THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Reportable
Case no: 979/2018
In the matter between:
RYNETTE PIETERS NO

APPELLANT
and
ABSA BANK LIMITED

RESPONDENT

Neutral citation: Pieters NO v Absa Bank Ltd (979/2018) [2019]
ZASCA 118 (23 September 2019)
Coram:
WALLIS, MBHA and NICHOLLS JJA and WEINER and
HUGHES AJJA
Heard:
12 September 2019
Delivered: 23 September 2019
Summary: Company dissolution – s 419 of Companies Act 61 of 1973 –
date of dissolution is date when Registrar recorded dissolution in the
Companies Register, not date of publication of notice of dissolution in
Government Gazette – agreed facts – no proof that Registrar had not
recorded dissolution of company – effect of Master’s certificates in terms
of ss 419(1) and 385 of Companies Act to discharge liquidator – Master
lacks power to re-instate liquidator after discharge – purported
reinstatement of liquidator invalid

ORDER

On appeal from: Gauteng Division of the High Court, Johannesburg
(Van der Linde J, as court of first instance):
The appeal is dismissed with costs, such costs to include those of two
counsel where two counsel were employed.

JUDGMENT

Wallis JA (Mbha and Nicholls JJA and Weiner and Hughes AJJA
concurring)
[1] On 14 August 2003 the Master of the High Court issued a
certificate in terms of s 419(1) of the Companies Act 61 of 1973 (the Act)
certifying that Cell F Services (Pty) Ltd (Cell F) had been completely
wound up. Pursuant thereto the Master furnished the present appellant,
Ms Pieters, the liquidator of Cell F, with a certificate of completion of her
duties in terms of s 385(1) of the Act. That certificate provided that the
bond of security she had furnished could be reduced to nil. Nearly five
years later, Ms Pieters, wrote to the Master of the High Court asking him
to ‘re-issue’ her certificate of appointment to enable her to pursue
recovery of a potential asset of Cell F. After the Master complied with
this request, in terms to which I will revert, Ms Pieters launched
proceedings against the respondent, Absa Bank Ltd (ABSA) claiming
substantial damages. ABSA’s special plea that Ms Pieters lacked locus
standi to pursue the claim on behalf of Cell F was separated from the

other issues in the case and dealt with on the basis of a statement of
agreed facts. The special plea was upheld by Van der Linde J sitting in
the Gauteng Division of the High Court, Johannesburg. This appeal is
with his leave.

The facts
[2] The facts from which this situation arose are simple and
uncomplicated. On 9 October 2001 Cell F was placed under provisional
winding-up on its own application. Ms Pieters was appointed as its
provisional liquidator on 26 October 2001. A final winding-up order was
made on 13 November 2001 and Ms Pieters was appointed as the
liquidator on 7 March 2002. On 24 March 2003 she submitted an
amended First and Final Liquidation Distribution Account to the Master.
The Master confirmed this account on 3 July 2003 in terms of s 408 of
the Act. The fact of its confirmation was published in the Government
Gazette on 18 July 2003.

[3] On 14 August 2003 the Master addressed a letter to Ms Pieters
which, so far as material, read as follows:
‘With reference to your letter . . . I have to inform you that as all my requirements
have been met, the final liquidation and distribution/contribution account herein has
now been filed of record.
I hereby certify that in terms of Section 56(7) of the Insolvency Act 24 of 1936/385(2)
of the Companies Act, No. 61 of 1973/66(1) of the Close Corporations Act, No 69 of
1984, the Bond of Security No. 605996 entered into by Rynette Pieters on behalf of
the Trustee(s)/Liquidator(s) may, with effect from date hereof be reduced to nil.’

[4] On the same date, the Master addressed a letter to the Registrar of
Close Corporations and Companies, embodying a certificate in terms of
s 419(1) of the Act, and stating, inter alia, the following:

‘In terms of Section 419(1) of the Companies Act, No. 61 of 1973, (as amended) read
with Section 66 of the Close Corporations Act, No 69 of 1984, I hereby certify that
according to record (sic) the affairs of the above Company/Close Corporation have
been completely wound-up.’
The Registrar responded to receipt of the Master’s certificate in terms of
s 419(1) by way of a letter asking for further details of the company, as it
could not be traced in the Registrar’s records. The Registrar’s letter had
the incorrect name for the company, so that may have been the source of
the confusion. The correct details were furnished to the Registrar under
cover of a letter dated 16 September 2003.

[5] On 30 January 2008, Ms Pieters, then employed by Independent
Trustees (Pty) Ltd, wrote to the Master stating that it had come to her
attention that there might be a further asset of Cell F and that, as the
company had not yet been dissolved in terms of s 419 of the Act, the
Master was asked to ‘re-issue’ her certificate of appointment urgently to
enable her to take the matter further. This was duly done on 5 March
2008, the certificate from the Master recording that Ms Pieters had been
‘re-instated’ as liquidator.

[6] On these facts, the sole issue before Van der Linde J and this court
was whether Ms Pieters’ ‘re-instatement’ as liquidator was effective to
give her the necessary locus standi to pursue the claim against ABSA.
The basis of the special plea was that Cell F had been finally wound up
on 14 August 2003, when the Master certified in terms of s 419(1) of the
Act that it had been ‘completely wound up’. Both the liquidator and the
Master had fully and finally discharged their respective offices and it was
therefore not open to Ms Pieters to request that her certificate of

appointment be re-issued, or to the Master to grant the request and ‘re-
instate’ her in that office. The Master was said to be functus officio.

[7] Ms Pieters’ retort was that the company had not been dissolved
because of the failure by the Registrar to record its dissolution and to
publish a notice of its dissolution in the Government Gazette. She
contended that the company remained in existence and in liquidation and
that it was therefore permissible for the Master to re-issue a certificate of
appointment to her to enable her to pursue the new matter that had come
up in relation to the affairs of the company.

Was Cell F dissolved?
[8] Dissolution of a company is an inevitable consequence of its
winding up. This is dealt with in s 419 of the Act, which at the relevant
time read as follows:
‘Dissolution of companies and other bodies corporate
(1)
In any winding-up, when the affairs of a company have been completely
wound up, the Master shall transmit to the Registrar a certificate to that effect and
send a copy thereof to the liquidator.
(2)
The Registrar shall record the dissolution of the company and shall publish
notice thereof in the Gazette.
(3)
The date of dissolution of the company shall be the date of recording referred
to in subsection (2).
(4)
In the case of any other body corporate the certificate of the Master under
subsection (1) shall constitute its dissolution.’

[9] Little attention was given in the heads of argument to an analysis
of the section. The prescribed procedure commences with the Master
sending a certificate to the Registrar in terms of s 419(1) certifying that
the affairs of the company have been completely wound up. The need for

that certificate flows from the Registrar’s function of maintaining the
register of companies. This register contains the founding documents of
the company1 and various statutory records such as the annual return
including the annual financial statements,2 notices relating to the
appointment and resignation of directors, special resolutions and the like.
For the sake of completeness of those records the Registrar must record
the dissolution of the company. Otherwise the Registrar has no
involvement in the winding-up of companies. That takes place under the
supervision of the Master. This indicates that the purpose of the Master’s
certificate in terms of s 419(1) is to inform the Registrar of the fact that
the company has been completely wound up, so that the Registrar can
update the records in the register in relation to the company.

[10] The provisions of s 419(2) reinforce this approach. They require
the Registrar to ‘record the dissolution of the company’. That
presupposes that the company has already been dissolved. One cannot
record something until it has happened. That suggests that the dissolution
of the company occurs prior to the Registrar receiving the notice in terms
of s 419(1) and that the Registrar does not dissolve the company, but
merely records the fact of its dissolution.  Where the date of dissolution is
relevant, s 419(3) provides that it will be the date on which the Registrar
records its dissolution.

[11] This analysis points to the dissolution of the company occurring
when the Master sends the s 419(1) certificate to the Registrar. However,
there is a contrary indication in s 419(4), which provides that, in the case
of other bodies corporate, it is the date of the Master’s certificate that

1 Companies Act 71 of 2008, ss 13 to 17.
2 Companies Act 71 of 2008, s 33, read with s 187(4).

constitutes its dissolution. If that were the case with a company, why not
include it with other bodies corporate? After all, the Master’s certificate
in relation to other bodies corporate has also to be furnished to the
Registrar and reflected in the records kept by the Registrar. The inference
is that a distinction was for some reason drawn between the case of
companies and that of other bodies corporate. The difference is reflected
in the provision in s 419 (3) that the date of recording by the Registrar is
the date of dissolution, as opposed to the earlier date of the Master’s
certificate in terms of s 419(3). Because of this difference I will accept for
present purposes, without finally deciding, that the date of recording is
the date upon which dissolution occurs, even though the company will
have been completely wound-up at an earlier date.

[12] There was a fundamental flaw in the argument advanced on behalf
of Ms Pieters in both the heads of argument and, apparently, in the high
court. That argument was based on the premise that the critical date was
the date of publication of notice of the dissolution in the Government
Gazette. Throughout the heads it was said that the dissolution of the
company was a consequence of publication in the Gazette and that it was
only after publication that dissolution was complete. This ignored the
wording of s 419(3). The two are necessarily different because the
Registrar’s recording of the dissolution would inevitably occur before
publication in the Gazette. Section 419(3) is a clear legislative choice that
it would be the former and not the latter date that would determine when
the company is dissolved. Publication is merely a public intimation of an
existing fact, namely, that the company has been dissolved.

[13] This error may have affected the matter from the outset. In her
letter asking for her certificate of appointment to be re-issued Ms Pieters
said that:
‘We have determined that the company has not as yet been dissolved in terms of
section 419 of the Companies Act.’
No details were given of the basis for that statement. It was common
cause that no notice of dissolution had been published in the Government
Gazette. If that is what she had in mind, she was in error. Given the
approach adopted on her behalf in argument, there is inevitably the
suspicion that her view was based on the absence of publication in the
Gazette and nothing more.

[14] The issue of dissolution was dealt with in the statement of agreed
facts in the following terms:
‘No proof that Cell f (in liquidation) was dissolved as contemplated in section 419(2)
of the Companies Act 61 of 1973 could be found in the records of the CIPC.’
The CIPC3 has succeeded to the functions of the Registrar of Companies
under the Act and is obliged to maintain the register of companies in
terms of s 187(4) of the Companies Act 71 of 2008.

[15] No further evidence was placed before the high court in regard to
the processes followed by the former Registrar of Companies in recording
the dissolution of a company in terms of s 419(2) of the Act. The
regulations promulgated under the Act and in force at that time had no
provisions dictating how this was to be done. Presumably, the Registrar
maintained the register of companies in a form that enabled a record to be
maintained of all documents, such as annual financial statements, or
changes in directors, special resolutions and the like that required to be

3 Companies and Intellectual Property Commission established in terms of s 185 of the Companies Act
71 of 2008.

filed with the Registrar. However, we do not know how this was done or
whether the record was retained in a file or electronically. We do not
know whether a separate register was kept in relation to the dissolution of
companies or whether this was simply a matter recorded in relation to the
company concerned as part of the overall records maintained in respect of
it.

[16] Counsel for Ms Pieters assumed that the agreement that there was
no proof of the dissolution of Cell F in the records of the CIPC was
sufficient to establish that it had not been dissolved, but that assumption
was misplaced. Absence of proof is not proof of absence. The absence of
anything in the records does not prove that the Registrar did not record
the dissolution of Cell F, and the absence of publication in the
Government Gazette was irrelevant to dissolution, because under s 419(3)
it was the date of recording by the Registrar that determined the date of
dissolution.

[17] Unless there was a statutory or regulatory requirement stipulating
how the Registrar was to record the dissolution of a company, and none
has been produced, all that s 419(2) required was that the Registrar make
a record of the dissolution of the company. As Van der Linde J noted in
his judgment, this did not require the Registrar to exercise a discretion or
perform any executive act. It was simply a matter of making a record of
the company’s dissolution. How that was to be done was a matter for the
Registrar. I see no reason why that record could not have been made by
the simple action of placing in the company’s file the s 419(1) notice
furnished to the Registrar by the Master.4 Once the Registrar’s office had

4 I understand that the practice was formerly that all s 419(1) notices would be sent to the office of the
Chief Master in Pretoria and on receipt would be taken and delivered by hand to the office of the

tracked down the relevant file in the light of the information furnished to
it by the Master on 16 September 2003, filing the s 419(1) notice in Cell
F’s file (whether a conventional file or one kept electronically) would
constitute an adequate recording of the dissolution of the company for the
purposes of s 419(2).

[18]  The inadequacy of the statement of agreed facts to establish that
there had been no recording by the Registrar of the dissolution of Cell F
is palpable. First, it does not disclose what documents if any existed in
the CIPC records in relation to Cell F. It does not say whether there was a
file for Cell F or whether it contained the s 419(1) notice and the two
letters that flowed from the notice being lodged with the Registrar.
Second, it does not deal with the procedures in the Registrar’s offices for
maintaining records in relation to companies and what form recording of
the dissolution of companies took. Third, it does not disclose what
investigations were conducted to ascertain the contents of the records in
the Registrar’s office in respect of Cell F. Nor does it disclose on what
factual basis Ms Pieters informed the Master that the company had not
been dissolved. Fourthly, it did not address the transition between the old
and new Companies Acts and whether, in the course of transferring the
functions of the Registrar to the newly created CIPC, documents and
records could have been thrown away, lost or misfiled. Fifthly, we were
not told whether the relevant paragraph in the statement was based on
investigations made in 2017 or 2018, shortly before the determination of
the separated issue, or in 2007 or 2008 shortly before Ms Pieters sent her
letter to the Master seeking the re-issue of her letters of appointment as

Registrar of Companies. Presumably they would then have been filed and instructions given to publish
notice of the dissolution in the Government Gazette.

liquidator. Finally, it is significant that there is no evidence that the
company was treated by the Registrar, or anyone else, as anything other
than dissolved, in the nearly five years that elapsed between the issue of
the two certificates and Ms Pieters’ letter asking for the re-issue of her
letters of appointment.

[19] Counsel sought to rely on Ms Pieters’ statement in the letter to the
Master of 30 January 2008 as proof of non-compliance with the
requirements of s 491(2). This faced two insuperable difficulties. First,
the letter was not admissible as proof of the correctness of factual
statements made in it. Second, the statement was a conclusion of law in
respect of which no facts were furnished. It provided no support for the
submission.

[20]  The onus of establishing that her appointment was legally
effective and gave her locus standi to bring this action against ABSA
rested on Ms Pieters. The foundation of her re-instatement as liquidator
by the Master was the proposition that Cell F had not been dissolved in
terms of s 419(2) and (3) of the Act. For the reasons set out above she
failed to discharge that onus.

[21] It seems to me more probable than not that the s 419(1) notice was
filed in the records of the Registrar, at least once the further information
about the company had been furnished by the Master on 16 September
2003. If that was the case no reason was advanced why this did not
suffice as a recording of the dissolution of the company. However, I do
not need to go so far. It suffices for present purposes to say that Ms
Pieters did not prove on a balance of probabilities that Cell F was not
dissolved. That being so she failed to establish that her reinstatement as

liquidator by the Master was lawful and vested her with locus standi to
bring proceedings as liquidator of Cell F. On that ground alone the appeal
must be dismissed. However, as I think it falls to be dismissed on the
point argued before the high court, I will deal with that issue as well

If Cell F was not dissolved, was the appointment valid?
[22] The s 419(1) notice recorded that Cell F had been completely
wound up. Although the s 385(1) certificate may conceivably be sent
after the s 419(1) certificate,5 in this instance they were sent at the same
time. The s 385 certificate provided that the bond of security could be
reduced to nil. Counsel submitted that this did not amount to consent to
the cancellation of the bond of security in terms of s 385(2) of the Act. I
do not agree. A bond of security reflecting nil, is no security at all. The
purpose of consenting to its reduction to nil is to enable the liquidator to
go to the financial institution that issued it and have it cancelled. That is
what happened in the present case, as Ms Pieters submitted a fresh bond
of security in order to procure her re-instatement as liquidator.

[23] What then is the legal effect of the issue of the s 419(1)
and s 385(2) certificates? In Standard Bank v The Master6 Nienaber JA
dealt with this in the context of a contention that the winding up was
complete once the liquidation and distribution account had lain for
inspection and been approved, and a distribution had been made to
creditors. Two aspects of the judgment are relevant. First, he said that
s 385 deals with the release of the liquidator. Second, he emphasised that
s 419(1) contemplates a distinction between the company being wound up
and it being completely wound up. In that case it had clearly not been

5 Standard Bank of S A Ltd v The Master and Others 1999 (2) SA 257 (SCA) at 265J -266I.
6 Ibid.

completely wound up, nor had the liquidator been released under s 385.
The same is not true of this case.

[24] We were referred to a judgment of the full court of the Gauteng
Division7 in which, in the context of insolvency, the court held that the
trustee of an insolvent estate remained obliged to collect debts owing to
the estate of the insolvent even after confirmation of the account. The
case is not in point. The trustee had not been discharged from office nor
had the security furnished by her been released. The estate remained
vested in the trustee, whereas that is not the case with a company being
wound up.

[25] In my view the issue by the Master of a certificate under s 385,
permitting the liquidator to cause the bond of security to be cancelled, in
conjunction with the issue of a certificate under s 419(1) that the
company had been completely wound up, brought the winding up process
to an end and released the liquidator from office. Assuming in favour of
Ms Pieters that the company had not been dissolved and remained a
company in liquidation, it was nonetheless a company in respect of which
the liquidator’s appointment had been terminated. If it transpired that
there were further assets and this occurred between the completion of the
winding up and the company’s dissolution that required, at the very least,
a fresh appointment of a liquidator. (I express no firm view on whether a
fresh application for liquidation would be necessary, or at least the setting
aside on review of the certificate under s 419(1). Prima facie, until that
happened the s 419(1) certificate stood and the Master was functus
officio.) A fresh appointment could only be made in terms of s 377(1) of
the Act. That route was not followed in the present case.

7 Cook NO v S J Coetzee Inc 2012 (2) SA 616 (GNP) para 10.

[26] It is interesting, but by no means decisive, that the approach I have
adopted in regard to the effect of the certificates in terms of ss 385(2) and
419(1), accords with what happened in the present case. When the
possible contract was drawn to her attention, Ms Pieters did not proceed
as if her appointment had never come to an end. Instead she approached
the Master asking for her letters of appointment to be re-issued. The bond
of security had clearly been cancelled because she proffered a fresh bond
of security and the Master required her to furnish this. The Master issued
new letters of appointment and certified that Ms Pieters was re-instated as
liquidator of Cell F. All of this was consistent only with her having been
discharged as liquidator once the company was fully wound up.

[27] As a final point in oral argument counsel submitted that, in the
absence of proof that the company had been dissolved, Ms Pieters had no
choice but to follow the course that she did. He submitted that an
application for reinstatement of the company to the register in terms of
s 420 was not open to her because she could not establish that it had been
dissolved and removed from the register. The point is without merit.
Accepting that there was some uncertainty as to the position, Ms Pieters
was no differently situated from any other potential litigant who is faced
with factual uncertainty and needs to determine the correct course of
action. She could have brought an application for restoration of Cell F to
the register on the footing that the company had been dissolved. In the
alternative she could have asked for declaratory relief as to the proper
procedure to be followed by the Master if the company had not been
dissolved. I accept that there would be a notional possibility of the court
saying that it could not determine either way whether the company had

been dissolved, but do not believe that a judge would reach such a
commercially insensible conclusion.

Result
[28]    The appeal is dismissed with costs, such costs to include the costs
of two counsel where two counsel were employed.

___________________________
M J D WALLIS
JUDGE OF APPEAL

Appearances
For appellant:
C Hattingh (heads of argument prepared by R Michau
SC and C Hattingh)
Instructed by:
Wessels and Hattingh Inc, Pietermaritzburg;
Van Wyk & Preller Inc, Bloemfontein

For respondent:
D van Loggerenberg SC (heads of argument prepared
by W H Trengove SC and D van Loggerenberg SC)

Instructed by:
Jay Mothobi Inc, Johannesburg;
EG Cooper Majiedt Inc, Bloemfontein.