REPORTABLE CASE NO: SA 106/2020 IN THE SUPREME COURT OF NAMIBIA In the matter between: TRANSNAMIB HOLDINGS LTD Appellant and STOCKS & STOCKS LEISURE (NAMIBIA) (PTY) LTD First Respondent SWAKOPMUND STATION HOTEL (PTY) LTD t/a THE SWAKOPMUND STATION HOTEL AND ENTERTAINMENT CENTRE Second Respondent MINISTER OF WORKS AND TRANSPORT MINISTER OF PUBLIC ENTERPRISES REGISTRAR OF COMPANIES Coram: SHIVUTE CJ, MAINGA JA and SMUTS JA Heard: 29 April 2021 Delivered: 14 May 2021 Summary: Third Respondent Fourth Respondent Fifth Respondent This is an appeal against the judgment and order of the High Court granting with costs, an application brought under s 260 of the Companies Act 28 of 2 2004. Section 260 replaced section 252 of the repealed Companies Act 61 of 1973 to empower a court to provide relief to a member of a company from unreasonably prejudicial, unjust or inequitable or oppressive conduct of the company affairs. The issue in this appeal is whether the conduct of the appellant falls within the parameters of the provision and warranting the granting of the application by the court below. The appellant and the third respondent are both equal shareholders in the second respondent, a company that operated a hotel and entertainment centre at the coastal town of Swakopmund. In 2020 the first respondent commenced a High Court application for relief under s 260. It claimed that the appellant had acted in a manner unreasonably prejudicial to the second respondent and, for that complaint, sought relief pursuant to the provisions of s 260 including compelling the appellant to sell its shares to it for N$5 million. The application was opposed by the appellant, the third and four respondents. The fifth respondent did not oppose the application and did not also participate to the proceedings in the court below as well as on appeal. The High Court held that s 260 empowered the courts to provide equitable relief to equal shareholders (and not only minority shareholders) provided that the conduct complained of met the criteria of s 260. The court proceeded to hold that the appellant’s refusal to accept a proposal to convert loans into equity as well as its refusing to provide further funds to the second respondent and accepted the offer to sell its share, considering the parlous state of the company, amounted to conduct as contemplated by s 260. The court thus granted the application with costs. It was not necessary for it to deal with the alternative relief in the form of a winding-up order on the grounds of being just and equitable. The appellant aggrieved, has appealed to the Supreme Court against the decision of the High Court. The appellant argued, amongst other things, that the first respondent had failed to establish any conduct on the part of the company which was unreasonably prejudicial, unjust or inequitable to it. The appellant however conceded that disagreements existed between itself as a shareholder and the first respondent as the other shareholder, concerning the running of business of the 3 second respondent, but it maintained that disagreement fell short of conduct which engaged s 260. The appellant thus claimed that the court below was wrong to have found that its conduct fell within the parameters of the provision. On appeal, the Supreme Court held that the first respondent failed to establish unreasonably prejudicial conduct on the part of the appellant. It was further held that the first respondent failed to meet the jurisdictional facts required in s 260(3) that the relief would bring to an end the deadlock complained of and that the relief itself was just and equitable. The Supreme Court also held that the court below should have made an order for the provisional winding-up of the second respondent instead of granting the relief in terms of s 260. That is the order made by this court and the matter is referred back to the High Court for further case management consistent with this order. APPEAL JUDGMENT SMUTS JA (SHIVUTE CJ and MAINGA JA concurring): [1] This appeal concerns the scope and ambit of the remedy provided to a shareholder by section 260 of the Companies Act 1 to obtain relief from unreasonably prejudicial, unjust or inequitable conduct of a company or where its affairs are conducted in such a manner. The heading of the section is ‘Remedy of member in case of oppressive or unreasonably prejudicial conduct’. Relevant to this appeal are sub-sections 260(1) and 260(3) which provid

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