MRL3701 Assignment 1 & 2 Semester 1 2026 (Answer Guide) – Due 2 and 24 March 2026

MRL3701 Assignment 1 & 2 Semester 1 2026 (Answer Guide) – Due 2
and 24 March 2026

VERIFIED AND CERTIFIED ANSWERS. WRITTEN IN REQUIRED FORMAT AND WITHIN
GIVEN GUIDELINES. IT IS GOOD TO USE AS A GUIDE AND FOR REFERENCE, NEVER
PLAGARIZE. Thank you and success in your academics.
UNISA, 2025



Contents
Assessment 1: Due 2nd March 2026 .................................................................................................... 2
Question (a): Voidable Preference .................................................................................................. 2
Explanation of a Voidable Preference ........................................................................................ 2
Requirements to Set Aside a Voidable Preference ................................................................. 2
Question (b): Undue Preference ...................................................................................................... 2
Meaning of an Undue Preference ................................................................................................ 2
Elements Required to Set Aside an Undue Preference ......................................................... 2
Question (c): Recovery of the R900 000 Paid to Andile ............................................................. 3
Legal Analysis and Application to the Facts ............................................................................ 3
Basis for Recovery .......................................................................................................................... 3
Conclusion ......................................................................................................................................... 4
Assessment 2: Due 24th March 2026 ................................................................................................... 5
Question 1 ...................................................................................................................................5
Intended Purpose of Section 21 of the Insolvency Act 24 of 1936 ...................................5
Question 2 ...................................................................................................................................5
Constitutionality of Section 21 in Harksen v Lane 1998 (1) SA 300 (CC) ........................5

, Assessment 1: Due 2nd March 2026

Question (a): Voidable Preference

Explanation of a Voidable Preference

A voidable preference occurs when an insolvent debtor makes a disposition of
property to a creditor shortly before sequestration, which has the effect of preferring that
creditor above others, even though there was no intention to prefer. Such a
disposition may be set aside to ensure equal treatment of creditors.

Requirements to Set Aside a Voidable Preference

In terms of section 29 of the Insolvency Act 24 of 1936, the following must be proved:

1. The disposition was made within six months before the sequestration of the
debtor’s estate.
2. At the time of the disposition, the debtor’s liabilities exceeded her assets.
3. The disposition had the effect of preferring one creditor above others.
4. The creditor who benefited cannot prove that the disposition was made in the
ordinary course of business and without the intention to prefer.

Question (b): Undue Preference

Meaning of an Undue Preference

An undue preference refers to a disposition made by an insolvent debtor with the
intention of preferring one creditor over others at a time when the debtor was
already insolvent.

Elements Required to Set Aside an Undue Preference