Court grants Steinhoff leave to appeal on contested jurisdiction in liquidation case

play article
Subscribers can listen to this article
Steinhoff has argued that it cannot face a liquidation hearing in a South African court.
Steinhoff has argued that it cannot face a liquidation hearing in a South African court.
Getty Images
  • Steinhoff has been granted leave to appeal in the liquidation application it is facing in the Western Cape High Court.
  • The retailer had argued that as an "external company" under the 2008 Companies Act it cannot face a liquidation hearing in a South African court.
  • The former owners of Tekkie Town, who brought the liquidation bid, say they are "fine with the process" and are in "no rush at all" as the matter now moves to the Supreme Court of Appeal.

The Western Cape High Court has granted retailer Steinhoff leave to appeal to the Supreme Court of Appeal (SCA) in the liquidation bid it is facing. 

This means that the winding up bid against Steinhoff, brought by the former owners of shoe retailer Tekkie Town, will be put on hold while the SCA deals with the question of whether a South African court has jurisdiction to hear the case. 

In early September, Presiding Judge Hayley Slingers had ruled that the court does have jurisdiction under SA company law to hear the case. Steinhoff then sought leave to appeal, which was eventually heard last week. It argued a separate postponement case earlier in the week. 

In her ruling on Friday, Slingers said that while she would have been unlikely to grant leave to appeal at this stage in the proceedings based on the evidence before her, the fact that Steinhoff has a case pending at the SCA forced her hand.

The judge said it would now be up to the SCA to probe whether repeated requests for leave to appeal and postponements by Steinhoff, and a group claiming to represent financial creditors, amounted to savvy and robust lawyering or bordered on an "abuse of process".

Lawyers for the former owners of shoe retailer Tekkie Town had on Wednesday argued that the retailer was attempting to manipulate postponement requests so it would not have to face questions around whether it is insolvent. 

Steinhoff denied this, saying it was "objectionable and entirely inappropriate" to claim it was trying to manipulate the court process.

The retailer has argued that, as an "external company" that is registered overseas, it cannot be subject to liquidation proceedings by a South African court. Since 2015, the group's apex holding company has been domiciled in Amsterdam.

'We're fine' 

Former Tekkie Town CEO Bernard Mostert said after the ruling was delivered on Thursday that he and colleagues were "fine with the process". 

"We have always accepted that our matter will run to the highest court and will set a precedent as to how the victims of fraud are treated and how those responsible for the fraud and those who obstruct the ends of justice are prosecuted," he said in a statement.

"While Steinhoff is in a rush to conclude a settlement that will allow the proceeds of the fraud to be distributed to parties who were not defrauded, we are in no rush at all."

A date has not yet been set for the SCA to hear the matter. Steinhoff previously promised to try and have the hearing expedited. 

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
Rand - Pound
Rand - Euro
Rand - Aus dollar
Rand - Yen
Brent Crude
Top 40
All Share
Resource 10
Industrial 25
Financial 15
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot