Compromise (Section 311 of the Companies Act)
A: The purpose of a Section 311 compromise is to reach a binding agreement between the shareholders and creditors of the company with a view to modify their claims against the company in the common interest of all parties concerned. Section 311 therefore creates the machinery which enables the company to negotiate with members of a group of shareholders and / or creditors collectively and combine all the members of that group to the agreement reached by the majority of member
Creditors in Liquidations
Q: What is a Preferent creditor? A: A preferent creditor is a creditor who holds security for his loans for example the creditor who has granted you a loan on your house or a hire purchase on your motor vehicle are examples of secured creditors. Apart from these creditors certain statutory creditors are preferent for example the taxman, employees, television licenses, costs owing to your doctor on your deathbed etc. The list is rather long and we will advise you on this. Q: W
What is a Secured creditor?
A: A Secured Creditor is a creditor which holds security for the credit. Examples: bond over your company’s property, motorcar/asset finance etc. He stands first in line in the asset is sold.
Q: Who is “The Master of the High Court”?
A: The Master of the High Court is an institution which is the guardian of all insolvents, minor children and the estates of deceased persons. Guardians, trustees, Liquidators and Executors all report to the Master in the execution of their duties.
Q: What is a: “Trustee”, “Liquidator” and “Curator”?
A: Once a natural person is sequestrated the Master of the High Court appoints a Trustee who must take control of the assets. In case a Company, Close Corporation or certain other legal entities are liquidated, the person appointed by the Master is referred to as a Liquidator. Curator can be either someone who is appointed to be guardian of the assets of an institution like for example an Art Gallery or Museum. A Curator is also the title used for a person appointed as guardi
What is the difference between “sequestration”, “bankruptcy”, “liquidation”, “insolvency” and “surre
Q: What is the difference between “sequestration”, “bankruptcy”, “liquidation”, “insolvency” and “surrender of estate”? A: “Sequestration”, “bankruptcy” “insolvency” and “liquidation” are all different terms, which in layman’s terms simply mean that a person or business is in such a bad financial state that creditors cannot get paid. The term “liquidation” refers to the bankruptcy of a company or close corporation and certain other legal entities. “The term “sequestration”ref
