The Port Elizabeth High Court on Thursday granted an order to place the Southern Spears rugby franchise under provisional liquidation, South African Broadcasting Corporation (SABC) radio news reported.
The application was brought by former Spears legal officer Charl Crous, who is representing former Spears players and employees for loss of earnings.
The Spears and the South African Rugby Union (Saru) have until March 27 to argue against final liquidation.
The Southern Spears were originally intended to participate in the Super 14 competition this year. However, their proposed entry into the competition led to controversy within the rugby establishment.
They were denied entry into the Super 14 in April last year after concerns over the franchise’s financial stability and sporting competitiveness.
Earlier this week, a disciplinary committee convened by Saru dismissed charges against former Southern Spears chief executive Tony McKeever.
The hearing in Cape Town on Monday could not find McKeever guilty of bringing the game into disrepute, following media statements he was alleged to have made during the course of last year.
The charges were dismissed after the legal representative of Saru informed advocate Jannie Lubbe, who chaired the hearing, that certain key witnesses had refused to testify.
The SABC further reported another rugby-related case in the same Port Elizabeth court as Thursday’s hearing. The Nelson Mandela metro had applied for the provisional sequestration of the Eastern Province Rugby Union, which allegedly owes the metro for electricity and services. The case was postponed to March 22. — Sapa