Kruger Ranch’s bid to blame Absa for ‘bad loan’ backfires in court
The National Credit Act does not apply to a loan granted to a company.
Image: Ron | IOL
Each of Kruger Ranch’s arguments that attempted to stop its own liquidation have been systematically dismantled by the Johannesburg High Court, including that Absa was negligent in loaning it money.
It was the very debt to Absa that caused its liquidation in the first place, as it was overdue.
Judge Wilson also slammed the company’s lawyers: “The fundamental problem in this case is the manner in which Kruger Ranch’s legal representatives have allowed themselves to abet an application which transparently lacks merit, and which has been slovenly pursued.”
Then, Kruger Ranch was found lacking in its argument that a loan Absa Bank had granted it in 2019 was a case of “reckless lending”.
“This overlooks the fact that the [National Credit] Act does not apply to the loan, because Kruger Ranch is a juristic entity, whose turnover exceeds the relevant amount the Act prescribes."
The company’s bid to escape being wound up – a winding-up order was granted in February 2025 – also relied in its claim that its debt to Absa Bank, for an undisclosed value, had prescribed.
The court rejected this, finding that the debt – defaulted on in April 2024 – is clearly enforceable.
“The full outstanding amount repayable on the loan fell due when Absa called the loan up on default. This could only have happened after the default occurred, on 16 April 2024,” wrote the judge.
Assuming that the amount due under the loan agreement was an ordinary debt, Absa’s claim for it would have prescribed on 17 April 2027 at the earliest, read the judgment.
Under South African law, prescription sets time limits on when debts can be enforced. In most cases, a creditor has three years from the date a debt becomes due to take legal action, failing which the claim becomes unenforceable.
Prescription can be interrupted if the debtor acknowledges the debt or if legal proceedings are started. Some debts, including those secured by a mortgage bond, prescribe over longer periods.
However, a prescription does not wipe out a debt, but it prevents it from being enforced through the courts once the time limit has passed.
Kruger Ranch also tried arguing that it only recently became aware of the order and claimed grounds to overturn it, but the court found the case “poorly litigated” and lacking any real merit.
Then, Kruger Ranch’s lawyers said it was factually solvent at the time it was wound up.
“No evidence of that proposition was presented in support of it,” the ruling said.
It was also argued that winding-up order was invalid because summons had not been issued claiming the debt upon which the order was founded. “But no such summons was necessary,” said the judge.
The application, launched by former director Clinton Kruger rather than the company’s liquidator, was initially challenged on the basis that he had no power to act.
However, the court relied on a 2025 Supreme Court of Appeal decision confirming that former directors can, in certain circumstances, bring such applications on a company’s behalf – giving Kruger Ranch a narrow window to argue its case.
The court described the application as “slovenly pursued”, saying the founding affidavits were “repetitive” and lacked detail.
While suggestions were raised that the litigation might have been used to delay the winding-up, the judge noted that any such concerns could be addressed through the liquidation process itself.
The application was dismissed. Costs, including those of an earlier aborted hearing in December 2025, were ordered to form part of the winding-up.
No personal costs order was made against Kruger. With the stay rejected, Kruger Ranch’s liquidation will proceed, and its financial obligations to Absa Bank remain enforceable.
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