Liquidations & Sequestrations
When a company or CC is unable to pay its debts as and when they become due, the management has to make a decision on whether or not the business can continue. If the answer is no, then the company is to be placed into liquidation which encompasses the process of a liquidator being appointed to basically turn the remaining assets into cash to pay off remaining creditors and debts.
When the company`s liquidation is finalised the company is dissolved, however, the possibility of personal sureties of the management being called upon remains. If they are unable to pay their debts, the sequestration process may be followed.
When a person is unable to pay his/her debts and is insolvent, then the sequestration process is followed to surrender the estate to an executor appointed by the Master of the High Court. When applying to Court for your estate to be sequestrated, there can be distinguished between the voluntary or compulsory sequestration.
Partners Wernher Bock & Hannes Pretorius both have extensive experience in the field of insolvency law. Be sure to arrange a consultation with them as soon as your company/personal finances begin to cause headaches to make sure that the right process is followed.