, MRL3701 Assignment 1 (COMPLETE ANSWERS)
Semester 2 2026 - DUE August 2026; 100% Correct
solutions and explanations.
QUESTION 1
ADVICE TO THE CREDITORS REGARDING WHETHER NALEDI
HAS COMMITTED AN ACT OF INSOLVENCY IN TERMS OF
SECTION 8(a) OF THE INSOLVENCY ACT 24 OF 1936
1. Introduction
The issue to be determined is whether Naledi’s absence from South Africa for a
period of six months amounts to an act of insolvency as contemplated in section
8(a) of the Insolvency Act 24 of 1936. The creditors wish to rely on her absence
as a basis for applying for the sequestration of her estate.
A debtor does not have to be factually insolvent before sequestration can be
granted. A creditor may apply for sequestration where the debtor has committed
an act of insolvency listed in section 8 of the Insolvency Act.¹ However, the act
relied upon must strictly comply with the requirements of the Act.²
Section 8(a) specifically deals with a debtor who leaves the Republic or remains
outside the Republic with the intention of avoiding or delaying payment of
debts.
2. Requirements of section 8(a) of the Insolvency Act
Section 8(a) provides that a debtor commits an act of insolvency if:
“he leaves the Republic or, being outside the Republic, remains outside the
Republic with intent by doing so to evade or delay payment of his debts.”³
The provision therefore contains two main requirements:
2.1 The debtor must leave the Republic or remain outside the Republic
Semester 2 2026 - DUE August 2026; 100% Correct
solutions and explanations.
QUESTION 1
ADVICE TO THE CREDITORS REGARDING WHETHER NALEDI
HAS COMMITTED AN ACT OF INSOLVENCY IN TERMS OF
SECTION 8(a) OF THE INSOLVENCY ACT 24 OF 1936
1. Introduction
The issue to be determined is whether Naledi’s absence from South Africa for a
period of six months amounts to an act of insolvency as contemplated in section
8(a) of the Insolvency Act 24 of 1936. The creditors wish to rely on her absence
as a basis for applying for the sequestration of her estate.
A debtor does not have to be factually insolvent before sequestration can be
granted. A creditor may apply for sequestration where the debtor has committed
an act of insolvency listed in section 8 of the Insolvency Act.¹ However, the act
relied upon must strictly comply with the requirements of the Act.²
Section 8(a) specifically deals with a debtor who leaves the Republic or remains
outside the Republic with the intention of avoiding or delaying payment of
debts.
2. Requirements of section 8(a) of the Insolvency Act
Section 8(a) provides that a debtor commits an act of insolvency if:
“he leaves the Republic or, being outside the Republic, remains outside the
Republic with intent by doing so to evade or delay payment of his debts.”³
The provision therefore contains two main requirements:
2.1 The debtor must leave the Republic or remain outside the Republic
