Abstract
Impediments to corporate accountability have over the recent years manifested in diverse forms. What took place in Peel v Hamon J&C Engineering (Pty) Ltd is a case in point. The aim of this article is in two forms. First, from the commentaries and cases consulted, it is clear that the character of who must qualify in terms of the section 163 criterion is not settled. Moreover, this can be gleaned from the criticisms against Moshidi J's judgment in Peel for having extended/expanded the section 163 remedy to afford relief to shareholders and directors whom the legislature may not have contemplated to cover under the relief. The aim here is to argue in support of this expansion as promoting accountability. Secondly, it is to make some comments on the criterion that it is only a shareholder and a director who are accorded locus standi to invoke the remedy. From the discussion, the paper makes numerous commendable observations. First, the complaint raised in Peel was not an abuse of process; it was a genuine complaint/application seeking to address genuine and novel issues which often arise between the parties in company law. Second, Moshidi J's judgment demonstrates evolution/progress for its contextual approach to the section 163 remedy's interpretation. The judgment heralds/foreshadows colossal principles/practices within company law aimed at balancing stakeholder interests. Third, the judgment potently disentangles hurdles which normally impede accountability by company directors. Lastly, the paper recommends that other stakeholders be considered for relief under the remedy.
Highlights
Impediments to corporate accountability have over the recent years manifested in one form or the other
Impediments to corporate accountability have over the recent years manifested in diverse forms
It is shown that when some courts embark on exposing the true character of particular conduct, they are mindful of and/or showing awareness of their constitutionally entrenched duties to close any possible loopholes either within company law rules or stakeholder relations which other directors might advantageously use to escape legislative accountability; such judgments can be commended for their robust approach to demand conformity to the governance of company affairs as envisioned by the Companies Act 71 of 20082 (2008 Act) as its general purpose
Summary
Impediments to corporate accountability have over the recent years manifested in one form or the other. The intention here is to argue in support of that expansion because in the view of the writer it assists to prohibit mala fide conduct perpetrated by company directors who hide behind the corporate veil, and promotes accountability. It is to make certain comments on the criterion that it is only a shareholder and a director who are accorded locus standi to invoke the remedy, and determine whether the limit to this class of complainants stems from any policy rationale, bearing in mind the general purpose of the 2008 Act. This paper contributes to this ongoing debate in the context of what took place in Peel. Part 6 provides overall remarks and the conclusion is set out in part 7
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