The Sunday News
Thulani Ndlovu Business Correspondent
THE High Court has discharged Gweru-based gold and antimony mining company, Aquarium Trading from provisional liquidation and placed it under provisional judicial management, saving the company from dissolution.
Under provisional judicial management, the company is under a temporary court-supervised rescue plan to give it a chance to rehabilitate itself and be restored to profitability.
Under provisional liquidation, the court appoints a liquidator to a company for the period between the filing of the application to wind up the company and the court hearing the application.
The application for provisional liquidation was brought to the Bulawayo High Court by its major shareholder Tamira Overseas SA (Tamira), a company incorporated in Belize, a country on the eastern coast of Central America.
Aquarium Trading was placed under provisional liquidation last year in September, 2014 by Judge Justice Martin Makonese, after the company failed to settle a debt of about $2, 5 million.
However, when the matter came for confirmation of the provisional liquidation order, it was heard by a different judge, Justice Maxwell Takuva who ruled that “there are no good and sufficient reasons for the court to grant a winding up order.”
In a judgment delivered on Thursday, Justice Takuva further discharged the former provisional liquidator Mr Knowledge Hofisi of Aurifin Capital from controlling the mining entity and directed the master of the High Court to appoint a provisional judicial manager within 10 days.
In his reasoning, Justice Takuva said the provisional liquidation had been erroneously granted before the application for the provisional order was served on Aquarium at its registered address in breach of Section 5 (2) of the Companies (Winding up) Rules, 1972 which provides, “Except where the petition is presented by the company itself a copy of the petition and the notice of set down for hearing shall be served upon the company by delivering of such copy at its registered office or to a responsible person at its place of business, failing such service, to a director or secretary of the company or, if the company is in voluntary liquidation, to the liquidator. An affidavit of service shall be filed with the petition.”
Justice Takuva added that a company facing liquidation must not be deprived of the opportunity to put forward its opposition to the grant order which will have the effect of causing it to suffer an immediate diminution in personal status and a removal of control over all its assets.
“The manifestly serious consequences flow from the issue of a provisional winding up order. The provisional liquidator is almost invariably vested by the court with wide powers. The present respondent being the victim of an inexcusable breach of procedure, the High Court ought to have afforded it the opportunity to oppose the application for the provisional order by the only means available, namely, by setting aside of the order that had been improperly obtained,” said Justice Takuva.
Furthermore, Justice Takuva took issue with the fact that Tamira principal legal practitioners failed to make it to court and sent a correspondent legal practitioner who was not versed with the facts of the matter.
“There is no proof of service of the application for a provisional order in the record. Consequently, the only inference is that it was granted on an ex parte basis,” said Justice Takuva.
“This is irregular and I would discharge the provisional order for this reason. Had Aquarium not prayed for an order that respondent be placed under judicial management the matter would have ended here.”
In summation Justice Takuva said, it is not disputed that Aquarium has enormous mineral deposits and that investors are on hand to chip in and put funds for the continued operations of Aquarium.
“In my view, one way of protecting the interests of all parties is to allow Aquarium to continue operating under judicial management,” he summed.
