How Insolvency Lawyers Can Assist Creditors in Debt Collection and Compulsory Sequestration
If a debtor owes your firm a substantial amount of money, you might want to consider bringing a compulsory sequestration order against the individual with the help of experienced insolvency lawyers. In order for your compulsory sequestration application against the debtor to succeed, the application must meet the following requirements:
- You must have established a claim against the debtor.
- There must be sufficient benefits to the creditors.
- The debtor must have committed an act of insolvency.
The above means that you must be able to prove that the debtor owes you money, and the sale of assets in the debtor’s estate must be sufficient to realise the minimum benefit to the creditors. The minimum benefit is 20 cents out of the rand, depending on various factors. The debtor must have committed an act that shows that they are indeed insolvent.
The debtor can oppose the compulsory sequestration. Since sequestration is an expensive process, it is imperative to ensure that it will indeed be to the creditor’s benefit to pursue sequestration of the individual. We recommend seeking assistance from our insolvency lawyers in this matter, to help you succeed in your compulsory sequestration application.
Alternative Steps
It is often more cost-effective to attach part of the debtor’s salary, or to attach the debtor’s property and sell it to ensure the debt is paid. You will benefit from the expertise offered by insolvency lawyers. The attorneys handle the tracing and collection duties, apply for the delivery of a summons by a Sheriff of the Court, and where the debtor admits the claim, negotiate for down payment of the debt by means of a new arrangement.
The insolvency attorneys can also assist, should a debtor enter into debt review. The attorneys oppose unreasonable requests for lower interest or a reduction in the amount owed.
Where to Get Help
There are eight acts of insolvency that a debtor can commit, which are best discussed with our lawyers. We will also advise you on how to proceed to collect large amounts owed, and whether sequestration of the debtor is the best option for the particular situation. We will handle the litigation process on your behalf.
Do not let outstanding debt create serious cash flow problems for your firm. Let our insolvency lawyers help you take the necessary steps against debtors to ensure the payment of debts owed.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Call our attorneys for legal advice, rather than relying on the information herein to make any decisions. The information is relevant to the date of publishing.