, MRL3701 Assignment 2 Semester 2 Memo | Due 9 September
2025;100% CORRECT AND TRUSTED SOLUTIONS
References included
QUESTION:
Bongani is experiencing financial difficulty. He has failed to pay his debts over the
past few months, and his liabilities have exceeded his assets since 28 October
2024. Bongani owes a total of R2 500 000 to his creditors, including Flora to
whom he owes R280 000. Although this debt was due and payable to Flora on 8
January 2024, Bongani failed to pay the debt. Frustrated by not having been paid
back, Flora undertook an investigation into Bongani’s financial situation. She has
established that Bongani owns a flat valued at R1 250 000 and a motor vehicle
valued at R200,000. Flora is planning to apply for the sequestration of Bongani’s
estate. Assume that the court grants an order for the sequestration of Bongani’s
estate.
Discuss the effect that such an order would have on Bongani.
(10 marks)
Title: The Effect of a Sequestration Order on Bongani
Introduction
Sequestration is a legal process under South African insolvency law
whereby the estate of a debtor (in this case, Bongani) is placed under the
control of a trustee for the benefit of creditors. It is governed primarily
by the Insolvency Act 24 of 1936, which aims to ensure the fair
distribution of a debtor’s assets amongst creditors. When a court grants a
final order of sequestration, the debtor is declared insolvent, and their
estate vests in the hands of the Master of the High Court, and
eventually a trustee is appointed. The effects of such an order are far-
reaching and have both legal, personal, and financial implications for
Bongani.
2025;100% CORRECT AND TRUSTED SOLUTIONS
References included
QUESTION:
Bongani is experiencing financial difficulty. He has failed to pay his debts over the
past few months, and his liabilities have exceeded his assets since 28 October
2024. Bongani owes a total of R2 500 000 to his creditors, including Flora to
whom he owes R280 000. Although this debt was due and payable to Flora on 8
January 2024, Bongani failed to pay the debt. Frustrated by not having been paid
back, Flora undertook an investigation into Bongani’s financial situation. She has
established that Bongani owns a flat valued at R1 250 000 and a motor vehicle
valued at R200,000. Flora is planning to apply for the sequestration of Bongani’s
estate. Assume that the court grants an order for the sequestration of Bongani’s
estate.
Discuss the effect that such an order would have on Bongani.
(10 marks)
Title: The Effect of a Sequestration Order on Bongani
Introduction
Sequestration is a legal process under South African insolvency law
whereby the estate of a debtor (in this case, Bongani) is placed under the
control of a trustee for the benefit of creditors. It is governed primarily
by the Insolvency Act 24 of 1936, which aims to ensure the fair
distribution of a debtor’s assets amongst creditors. When a court grants a
final order of sequestration, the debtor is declared insolvent, and their
estate vests in the hands of the Master of the High Court, and
eventually a trustee is appointed. The effects of such an order are far-
reaching and have both legal, personal, and financial implications for
Bongani.
