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13 Int'l Insolvency Rev. 1 (2004)

handle is hein.journals/intvcy13 and id is 1 raw text is: 

    Human Rights Issues in South African

                          Insolvency Law

                                  Lee Styn*

             Associate Professor, School ofLaw, Universit of Natal (Durban), South Africa

   I. Introduction: South African Insolvency Law and the South
                            African Constitution

The concept of concursus creditorum, or a gathering of creditors, is fundamental to
South African insolvency law. Advantage of creditors'  not one creditor, or some
creditors, but the creditors as an entity has been described as a recurrent motif
which is apparent throughout the Insolvency Act 24 of 1936.1,2 Indeed, a person's
estate may be sequestrated3 in terms of the Insolvency Act only if it is proved to be
to the advantage of creditors. While, to some extent, a debtor's interests are taken
into consideration, it is clear, from the provisions of the Act and from the way in
which the courts have applied them, that the interests of the creditors and the public
interest in the efficient administration of insolvent estates take precedence.
   The enactment of the Constitution of the Republic of South Africa, Act 200 of
1993,4 and the Constitution of the Republic of South Africa, Act 108 of 1996,5
which replaced it, has brought about what has been described as a complete
metamorphosis of South Africa's jurisprudence and legal system.6 Chapter 2 of the
Constitution contains a Bill of Rights, which 'enshrines the rights of all people in
our country and affirms the democratic values of human dignity, equality and
freedom'.7 The state is obliged to 'respect, protect, promote and fulfil'8 these funda-
mental rights. Moreover, the Bill of Rights applies both vertically, between the
state and its subjects, and, where appropriate, horizontally, between its subjects
inter se.9 Thus constitutional law now infiltrates, either directly or indirectly,

*E-mail: steyn@nu.ac.za
1. C Smith 'The recurrent motif of the Insolvency
Act advantage of creditors' 1985 MB 27.
2. Referred to as 'the Insolvency Act'.
3. See ss 6, 10 and 12 of the Insolvency Act.
'Sequestration' is the term used in the Insolvency
Act to refer to the liquidation of the estate of a
natural person or a partnership. It may be noted
that the South African Law Reform Commission
has proposed that this term be substituted with
4. Referred to as 'the interim Constitution'.

5. Referred to as 'the Constitution'.
6. G E Devenish 'Constitutional Law' in LAWSA
Vol 5 (LexisNexis Butterworths) 15, I Rautenbach
& E Malherbe ConstitutionalLaw (LexisNexis Butter-
worths 1996) 283.
7. s 7 of the Constitution.
8. Ibid.
9. s 8 of the Constitution. See also In re Certi/cation
of the Constitution of the RSA, 1996 1996 10 BCLR 1253
(CC) and Khumalo and Others v Holom isa 2002 (5) SA
401 (CC).

Copyright ( 2004JohnWiley & Sons, Ltd.

            Int. Insolv. Rev., Vol. 13:1 25 (2004)
       Published on line in Wiley InterScience
(www.interscience.wiley.com). DOI: 10.1002/iir.l5

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