MCL5903
ASSIGNMENT 2 2025
UNIQUE NO.
DUE DATE: 5 SEPTEMBER 2025
, 1. Introduction
The deregistration of companies for non-compliance with statutory obligations raises
complex legal issues, particularly concerning the validity of contracts concluded during
the deregistration period. This assignment critically discusses the case of Sand-Ton
Computer Systems (Pty) Ltd ("Sand-Ton") whose name was removed from the
companies register, yet entered into a contract with the Department of Education. The
Department later refused payment, arguing that Sand-Ton lacked juristic personality at
the time of contracting. This discussion evaluates the legal status of such contracts
under the Companies Act 71 of 2008, relevant case law, and academic commentary.
2. Legal Framework under the Companies Act 71 of 2008
Section 33 of the Companies Act obliges companies to file annual returns. Failure to
comply may result in deregistration by the Companies and Intellectual Property
Commission (CIPC). Section 82 empowers the CIPC to remove a company from the
register for non-compliance.
Upon deregistration, section 82(3) provides that the company ceases to exist as a
juristic person. However, section 82(4) allows for reinstatement of a deregistered
company either through the CIPC or a court order. Furthermore, section 83(1) provides
that upon deregistration, "the company is dissolved."
Critically, section 83(4) empowers a court to make an order that is "just and equitable"
regarding contracts or property rights affected by deregistration, highlighting legislative
intent to mitigate the harsh consequences of deregistration.
ASSIGNMENT 2 2025
UNIQUE NO.
DUE DATE: 5 SEPTEMBER 2025
, 1. Introduction
The deregistration of companies for non-compliance with statutory obligations raises
complex legal issues, particularly concerning the validity of contracts concluded during
the deregistration period. This assignment critically discusses the case of Sand-Ton
Computer Systems (Pty) Ltd ("Sand-Ton") whose name was removed from the
companies register, yet entered into a contract with the Department of Education. The
Department later refused payment, arguing that Sand-Ton lacked juristic personality at
the time of contracting. This discussion evaluates the legal status of such contracts
under the Companies Act 71 of 2008, relevant case law, and academic commentary.
2. Legal Framework under the Companies Act 71 of 2008
Section 33 of the Companies Act obliges companies to file annual returns. Failure to
comply may result in deregistration by the Companies and Intellectual Property
Commission (CIPC). Section 82 empowers the CIPC to remove a company from the
register for non-compliance.
Upon deregistration, section 82(3) provides that the company ceases to exist as a
juristic person. However, section 82(4) allows for reinstatement of a deregistered
company either through the CIPC or a court order. Furthermore, section 83(1) provides
that upon deregistration, "the company is dissolved."
Critically, section 83(4) empowers a court to make an order that is "just and equitable"
regarding contracts or property rights affected by deregistration, highlighting legislative
intent to mitigate the harsh consequences of deregistration.
