Steinhoff nearing 'abuse of process' in court case, say lawyers for ex-Tekkie Town owners

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Judge Hayley Slingers is hearing the application to have Steinhoff liquidated.
Judge Hayley Slingers is hearing the application to have Steinhoff liquidated.
Jaco Marais/Netwerk24
  • Lawyers for the former owners of Tekkie Town have taken aim at what they say are unnecessary attempts by retailer Steinhoff to delay the hearing of a liquidation application. 
  • The former owners of the shoe retailer have accused Steinhoff's former CEO Markus Jooste of "duping" them into giving up their business. 
  • Steinhoff wants the liquidation case postponed while it takes an appeal based on contested jurisdiction to the Supreme Court of Appeal. 

Lawyers for the former owners of shoe retailer Tekkie Town - who have instituted a bid to have Steinhoff placed into liquidation - have argued that the retailer is attempting to manipulate postponement requests so it will not have to face questions around whether it is insolvent. 

The Western Cape High Court has to decide whether it should continue to hear the liquidation bid or postpone hearings until the question of whether it has legal jurisdiction to do so has been considered by a higher court.  

On Wednesday, advocate Willie Duminy, for the one-time owners of the shoe retailer, said the liquidation case should continue immediately. 

The former Tekkie Town owners have accused Steinhoff's former CEO Markus Jooste of "duping" them into swapping their Tekkie Town shares for stock in Steinhoff, which fell in value since late 2017. It wants the retailer to be liquidated. 

On Tuesday, Duminy asked that Steinhoff's application for postponement be dismissed so that the parties could finally argue whether or not Steinhoff is financially insolvent. 

Jurisdiction 

Earlier in the week, lawyers for Steinhoff had argued that the case should be stayed until the Supreme Court of Appeal (SCA) had decided whether it would hear an appeal based on contested jurisdiction. 

It is Steinhoff's case that, as an external company under the 2018 Companies Act, it cannot be wound up by a South African court and should not even be facing a liquidation hearing. 

Duminy on Wednesday accused Steinhoff of simply repeating the same arguments over and over. 

He said the retailer was "repeating applications for leave to appeal and postponement ad infinitum until something gives".

"It will never end," he added. 

He put it to the court that Steinhoff's "repeated hammering on the same point" – that the case should be postponed so that a higher court could hear an appeal on the basis of jurisdiction – was close to an "abuse of process."

'Objectionable' 

Subel, for Steinhoff, denied the retailer was trying to delay proceedings. 

"To talk about the respondent 'manipulating' is objectionable and entirely inappropriate," he said.  

He said that Steinhoff had the right to ask for leave to appeal like any other applicant before a court.

Presiding Judge Hayley Slingers previously dismissed the retailer's argument that the court does not have jurisdiction. Steinhoff eventually argued its leave to appeal bid on Friday. Slingers has not yet ruled on the application.  

Subel said that what was needed for the process to be expedited was clarity on the question of jurisdiction.

For this, Slingers had to rule on Steinhoff's request for leave to appeal, he said.  If it is not granted, Steinhoff has said a "back-up" application before the SCA that would kick in. 

The retailer has previously warned that it may face the "catastrophic" scenario of a court placing it into provisional liquidation only for a superior court to find it lacked the legal grounding to do so. 

Duminy, meanwhile, argued that Steinhoff had overstated the risks to companies in its stable if the liquidation hearing continues.

He added that the argument that the case should be stayed because Steinhoff had applied to the SCA for leave to hear an appeal was of "no consequence".

Steinhoff's application to the SCA, he said, was not before a court but "sitting in some pigeonhole". 

"According to law, there is no matter that 'is so-called 'pending'," he said.

Duminy again argued there had never been an agreement between the parties to separate the liquidation case into distinct parts, which would result in a piecemeal hearing. 

If Steinhoff wished to appeal it would be free to do so once the case's merits had been argued and the judge had made her decision, he said. 

Judge Slingers, meanwhile, said she would make rulings on the applications for leave to appeal and postponement on Thursday morning. 

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