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Supreme Court settles Adlecraft directorship dispute

by Staff Reporter
08 Nov 2022 at 13:44hrs | Views
The Supreme Court has settled the directorship dispute in mining firm Adlecraft Investments which has seen a number of court battles between its chairperson and Israeli businessman Gilad Shabtai and his erstwhile business partner Ofer Sivan.

In a judgement dated November 4, the Supreme Court settled the directorship row effectively stripping Sivan of the control of the firm in favour of minority shareholder Munyaradzi Gonyora who assumed a role of acting managing director.

This is after Adlecraft Investments employees Cassandra Myburgh and Colin Baker loyal to Sivan had attempted to stop Gonyora from taking control of the firm as resolved by its board.

The dispute arose when Sivan allegedly misappropriated trust funds in excess of USD $1 500 000 and when he realised the matter had been reported to the police, he allegedly fled the country and went to the United States of America. The remaining board members resolved that Munyaradzi Gonyora be appointed the company's acting managing director with effect from 18 August 2021.

Gonyora reportedly went to the company premises to commence his duties as acting general manager but Colin Baker allegedly barred him from accessing the premises and further dispossessed him of his company vehicle keys.

In a bid to avoid a scene, Gonyora reportedly went to the company's workshop which was situated at different premises to commence his duties and he met Cassandra Myburgh who allegedly abused his verbally and barred him from the premises.

Following the alleged actions by Baker and Myburgh, the board resolved to institute disciplinary proceedings against them and suspended them from employment.

Despite the suspension, the two allegedly resorted to locking up both the head office and the workshop barring Gonyora from accessing the premises, actions which prejudiced the operations of the company.

The company thereafter sought spoliatory relief against the two at the High Court arguing that Gonyora was prevented from exercising his functions as the acting managing director and that the two had taken the law into their own hands as they had no right to barricade his access to either the head office or the workshop and the company's assets.

The two vehemently opposed the application arguing that l Gonyora had no authority to act in such capacity as the resolution that gave him that acting position was a fraud.

They disputed that they denied him access to the premises and further averred that the operations of the company never ceased and that the company was never despoiled.

The court however found that the resolution giving Gonyora authority to act as acting managing director was passed by a majority of the directors. It was also the High Court' finding that the two could not take the law into their own hands and that the evidence before it showed that there was resistance by them to Gonyora taking over and exercising his assigned functions in terms of the board resolution.

The two were aggrieved by the High Court's findings and appealed to the Supreme Court and through their lawyer they submitted that the court a quo erroneously dealt with the application for spoliation made by Gonyora as if it was an application made by the company.

It was their submission that Gonyora could not prove peaceful possession of the company premises prior to 18 August, 2021 when the alleged dispossession occurred.

The company in response submitted that the court a quo did not err when it found that the board resolution giving Gonyora the authority to act as managing director was valid. It was their argument that the fact that Gonyora who was acting as Managing Director on behalf of the respondent was denied access to the company premises meant that the two had despoiled the respondent of its premises.

The Supreme Court however dismissed their appeal with costs and determined that the board resolution authorising Gonyora to act as managing director was valid.

"The evidence before the court a quo clearly established that the company had resolved that its day to day business operations, leadership of employees as well as other administrative functions, were to be executed by Mr Gonyora, whose authority the appellants (employees) set out to challenge and frustrate.

"The appellants thus took it upon themselves to unlawfully wrestle with their employer, the respondent company, and despoil it by preventing its authorised agent in the person of its authorised Acting Managing Director, Gonyora, from performing his functions on behalf of and for the benefit of the respondent company. "Their preference to receive instructions from Ofer Sivan did not and does not invalidate the respondent company's actions and resolutions. Ofer Sivan is not the company. In the circumstances, it is the court's view that the appellants therefore despoiled the respondent company as correctly found by the court a quo.

"In the circumstances, the appellants cannot escape an order of costs against them.

"In the result it is ordered, the appeal be and is hereby dismissed with costs," the Supreme Court said.

Source - Online