Bayer v Polkadraai Nursery Proprietary Limited (18728/2024) [2025] ZAWCHC 232 (2 June 2025)

IN
THE HIGH COURT OF SOUTH AFRICA

(WESTERN
CAPE DIVISION, CAPE TOWN)

JUDGMENT

Not Reportable

Case no: 18728/2024

In the matter between:

CHARLENE
JUANITA
BAYER                                                          

APPLICANT

and

POLKADRAAI
NURSERY PROPRIETARY LIMITED                        

RESPONDENT

Neutral
citation:      Bayer
v Polkadraai Nursery (Pty) Ltd (Case no
18728/2024) [2025] ZAWCHC 232 (02 June 2025)

Coram:         
NUKU J 

Heard:           
22 April 2025

Delivered:    
02 June 2025

Summary:    
Interdict – proposed sale of
respondent’s business enterprise as a going concern not posing
any threat to the applicant’s shares
– no prima facie
right established – application dismissed    

ORDER

The
application is dismissed with costs including the (a) costs of
counsel on scale B, and (b) costs occasioned by the postponement
of
the matter on 28 August 2024 and 11 November 2024.

Nuku
J

[1]       
The applicant, who describes herself as a business woman and a
shareholder of the
respondent, applies for an order, the effect of
which is to prohibit the  respondent’s body of
shareholders from considering
an offer to purchase the respondent’s
business (sale of business agreement) until the finalisation of the
legal proceedings
she has instituted in this Court, under case number
21620/2014 against her ex-husband Mr Warwick Bruce Bayer (Mr Bayer),
the Bayer
Trust, the respondent and the former business rescue
practitioners of the respondent’s predecessor (action
proceedings).
 

[2]       
The application was precipitated by a notice issued
by the respondent on 13 August 2024,
convening a general meeting of its shareholders which was to be held
on 28 August 2024. The notice
proposed resolutions for, inter
alia:

2.1      
approving the sale of business agreement as tabled;

2.2      
approving the transfer of shares, being the whole or greater part of
the assets of the company.

[3]       
On 22 August 2024, the applicant’s attorneys of record
addressed a letter to
the respondent’s board of directors
recording the applicant’s objection to the sale of the
respondent’s business.
The letter acknowledged that neither the
applicant nor Mr Bayer has any right to unilaterally prevent the sale
of the respondent’s
business. That notwithstanding the letter went on
to formally record the applicant’s objection to the proposed
sale of the
respondent’s business which objection was said to be
rooted ‘in the fact that the settlement agreement, which
dictates the rightful ownership of the business, has been
disregarded.’ At subparagraph 6.3, the letter recorded
that:

‘It
is our client’s (applicant’s) position that the sale of
business should not proceed until the shares are transferred
in
accordance with the settlement agreement, and the action under case
number 21620/2014 relating to the legitimacy of the appropriation
of
our client’s (applicant’s) shares/members interest has
been finalised. Furthermore, it is our client’s understanding

that she is not the only shareholder who objects to the sale.’

[4]       
It is not clear from the papers whether the applicant’s
attorneys received any
response to the letter referred to in the
preceding paragraph. In any event, the applicant launched the
application on 27 August
2024 for hearing the following day. On 28
August 2024, the matter came before Ndita J who postponed it to the
semi-urgent roll
for hearing on 11 November 2024 with costs standing
over for later determination. The application was further postponed
for hearing
on 22 April 2025 with costs, again, standing over for
later determination.

[5]       
The applicant, in her rather terse founding affidavit, explained the
basis of her
approach to the Court as follows:

‘8.       
The proposed sale involves the transfer of 80% of the shares held by
the Trustees for
the time being of the Bayer Trust and 20% of the
shares held by myself in Shadowlands Wholesale Nursery (Pty) Ltd.

9.        
I have a clear right to prevent the alienation of the shares which
form the subject
matter of the main action, pending its final
determination.

10.      
The proposed sale, if implemented, will cause me to suffer
irreparable harm as it will effectively
render the main action moot
and deprive me of my rights should I succeed in that action.

11.      
I have no alternative remedy. Once the shares are transferred, it
will be extremely difficult,
if not impossible, to reverse the
transaction.

12.      
The balance of convenience favours the granting of the interdict.
While the Company may
suffer some inconvenience in delaying the
proposed sale, this inconvenience is outweighed by the potential
prejudice I will suffer
if the sale proceeds before the main action
is resolved.’

[6]       
It is clear from the above that the applicant’s entire case is
based on the
notion that the sale of business agreement would result
in the transfer of the shares she holds in the respondent, and which
are
still subject of a dispute in the action proceedings. The notion
that the sale of business agreement would result in the transfer
of
the applicant’s shares in the respondent is, however, untenable
for a number of reasons.

[7]       
Firstly, a copy of the sale of business agreement had been made
available to the applicant
prior to the issuing of the notice
convening the shareholders’ meeting. The sale of business
agreement recorded that the
respondent intended to sell its business
enterprise as a going concern, including the business assets as
outlined in clause 1.2.2
thereof. The sale of business agreement did
not, however, refer to any sale of shares.

[8]       
Secondly, although the notice and proxy form, which accompanied the
notice, made reference
to a request for approval to ‘transfer
shares’ as it constituted ‘whole or greater part
of the assets’ of the respondent, this was clearly an error
because there was only one transaction that was to be considered by
the shareholders,
namely, the sale of business agreement which made
no reference to any transfer of shares.

[9]       
Thirdly, the letter by the applicant’s attorneys dated 22
August 2024 makes
it clear that the applicant understands that
neither she nor Mr Bayer have a right to unilaterally prevent the
sale of business.
Importantly, although this letter was in response
to the notice convening the meeting, it made no reference to a
possible transfer
of the applicant’s shares and the only
explanation for this must be that it is clear from the reading of the
sale of business
agreement, that what was intended to be sold was the
first respondent’s business enterprise as a going concern, and
that
does not involve any transfer of shares.

[10]     
The application was, in my view, entirely misconceived and should not
have been instituted in
the first place. Counsel for the applicant,
however, sought to justify the institution of the application on the
fact that the
notice convening the meeting referred to, as one of the
proposed resolutions, the transfer of shares.

[11]     
As stated already, whilst there is referred to a resolution relating
to the transfer of shares,
on any reasonable reading of the
documents, there was only one issue to be considered, namely, the
sale of business agreement.
In addition to that, this aspect was
explained in the respondent’s answering affidavit and from that
point onwards, the continuation
of the application bordered on being
reckless.

[12]     
The simple point is that sale of the respondent’s business
enterprise as a going concern
has no bearing on the applicant’s
shares in the respondent. The respondent will continue to exist with
the shareholders unchanged,
even if the proposed sale of its business
is approved. As the sale of the respondent’s business does not
threaten the applicant’s
shares in the respondent, it follows
that the applicant can assert no right, clear or prima facie,
that requires protection by the intervention of this Court. In the
circumstances of this case, the issue of irreparable harm as
well as
the balance of convenience do not even arise because the applicant
will continue to exercise her right qua shareholder of the
respondent whether the sale of business goes through or not.

[13]     
The result is that the application must fail, and the costs should
follow the result.   

Order

[14]     
In the result I make the following order:

The
application is dismissed with costs including the (a) costs of
counsel on scale B, and (b) costs occasioned by the postponement
of
the matter on 28 August 2024 and 11 November 2024.      

For
respondent:                  
H Beviss-Challinor