ATTORNEYS IN SOUTH AFRICA TO ASSIST WITH INSOLVENCY MATTERS: YOUR QUESTIONS
Since voluntary sequestration is a judicial process, you need legal help, so make use of experienced attorneys in South Africa to assist with insolvency; do not rely on information from friends or family. Even before you take the first step towards voluntary sequestration, consult with sequestration attorneys in South Africa to assist with insolvency matters. They can help you avoid several costly pitfalls and make sure your application for voluntary sequestration complies with legal requirements. To get you started, let us consider questions on insolvency in South Africa, giving you an idea of how experienced attorneys can assist:
WHAT IS THE STAY OF SALES IN EXECUTION?
Once insolvency attorneys in South Africa have filed the notice of intention to apply for sequestration in the Government Gazette, the sheriff may not sell any assets attached for a sale in execution. If the sheriff is not aware of the notice, the sale in execution may still go ahead. The court can award the sale of the assets, provided it can benefit the creditors. Despite the stay of sales in execution, other types of civil proceedings against you can continue. This means that the court may still grant a writ of execution. Our attorneys are here to assist with insolvency matters such as a stay of sales in execution and thus to help protect you during the prohibition period.
WHAT IS THE PERIOD FOR THE STAY OF SALES IN EXECUTION?
The law does not state a specific period, so it is generally taken as lasting until the day of the hearing in court.
IS THE ATTACHMENT OF EXECUTION OF JUDGMENTS STOPPED BY THE NOTICE OF INTENTION TO VOLUNTARY SEQUESTRATE?
No. It can still go ahead, regardless of the stay of the execution of sale.
ONCE THE NOTICE OF SURRENDER IS PUBLISHED, CAN A PERSON STILL SELL THEIR ASSETS?
Yes, though this is not recommended. As the debtor, you are still in control of your financial estate and can thus sell assets. With the legalities involved, best seek advice from our attorneys in South Africa to assist with insolvency matters such as the right to sell assets or applying for a mortgage on immovable property after the publication of the notice.
WHAT HAPPENS IF THE DEBTOR DOES NOT PROCEED WITH THE APPLICATION FOR VOLUNTARY SEQUESTRATION AFTER THE NOTICE OF SURRENDER HAS BEEN PUBLISHED?
Failure to proceed with the application is an act of insolvency. A creditor has the right to bring an application for the compulsory sequestration of the debtor in this case, should the debtor not withdraw the notice of surrender. The debtor can withdraw the notice and application but there is an inherent risk of a creditor proceeding with an application for compulsory sequestration. The creditor can do the same if the debtor lodges an incomplete, false, or incorrect statement of affairs. Of course, the statement should be materially defective; a small mistake that does not affect the potential outcome of the sequestration. Here too, call on attorneys in South Africa to assist with such intricate insolvency matters.
DOES THE DEBTOR NEED PERMISSION TO WITHDRAW THE NOTICE?
Yes. Once the notice has been published in the Government Gazette, the Master must grant permission for withdrawal – but only if it is clear that the debtor published the notice in good faith, with the intention to surrender their estate, and has a valid cause for withdrawing it.
HOW DOES THE DEBTOR WITHDRAW THE NOTICE?
Upon consent of the Master, the debtor publishes the withdrawal notice in the Government Gazette and the publication in which the notice of intention to surrender their estate was published. Seek guidance from our attorneys in South Africa to assist with insolvency matters such as withdrawal of notices in compliance with legal requirements.
WHEN DOES THE NOTICE OF SURRENDER LAPSE?
The notice is no longer valid once the Master consents to withdrawal and the notice is duly published in the relevant publications, or if the court does not accept the debtor’s application, or if the debtor does not apply for surrendering their estate between 14 and 30 days before the notice’s stated date of the hearing.
The court can still reject the surrendering of the estate even if all the requirements have been met. In this regard, seek legal guidance on factors that may cause rejection of the application. Call our attorneys in South Africa to assist with insolvency matters such as the ones discussed herein.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Call our attorneys rather than relying on the information herein to make any decisions. The information is relevant to the date of publishing: October 2019.