THE liquidation of a luxurious food and accommodation outlet, AM Weinberg, will not be happening just yet, following a High Court decision to set aside the appointment of its current liquidators, Alwyn van Stratten and William de Villiers, today.
The property developer and owner of AM Weinberg, Archie Graham, has won a relief application. Judge Thomas Musuku delivered the judgment that the Masters of the High Court decision apply a practice to receive and to allow insolvency practitioners to lodge security bonds prior to a liquidation order having been made. “Is hereby reviewed and declared null and void and set aside by reason of the First Respondent’s decision being in conflict with the provisions of section 375 of the Act and thus unlawful.”
Furthermore, the Masters decision to apply a practice to determine securities or allow securities to be provided by provisional liquidators in respect of legal or private persons in provisional or final insolvency in an amount unrelated to the full amount of the assets to be administered is, “hereby reviewed and declared null and void and set aside by reason of the masters decision being in conflict with the provisions of section 375 of the Act and thus unlawful.”
Graham had essentially sought to review a decision of the Master of the High Court, whereby she allegedly appointed the Alwyn Van Straten and William De Villiers Schickerling, as the provisional liquidators of the entities associated with him in terms of what she referred to as the “first come, first served “principle. It further sought an order interdicting the Master from making any appointments of provisional liquidators or trustees in respect of the entities associated with him, on the basis of security bonds lodged with the Master prior to insolvency or resolutions for voluntary insolvency not having been registered, or sequestration orders having been issued.
In this connection, Graham claims that the provisional liquidators were appointed before any of the entities were dissolved, in voluntary liquidations, the resolution in terms of s 208 of the Act, had not been duly registered with the Master.
In addition to this, he challenged the practice employed by the Master for the determination of securities payable by provisional liquidators.
The security bond is used as a measure to indemnify the entity under liquidation, its creditors or contributories against any maladministration that may occur or carried out by the provisional liquidator.
This comes after the entities owned by Graham were placed under liquidation after being unable to pay their Bank Windhoek debts of which according to media reports are over N$252 million, which is subsequent not adhering to the banks debt repayment schedule.