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MRL 3701- Insolvency LAW- 2020 EXAM PACK
Insolvency Law (University of South Africa)
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INSOLVENCY
LAW
MRL 3701
2020 EXAM PACK
QUESTIONS AND ANSWERS FROM
2015 TO 2019
NOV 2019 – Q & A
MAY 2019 – Q & A
OCT 2018 – Q & A
MAY 2018 – Q & A
NOV 2017 -Q & A
NOV 2016 – Q & A
JUNE 2016 – Q & A
NOV 2015 – Q & A
MRL 3701
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OCTOBER / NOVEMBER 2019 EXAMINATION PAPER AND ANSWERS
QUESTION 1 - FILL IN THE BLANKS
(a) The term "debtor" also embraces a partnership, even one whose members are all JURISTIC
persons (2)
(b) The free residue includes the balance of the proceeds of ENCUMBERED
property after discharge of the encumbrances (2)
(c) A "liquidated claim " is a MONEY claim (2)
(d) An application for compulsory sequestration brought by a creditor who Is not at
arm's length Is generally referred to as a " FRIENDLY “sequestration (2)
(e) An insolvent may not without the written consent of the trustee carry on, be employed
in any capacity, or have any direct or indirect interest in the business of a TRADER
who is a general dealer or manufacturer (2)
(f) Dave Is a miner, and his right to a benefit or a GRATUITY or money paid to him as a
miner, does not form part of his insolvent estate (2)
(g) The solvent spouse must, within 7 days of service, lodge with the Master a
statement of his/her affairs as at the date of sequestration, framed by the necessary
requirements and verified by affidavit (2)
(h) With regard to a contract completed by an insolvent, a right to performance held by
the estate lapses If the other party in good faith, and WITHOUT knowledge of the
sequestration, performs to the insolvent (2)
(I) Section 84(1) of the Insolvency Act provides that, on the sequestration of the buyer's
estate, the seller automatically acquires a HYPOTHEC over the res vend1ta, whereby the
balance outstanding under the agreement 1s secured (2)
(j) A general meeting cannot be convened solely for the purpose of
“INTERROGATING witnesses” (2)
(k) If the Master declines to confirm a party's election or to appoint him as trustee, he
must notify the party in WRITING and state the reasons for so declining (2)
(l) The object of section 26 is simply to prevent a person in insolvent circumstances from
impoverishing his estate by giving away assets without receiving any appreciable ADVANTAGE
in return
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(m) If the other party to a collusive disposition is a CREDITOR, he forfeits any claim that he may
have had against the estate (2)
(n) Under section 29(1), the court may set aside a disposition which the insolvent made at
any time before sequestration If he made the d1spos1t1on with the intention of
preferring one of his creditors above another (2)
(o) Compared toacommon-law compromise, themain advantageof astatutory composition is that it
does not depend on the" PARTICIPATION” of all the creditors
(p) Examples of factors which may persuade the court to refuse an order of rehabilitation are
that the insolvent conducted his business in an improper and NEGLIGENT
manner
(q) A sequestration of a partner's estate, ipso ,ure, TERMINATES the partnership (2)
(r) " WINDING UP "means, essentially, the procedure by which a company's assets are sold,
its debts are paid, and any money left over is divided amongst the shareholders
according to their rights (2)
(s) Section 7(k) of the Companies Act 2008 provides for "the efficient rescue and recovery of
financially distressed companies, in a manner that BALANCES the rights and interests of
all relevant stakeholders" (2)
(t) Thereis always the risk that businessrescue eproceedings maybe ABUSED by a company with
no prospect of financial recovery to obtain a temporary relief from creditors (2)
Question 2
Indicate whether the following statements are true or false
a) An estate is usually conceived of as a collection of assets of a debtor for purposes of
sequestration - FALSE - IT’S A COLLECTION OF ASSETS AND LIABILITIES
b) The "costs of sequestration" only include the costs of surrender - FALSE
c) The insolvency Act does not deprive a debtor of his contractual capacity generally and accordingly
the retains a general competency to make binding agreements, but subject to certain restrictions
on the debtor’s capacity - TRUE
d) Property inherited by a spouse to a marriage in community of property forms part of the
insolvent estate, unless the will contained a provision that specifically excluded the property
from any community of property – FALSE
Downloaded by Wessel Engelbrecht ()
MRL 3701- Insolvency LAW- 2020 EXAM PACK
Insolvency Law (University of South Africa)
StuDocu is not sponsored or endorsed by any college or university
Downloaded by Wessel Engelbrecht ()
, lOMoARcPSD|15070327
INSOLVENCY
LAW
MRL 3701
2020 EXAM PACK
QUESTIONS AND ANSWERS FROM
2015 TO 2019
NOV 2019 – Q & A
MAY 2019 – Q & A
OCT 2018 – Q & A
MAY 2018 – Q & A
NOV 2017 -Q & A
NOV 2016 – Q & A
JUNE 2016 – Q & A
NOV 2015 – Q & A
MRL 3701
Downloaded by Wessel Engelbrecht ()
, lOMoARcPSD|15070327
OCTOBER / NOVEMBER 2019 EXAMINATION PAPER AND ANSWERS
QUESTION 1 - FILL IN THE BLANKS
(a) The term "debtor" also embraces a partnership, even one whose members are all JURISTIC
persons (2)
(b) The free residue includes the balance of the proceeds of ENCUMBERED
property after discharge of the encumbrances (2)
(c) A "liquidated claim " is a MONEY claim (2)
(d) An application for compulsory sequestration brought by a creditor who Is not at
arm's length Is generally referred to as a " FRIENDLY “sequestration (2)
(e) An insolvent may not without the written consent of the trustee carry on, be employed
in any capacity, or have any direct or indirect interest in the business of a TRADER
who is a general dealer or manufacturer (2)
(f) Dave Is a miner, and his right to a benefit or a GRATUITY or money paid to him as a
miner, does not form part of his insolvent estate (2)
(g) The solvent spouse must, within 7 days of service, lodge with the Master a
statement of his/her affairs as at the date of sequestration, framed by the necessary
requirements and verified by affidavit (2)
(h) With regard to a contract completed by an insolvent, a right to performance held by
the estate lapses If the other party in good faith, and WITHOUT knowledge of the
sequestration, performs to the insolvent (2)
(I) Section 84(1) of the Insolvency Act provides that, on the sequestration of the buyer's
estate, the seller automatically acquires a HYPOTHEC over the res vend1ta, whereby the
balance outstanding under the agreement 1s secured (2)
(j) A general meeting cannot be convened solely for the purpose of
“INTERROGATING witnesses” (2)
(k) If the Master declines to confirm a party's election or to appoint him as trustee, he
must notify the party in WRITING and state the reasons for so declining (2)
(l) The object of section 26 is simply to prevent a person in insolvent circumstances from
impoverishing his estate by giving away assets without receiving any appreciable ADVANTAGE
in return
Downloaded by Wessel Engelbrecht ()
, lOMoARcPSD|15070327
(m) If the other party to a collusive disposition is a CREDITOR, he forfeits any claim that he may
have had against the estate (2)
(n) Under section 29(1), the court may set aside a disposition which the insolvent made at
any time before sequestration If he made the d1spos1t1on with the intention of
preferring one of his creditors above another (2)
(o) Compared toacommon-law compromise, themain advantageof astatutory composition is that it
does not depend on the" PARTICIPATION” of all the creditors
(p) Examples of factors which may persuade the court to refuse an order of rehabilitation are
that the insolvent conducted his business in an improper and NEGLIGENT
manner
(q) A sequestration of a partner's estate, ipso ,ure, TERMINATES the partnership (2)
(r) " WINDING UP "means, essentially, the procedure by which a company's assets are sold,
its debts are paid, and any money left over is divided amongst the shareholders
according to their rights (2)
(s) Section 7(k) of the Companies Act 2008 provides for "the efficient rescue and recovery of
financially distressed companies, in a manner that BALANCES the rights and interests of
all relevant stakeholders" (2)
(t) Thereis always the risk that businessrescue eproceedings maybe ABUSED by a company with
no prospect of financial recovery to obtain a temporary relief from creditors (2)
Question 2
Indicate whether the following statements are true or false
a) An estate is usually conceived of as a collection of assets of a debtor for purposes of
sequestration - FALSE - IT’S A COLLECTION OF ASSETS AND LIABILITIES
b) The "costs of sequestration" only include the costs of surrender - FALSE
c) The insolvency Act does not deprive a debtor of his contractual capacity generally and accordingly
the retains a general competency to make binding agreements, but subject to certain restrictions
on the debtor’s capacity - TRUE
d) Property inherited by a spouse to a marriage in community of property forms part of the
insolvent estate, unless the will contained a provision that specifically excluded the property
from any community of property – FALSE
Downloaded by Wessel Engelbrecht ()
