On 8 April 2024 the Supreme Court of Appeal delivered a judgment affirming that the residence of the defendant alone does not confer jurisdiction on the South African courts where no other link exists between the claim and the jurisdiction of the South African courts.       

A South African company sought an order in terms of the Swaziland Companies Act against the directors of an Eswatini company, holding them personally liable for debts owed by the Eswatini company to the South African company.  This order was sought on the alleged basis that the directors allowed the Eswatini company to trade recklessly.    

At all material times the Eswatini company conducted its business in Eswatini and not in South Africa.  The Eswatini company was also liquidated in Eswatini.  The directors, however, were all resident in South Africa.  The court had to determine whether South African courts had jurisdiction to apply the Swaziland Companies Act against the directors.    

The court stated that the residence of the directors within its geographical area of jurisdiction without more was insufficient to confer jurisdiction in the circumstances.  The dispute concerned alleged reckless conduct in a foreign country by a foreign company that was liquidated by a foreign court.  The Swaziland Companies Act has no extraterritorial application and the reference to “court” in that Act can only mean the Eswatini courts.  

Therefore, no link existed between the South African company’s claim and the jurisdiction of the South African courts.  Accordingly, the South African company’s claim was dismissed with costs.

The appropriate remedy for the South African company is to obtain a final judgment in Eswatini and enforce it in South Africa.  

The case is Organi Mark (Pty) Ltd v Goolam Nabi Ebrahim Akoodie and Another (240/2023) [2024] ZASCA 44 (8 April 2024).