Race against time as court postpones Steinhoff case ahead of imminent creditor vote

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Steinhoff head office, Stellenbosch. (Getty Images)
Steinhoff head office, Stellenbosch. (Getty Images)
Steinhoff head office, Stellenbosch. Photo: Getty
  • A matter brought against Steinhoff by two claimants has been postponed to 7 June.
  • The three-day hearing was brought to a halt on Wednesday as Steinhoff's legal counsel sought to submit a new document as evidence, which other parties to the case objected to.
  • However, the Western Cape High Court aims to finalise the matter before creditors vote on the proposed settlement anticipated to be in July.

The Western Cape High Court will seek to finalise a legal battle concerning Steinhoff's global settlement proposal before creditors are meant to vote on it - possibly in July.

The three-day hearing brought before the court by two claimants against Steinhoff was halted on Wednesday. Steinhoff's legal counsel sought to submit a new document as evidence in the matter, but the legal counsel of applicants Trevo Capital and Hamilton BV and Hamilton 2 BV objected.

Trevo, registered in Mauritius, is claiming R2.15 billion from Steinhoff; and Hamilton, headquartered in Ireland, is claiming R14 billion against the multinational retailer. These are just two out of the more than 100 claims lodged against Steinhoff following the fallout of its share price in December 2017, as former CEO Markus Jooste exited the firm following reports of an accounting scandal.

The court on Monday heard that Trevo wants a guarantee and a CPU (corporate payment undertaking) agreement to be declared void as they do not comply with section 45 of the Companies Act which outlines requirements that must be met for a board to extend financial assistance. These agreements, which relate to Financial Creditors, affect the payouts to other claimants, the applicants assert in court documents. 

Steinhoff's legal counsel, André Smalberger, SC, on Tuesday asked for an adjournment to verify the documents submitted as part of his argument for the section 45 case.

However, Hamilton's legal counsel, Werner Lüderitz, SC, objected to Smalberger presenting the document as evidence on the third day of the hearing. "This is not acceptable and not fair that we be confronted by documents at this hour, left guessing what my learned friend seeks to make of it," he said.

Smalberger said it would be "inequitable and unjust" to proceed with the hearing without the full facts.

Judge Bozalek commented that it is a "lengthy, complex legal document", and that he is now being led "in this fog". "This matter obviously is one with far-reaching consequences for all parties," he said. He noted that the facts need to be "fully ventilated".

He granted a postponement untill 7 June so that Steinhoff can file affidavits pertaining to the document in question, and the applicants can exercise the option to object to the submission of the new document.

No time

There is another matter regarding the creditors' settlement proposal related to section 155 of the Companies Act. According to the act, creditors have to vote. The court heard Steinhoff will on 28 June issue notice of a meeting, which is anticipated to be on 28 July. This means that a separate court application dealing with the settlement proposal must be dealt with in June.

Smalberger said that his team would do everything to ensure the matter is dealt with "expeditiously".

Trevo's legal counsel Alasdair Sholto Douglas, SC, stressed that the matter must be dealt with urgently as the verification of claims is currently under way, and these claims are to be approved at Steinhoff's meeting. 

Smalberger, however, said that all this is taking place "two months in advance" and if all legal counsel cooperate, the matter can be resolved.

Bozalek allowed the postponement, subject to costs, and all parties have to agree to a timetable.

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