Tendai Tarinda v Cake Fairy Pvt Ltd and Kathy Mwanza

### Preamble
1
HB 163/19
HC 2332/19
---------


TENDAI TARINDA

Versus

CAKE FAIRY PVT LTD

And

KATHY MWANZA

IN THE HIGH COURT OF ZIMBABWE

MOYO J

BULAWAYO 15 & 24 OCTOBER 2019

Urgent Chamber Application

M K Chigudu for the applicant

T Moyo-Masiye for the 2nd defendant

MOYO J:	In this matter the applicant filed an urgent chamber application asking for the placement of the 1st respondent in provisional liquidation in terms of section 207 as read with section 206 of the Companies Act Chapter 24:03.

Section 206 provides for circumstances under which a company may be wound up by a court and section 207 provides for how the petition for winding up is presented.  Section 206 (g) provides that a company may be wound up by the court if the court is of the opinion that it is just and equitable that the company should be wound up.

The background to this matter is that applicant and 2nd respondent were living together as husband and wife and are co-directors in 1st respondent.  It would appear that their relationship is now strained and as a result, they are living separately.  2nd respondent is the     hands-on director at 1st respondent.  It appears she is the one in control of the company, its books and its day to day running.  Applicant avers at paragraph 9 of his founding affidavit that:

“Due to irreconcilable differences, 2nd respondent and I went on separation in August 2019 which gave rise to a company dispute between 2nd respondent and I over the 1st respondent as we were clearly struggling to co-manage and co-direct the company”

He further avers that as a result, he engaged his erstwhile legal practitioners to assist him in this predicament, that they tried through a series of meetings but failed.

He further alleges that on 29 July 2019 2nd respondent filed a frivolous application in a bid to eliminate him from the company.  On the 2nd August 2019, his then former legal practitioners wrote a letter to 2nd respondent’s lawyers requesting that the company (1st respondent) be audited and further that applicant be restored access to the company.  In paragraph 21 of the founding affidavit the applicant avers that from 9 August 2019 when the protection order against him was granted in 2nd respondent’s favour, 2nd respondent has been solely running the company to his exclusion, even despite several demands and engagements through his lawyers for her to give him access to company information, records and financial statements.

At paragraph 23 of the founding affidavit applicant avers that to his surprise on 25 September 2019, he discovered through social media that 2nd respondent had posted that she was opening a business in Harare along similar lines with 1st respondent.  He then checked at the companies’ office and he discovered that 2nd respondent held 99% of shareholding in that company and her mother held 1% shareholding.  He also discovered that the company was incorporated in June 2019 without his knowledge.

At the hearing of the matter, the 2nd respondent’s legal practitioners raised some points in limine one of which was that the matter is not urgent as the conduct complained of (i.e of applicant’s failure to access the company and its records) occurred a while ago and that it was the subject of engagements by the parties’ legal practitioners as early as the 1st week of August 2019.

Applicant does not dispute that problems relating to his failure to access the company and its records dates back about 2 months ago, but instead, avers that it is the discovery of a new company by 2nd respondent along the same lines that sparked urgency as he feared that 2nd respondent will siphon funds from 1st respondent and use them to set up or capitalize her new company where he is excluded..  The certificate of urgency itself states that applicant has failed to access the records of 1st respondent and that 2nd respondent continues to run the affairs of 1st respondent to applicant’s total exclusion.  The certificate of urgency also states that there is a reasonable probability that if the company is not placed under provisional liquidation and an independent person appointed to manage the company, 2nd respondent may and/or will defraud applicant.

Clearly, from the events as narrated in the founding affidavit, applicant has issues with 2nd respondent denying him access to 1st respondent’s premises, books of accounts and its day to day management.  Applicant is apprehensive that now that he does not know what happens within 1st respondent, 2nd respondent may defraud him.  That is the gist of the application.  The situation is worsened by the discovery by applicant of a company that 2nd Respondent has opened in similar lines of business in Harare.

Consequently, from the facts  the harm that applicant fears, is not based on the incorporation of another company, it is in fact based on his exclusion from the day to day running of 1st respondent, his failure to access the books of accounts and all relevant documents.  That 2nd respondent has incorporated another company may have further comprehended that fear but it certainly is not the occurrence which has called or should call for applicant’s action.  Applicant’s action was called from the moment he discovered that he was sidelined and had no access whatsoever to a business that he co-owned.  That is the time urgency beckoned, that is the time applicant deserved to act as a matter of urgency.  If, his failure to access 1st respondent and its books, could wait from the first week of August to 1 October, then it suddenly cannot be treated with urgency.  Urgency means that once an occurrence has commenced, it cannot be put aside, it cannot be debated upon or discussed, it should be acted upon without undue delay.  A bid to enforce one’s rights on the basis of urgency means exactly that.  If a litigant, dilly dallies or decides to enter into prolonged discussions or debates, they lose the right to approach this court as a matter of urgency for, urgency denotes that it is impossible or impracticable to wait, therefore any matter that can wait for 2 full months cannot jump the queue, for the simple reason that it can wait.

That is what it means.  Even where a litigant observed the matter as urgent but due to some reasonable explanation, they could not act as such, the founding affidavit must espouse such an explanation.  We should be told the reason for inaction when urgency called.  Such reason should be justifiable in the circumstances.  Such were the findings of the court in Kuvarega  vs Registrar General 1998 (1) ZLR 188.

On what an urgent matter is, CHATIKOBO J had the following to say:

“What constitutes urgency is not only the imminent arrival of the day of reckoning, a matter is urgent, if at the time the need to act arises, the matter cannot wait.”

In this matter the need to act arose, during the first week of August when applicant realised that he had been shut out of a company that he co-owns.   At that moment, the role of 2nd respondent managing the company in a manner that did not cater for his interests, presented itself.  It need not wait for 25 September when he discovered that 2nd respondent had incorporated another company.  It is his being in darkness about the goings on at 1st respondent that makes him suspicious of 2nd Respondent’s intentions and plans and the need to act therefore arose at the time that he made that discovery.  Applicant was reasonably expected to take action urgently to protect his interest then, not 2 months down the line.  It is for these reasons that I find that applicant sat back and did nothing and could thus not later approach this court on an urgent basis.  Applicant let go of such an opportunity when it presented itself and the only logical conclusion is that this matter proceeds like any other ordinary court application for liquidation.  I will not deal with the rest of the points in limine as I am of the view that the one on urgency disposes of the matter.

I accordingly find that this matter is not urgent from the facts and circumstances of this case, I consequently decline to hear it on such basis.  Accordingly the matter is struck off the roll of urgent matters with applicant paying the costs of suit.

Liberty Mcijo & Associates, applicant’s legal practitioners

Masiye-Moyo & Associates, 2nd respondent’s legal practitioners