Insolvency and Liquidation

Insolvency and liquidation in South Africa involve legal services related to the financial distress, inability to pay debts, and the winding up of businesses or individuals' affairs. These legal services are aimed at addressing financial difficulties, maximizing the recovery of assets for creditors, and ensuring an orderly process for distributing assets. Here are the key legal services covered under insolvency and liquidation in South Africa:

1. Insolvency Advice:

  • Providing legal advice to debtors and creditors regarding insolvency, financial distress, and available options, such as business rescue or liquidation.

2. Business Rescue:

  • Assisting financially distressed businesses in initiating business rescue proceedings to rehabilitate the company and avoid liquidation.
  • Advising on the legal requirements, procedures, and steps involved in business rescue.

3. Voluntary Liquidation:

  • Advising companies on initiating voluntary liquidation proceedings when they are unable to pay their debts and wish to wind up their affairs.

4. Compulsory Liquidation:

  • Assisting creditors in applying to the court for the compulsory liquidation of a company that is unable to meet its financial obligations.

5. Appointment of Liquidators:

  • Advising on the appointment of liquidators who will manage the winding-up process, realize the company's assets, and distribute proceeds to creditors.

6. Asset Realization:

  • Overseeing the process of realizing and selling a company's assets to generate funds for creditors.
  • Ensuring that assets are sold at fair market value and that the process is transparent and compliant with legal requirements.

7. Debt Recovery and Collection:

  • Assisting liquidators in recovering debts owed to the insolvent company, pursuing outstanding payments, and maximizing creditors' returns.

8. Claims Adjudication:

  • Managing the process of assessing and adjudicating claims from creditors, ensuring fair treatment and equitable distribution of available funds.

9. Sale of Business as a Going Concern:

  • Advising on the potential sale of a business or its assets as a going concern to preserve its value and continue operations.

10. Employee and Labor Issues: - Addressing legal matters related to employee rights, outstanding wages, and the legal obligations of the insolvent company towards its employees.

11. Reporting and Compliance: - Preparing regular reports for creditors and relevant authorities, providing updates on the liquidation process and financial status.

12. Court Proceedings and Disputes: - Representing creditors, debtors, and liquidators in court proceedings related to insolvency, liquidation, and disputes arising during the process.

13. Fraud Investigations: - Investigating instances of fraudulent or wrongful conduct that may have contributed to the insolvency, uncovering any wrongdoing.

Insolvency and liquidation legal services are designed to ensure the orderly and fair distribution of assets among creditors, protect the rights of stakeholders, and manage the complex legal and financial aspects of winding up a company's affairs. Legal professionals in this field play a crucial role in facilitating the resolution of financial distress situations while adhering to relevant laws and regulations.

LEXICON Specialists in Insolvency and Liquidation

Sean Johnson

We have a remarkable business rescue success rate and pride ourselves on being able to assist you in times of need.

However, we also attend to liquidations of companies and close corporations, voluntary or compulsory and sequestration and preparation of claims.