Analyses: Ensuring advantage to everyone in a modern South African insolvency law

• Jurisdiction: South Africa
• Author: Anneli Loubser
• Date: 25 May 2019
• Citation: (1997) 9 SA Merc LJ 325
• Published date: 25 May 2019
• Pages: 325-333

Analyses/Analises

Ensuring Advantage to Everyone in a

Modern South African Insolvency Law

ANNELI LOUBSER

University of South Africa

1 Introduction

There can be no doubt that insolvency law has come a long way since

Roman times when unpaid creditors were sometimes allowed to 'attach'

the person of the debtor who was unable to repay his debts and literally

divide the pieces of his body among themselves. By selling these pieces to

the family of the (now) deceased debtor for proper burial, funds were

generated with which to repay at least part of their claims (see

Mars' The

Law of Insolvency in South Africa

8 ed (1988) by Elmarie de la Rey at 1).

An interesting indication of how far the pendulum has already swung in

the opposite direction, was contained in a newspaper article which

reported that a supporting organisation had been founded by

sequestrated debtors to put an end to what they perceived to be unfair

discrimination ('Gesekwestreerdes snoer hul kragte saam' 17 June 1996

Beeld

at 7). A long list of grievances included the complaints that assets

obtained after sequestration formed part of the insolvent estate and that

after sequestration of their estates, these debtors were not allowed to

open savings accounts or cheque accounts, although, according to their

spokesperson, the average income of the fourteen founding members of

the organisation was

R14

500 per month!

2 International Developments

We have to accept the fact that modern insolvency law is moving

further and further away from the principle of burdening the debtor who

is unable to pay his debts with severe or permanent disabilities, let alone

with punishment. Insolvent debtors are no longer regarded or treated as

criminals who 'craftily obtaining into their hands great substance of other

men's goods, do suddenly flee to parts unknown, or keep their houses,

not minding to pay or restore to . . . their creditors their duties, but [using

the money] for their own pleasure and delicate living', as they were

described in the preamble to the first English bankruptcy statute passed in

1542. This was a criminal statute directed at fraudulent debtors, and

eventually led to a provision in an Act of 1705 that such debtors could be

sentenced to death (Andrew J Duncan 'From Dismemberment to

325

(1997) 9 SA Merc LJ 325

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