Introduction
The main aim of this article is to undertake a analysis of the effect that the advantage to creditors requirement has on sequestration applications. In terms of the Insolvency Act 24 of 1936 there are two processes that a debtor may sequestrate his estate. Either by voluntary surrender of his estate or by compulsory sequestration. In both these instances there is a requirement that the granting of the sequestration must be to the “advantage of the creditors”. A discharge of debtors from debts is a something yet to be realized if the advantage requirement is not relaxed. Although the Act does not outline what constitutes an advantage of creditors, the courts have interpreted it to encapsulate a benefit to creditors.
Loubser expresses a view that:
“South Africa cannot remain untouched by developments in Europe and the United States of America, and the signs are there that in South African insolvency law, too, more emphasis is gradually being placed on the plight of the insolvent debtor and the opportunity he should be given to make a fresh start.”
Cases Law that shows the required as a major part of our South African Insolvency Law system:
1. In Ex parte Arntzen
The court rejected the application for voluntary sequestration of this estate because the court was not satisfied that the applicant owned realizable property of sufficient value to defray all costs of the sequestration which will, in terms of the Act, be payable out of the free residue of his estate. Also that that it would be to the advantage of his creditors if his estate is sequestrated. In this case we can see that the courts used this advantage to creditor requirement to decide on whether to grant this application or not.
In ex parte Shmukler
The cou...
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...50 000 and who can afford to pay debts in instalments.
Debt review also does not provide debtors with discharge.
In my humble opinion I would like to submit that I agree with the above articles discussed in that South African Insolvency Law needs a complete change to the advantage of debtors as discussed above. Clearly the advantage to creditor’s requirement has placed a stumbling block in the path of complete debt relief and a fresh start for the debtor. I submit that for the debtors that are drowning in debt a review of the systems in place is necessary if we would like to get our country back to the economically strong place that we have been in the past.
For South Africa to decrease the number of people that seek these sequestration orders we have to change our processes and put other debt relief measures in place to cope with the debtors that require them.
Issue: Whether public policy forbids the recovery by a plaintiff partner to an unmarried but cohabitating or relationship, from the other partners estate, for services rendered to or benefits conferred upon the other partner through the plaintiffs work in the operation of a joint business when the business proceeds were utilized to enrich the estate of the diseased
Instead of the current administration making a swift and decisive action to deal with these insolvent institutions, there were many bureaucratic attempts to delay action so that the problems would not become a polit...
Case name: Peter K. Dementas v The Estate of Jack Tallas, 764 P.2d 628 (1988)
The decision of the House of Lords in City of London Building Society v Flegg marks a key stage in how the balance is drawn between occupiers and creditors in priority disputes; the seeds of which were originally planted in the Law of Property Act 1925. It posed a serious challenge to the conventional understanding of overreaching and the machinery of conveyancing.Ref ?
A Quistclose trust arises when money is paid to a recipient for a specific purpose, if that purpose fails the money is held on trust for the payer. It mostly arises in insolvency cases where the proprietary rights have to be established. However, this type of trust has been thought to be inconsistent with the traditional trust principle. Many have suggested the Quistclose trust must be treated as any other fully fledged security device taking into account the protection it offers the payer on insolvency and should therefore be registrable. This essay critically analyses the concept of Quistclose trust, whether it differs from the resulting trusts.
Gummow and Bell JJ concluded that clause 1 of the Deed signed Rural’s debts and its interests under the loan agreements to Equuscorp. Their Honours observed that the phrase “other remedies for these matters” located in clause 2 assigned a claim in restitution for money had and received . Heydon J agreed with this decision on similar grounds .
Andrews N, Strangers to Justice No Longer: The Reversal of the Privity Rule under the Contracts (Rights of Third Parties) Act 1999 (2001) 60 The Cambridge Law Journal 353
It has been generally acknowledged that the doctrine of proprietary estoppel has much in common with common intention constructive trusts, i.e. those that concern the acquisition of an equitable interest in another person’s land. In effect, the general aim is the recognition of real property rights informally created. The similarity between the two doctrines become clear in a variety of cases where the court rely on either of the two doctrines. To show the distinction between the doctrines, this essay will analyse the principles, roots and rationale of both doctrines. With reference to the relevant case law it will be possible to highlight the subtle differences between the doctrines in the cases where there seems to be some overlap. Three key cases where this issue surfaced were the following: Lloyds Bank Plc v. Rosset (1991), Yaxley v. Gotts (1999) and Stack v. Dowden (2007). This essay will describe the relevant judgements in these cases in order to show the differences between the two doctrines.
“[T]he pari passu principle providing for equality of division among creditors is said to be one of the (if not the most) fundamental principles of the law of insolvency and is at the very heart of the who...
The unfair prejudice petition has always been regarded as the easier and more flexible option for minority shareholders’ protection compared to the statutory derivative action. The restrictive leave requirements under the statutory derivative claim where the concept of prima facie, good faith and ratification have been interpreted within the confines of the origins in the case of Foss v Harbottle do not add any appeal the statutory derivative claim. Further, the approach in relation to granting indemnity costs orders which is rather limited does not in any way encourage any potential claimant to pursue a derivative action. Recent cases which allows corporate relief to be obtained via unfair prejudice petition and even the possibility if recovering costs under and unfair prejudice petition has further relegated the significance of the derivative action.
Despite it’s longevity, consideration is not without criticism. Lord Goff observed in White v Jones that: ‘our law of contract is widely seen as deficient in the sense that it is perceived to be hampered by the presence of an unnecessary doctrine of consideration’. Abolition has been urged. Since the publication of the Law Revision Committee’s report in 1937, la...
[7] Cavendish Lawcards Series (2002) Company Law (3rd edn), p.15 [8] [1976] 3 All ER 462, CA. [9] Griffin, S. (1996) Company Law Fundamental Principles (2nd edn), p.19 [10] [1990] Ch 433. [11] Lecture notes [12] Lecture notes [13] [1939] 4 All ER 116.
According to Corporation Act 2001 s124(1), it illustrates that ‘’A company has the legal capacity and powers of an individual both in and outside the jurisdiction” . As it were, company as a legal individual must be freely with all its capital contribution shall embrace liability for its legal actions and obligations of the company’s shareholders is limited to its investment to the company. This ‘separate legal entity’ principle was established in the case of Salomon v Salomon & Co Ltd [1987] as company was held to have conducted the business as a legal person and separate from its members. It demonstrated that the debt of company is belonged to the company but not to the shareholders. Shareholders have only right to participate in managing but not in sharing the company property. Besides ,the Macaura v Northern Assurance Co Ltd [1925] demonstrates that the distinction between the shareholders and company assets. It means that even Mr Macaura owned almost all the shares in the company, he had no insurable interest in the company’s asset. The other recent case is the Lee v Lee’s Air Farming Ltd [1961] which illustrates that the distinct legal entities between employee ad director allows Mr.Lee function in dual capacities. It resulted that the corporation can contract with the controlling member of the corporation.
An insolvent debtor may file a debtor’s petition for voluntary bankruptcy. The insolvent debtor must provide to the court a summary of debts and assets. An agreement between a debtor and creditor that the amount stated as being owed to the creditor is accurate is an account stated. However, an account that is open and unsettled is an account current.
The courts of England and Wales acknowledge that the above must be something of value, in order to amount to consideration. A valuable consideration in the perspective of the English La...