Some Consequences of the National Credit Act 34 of 2005 on the Proof of Claims in Insolvency Law
2010. Tydskrif vir die Suid-Afrikaanse Reg, vol. 4, pp. 797-807
11 Pages Posted: 26 Feb 2018
Date Written: 2010
As a general rule any creditor who wishes to share in the distribution of the proceeds of the assets in an insolvent estate must prove a claim against the estate at a meeting of creditors (“creditors” in this context refers to creditors in respect of debts incurred prior to sequestration – cf Vather v Dhavraj 1973 2 SA 232 (N)). South African insolvency law proceeds from the premise that once a sequestration order is granted, a concursus creditorum comes into being and the interests of the creditors as a group enjoy preference over the interests of individual creditors (cf Walker v Syfret 1911 AD 141 166, where the court explained the key concept of concursus creditorum; Richter NO v Riverside Estates (Pty) Ltd 1946 OPD 209 223; Sharrock et al Hockly’s Insolvency Law (2006) 5). The concursus creditorum is regarded as one of the key concepts of the South African law of insolvency, and the object of the Insolvency Act 24 of 1936 is to ensure a due distribution of assets among the general body of creditors. As a rule, however, a creditor has no right to share in the distribution of the assets, vote on matters concerning the administration of the estate, or challenge any of the trustee’s actions, unless he has successfully proven a claim against the estate. The proof of a claim gives the creditor the required locus standi and at the same time provides prima facie proof of the existence of a debt (Grufin Finance Co (Pty) Ltd v Cohen 1991 2 SA 345 (W); see also Nagel (ed) Mars: The Law of Insolvency in South Africa (2008) 3).
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