Abstract
LL.M. (Mercantile Law)
This thesis deals with the question whether section 417 is adequately framed in order
to fulfill its intended purpose in South African law. The necessity, efficiency and
validity of private examinations are explored. Chapter 1 provides an introduction
which sets out the methodology relied upon, namely a closer look at the primary
source, namely section 417 as set out in the Companies Act 61 of 1973, as well as the
consideration of secondary sources including academic texts and court decisions. In
particular the matter of Kebble v Gainsford 2010 (1) SA 561 GSJ is considered as it is
a recent case which again highlighted the value of private examinations. The law
applicable to South African private examinations is considered in Chapter 2. By
unpacking the various provisions relating to private examinations, which have been
honed by the courts in a prolific number of cases, the aim of the thesis is to determine
whether section 417 in its present format remains lawful, purposeful and necessary in
our current society.
As a comparison, section 236 of the English Insolvency Law 1986 is considered in
Chapter 3, where the relevant legislation and complimentary rules are firstly
ventilated, before the scope and purpose of the section as crystalised in English law, is
determined.
It is found that the main objective of the private examination procedure in South
Arican law is to collect information which is not available by other means, in order
that liquidators may determine as many assets as quickly and efficiently as possible.
Although this purpose is echoed in English law, the wider scope of the section in that
jurisdiction suggests areas where South African law may be enhanced by reform. In
particular, the duty to investigate the cause of failure of a company is emphasised in
English law, but underplayed in South African law. It is submitted that liquidators
should have a duty to determine the cause of failure of a company, as the failure of a
company affects society as a whole. Further suggestions for reform, based on the
English example, comprise the adoption of supportive measures to complement the
liquidator in the performance of his duties. It is acknowledged that a restructuring of
South African insolvency law as a whole is needed