Shareholders' agreements cannot oust statutory winding-up power; tax amendment commences immediately

Government Notice R. 7838 of 19 August 2026 determines that section 1(1)(f) of the Taxation Laws Amendment Act, 2024 (Act 42 of 2024) comes into operation on 19 August 2026, the date of publication. The Minister of Finance acted under section 1(3) of the Act, which had deferred commencement of this provision pending ministerial determination. The gazette notice does not set out the substantive content of section 1(1)(f); practitioners must cross-reference Act 42 of 2024 to identify the specific tax amendment now in force. There is no lead-in or transitional period — the provision is operative from the date of publication.

Two equal shareholders in a property-holding company (Proud Heritage Properties 60) were formerly in a romantic relationship. After the relationship broke down irretrievably, the shareholders and directors reached a complete deadlock on the management and direction of the company. The applicants sought provisional liquidation on just and equitable grounds under s 81(1)(d)(iii) of the Companies Act 71 of 2008. The respondent resisted, relying on a shareholders' agreement (SHA) that purportedly required disputes to be resolved through its own mechanisms, and filed a supplementary counter-application.

The court held: The court ordered provisional liquidation, holding that the SHA cannot displace the court's statutory winding-up jurisdiction — statute prevails over a private agreement. The irretrievable breakdown of the quasi-partnership relationship and resulting deadlock satisfied the just and equitable ground. The court further held that Rule 6(7) permits only one counter-application per party, set aside the supplementary counter-application as irregular and an abuse of process, and awarded punitive attorney-and-own-client costs for that step. The court declined to determine the solvency dispute, finding it unnecessary once the just and equitable ground was established. A rule nisi was issued returnable on 13 October 2026.

Legal impact: Confirms that shareholders' agreements cannot contract out of the court's statutory winding-up power under s 81(1)(d)(iii), reinforcing the supremacy of statute over private shareholder arrangements in quasi-partnership companies. This is directly relevant to the drafting and enforcement of SHAs. The Rule 6(7) ruling — that only one counter-application is permitted — provides procedural clarity and a deterrent against dilatory supplementary filings. The punitive costs order signals judicial intolerance of procedural abuse in liquidation proceedings.