MRL3701 EXAM PACK 2025

MRL3701 INSOLVENCY LAW PAST EXAM PACK QUESTIONS AND ANSWERS SUMMARISED NOTES S - The study-notes marketplace MRL 3701 OCTOBER/NOVEMBER 2018 QUESTION 1 a) Inability to pay debts is, at most merely evidence of insolvency. (page 3) b) Brenda’s application for voluntary surrender must be set out the causes of her insolvency in some detail to enable the court to determine whether the application is ......................... c) Christopher commits an act of insolvency by departing from his dwelling with the intent by doing so to evade payment of his debts.(page 36) d) The court must be mindful of the fact that where a debtor and creditor in sequestration proceedings are not at arm’s length, there is considerable potential for ....................... e) If a trustee elects to set aside a contract, he may recover any performance rendered by the insolvent, but he must also restore to the third party any perfomance that the insolvent has received under the transaction. f) Dave is a miner, and his right to a benefit or a reward, or money paid to him as a miner, does not form part of his insolvent estate. (page 72) g) One of the duties of the sheriff on receiving a sequestration order is to serve a copy of the order on the solvent spouse if she has a separate estate that has not been sequestrated. (page 81) h) Section 84(1) of the Insolvent Act presupposes that the seller is the owner of the property sold (the res vendita). (page 96) i) If the insolvent has carried out his side of the contract and only the other party’s performance is outstanding, the right to that performance is an asset in the insolvent estate and vests in the trustee. (page 86) j) Kim, the trustee of Lee’s estate, is obliged to convene a general meeting of creditors by means of a notice that must state the matters to be dealt with at the meeting. (page 111-112) k) Where the insolvent contracted to acquire immovable property and the property has not been transferred to him, the trustee must make his election to uphold or repudiate the contract within six weeks after receiving written notice from the other party calling upon him to do so.(page 88) l) If the creditors elect a trustee unlawfully, the Master is not obliged to confirm the election. (page 124) m) In deciding whether a disposition was made in the ordinary course of business, an objective test is applied. (page 143) S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace n) In terms of section 89(2) of the Insolvency Act, a secured creditor may, when proving his claim, choose to rely exclusively on his security. (page 183) o) Compared to common-law compromise, the main advantage of a statutory composition is that it does not depend on the participation of all the creditors. (page 203) p) An application for rehabilitation is brought by way of notice of motion supported by affidavits. (page 212) q) When a partnership is dissolved because the estate of one of the partners has been sequestrated, the partnership assets are divided among the partners in terms of partnership contract or the common law. (page 223) r) The human beings (natural persons) who administer the business of the company are the management/its directors. () s) A voluntary winding up of Kilo CC may be either a creditors’ voluntary winding up, a voluntary winding up by the corporation, or a shareholders voluntary winding up. (page 241) t) The application for compulsory business rescue suspends any liquidation proceedings involving the company. (page 279) QUESTION 2 1. T (page 6) 2. T (page 19) 3. F (page 39) 4. F (page 63) 5. F (page 78) 6. T (page 81) 7. F (page 63) 8. F (page 111-112) 9. T (page 148) 10. F (page 95) 11. F (page 209) 12. F (page 18) 13. F (page 243) 14. T (page 241) 15. F (page 279) QUESTION 3 S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace a) A person is insolvent when his liabilities fairly valued exceed his assets fairly valued. A person’s estate may be sequestrated in-order to secure the orderly and equitable distribution of a debtor’s assets wher they are insufficient to meet claims of all his creditors. Therefore for the granting of a sequestration order the following requirements must be met;  The debtor’s estate must in fact be insolvent  The debtor has sufficient assets to defray all costs of sequestration  Only if sequestration is to the advantage of creditors. (page 18) If these requirements are met the order for sequestration may be granted if not sequestration order will be refused. b) In terms of section 17(4) of the Matrimonial Property Act 88 of 1984 both spouses who jointly own an estate because they are married in Community of property may apply for sequestration. (page 18) c) Amod v Khan SEE ATTACHED DOCUMENT FOR CASE SUMMARIES d) (i) The trustee of the insolvent estate may have a claim in terms against Mpho’s estate to the extent of the accrual. This is so because the ante-nuptial contract does not exclude accrual therefore a part of the accrual estate belongs to Tenza’s insolvent estate and the trustee is mandated with the collection of all assets for the orderly and fair distribution to all creditors. (ii) The answer will not change the exception is if Mpho bequeath her estate to Tenza then the inheritance will then fall into Tenza’s insolvent estate. e) Section 26 provides that dispositions made without value may be set aside, whereas section 27 provides an exception to this by saying No immediate benefit under duly registered ante-nuptial contract given in good faith by a man to his wife or any child born of the marriage shall be set aside as a disposition without value unless that the man’s estate was sequestrated within two years of the registration of that ante-nuptial contract. f) Notification of the intention to sequestrate will inform the creditors so that they can have time to adequately deal with the matter to their advantage. g) A court may wind up a company if it is unable to pay its debts as provided in section 345 of the Companies Act 2008in terms of section 345 a company is deemed to be unable to pay its debts in the following ways;  A creditor to whom the company is indebted for at least R100 has left a letter of demand for payment at the company’s registered office and the company has neglected for three weeks thereafter to pay, secure or compromise.  A warrant of execution issued on judgment against the companyhas been returned by the sherriff with an endorsement that he did not find S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace disposable property sufficient to satisfy judgment, or that the disposable property found did not satisfy judgment  It is proved to the satisfaction of the court that the company is unable to pay its debts. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MAY/JUNE 2018 QUESTION 1 a) If a formal defect (irregularity) has not caused a substantial injustice, the court may CONDONE (1.6) the defect. b) Brenda’s application for voluntary surrender must set out the causes of her insolvency in some detail to enable the court to determine whether the application is VALID. c) Christopher commits an act of insolvency by departing from his dwelling with the intent by doing so to evade or, DELAY PAYMENT (pg 36)of his debts d) An application for COMPULSORY(pg 45) sequestration brought by a creditor who is not at arm’s length is generally referred to as friendly sequestration. e) Mpho is the trustee of an insolvent estate, and if she chooses to set aside a prohibited contract, then she must restore to third party any benefits that the INSOLVENT (pg 65) has received under the transaction. f) Dave is a miner, and his right to a benefit or REMUNERATION (pg 72), or money paid to him as a miner, does not form part of his insolvent estate. g) The trustee is obliged to release property which was acquired by the solvent spouse during her marriage with the insolvent by a valid TITLE (pg82) against creditors of the insolvent. h) Section 84(1) of the Insolvency Act presupposes that the seller is A SECURED CREDITOR (pg 96) of the sold property(the res vendita) i) If the insolvent has carried out his side of the contract and only the other party’s perfomamnce is outstanding, the right to that performance is an ASSET (page 86) in the insolvent estate and vests in the trustee. j) Kim, the trustee of Lee’s insolvent estate, is obliged to convene a general meeting of creditors by means of a NOTICE (page 111 & 112) that must state the matters to be dealt with at the meeting. k) Where the insolvent contracted to acquire immovable property and the property has not been transferred to him, the trustee must make his election to uphold or repudiate the contract within SIX WEEKS (pg 88) after receiving written notice from the other party calling upon him to do so. l) The Master may remove Mike from the office as the trustee of Nicci’s insolvent estate on the grounds that Mike is mentally or PHYSICALLY (pg 126) incapable of performing his duties as trustee satisfactorily. m) In terms of section 29(1) of the Insolvency Act, the values of the assets to be assessed is the MARKET VALUE. (pg 143) n) A valid PLEDGE(PG 16.2.3) is constituted where there is delivery of movable property to a creditor on the understanding that it will be retained by him until his claim has been satisfied. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace o) Compared to a common law compromise, the main advantage of a statutory composition is that it does not depend on the CONSENT of all the creditors. p) The rehabilitation of an insolvent is a matter which lies solely within the discretion of the COURT (19.2.5) q) When a partnership is dissolved because the estate of one of the partners has been sequestrated, the partnership assets are divided among the partners in terms of the partnership contract or the MEMORANDUM OF UNDERSTANDING. r) A voluntary winding up of Bravo Pty Ltd is initiated by a special RESOLUTION of shareholders. s) A voluntary winding up of Kilo CC may be either a creditors’ voluntary winding up, a voluntary winding up by the corporation, or a COURT. t) AFFECTED PERSON QUESTION 2 Indicate whether the following statements are true or false. Do not give written explanation use only letters T or F. 1. T (page 6) 2. T (page 28) 3. F (page 40) 4. F (page 63) 5. F (page 71) 6. F (page 81) 7. T(page 93) 8. T(page 120-121) 9. F(page 143) 10. F(page 209-210) 11. F(page 209) 12. F(page 221) 13. F(page 243) 14. T(page 270) 15. T(page 214) S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace QUESTION 3 a) Before the court can grant an order for voluntary surrender of a debtor’s estate the court must be convinced that; The debtor’s estate is, in fact insolvent The debtor owns realizable property of sufficient value to defray costs of the sequestration which will in terms of the Act, be payable out of the free residue of his estate Sequestration will be to the advantage of creditors b) Even if the court is satisfied that all the requirements for sequestration have been met it still has discretion to reject or grant the sequestration. Factors such as if the debtor’s object in applying for surrender of his estate to avoid paying, or to defeat the rights of a particular debtor, or if the debtor displayed gross extravagance and ran debts on a pretentious scale will all play a crucial part. In case in stud (Ex parte Henning) c) In Magnum Financial Holdings Pty Ltd (Liquidation) v Sommerly and another 1984 the question before the court was whether the trust before the court was susceptible to sequestration. The court was satisfied that the applicant had made out a case for relief sought because in terms of section 2 of the Insolvent Act a trust is included in the definition of a debtor thus the trust through its trustees could acquire property and incur liabilities thus it fell within the meaning of debtor. There had been sufficient service of papers on the trustee of trust The provisional liquidator of the applicant company had locus standi to apply for the provisional sequestration of the trust estate. The applicant company had a claim of R1,6 million which wasdue and payable It was to the advantage of the trust’s creditors that its estate should be urgently sequestrated An act of insolvency had been committed d) An insolvent person is prohibited from holding office because they is a great amount of trust and responsibility required and they is a possibility of dishonesty business practice that exists on the insolvent’s part which may result in a prejudice to the public interest. e) This refers to dispositions made without value section 26 of the Insolvency Act. Section 26 provides that disposition made without value may be set aside by the court if the disposition had been made more than two years before sequestration of his estate, and it is proved that immediately after the disposition was made, the liabilities exceeded the his assets, or that the disposition was made within two years of sequestration and the person claiming or benefitted by the S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace disposition is unable to prove that immediately after the disposition was made the assets of the insolvent exceeded his liabilities. f) In Pretorius Trustee v Van Blommenstein 1949 the facts were that t was only he insolvent purchased a lorry from defendant and sometime later pledged it to secure payment of the price, because the seller had sued for the price and prepared to agree to an extension if real security existed. Trustee of the insolvent estate applied to set aside the disposition as avoidable preference in terms of sec 29. Defendant raised the defence of ordinary course of business . court held the pledge of lorry valid. g) Business Rescue S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace NOV/OCT 2017 QUESTION 1 a) In terms of the section 149(1) of the Insolvency Act, a court has jurisdiction over a debtor and in regard to the estate of a debtor if at any time within the TWELVE MONTHS immediately preceding the lodging of the application, the debtor ordinarily resided or carried on business within the jurisdiction of the court. b) As a general rule, costs occasioned by an unsuccessful opposition to an application of voluntary surrender must be borne by the CREDITORS (2.7) concerned. c) To avail as an act of insolvency under section 8(b) of the Insolvency Act, the sheriff’s return should refer to all DISPOSABLE (3.1.2 b) property of whatever description. d) The court must be mindful of the fact that where debtor and creditor in sequestration proceedings are not at arm’s length, there is considerable potential for PREJUDICE and malpractice e) Unless granted exemption by the COURT, the insolvent is disqualified from being a director of a company. f) Immovable property is defined by section 2 of the Insolvency Act as land every right or interest in the land or MINERALS (sec 2) which is registrable in deeds registry within the Republic. g) Section 23(8) of the Insolvency Act allows the insolvent to recover for his own benefit compensation for any loss or damage which he may have suffered, whether before or after sequestration of his estate, by reason of DEFAMATION (sec 23 (8) or personal injury h) A majority of the Constitutional Court decided that section 21 of the Insolvency Act cannot be regarded as expropriating the solvent spouse’s property since it does not contemplate a permanent transfer of ASSETS to the Master or trustee. i) If the insolvent has carried out his side of the contract and only the other party’s performance is outstanding, the right to that performance is an ASSET in the insolvent estate and vests in the trustee. j) The MASTER determines the date and time of the first meeting of creditors. k) Where the insolvent contracted to acquire immovable property and the property has not been transferred to him, the trustee must make his election to uphold or repudiate the contract within SIX WEEKS after receiving written notice from the other party calling upon him to do so. l) Note that as a result of a relative ground for disqualification such a person cannot be a trustee of a specific insolvent estate. This prohibition differs from the S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace ABSOLUTE grounds for disqualification where such a person may not be a trustee of any insolvent estate whatsoever. m) The term “disposition” does not include a disposition made in compliance with AN ORDER OF COURT. n) In terms of section 89(2) of the Insolvency Act, a secured creditor may, when provinghis claim, choose to rely exclusively on his CLAIM o) Compared to a common-law compromise, the main advantage of a statutory composition is that it does not depend on the CONSENT of all the creditors. p) At any time after the confirmation by the Master of a plan of distribution providing for the payment in full of all claims proved against the insolvent estate with interest calculated in terms of the Act and all the COST OF SEQUESTRATION the insolvent may apply for his rehabilitation. q) A partnership, therefore, although not a separate juristic person in the eyes of the law, is regarded for purposes of the Act as a separate ENTITY with an estate which may be sequestrated like that of a natural person. r) The human beings (the natural persons) who administer the business of the company are its DIRECTORS/MANAGEMENT s) A member of a close corporation has a VESTED INTEREST in the close corporation. t) Business rescue proceedings commence when the company files a VOLUNTARY BUSINESS RESCUE to place itself under supervision. QUESTION 2 1. T (page 3) 2. F (page 28) 3. F (page 63) 4. T (page 82) 5. T (page 93) 6. F 7. F (page 143) 8. T (page 148) 9. F 10. T(para18.4.2) 11. F(para19.1) 12. F (para20.1) 13. T S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace 14. T(para25.2.1) 15. F (section 128f Companies Act) QUESTION 3 a) Within seven days after publication of notice to surrender the debtor must furnish copies of notice to various parties. The debtor must deliver a notice to every one of his creditors whose address he knows or can ascertain. SARS b) The court may grant an application for the compulsory sequestration of a debtor’s estate if the court is satisfied that certain requirements have been met. The requirements are the applicant has established a claim which entitles him, in terms of section 9(1) to apply for the sequestration of the debtor’s estate. The debtor has committed an act of insolvency. There is reason to believe that it will be to the advantage of creditors of the debtor if his estate is sequestrated. c) Contract of sale of movable property. d) The trustee is obliged to call a general meeting of creditors if he is required to do so by the Master or by the creditors representing one-fourth of the value of all claims proved against the estate. A meeting called for the purpose of considering an offer of composition and the trustee is obliged to call a general meeting to inform the creditors of the offer of composition. e) i) Both of them maybe appointed joint trustees that is if they all accept to be joint trustees ii) yes since a person residing outside the Republic is disqualified from becoming a trustee of any estate iii) the Master may remove a trustee on the ground that he has faile to perform any of his duties satisfactorily. f) A secured claim is a creditor who holds security for his claim in the form of a special mortgage, landlord’s hypothec, pledge or right of retention. On the other hand a preferent claim refers to a claim that is entitled to payment before other claims. Although preferent claim is wide enough to include secured claims it normally refers to preferences in regard to the following claims; funeral and death-bed expenses, costs of sequestration, statutory costs and salary or remuneration of employees. g) The courts have held that it is just and equitable to wind up a company in six specific categories of cases namely; i. Where the main object for which the company was formed is not possible of being attained ii. Where the company’s objects are illegal, or the company was formed to defraud the persons invited to subscribe for its shares S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace iii. Where they is a justifiable lack of confidence in the conduct and management of the company’s affairs. iv. Where the voting power in the board of directors or in the general meeting of the company is so divided between dissenting groups that the deadlock cannot be resolved except by winding up the company. v. Where the company is a quasi-partnership and circumstances exists which would be good grounds for desolving a partnership. vi. Where the minority shareholders are oppressed by the controlling shareholders. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MRL 3701 MAY – JUNE 2014 QUESTION 1 (a) Sequestrated (b) 12 months (c) Portion (d) Contractual capacity (e) Contract (f) Immovable (g) Section 21 (h) Immediately (i) Counter – performance (j) Suspended (k) Unjustified enrichment (l) Interrogating (m) Misconduct (n) Estate Wege V Strauss (o) Balance of probabilities (p) Disposition (q) Concurrent (r) Ensor Nov Renscor Motors (s) Property (t) Composition S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace QUESTION 2 1. T 2. T 3. F 4. F 5. T 6. F 7. T 8. T 9. F 10. T 11. T 12. T 13. T 14. F 15. T QUESTION 3 3(a) The debtor had business whereby he sold Mazda parts. He sold these parts and the trustee wanted to impeach them in terms of section 34. The legal question was whether the alienation by the insolvent of certain goods just before its liquidation was in the ordinary course of that business. The court held that the disposition was in the ordinary course of business. Onus is on the trustee to provide that it was not in the ordinary course of business and the trustee could not discharge this onus. 3b (i) under section 26, the court may set aside a disposition for which has no value has been received or promised. These dispositions should have been made by the insolent two years before the sequestration of his estate and must be proved that the insolvent to exceed his assets. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace In Estate Wege v Strass held that a bet is not illegal at common law. Also a bet is not null and void in the sense that it gives rise to no claim. Parties to the bet cannot enforce it in court. This means the court may not assist parties to enforce a bet. The payments made by Andy to Betty between 2011 and 2013 may not qualify as dispositions without value under section 26 of the insolvency Act. 3(b)(ii) In terms of section 24 of the Insolvency Act a court may set aside a disposition made by he insolvent not more than six months before the sequestration of his estate if (1) the disposition had the effect of preferring one creditor above another (2) immediately after the disposition, the insolvent’s liabilities exceeded his assets. Exception – disposition in ordinary course of business and did not intended to prefer. Andy’s payment made in June 2013 was made four months before his sequestration but from the facts it cannot be proved that the disposition preferred Betty among another creditors of Andy, and Any’s liabilities immediately exceeded his assets after the payment. Betty may successfully argue that the payment was made in the ordinary course of business. Therefore the payment may not qualify as a voidable preference. 3(c) Employees fall within the preferential creditors’ category. In terms of section 98A, salary for a period of 3months and to the maximum of R12 000 and R6000 exceeding his preferential claim becomes a concurrent claim. B is entitled to R12 000 and has no amounts exceeding the preferential amounts. C is only entitles to R2000 and this amount comply with section 98A. 3(d) An offer of composition by the insolvent had been accepted by a simple majority in value but not by a three – fourth majority in number or in value. The error was accepted, and the insolvent was reinstated with his assets. The offer of composition was accepted by only a majority in value and did not comply with section 119 (7). So there was no valid acceptance and thus no composition. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MRL3701/101/3/2017 Tutorial Letter 101/3/2017 Insolvency Law MRL3701 Semesters 1 and 2 Department of Mercantile Law This tutorial letter contains important information about your module. You must also register for myUnisa and activate your myLife e-mail address. BARCODE S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace 2 CONTENTS Page 1 INTRODUCTION .......................................................................................................................... 4 2 PURPOSE AND OUTCOMES ...................................................................................................... 5 2.1 Purpose ........................................................................................................................................ 5 2.2 Outcomes ..................................................................................................................................... 5 3 LECTURER(S) AND CONTACT DETAILS ................................................................................... 5 3.1 Lecturer(s) .................................................................................................................................... 5 3.2 Department ................................................................................................................................... 6 3.3 University ...................................................................................................................................... 6 4 RESOURCES ............................................................................................................................... 6 4.1 Prescribed books .......................................................................................................................... 6 4.2 Recommended books ................................................................................................................... 9 4.3 Electronic reserves (e-reserves) ................................................................................................... 9 4.4 Library services and resources information ................................................................................... 9 5 STUDENT SUPPORT SERVICES .............................................................................................. 10 5.1 General ....................................................................................................................................... 10 5.2 Contact with fellow students ........................................................................................................ 10 6 STUDY PLAN ............................................................................................................................. 11 7 PRACTICAL WORK AND WORK-INTEGRATED LEARNING ................................................... 12 8 ASSESSMENT ........................................................................................................................... 12 8.1 Assessment criteria ..................................................................................................................... 12 8.2 Assessment plan ........................................................................................................................ 12 8.2.1 Information about the three assignments ................................................................................... 12 8.2.2 Commentaries on assignments .................................................................................................. 12 8.2.3 General approach to answering essay or problem-type questions in assignments ...................... 13 8.2.4 Guidance on submitting your assignments via the post .............................................................. 15 8.2.5 Guidance on submitting your assignments online via myUnisa .................................................. 15 8.3 Assignment numbers .................................................................................................................. 16 8.3.1 General assignment numbers ..................................................................................................... 16 8.3.2 Unique assignment numbers ...................................................................................................... 16 8.4 Assignment due dates ................................................................................................................ 16 8.5 Submission of assignments ........................................................................................................ 17 8.6 The assignments ........................................................................................................................ 18 S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MRL3701/101/3/2017 3 8.7 Other assessment methods ........................................................................................................ 19 8.8 The examination ......................................................................................................................... 19 9 FREQUENTLY ASKED QUESTIONS ........................................................................................ 21 10 IN CLOSING ............................................................................................................................... 22 11 ADDENDA CONTAINING THE ASSIGNMENT QUESTIONS .................................................... 23 S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace 4 Dear Student 1 INTRODUCTION We are pleased to welcome you to this undergraduate module in insolvency law, and hope that you will find it both interesting and rewarding. We will do our best to make your study of this module successful. You will be well on your way to success if you start studying early in the semester and resolve to do the assignments properly. This tutorial letter contains important information about this course. We urge you to read it carefully and to keep it at hand when working through the study material, preparing the assignments, preparing for the examination and addressing questions to your lecturers. In this tutorial letter, you will find the assignments for both semesters and instructions on the preparation and submission of the assignments. This tutorial letter also provides all the information you need with regard to the prescribed study material and how to obtain it. Please study this information carefully and make sure that you obtain the prescribed material as soon as possible. We have also included certain general and administrative information about this module. Please study this section of the tutorial letter carefully. Right from the start we would like to point out that you must read all the tutorial letters you receive during the semester immediately and carefully, because they always contain important and, sometimes, urgent information. You must be registered on myUnisa to be able to submit your assignments online, gain access to the library functions and various learning resources, to “chat” to your lecturers and fellow students about your studies and the challenges that you may encounter, and to participate in online discussion forums on myUnisa. Most important, however, is the fact that all the learning units for the module are available on myUnisa, and you will only be able to access the online study material for this module if you have registered on and have access to myUnisa. Please visit the MRL3701 module sites on myUnisa often. The module site for the first semester is MRL3701-17-S1, and the module site for the second semester is MRL3701-17-S2. To access myUnisa, follow this link: and login with your student number and password. You will see MRL3701-17-S1 and MRL3701-17-S2 in the row of modules in the grey blocks across the top of the web page. Click on the module you want to access. Further, please activate your myLife e-mail address, as we will send all official correspondence about this module to your myLife address, and not your private e-mail address. Please consult the booklet my Studies @ Unisa for more information about activating your myLife e-mail address and accessing the MRL3701 module site on myUnisa. We hope that you will enjoy this module and we wish you all the best! S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MRL3701/101/3/2017 5 2 PURPOSE AND OUTCOMES 2.1 Purpose This module, Insolvency Law (MRL3701), is a third-level module dealing with the law of insolvency (voluntary surrender and compulsory sequestration), and with the liquidation (winding-up) and business rescue of companies and close corporations. 2.2 Outcomes Learning outcomes for this module are found in your study guide, which will be sent to you. You will notice that we have included learning outcomes for each study unit. The learning outcomes at the beginning of each study unit indicate what competence you should be able to demonstrate at the end of this learning experience. We expect you to achieve the learning outcomes. You should be able to achieve these outcomes if you work through the study material by following the guidelines and doing the activities in your study guide. You will also find an application learning outcome as the last outcome in each unit. This learning outcome is a standard feature that will remind you that you need to be able to apply your knowledge in order to carry out the activities and to answer the self-test questions in the particular study unit. 3 LECTURER(S) AND CONTACT DETAILS 3.1 Lecturer(s) The lecturers responsible for this course are: Name: Ms Z Mabe Building and office number: Cas van Vuuren Building 4-101 E-mail address: Telephone number: Name: Prof RG Evans Building and office number: Cas van Vuuren Building 6-105 E-mail address: Telephone number: Name: Prof AD Smith Building and office number: Cas van Vuuren Building 6-134 E-mail address: Telephone number: Name: Ms Z Taljaard Building and office number: Cas van Vuuren Building 6-53 E-mail address: Telephone number: S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace 6 3.2 Department Letters should be sent to: The Module Leader (MRL3701 – Insolvency Law) Department of Mercantile Law PO Box 392 UNISA 0003 Fax number: 012 – 429 3343 PLEASE NOTE: Letters to lecturers may not be enclosed with or inserted into assignments. 3.3 University Communication with the University If you need to contact the University about matters not related to the content of this module, please consult the publication My studies @ Unisa, which you received with your study material. This booklet contains information on how to contact the University (eg, to whom you may write, important telephone and fax numbers, addresses and details of the times certain facilities are open). Always have your student number at hand when you call the University. 4 RESOURCES 4.1 Prescribed books The study material for this module consists of the following:  Study guide There is one study guide for this module that must be used in conjunction with the prescribed textbook as a guide through the chapters in the textbook.  Tutorial letters (which you will receive during the semester)  One textbook (which you must purchase)  MO001 (Module Online) The MO is an online presentation of this module. A printed version of the MO will be sent to you, and the electronic version of the MO will be available on myUnisa under “Additional Resources”. You will also find the individual learning units under “Learning Units” on myUnisa.  A number of prescribed cases S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MRL3701/101/3/2017 7 The Department of Despatch should also supply you with the following printed study matter for this module:  Study guide  Tutorial letters which you will receive during the semester  MO001 (Module Online) 4.1.1 Study guide There is one study guide for this module that must be used in conjunction with the prescribed textbook and the MO as a guide through the chapters in the textbook. At the beginning of the study guide, you will find detailed instructions on how to use it. Please note that you must omit Study Units 22-24 of the Study Guide. These have now been replaced by Learning Units 22-24 of the MO, which are compulsory. Please note that you will be asked questions from these Learning Units 22-24 of the MO, and so it is important to study these Learning Units 22-24 of the MO. 4.1.2 Further tutorial letters Apart from this Tutorial Letter 101, you will also receive other tutorial letters during the semester. Some of these tutorial letters may not be available when you register. Printed versions of these tutorial letters that are not available when you register will be posted to you as soon as possible, and the electronic versions of these tutorial letters will also be available on myUnisa. Students who have access to the Internet can view the study guides and tutorial letters for the modules for which they are registered on the University’s online campus, myUnisa, at . We therefore encourage you to use myUnisa and to check the webpage for MRL3701 regularly. 4.1.3 Prescribed textbook Your prescribed textbook for this module for this semester is:  Sharrock R, Van der Linde K & Smith A Hockly’s Insolvency Law 9 th edition (Juta, Cape Town, 2012) You must therefore disregard the information in paragraph 4.2 on page 3 of the study guide concerning the previous, eighth edition of this textbook. In addition, please do not use the eighth edition or any other previous edition of the textbook, because you will then be studying out-ofdate law. Please consult the list of official booksellers and their addresses listed in My studies @ Unisa. If you have any difficulty obtaining books from these bookshops, please contact the Prescribed Books Section at telephone or email . S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace 8 4.1.4 MO001 The MO is an online presentation of this module. The purpose of the online presentation of this module is to introduce you to a graphic journey of the content of this subject known as Insolvency Law. You will receive a printed version of the MO, and the electronic version of the MO will also be available on myUnisa under “Additional Resources” for printing purposes and under “Learning Units” for reading online. Although the study guide and the MO may be similar in some circumstances, the MO must be used in conjunction with the study guide, the tutorial letters and the prescribed textbook, as a guide though the chapters in the textbook. At the beginning of each learning unit of the MO, you will find detailed instructions on how to study for this course. Please note that you must omit Study Units 22-24 of the Study Guide. These have now been replaced by Learning Units 22-24 of the MO, which are compulsory. Please note that you will be asked questions from these Learning Units 22-24 of the MO, and so it is important to study these Learning Units 22-24 of the MO. 4.1.5 Prescribed cases All the prescribed cases listed below (except for one case on business rescue proceedings), together with short summaries and/or explanatory notes, are contained in the following bilingual case book: Loubser A Case Book on the Law of Partnership, Company Law and Insolvency Law / Vonnisbundel oor die Vennootskapsreg, Maatskappyereg en Insolvensiereg (1992) Juta. If you do not have direct access to the law reports, you should acquire a copy of this case book. It is COMPULSORY that you study the cases listed below. You must study the cases in conjunction with the study guide, MO and the prescribed textbook. This will help you to gain greater insight into the relevant principles and their application. We appreciate that it is impossible to study all the cases cited in the study guide, MO and the textbook in the time allotted to this module. We have therefore selected some of the most important decisions. Some of the cases included in the list below are leading ones; others may contain an informative discussion, a succinct statement of principles, or a set of facts which neatly illustrates such principles. We offer you merely a small selection, however, and you would be well advised to read as many additional cases as possible, not only for the reasons set out above, but also to become adept at swiftly reading through and appraising a case. This will be of inestimable value to you in practice later on. We also advise you to read the relevant cases in the law reports as they appear each month: this will enable you to keep abreast of the latest developments in the field of law that you are studying. You should also bear in mind that the cases discussed in the study guide and the prescribed textbook which do not appear in the list below are also important and should not be ignored. They must be studied in the way in which they appear in the study guide and the textbook. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MRL3701/101/3/2017 9 List of prescribed cases The prescribed cases on insolvency law that you must read, summarise and study are the following: (1) Ex parte Henning 1981 (3) SA 843 (O) (2) Amod v Kahn 1947 (2) SA 432 (N) (3) Epstein v Epstein 1987 (4) SA 606 (C) (4) Magnum Financial Holdings (Pty) Ltd (in liquidation) v Summerly NO 1984 (1) SA 160 (W) (5) Hendriks NO v Swanepoel 1962 (4) SA 338 (A) (6) Pretorius’ Trustee v Van Blommenstein 1949 (1) SA 267 (O) (7) Pretorius NO v Stock Owners’ Co-operative Co Ltd 1959 (4) SA 462 (A) (8) Estate Wege v Strauss 1932 AD 76 (9) Ensor NO v Rensco Motors (Pty) Ltd 1981 (1) 815 (A) (10) Prinsloo en ’n ander v Van Zyl NO 1967 (1) SA 581 (T) (11) Vorster v Steyn NO en andere 1981 (2) SA 831 (O) (12) Joint Liquidators of Glen Anil Development Corporation Ltd (in liquidation) v Hill Samuel (SA) Ltd 1982 (1) SA 103 (A) The prescribed cases on winding-up and business rescue that you must read, summarise and study are the following: (1) Rand Air (Pty) Ltd v Ray Bester Investments (Pty) Ltd 1985 (2) SA 345 (W) (2) Southern Palace Investments 265 (Pty) Ltd v Midnight Storm Investments 386 Ltd 2012 (2) SA 423 (WCC) In paragraph 4.3 below, we explain how to download these prescribed cases from myUnisa. 4.2 Recommended books There are no recommended books for this module. 4.3 Electronic reserves (e-reserves) The fourteen prescribed cases listed above in paragraph 4.1.5 above have been uploaded into the “Additional Resources” folder on myUnisa for this module. There is a subfolder named “Prescribed cases” containing the cases listed there in PDF files. So, if you wish to download these cases, the series of steps to follow is: “MRL3701-17-S1” > Resources > Prescribed Cases, or “MRL3701-17-S2” > Resources > Prescribed Cases. These PDF files contain the complete cases. This is another reason to become a myUnisa user. 4.4 Library services and resources information For brief information, go to For detailed information, go to the Unisa website at Library. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace 10 For research support and services of personal librarians, go to The library has compiled a number of library guides:  finding recommended reading in the print collection and e-reserves –  requesting material –  postgraduate information services –  finding, obtaining and using library resources and tools to assist in doing research –  how to contact the library/finding us on social media/frequently asked questions – 5 STUDENT SUPPORT SERVICES 5.1 General For information on the various student support systems and services available at Unisa (eg, student counselling, tutorial classes, and language support), please consult the publication My studies @ Unisa, which you received with your study material. Unisa has entered into partnerships with establishments (referred to as Telecentres) in various locations across South Africa to enable you (as a Unisa student) free access to computers and the Internet. This access enables you to conduct the following academic related activities: registration; online submission of assignments; engaging in e-tutoring activities and signature courses; etc. Please note that any other activities outside of these are for your own costing e.g. printing, photocopying, etc. For more information on the Telecentre nearest to you, please visit telecentre if you do not have your own means of accessing the Internet, so that you can submit all your assignments on myUnisa rather than by post (see paragraph 8.2.4 below). 5.2 Contact with fellow students 5.2.1 Study groups It is advisable to form study groups and to have contact with fellow students. The addresses of students in your area may be obtained from the following department: Directorate: Student Administration and Registration PO Box 392 UNISA 0003 You can contact Unisa at: Email: S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MRL3701/101/3/2017 11 5.2.2 myUnisa The myUnisa learner management system is Unisa’s new virtual campus that will help students to communicate with their lecturers, with other students and with the administrative departments of Unisa — all through the computer and the Internet. To go to the myUnisa web site, type in in your web browser. Please consult the publication My studies @ Unisa, which you received with your study material for more information on myUnisa. 5.3 Discussion classes There are no discussion classes for this module. We suggest that you use your study guide together with your prescribed material to study the module. You are, of course, most welcome to contact any of the lecturers if you experience any problems with the contents of this module. We will gladly assist you. 6 STUDY PLAN We would like to support you in your learning process. We can support you, however, only if you take responsibility for your own learning. So you have to work through the tutorial letters and the learning material and plan a schedule for your learning process to ensure that you submit all the assignments and prepare for the examinations in time. We suggest that you follow the following steps in your learning process: Step 1: Work through the overview in your study guide, the MO and Tutorial Letter 101. This step will provide all the important information that you need to complete the learning process successfully. Step 2: Start working through the study units in your study guide and the learning units in the MO. Study the relevant chapters and cases in the textbook and case book. The readings that you have to study for each study unit and learning unit are indicated in a box. Do all the activities and self-test questions in your study guide and learning units. Step 3: Complete and submit the relevant assignments. Step 4: Prepare for the examination by revising the study units in your study guide, MO and the activities and self-test questions. In addition, study all the tutorial letters that you receive during the semester. NB: Please note that you must omit Study Units 22-24 of the Study Guide. These study units have now been replaced by Learning Units 22-24 of the MO, which are compulsory. Please note that you will be asked questions from these Learning Units 22-24 of the MO, and so it is important to study these Learning Units 22-24 of the MO. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace 12 7 PRACTICAL WORK AND WORK-INTEGRATED LEARNING There is no module practical work or work-integrated learning in this module. 8 ASSESSMENT 8.1 Assessment criteria There are no assessment criteria in this module. 8.2 Assessment plan 8.2.1 Information about the three assignments This tutorial letter contains three (3) assignments that are set out below. NB: Assignment 1 and Assignment 2 are both compulsory and must be submitted to Unisa for assessment. 1. Assignment 01 is a short assignment containing fill-in questions as well as true or false questions. Your answers to this Assignment 01 must be submitted to the University as a written or typed document for assessment. The submission of Assignment 01 is compulsory and is a prerequisite to gain admission to the examination. This is the only assignment that gives admission to the examination. Because it is a written or typed assignment containing fill-in questions and true or false questions, it is obvious that you must not use a mark-reading sheet to answer this assignment. But you still need to use the appropriate unique number for the assignment. Completing this Assignment 01 also gives you practice in answering the type of fill-in questions that you can expect in Question 1 of the examination paper, and the type of true or false questions that you can expect in Question 2 of the examination paper. 2. Assignment 02 is a short written or typed assignment that must be submitted to the University as a written or typed document for assessment. Because it is a written or typed assignment, you must not use a mark-reading sheet. But you still need to use the appropriate unique number for the assignment. Answering this Assignment 02 also gives you practice in answering the type of questions that you can expect in Question 3 of the examination paper. 3. Assignment 03 is a self-evaluation assignment which you must not submit to the University, but which you must answer yourself with the help of the commentary that we will send to you in Tutorial Letter 201/2017. 8.2.2 Commentaries on assignments The commentaries on the assignments will be sent to all students registered for this module in a follow-up tutorial letter, and not only to those students who have submitted the assignments. As soon as you have received the commentaries, please check your answers. The assignments and the commentaries on these assignments constitute an important component of your study material for the examination. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MRL3701/101/3/2017 13 The commentary on the self-evaluation assignment (Assignment 03) is included in Tutorial Letter 201/2017. This will enable you to mark your assignment as soon as you have completed it. To obtain the full benefit of completing the assignment, you should, after receiving it back, also go through the process of self-assessment in accordance with the memorandum that you will receive in Tutorial Letter 201/2017. The purpose of the self-evaluation of assignments is fourfold: 1 to help you work through the tutorial material 2 to teach you the necessary reading and writing skills expected of a future legal practitioner 3 to teach you to make a synthesis from various sources: in other words, to teach you to combine different ideas and arguments in a single answer; to gather material and present it in a logical, orderly fashion and supported with convincing arguments (merely copying the tutorial material is not acceptable) 4 self-evaluation: when you join the legal profession, you will have to evaluate your own arguments and submissions, and therefore you should acquire this skill as soon as possible. The fact that the Assignment 03 is a self-evaluation assignment implies the following: 1 You have to complete the assignment. 2 You must evaluate your assignment yourself by using the memorandum, which we will send to all students in a tutorial letter during the course of the semester. 3 The value of the assignment lies in doing it. Because the questions in the assignment are similar to examination questions, we do, however, require you to answer them under examination conditions. For example, had the assignment been an examination counting 50 marks, you would have been given one hour to complete it. This means that you must not write pages and pages for an answer that counts for only 10 marks. 4 The background knowledge that you get by doing Assignment 03 and marking it is an excellent opportunity to increase your knowledge and understanding of the work to the point that you can approach the examination with confidence. 8.2.3 General approach to answering essay or problem-type questions in assignments In order to answer your assignments satisfactorily, you must work through the prescribed study material carefully. The following basic guidelines can be of help:  To complete your assignment satisfactorily, you must consult your study guide, prescribed textbook, prescribed cases, MO and tutorial letters. Read the questions carefully, ascertain what they deal with, and then use only the relevant information from your study material to answer the questions. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace 14  Students normally complain that they cannot rewrite the study material in their own words. Unfortunately, you have to get used to doing this, since you will not have your textbook at hand during the examination. However, there are three easy steps towards accomplishing this: o Study the relevant study material until you understand it. While you are reading the particular section or chapter, make notes or lists of the key words and concepts. o Put away your study material and try to summarise that particular study unit in your own words by using your notes and list of key words. o Use the study material to finalise your summary with references to case law and other relevant authority. You are often expected to consult textbooks and cases when answering an assignment, and then to cite these materials as authority in your answer. Case law must be cited in full when used for the first time in the text (eg, Kanhym Bpk v Oudtshoorn Munisipaliteit 1990 (3) SA 252 (C)); thereafter an abbreviated reference is sufficient (eg, Kanhym supra). Criminal-law cases may simply be referred to by the name of the accused (eg, Mokgethi). Textbooks can be referred to in your answer by merely giving the author’s name and the page number (eg, Snyman 20). The full bibliographical details are then supplied in a bibliography at the end of your assignment (eg, Snyman CR Criminal law (1995) Butterworths;). Do not refer to sources you have not personally consulted.  Note that it is not necessary to provide full references in the examination.  Quotations from case law and other sources must be kept to a minimum.  If you do use quotations, they must be accurate and you must give proper attribution. The use of other sources, without the necessary acknowledgement, amounts to plagiarism. Plagiarism takes place when you use words, ideas and thoughts of other persons and represent them as your own. Plagiarism is a form of theft that can materialise in various dishonest academic activities.  Names of cases and Latin expressions must either be underlined or typed in italics.  Neatness is a prerequisite. Plan your answers in advance. For essay-type answers, you should do a number of rough drafts before you write the final answer.  We restrict the length of assignment answers to teach you to write concise and logical legal arguments. It is very easy to write long, rambling answers, but these answers do not earn good marks. You must learn to summarise your study material so that you can answer a question in a factually correct, concise and logical manner. This will also teach you to give similar answers in an examination. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MRL3701/101/3/2017 15 8.2.4 Guidance on submitting your assignments via the post If you wish to submit your assignment via the post, please note the following:  Please remember to number your assignment Assignment 01 or Assignment 02 (as appropriate).  Please ensure that your name and address, student number, subject and module, and assignment number are written clearly on the assignment cover and on the first page of your answer. This information must be correct. Each successive page must also indicate at least your student number and the module code.  Ensure that the pages of your assignments are in the correct order and fastened securely. Please do NOT write on both sides of the page. The answers to all the questions of the same assignment must be submitted together. Do not submit answers to the different assignments together.  It is wise to make a copy of the assignment before submitting it, in case your assignment gets lost in the post. 8.2.5 Guidance on submitting your assignments online via myUnisa If you wish to submit your assignments online via myUnisa, then please note the following:  Type your answers to the assignment in a document in a computer programme such as, for example, Microsoft Word.  When you have finished your assignment, check that it states the law correctly and that it is spelt correctly. To check the spelling, use the spell-checker (shortcut in MS Word: Press the F7 key).  Save the final version of your assignment in a document that is formatted in PDF.  Submit your PDF document online via myUnisa. Saving your document in PDF format You can use various computer programmes to save your assignment in PDF format. A variety of these programmes can be downloaded from myUnisa. Go to the web page entitled “Electronic resources” at 839c23c198f8. At this point, we explain two further ways of using programmes to save your assignments in PDF format: (1) Microsoft Word 2010 In MS Word, click on the “File” tab in the top left corner of your screen. In the drop-down list that opens, you may perhaps see an item named “Save as PDF” as the third item. Use that option if it is available. Follow the steps to save your document in PDF format. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace 16 If you cannot see “Save as PDF” in the drop-down list, click on the “Save As” item. It is the second item in the drop-down list. In the field named “Save as type”, click on the bar with the down arrow. The seventh item in the list that you can then see is “PDF (pdf)”. Choose that option. In the bottom right corner of the next window, click the “Save” button. Your MS Word document will then be saved in PDF format. (2) Google Drive Another way of saving your work in PDF format is to use Google Drive. It is free via the Chrome web browser. Download Chrome at accessible at click on the red “Create” button in the top left corner. In the window that opens, choose the “Document” option. Google Drive saves your document automatically online. It also has a spellchecker to help you correct your work. When you have finished working on your assignment and you wish to save your work in a PDF document, click on the word “File” in the top left corner. In the list, you will see the option “Download as…”. Click on that item. The fourth format that you can choose is “PDF document (pdf)”. Choose that format to download your work. In your “Downloads” folder on your computer, you can open the PDF file that contains your assignment. NB: Although students may work together when preparing assignments, each student must write and submit his or her own individual assignment. In other words, each student must submit his or her own work. It is unacceptable for students to submit identical assignments on the basis that they worked together. That will amount to plagiarism and none of these assignments will be marked. Furthermore, these students may be penalised or subjected to disciplinary proceedings of the University. 8.3 Assignment numbers 8.3.1 General assignment numbers There are no general assignment numbers is this module. 8.3.2 Unique assignment numbers You must submit your Assignments 1 and 2 to Unisa to be marked. You must not submit your Assignment 3 to Unisa, but mark it yourself. Assignments 1 and 2 each have unique assignment numbers. S - The study-notes marketplace Downloaded by: uzziboy786 | Distribution of this document is illegal S - The study-notes marketplace MRL3701/101/3/2017 17 Please note: from 2015 onwards, there are different assignments for each of the two semesters. Students registered for Semester 01 must answer Assignment 01 and Assignment 02 for Semester 01; these assignments are in Addendum A to this tutorial letter, in paragraph 11 below. Students registered for Semester 02 must answer Assignment 01 and Assignment 02 for Semester 02; these assignments are in Addendum B to this tutorial letter, in paragraph 11 below. 8.4 Assignment due dates The relevant details are stated below: SEMESTER 01 ASSIGNMENT 01: DUE DATE: 3 MARCH 2017 (UNIQUE NO: ) ASSIGNMENT 02: DUE DATE: 7 APRIL 2017 (UNIQUE NO: ) SEMESTER 02 ASSIGNMENT 01: DUE DATE: 11 AUGUST 2017 (UNIQUE NO: ) ASSIGNMENT 02: DUE DATE: 15 SEPTEMBER 2017 (UNIQUE NO: ) 8.5 Submission of assignments We wish to draw your attention to two im