Abstract
LL.M. (Corporate Law)
This dissertation firstly looks at the need for avoidance provisions over the course of insolvency proceedings and the attaching considerations in the development of same. Mention is also made of the difference between corporate rescue proceedings compared to liquidation. This brief comparative is essential as the different avoidance powers that are afforded to “rescue practitioners” when compared to “liquidators” is a common thread running through each of the following chapters.
I will then shift the focus of my discussion to South Africa, briefly describing the avoidance powers that were afforded to a judicial manager under the Companies Act 61 of 1973. Thereafter, I will discuss the extent of any avoidance powers that have been afforded to a business rescue practitioner in terms of section 141(2)(c)(i) of the Companies Act 71 of 2008. This will involve consideration of the latest case law and other practical factors which will seek to build-on and/or enhance our judiciary’s decisions as to the extent of the avoidance powers that have been afforded to a business rescue practitioner.
Once I have clearly set out the position in South Africa, I will consider the avoidance powers that have been afforded to an administrator in terms of Australia’s comparative corporate rescue mechanism, known as the administration of a company’s affairs with a view to executing a deed of company arrangement. Last, I will shift my focus to England, once again discussing and comparing the range of avoidance powers that are available to what they also term an administrator, when a distressed company enters Administration.
At the end of each of the chapters setting out the powers that have been afforded to the business rescue practitioner and the administrators in both Australia and England, the position in South Africa will be analysed, with any and all uncertainties and/or inadequacies relating to our section 141(2)(c)(i) being identified.
Finally, I will conclude my discussion by way of setting out my proposed recommendations that could assist in making South Africa’s business rescue regime both more effective and attractive to creditors – hopefully ensuring its continued effectiveness.