The Appointment of a Proxy "At Any Time" in Terms of Section 58 of the Companies Act 71 of 2008: Richard Du Plessis Barry v Clearwater Estates NPC [2017] ZASCA 11

Keywords: Proxy; representation by proxy, Appointment of proxy, Proxy giver, proxyholder, shareholders' meetings, Alterable provision, Unalterable provision, The Richard Du Plessis Barry case, Section 58 of the Companies Act 71 of 2008

Abstract

Section 58(1) of the Companies Act 71 of 2008 gives a shareholder the right to appoint a proxy "at any time" for the purpose of participating in, speaking and voting on behalf of that shareholder at a shareholders′ meeting, or providing or withholding written consent on behalf of the shareholder in terms of section 60. One important issue that arises in regard to the appointment of a proxy relates to the proper interpretation of section 58(1) of the Companies Act 71 of 2008, namely whether this section, as read with section 58(3)(c), constitutes an unalterable provision giving a shareholder an unlimited right to appoint a proxy "at any time" before the proxy exercises the shareholder's rights at the shareholders meeting, or whether the time period within which the instrument of a proxy′s appointment must be delivered to the company may be restricted by the MOI. This issue was considered by the SCA in the Richard Du Plessis Barry case in view of the appellant′s contention that the provisions of the MOI that limited the time period within which the instrument appointing a proxy must be delivered to the company, or other person on behalf of the company, were valid. In this note, I examine the Richard Du Plessis Barry case with a focus on the proper interpretation of the right of a shareholder to appoint a proxy "at any time" as conferred by section 58(1) of the Companies Act 71 of 2008. I provide some critical comments on the main issues that this judgement raises, including the interpretation of section 58(1) in the context of "alterable" and "unalterable" provisions of the Companies Act 71 of 2008, a purposive interpretation of section 58(1), the interaction between section 58(1) and section 58(3)(c), the significance of the difference in the wording of section 58(1) of the Companies Act 71 of 2008 and section 189 of the previous Companies Act 61 of 1973, as well as the practical implications of the court's decision in this matter. This is followed by a brief comparative analysis with selected international jurisdictions and some concluding remarks.

 

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Author Biography

Vela Madlela, University of South Africa

Lecturer, Department of Mercantile Law

References

Bibliography

Literature

Cassim et al Contemporary Company Law
Cassim FHI et al Contemporary Company Law 2nd ed (Juta Claremont 2012)

Davis et al Companies and Other Business Structures
Davis D et al Companies and other Business Structures in South Africa 3rd ed (Oxford University Press Cape Town 2013)

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Du Plessis and Mathiopoulos 2016 Aust Jnl of Corp Law
Du Plessis JJ and Mathiopoulos JA "Defences and Relief from Liability for Company Directors: Widening Protection to Stimulate Innovation" 2016 Aust Jnl of Corp Law 287-318

Stein and Everingham New Companies Act Unlocked
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Stoop 2016 JCCL&P
Stoop H "Alterable and Unalterable Provisions of the Companies Act 71 of 2008: Recent Cases Expose Inherent Uncertainties" 2016 JCCL&P 40-51

Case law

Du Plessis Barry v Clearwater Estates NPC (GP) (unreported) case number 82306/2014 of 13 November 2015
Natal Joint Municipal Pension Fund v Endumeni Municipality [2012] ZASCA 13 (16 March 2012)
Nuwe Suid-Afrikaans Prinsipale Beleggings (Edms) Bpk v Saambou Holdings Ltd 1992 4 SA 387 (W)
R v Shole 1960 4 SA 781 (A)
Richard Du Plessis Barry v Clearwater Estates NPC [2017] ZASCA 11 (16 March 2017)

Legislation

Australia
Corporations Act, 2001

Canada
Business Corporations Act, 1985

India
Companies Act, 2013

Kenya
Companies Act, 2015

New Zealand
Companies Act, 1993

South Africa
Companies Act 61 of 1973
Companies Act 71 of 2008

UK
Companies Act, 1985
Companies Act, 2006
Government publications
GN 1183 in GG 26493 of 23 June 2004
GN 969 in GG 41913 of 21 September 2018

Internet sources
Cashbuild Limited 2017 http://www.cashbuild.co.za/Reports/2017/
Tabs/notice_of_annual_general_meeting.pdf
Cashbuild Limited 2017 Notice of Annual General Meeting http://www.cashbuild.co.za/Reports/2017/Tabs/notice_of_annual_general_meeting.pdf accessed 22 December 2017

Strate 2017 https://www.strate.co.za/blog/2017/11/nasdaq-to-deliver-blockchain-e-voting-solution-to-strate/
Strate 2017 Nasdaq to Deliver Blockchain e-Voting Solution to Strate https://www.strate.co.za/blog/2017/11/nasdaq-to-deliver-blockchain-e-voting-solution-to-strate/ accessed 13 November 2018

Super Group Limited 2017 http://supergroup.co.za/2017_
integrated_report/downloads/supergroup_agm.pdf
Super Group Limited 2017 Notice of Annual General Meeting http://supergroup.co.za/2017_integrated_report/downloads/supergroup_agm.pdf accessed 22 December 2017

List of Abbreviations
AGM Annual General Meeting
Aust Jnl of Corp Law Australian Journal of Corporate Law
DTI Department of Trade and Industry
JCCL&P Journal of Corporate and Commercial Law and Practice
MOI Memorandum of Incorporation
SCA Supreme Court of Appeal
UK United Kingdom
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Published
2019-01-31
Section
Case Notes