A jewellery company which reneged on an agreement to pay business rescue practitioners R2m has been castigated by the SCA.

Caratco – which held an indirect controlling interest in Galaxy Jewellers – made arguments that were ‘not only extraordinary, but utterly without merit’, said Judge Azhar Cachalia.

A Times Select report says Cachalia was particularly critical of Caratco MD Tim Watson, ‘the Galaxy group’s controlling mind’, for admitting in an affidavit that there was an agreement to pay business rescue practitioners Independent Advisory, then later denying it.

Cachalia and four other judges dismissed Caratco’s appeal against a finding of the Gauteng High Court (Johannesburg) that it must pay Independent Advisory R2m plus VAT.

In the High Court, said Cachalia, Caratco did not call Watson to explain why he had accepted that an agreement was concluded in his answering affidavit, which was now denied in its plea.

In its application for leave to appeal, Caratco ‘persisted with its unmeritorious defence that no agreement had been concluded ... despite Watson’s earlier admission to the contrary’.

Said Cachalia: ‘It is clear from the evidence that Watson ... was a central figure in negotiating and concluding the agreement.’

Full Times Select report (subscription needed)