LML4806
Assignment 2 Semester 2 2024
, QUESTION 1
Advice to Barbara on Setting Aside Winelands Packers' Vote
1. Grounds for Application:
Barbara can apply to the court to set aside the vote of Winelands Packers (Pty) Ltd
based on several grounds:
• Improper Conduct
According to Section 153(6) of the Companies Act 71 of 2008, if a vote is cast in
a manner that is improper or not in good faith, it can be challenged. If Barbara
can show that Winelands Packers voted against the plan for reasons that are not
aligned with the company’s best interest or were intended to sabotage the rescue
process, this could be a strong basis for her application.
• Harmful Impact on the Rescue
If Winelands Packers' vote against the plan is blocking the successful adoption of
the business rescue plan and harming the company's chances of recovery,
Barbara could argue that their vote is detrimental to the company's rescue
efforts. This aligns with the purpose of business rescue, which is to rehabilitate
the company for the benefit of all creditors, including employees.
• Prejudice to Other Stakeholders
Barbara should also consider if Winelands Packers’ vote is unfairly harming other
creditors or the employees. If their opposition is causing undue harm or if their
vote is not representative of fair creditor interests, this could be a reason to
challenge their vote.
Assignment 2 Semester 2 2024
, QUESTION 1
Advice to Barbara on Setting Aside Winelands Packers' Vote
1. Grounds for Application:
Barbara can apply to the court to set aside the vote of Winelands Packers (Pty) Ltd
based on several grounds:
• Improper Conduct
According to Section 153(6) of the Companies Act 71 of 2008, if a vote is cast in
a manner that is improper or not in good faith, it can be challenged. If Barbara
can show that Winelands Packers voted against the plan for reasons that are not
aligned with the company’s best interest or were intended to sabotage the rescue
process, this could be a strong basis for her application.
• Harmful Impact on the Rescue
If Winelands Packers' vote against the plan is blocking the successful adoption of
the business rescue plan and harming the company's chances of recovery,
Barbara could argue that their vote is detrimental to the company's rescue
efforts. This aligns with the purpose of business rescue, which is to rehabilitate
the company for the benefit of all creditors, including employees.
• Prejudice to Other Stakeholders
Barbara should also consider if Winelands Packers’ vote is unfairly harming other
creditors or the employees. If their opposition is causing undue harm or if their
vote is not representative of fair creditor interests, this could be a reason to
challenge their vote.
