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Companies Act, 2008 (Act No. 71 of 2008)

Chapter 7 : Remedies and Enforcement

Part B : Rights to seek specific remedies

163. Relief from oppressive or prejudicial conduct or from abuse of separate juristic personality of company

 

 

1) A shareholder or a director of a company may apply to a court for relief if—
a) any act or omission of the company, or a related person, has had a result that is oppressive or unfairly prejudicial to, or that unfairly disregards the interests of, the applicant;
b) the business of the company, or a related person, is being or has been carried on or conducted in a manner that is oppressive or unfairly prejudicial to, or that unfairly disregards the interests of, the applicant; or
c) the powers of a director or prescribed officer of the company, or a person related to the company, are being or have been exercised in a manner that is oppressive or unfairly prejudicial to, or that unfairly disregards the interests of, the applicant.

 

2) Upon considering an application in terms of subsection (1), the court may make any interim or final order it considers fit, including—
a) an order restraining the conduct complained of;
b) an order appointing a liquidator, if the company appears to be insolvent;
c) an order placing the company under supervision and commencing business rescue proceedings in terms of Chapter 6, if the court is satisfied that the circumstances set out in section 131(4)(a) apply;
d) an order to regulate the company’s affairs by directing the company to amend its Memorandum of Incorporation or to create or amend a unanimous shareholder agreement;
e) an order directing an issue or exchange of shares;
f) an order—
i) appointing directors in place of or in addition to all or any of the directors then in office; or
ii) declaring any person delinquent or under probation, as contemplated in section 162;
g) an order directing the company or any other person to restore to a shareholder any part of the consideration that the shareholder paid for shares, or pay the equivalent value, with or without conditions;
h) an order varying or setting aside a transaction or an agreement to which the company is a party and compensating the company or any other party to the transaction or agreement;
i) an order requiring the company, within a time specified by the court, to produce to the court or an interested person financial statements in a form required by this Act, or an accounting in any other form the court may determine;
j) an order to pay compensation to an aggrieved person, subject to any other law entitling that person to compensation;
k) an order directing rectification of the registers or other records of a company; or
l) an order for the trial of any issue as determined by the court.

 

3) If an order made under this section directs the amendment of the company’s Memorandum of Incorporation—
a) the directors must promptly file a notice of amendment to give effect to that order, in accordance with section 16(4); and
b) no further amendment altering, limiting or negating the effect of the court order may be made to the Memorandum of Incorporation, until a court orders otherwise.