Exam (elaborations)
MAY/JUNE EXAM PACK MRL3701
- Course
- Institution
ACCURATE SUBSTANTIVE ANSWERS THAT WILL BRING GREATFUL RESULTS AND DISTINCTION.
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June 2018Question 1
A condone
B bona fide
C payment
D compulsory
E insolvent debtor
F gratuity
G title
H owner
I asset
J notice
K six weeks
L physically
M market value
N pledge
O consent
P court
Q common law
R resolution
S member
T affected person
Question 2
1. T
2. F
3. F
4. F
5. F
6. T
7. T
8. T
9. F
10. F
, 11. F
12. F
13. T
14. T
15. T
Question 3
A
In terms of section 6(1) of the Insolvency Act, the court must be satisfied that (a) all
the prescribed formalities have been adhered to (notices, etc); (b) Tenza’s estate is
indeed insolvent; (c) there is sufficient realisable property in the free residue of
Tenza’s estate to defray the costs of sequestration; and (d) it will be to the advantage
of Tenza’s creditors if his estate is sequestrated.
B
With regard to the requirement of advantage to creditors at an application for the voluntary surrender
of the estate, note the prescribed decision in Ex parte Henning 1981 (3) SA 843 (O). In this case, the
debtor’s wife, to whom he was married out of community of property, made a monthly contribution
from her salary to pay his (the debtor’s) creditors. The question was whether this fact should have
been taken into account to determine whether sequestration would be to the advantage of the
creditors. The court held that it could not be taken into account, because it was uncertain whether
the debtor’s wife would continue working, and would continue to make the monthly contribution. She
could not be compelled to do so, because her husband’s creditors were not her creditors.
C
Magnum Financial Holdings
1. Where a trust at law could be sequestrated
2. trust fell within definition of debtor through its trustee
3. trust can borrow and as property owner be liable for rates and taxes
4. creditors could be paid from trust estate
5. trustees cannot be held personally liable
6. estate could be sequestrated to establish concursus creditorium
D
1. Insolvent prevented from holding office
• insolvent is prohibited from holding some offices if there is a possibility of prejudice to the public
interest,
• if a great amount of trust and responsibility is required, or
• if the possibility of dishonest business practices exists.
• The common denominators in these offices are honesty and trust.
• Sometimes there is an accumulation of circumstances over which the debtor had no control which
led to his insolvency. But very high expectations are placed on members of the National Assembly,
and it is therefore reasonable to prohibit a person who is insolvent from serving as a member.
E
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