Project thunder shareholder liquidating trust
The rights of the shareholders to dispose of their shares were limited so that a shareholder could not sell its shares without the approval of other shareholders.The facts, the issues and the contextual authority of The pertinent statutory provisions of section 81(1)(d)(i)-(iii) provide that a court may order a solvent company to be wound up if the company, one or more directors or one or more shareholders have applied to the court for an order to wind up the company on the grounds that- The shareholders are deadlocked in voting power, and have failed for a period that includes at least two consecutive annual general meeting dates, to elect successors to directors whose terms expired; orcourt retains a broad discretion to make a winding-up order under section 81(1)(c) and (d) or any other order it considers appropriate.This is because the deadlock and partnership analogy are broad in scope and, at the same time, they are the easiest categories to satisfy in terms of proof.for scenarios where in substance a partnership exists in the guise of company.Briefly, the company was set up as a joint venture partnership between the second appellant, Arcay Communications Holdings (Pty) Ltd ("Arcay") and the respondent, Apco Worldwide Inc.
Clause 8.2 dealing with deadlock at board level excluded the inability to obtain the required vote at board meetings as a ground for winding up the company.
Mediation efforts floundered due to the confrontational attitude of the warring shareholders.
The internal wrangling, mutual disillusionment and distrust, and the consequent breakdown of the relationship between the shareholders paralysed the company.
A court must be careful not to construe the authorities as setting out a series of restrictive principles which would confine the phrase "just and equitable" to rigid categories.
The decisive question therefore is: When is it "just and equitable" for the court to order that a company be wound up on the "just and equitable" ground?