, MCL5903 Assignment 2
Semester 2 2025
DUE 5 September 2025
Use this document as a guide and for references to answer your assignment
The Status of Contracts Entered Into by Deregistered Companies: A
Critical Discussion with Reference to Sand-Ton Computer Systems (Pty)
Ltd
Introduction
The removal of a company’s name from the Companies and Intellectual Property
Commission’s register under the Companies Act 71 of 2008 (“the Companies Act”)
raises complex questions regarding the legal personality of the company and the
validity of transactions undertaken during the period of deregistration. The scenario
concerning Sand-Ton Computer Systems (Pty) Ltd (“Sand-Ton”)—removed from
the companies register for failure to file annual returns, but later reinstated—offers
a practical lens through which to evaluate these complexities.
The Department of Education (“the Department”) refuses to honor Sand-Ton’s
contractual claim on the basis that the contract was concluded at a time when Sand-
Ton was deregistered and, therefore, lacked legal existence. The dispute requires
consideration of:
1. the statutory framework of deregistration and reinstatement under the
Companies Act,
2. the effect of deregistration on legal personality, property, rights, and
obligations,
3. the legal consequences of reinstatement (specifically, whether reinstatement
retrospectively validates contracts entered into during deregistration),
4. relevant case law that has interpreted these issues, and
5. critical academic commentary on whether the Companies Act adequately
addresses the uncertainties surrounding contracts concluded during
deregistration.
Semester 2 2025
DUE 5 September 2025
Use this document as a guide and for references to answer your assignment
The Status of Contracts Entered Into by Deregistered Companies: A
Critical Discussion with Reference to Sand-Ton Computer Systems (Pty)
Ltd
Introduction
The removal of a company’s name from the Companies and Intellectual Property
Commission’s register under the Companies Act 71 of 2008 (“the Companies Act”)
raises complex questions regarding the legal personality of the company and the
validity of transactions undertaken during the period of deregistration. The scenario
concerning Sand-Ton Computer Systems (Pty) Ltd (“Sand-Ton”)—removed from
the companies register for failure to file annual returns, but later reinstated—offers
a practical lens through which to evaluate these complexities.
The Department of Education (“the Department”) refuses to honor Sand-Ton’s
contractual claim on the basis that the contract was concluded at a time when Sand-
Ton was deregistered and, therefore, lacked legal existence. The dispute requires
consideration of:
1. the statutory framework of deregistration and reinstatement under the
Companies Act,
2. the effect of deregistration on legal personality, property, rights, and
obligations,
3. the legal consequences of reinstatement (specifically, whether reinstatement
retrospectively validates contracts entered into during deregistration),
4. relevant case law that has interpreted these issues, and
5. critical academic commentary on whether the Companies Act adequately
addresses the uncertainties surrounding contracts concluded during
deregistration.
