicant's costs of suit, including the costs of two counsel; their liability in that regard to be joint and several.