Exam (elaborations)
MRL3701 Assignment 2 2024
- Institution
- University Of South Africa
MRL3701 Assignment 2 2024
[Show more]
Content preview
MRL3701Assignment 2
(ANSWERS)
Semester 1 2024
, Wandile owes a total of R3 million to various creditors. His creditors include
Zozo to whom he owes R400 000. He also owes R1,3 million to DRG Bank.
Last year Wandile invested in a get-rich-quick scheme as a result of which he
lost a lot of money. This left him in a dire financial situation. By 31 October
2023 his liabilities exceeded his assets by R800 000. Over the past few
months Wandile has failed to pay some of his debts. In particular he failed to
pay the R400 000 he owes to Zozo. This debt was due and payable on 1
February 2024. Disappointed at not having been paid back the R400 000
owed to her, Zozo undertook an investigation into Wandile’s financial
situation. The investigation turned up unassailable proof that Simphiwe had
owed R100 000 to his father-in-law, and that Simphiwe repaid R80 000 to his
father-in-law on 3 February 2024. Mindful that he was technically insolvent
and that one of his creditors could apply for the sequestration of his estate at
any time, Simphiwe had wanted to ensure that whatever happened, his father-
in-law would at least get something from his estate. Hence, he repaid the loan
that he had obtained from his father-in-law even though the amount was only
due and payable on 30 November 2024. Zozo has established that Wandile
owns a house in Mamelodi valued at R700 000, household furniture valued at
R300 000 and a motor vehicle valued at R800 000. Zozo is planning to apply
for the sequestration of Wandile’s estate. Answer the following questions
based on the facts given above:
a. Discuss the requirements that an applicant must prove in order to obtain
a court order for the sequestration of a debtor’s estate. (3)
1. Insolvency:
The applicant must establish that the debtor is insolvent,
meaning that the debtor is unable to pay their debts as they
become due. In this case, Wandile's liabilities exceeded his
assets by R800,000, indicating insolvency.
2. Cessation of Payment:
The applicant needs to show that the debtor has ceased to
meet their financial obligations. In Wandile's case, his failure to
pay the R400,000 debt to Zozo and other debts, despite being
due, suggests a cessation of payment.
3. Benefit to Creditors:
The court will consider whether sequestration will be beneficial
to the creditors. The applicant needs to demonstrate that there
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Jennifer2024. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R46,62. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
71498 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy summaries for 14 years now