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Close Corporations Act, 1984 (Act No. 69 of 1984)

Part IX : Winding up

69. Circumstances under which corporation deemed unable to pay debts

 

(1) For the purposes of section 68(c) a corporation shall be deemed to be unable to pay its debts, if—
(a) a creditor, by cession or otherwise, to whom the corporation is indebted in a sum of not less than two hundred rand then due has served on the corporation, by delivering it at its registered office, a demand requiring the corporation to pay the sum so due, and the corporation has for 21 days thereafter neglected to pay the sum or to secure or compound for it to the reasonable satisfaction of the creditor; or
(b) any process issued on a judgment, decree or order of any court in favour of a creditor of the corporation is returned by a sheriff, or a messenger of a magistrate's court, with an endorsement that he has not found sufficient disposable property to satisfy the judgment, decree or order, or that any disposable property found did not upon sale satisfy such process; or
(c) it is proved to the satisfaction of the Court that the corporation is unable to pay its debts.

 

(2) In determining for the purposes of subsection (1) whether a corporation is unable to pay its debts, the Court shall also take into account the contingent and prospective liabilities of the corporation.

 

 


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