It
might happen that you have heard people talking about being insolvent and that
their assets are sequestrated. This article will take you through the meaning
of Insolvency for a person (NOT a company – that is Liquidation and will be
covered in a later blog). We will also
discuss who a debtor is for the purposes of insolvency, the purpose of a
sequestration order and who may be sequestrated.
Meaning of: “Insolvency”
A
person is insolvent when his liabilities exceed his/her assets. Inability to
pay debt is, at most, merely evidence of insolvency.
A
person who has insufficient assets to discharge his/her liabilities, although
satisfying the test of insolvency, is not treated as insolvent for legal
purposes unless his/her estate has been sequestrated by an order of the court.
A
sequestration order is a formal declaration by the High Court that a he/she is
insolvent. The order is granted either
when he/she voluntarily surrenders their estate or where one or more of his/her
creditors apply for compulsory sequestration.
The person in this circumstances is referred to as a debtor (someone who
owes money to creditor(s)).
Who can be regarded as a
“debtor”?
The
term “debtor” is technically wider than just a single person. It embraces the following:
- A natural person
- A partnership
- A deceased person
- A person incapable of
managing his own affairs
- An entity or association of
persons that is not a juristic person, such as a trust
- Parties married in Community
of Property
The purpose of a
sequestration order
The
order of sequestration is made by the High Court to secure the orderly and
equitable distribution of a debtor’s assets where they are insufficient to meet
the claims of all his creditors. A sequestration order is issued by court to
execute property belonging to a debtor in order to for the creditors to be paid
which in some cases one or a few creditors are being paid, and the rest
receiving little or nothing at all. However, the law takes its cause to
ascertain that whatever assets the debtor has are liquidated and distributed
among all his creditors in accordance with a predetermined fair order of
preference.
Once
an order of sequestration is granted, a coming together of creditors is
established, and the interests of the creditors as a group enjoy preference
over the interests of individual creditors.
A
creditor’s right recover his claim in full by judicial proceedings is replaced
with the right, on proving a claim against the insolvent estate, to share with
all other proved creditors in the proceeds of the estate assets.
Apart
from what is permitted by the Act, nothing may be done which would diminish the
assets of the estate or prejudice the rights of creditors.
The
law of insolvency exist primarily for the benefit of the creditors, thus a
court will not sequestrate a debtor’s estate unless it’s known that the
sequestration will be to the benefit of the creditors. Thus a sequestration
order would not be granted if there is only one small creditor or if the
debtor’s assets are not sufficient to cover the costs of sequestration, and so
the creditors of the debtor would then have to seek individual relief against
the debtor by taking judgment against him for nonpayment of debts. The concept of sequestration being to the
benefit of creditors means that each creditor must benefit – receive some
dividend from the sequestration order being made.
What may be sequestrated?
Estates
that fall with the meaning of the word “estate” with regard to insolvency:
- An estate that includes
assets and liabilities
- An estate that consists of
liabilities only
- The joint estate of spouses
married in community of property
- The separate estates of
spouses married out of community of property
- The new estate of a debtor
whose estate has been sequestrated.
Written
by Portia Dlamini
What are the duties of employees and employers?
The rights of an employee or employer come from many sources and one of the main sources as with many other laws come from Common law.
South Africa’s Common law is a mixture of Roman-Dutch law and English law. These sources have in turn been formalised by Legislation like the Basic Conditions of Employment Act, the Labour Relationship Act and others.
However, as times have changed so have our laws and with the many amendments to the Labour Relations Act as well as the Basic Conditions of Employment Act employers and employees may become confused on what are their most pivotal duties and rights are in respect of employment.
Here are some tips for you:
The Employee’s Duties:
The Employers Duties:
An employment contract is an agreement between two parties (employer and employee) who hold themselves liable for the obligations as discussed, described and agreed to within that contract or agreement.
For more advice on your rights and obligations and any other labour related query contact our offices today at Charmaine@schwenninc.co.za or call us on 031 003 0630.
School Fee – Reduction for single parents
SINGLE PARENTS WILL PAY LOWER SCHOOL FEES
In a recent SCA (Supreme Court of Appeal) Court case – Head of Department: Western Cape Education Department & another v S (Women’s Legal Centre as Amicus Curiae) (1209/2016) [2017] ZASCA 187 (13 December 2017) it was found that a single parent could and should be given a school exemption.
Section 40 of the South African Schools Act No. 84 of 1996 states that:
40 (1) “A parent is liable to pay the school fees determined in terms of section 39 unless or to the extent that he or she has been exempted from payment in terms of this Act.”
40 (2) goes on to say a “parent may appeal to the Head of Department against a decision of a governing
body regarding the exemption of such parent from payment of school fees.”
Single parents will no longer need their ex-spouses to qualify for a school fees exemption, this followed on from a case concerning a Western Cape mother who applied for a school fees exemption. The school concerned wanted both her and her estranged ex-husband to fill in a form, because they both constituted a “family unit” even though she had custody of the daughter.
The mother of the child found that this process discriminatory, humiliating and unreasonable, the SCA Judgement, therefore made it clear that in circumstances where one parent has refused or failed to provide their income details, public schools shall grant a conditional fee exemption to the parent who has custody over the child, having regard to that parent’s income.
This conditional fee exemption shall be similar to an exemption that a parent would receive if there were the only parent of the learner concerned.
The granting of such a conditional exemption will not limit the public school from taking legal steps to enforce payment by the other parent for the balance of the school fees. This ensures that non-custodial parents are held responsible where required.
We hope that all our readers enjoy the festive season and have enjoyed our blogs. Should you have any legal issues, kindly note our offices are closed from the 24th of December 2019 until the 6th of January 2020. If you need to contact our offices in between that period, contact Charmaine Schwenn on 083 789 7638 or email charmaine@schwenninc.co.za.
Labour law – know your rights regarding your leave.
It’s that time of year where everyone is burnt out, getting sick and generally just trying to plan their holidays. Do you understand your employment contract and how much leave you are entitled to?
Let’s take a look at the types of leave an employee is afforded according to South African law:
Annual Leave:
According to the Employment Equity Act, an employee must be working more than 14 hours a month to be entitled to leave. A leave cycle is a period of 12 months during which you are entitled to 21 consecutive days of off with full remuneration. This is equal to 15 working days leave if you work a 5-day working week and 18 working days leave if you work a 6-day working week. You are entitled to roughly 1.25 days leave a month per cycle.
Should an employee not take their leave within 6 months after the end of the annual leave cycle then the employer cannot refuse to give the employee permission to take leave unless this has been agreed otherwise in their contract of employment.
Sick Leave:
Sick leave is a total of six weeks in every three-year cycle which is calculated from the first day of employment. For an employee who has a five-day working week this would equal 30 days full paid leave. However, during the first six months of employment, the employee is only entitled to take one-day sick leave for every 26 days worked. If you do not take your sick leave within that cycle you forfeit same.
If you are absent from work for more than two consecutive days then you have to produce a medical certificate to your employer.
Maternity Leave:
Maternity leave is for a period of four months and can start one month before the date of delivery of the baby. The employee legally cannot return to work for a period of six weeks after giving birth.
An employee must notify the employer in writing four weeks before the expected maternity leave commences and the date that they intend to return to work. During this leave, an Employer must keep that person’s job open for them to return. Your employer is not obliged to pay you during this time and you will be entitled to claim compensation from the Unemployment Insurance Fund.
Family Responsibility Leave:
Family responsibility leave is three days a year which is forfeited if not used within that year and is only available to employees who have worked for their employer longer then four months and work more then four days a week. Previously fathers were not afforded the same rights as mothers when their children were born but the new Labour Law Amendment Bill will since change same.
This type of leave can be taken when your child is born, sick or when a relative passes away, however, your employer may require proof that the event took place.
It is therefore important for employees to understand their rights with regards to their leave and their responsibility to follow the act as well as their employment contracts. If you have any questions regarding your employment contracts contact us today on 031 003 0630 or email us on info@schwenninc.co.za.
How to survive the holiday season: Separated or Divorced Families
The holiday season can cause much unnecessary conflict between separated and divorced spouses or split families. Navigating the holidays can be a very emotional time, whether it is your first or your fifteenth Christmas, sharing your time with your children.
A good divorce settlement agreement or parenting plan should have clear and specific guidelines for the sharing of the holiday season.
Holiday seasons often include travel plans. If these are going to interfere with the dates that the other parent should spend with your children, make sure that they are aware of these dates and that you have their agreement in advance.
If you are travelling internationally, on top of valid passports you will need to ensure that you have sufficient written legal consent from the other parent who is not coming on holiday with you and the children. This needs to be attended to in advance and must comply with the requirements of South Africa and the country that you are entering.
Here are some tips on ensuring that your holiday season runs as smoothly as possible:
If you require any assistance in navigating an agreement, a divorce or a parenting plan please contact our offices.
Written by Liza Bagley contact number 031 003 0630 and email address Liza@schwenninc.co.za
The law of insolvency – What does it mean to be insolvent?
It might happen that you have heard people talking about being insolvent and that their assets are sequestrated. This article will take you through the meaning of Insolvency for a person (NOT a company – that is Liquidation and will be covered in a later blog). We will also discuss who a debtor is for the purposes of insolvency, the purpose of a sequestration order and who may be sequestrated.
Meaning of: “Insolvency”
A person is insolvent when his liabilities exceed his/her assets. Inability to pay debt is, at most, merely evidence of insolvency.
A person who has insufficient assets to discharge his/her liabilities, although satisfying the test of insolvency, is not treated as insolvent for legal purposes unless his/her estate has been sequestrated by an order of the court.
A sequestration order is a formal declaration by the High Court that a he/she is insolvent. The order is granted either when he/she voluntarily surrenders their estate or where one or more of his/her creditors apply for compulsory sequestration. The person in this circumstances is referred to as a debtor (someone who owes money to creditor(s)).
Who can be regarded as a “debtor”?
The term “debtor” is technically wider than just a single person. It embraces the following:
The purpose of a sequestration order
The order of sequestration is made by the High Court to secure the orderly and equitable distribution of a debtor’s assets where they are insufficient to meet the claims of all his creditors. A sequestration order is issued by court to execute property belonging to a debtor in order to for the creditors to be paid which in some cases one or a few creditors are being paid, and the rest receiving little or nothing at all. However, the law takes its cause to ascertain that whatever assets the debtor has are liquidated and distributed among all his creditors in accordance with a predetermined fair order of preference.
Once an order of sequestration is granted, a coming together of creditors is established, and the interests of the creditors as a group enjoy preference over the interests of individual creditors.
A creditor’s right recover his claim in full by judicial proceedings is replaced with the right, on proving a claim against the insolvent estate, to share with all other proved creditors in the proceeds of the estate assets.
Apart from what is permitted by the Act, nothing may be done which would diminish the assets of the estate or prejudice the rights of creditors.
The law of insolvency exist primarily for the benefit of the creditors, thus a court will not sequestrate a debtor’s estate unless it’s known that the sequestration will be to the benefit of the creditors. Thus a sequestration order would not be granted if there is only one small creditor or if the debtor’s assets are not sufficient to cover the costs of sequestration, and so the creditors of the debtor would then have to seek individual relief against the debtor by taking judgment against him for nonpayment of debts. The concept of sequestration being to the benefit of creditors means that each creditor must benefit – receive some dividend from the sequestration order being made.
What may be sequestrated?
Estates that fall with the meaning of the word “estate” with regard to insolvency:
Written by Portia Dlamini
AS THE PARENT WITH PRIMARY RESIDENCE CAN I RELOCATE WITH MY CHILD?
Where both parents have guardianship over their children and one parent wants to move overseas the consent of the other parent is needed.
If however, consent is unreasonably withheld, the parent wanting to relocate can approach either the Children’s Court or the High Court for an order granting the parent to move with the child.
It is very important to note that a decision by a court is not made without a proper investigation. The court must be satisfied that the parent’s reasons for relocating are bona fide (meaning in good faith) and it must be within the best interests of that child.
The court will prefer a well laid out plan for things before making any decisions such as the child’s well-being, education, care and among other things the child’s housing.
The court will also take the following into account before granting the relocation:
Some of the factors that could go against the child relocating would be:
It is also of great importance to note and fully understand that the High Court and Children’s Court are the upper guardians of children and can make the necessary decision for the child regarding what is in his/her best interest. For any legal advice regarding the relocation of a child or children’s rights in generally contact our offices today on 031 003 0630 or email us on Charmaine@schwenninc.co.za.
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The Importance of having a living will
In light of wills week this month (16 to 20 September 2019) we thought we would highlight the importance of drafting a living will when drafting your last will and testament.
What is a living will?
It is a document in which you give instructions to your medical doctor and your family that in the event of a serious injury or disease, that renders you in a coma or in a vegetative state that you do not wish to be kept alive through artificial means.
Reasons Why You Need a Living Will:
What a living will cannot state.
You cannot include instructions for euthanasia or doctor-assisted suicide in South Africa. You are entitled to request for specific treatments to be withheld or withdrawn, but you cannot ask a doctor to end your life.
How to draw up a living will?
Drawing up a living will isn’t time-consuming, and while you can do it yourself, it’s always best to have an attorney assist you with the process. Your living will should be accessible, so it’s advisable to inform your family and your medical practitioners of your living will’s location and give them copies.
As with many things in life, people change their minds and we always recommend that you review both your Last Will and Testament and your living will on an annual basis or if your circumstances have changed.or any queries contact, Charmaine Schwenn on 031 – 003 0630 or email – charmaine@schwenninc.co.za so that we can assist you in drafting both your will and living will.
#Willsweek2019 #Justschwennit #Yougotschwenned
SPOUSAL MAINTENANCE: WHAT DO I NEED TO KNOW
Should a spouse be entitled to payment of a monthly amount of maintenance for themselves when they get divorced?
The simple answer is “no”. Our courts try to ensure what is known as a “clean break principle” on divorce, ensuring that as much as possible that each party goes their separate ways after a divorce.
This started with courts refusing spousal maintenance orders in some of the following circumstances:
In the past it was common that women would stay at home raising children and looking after the family home, however, this has become more rare. In these kind of situations, the court favours the application of “rehabilitative maintenance.” This upholds the clean break principle, giving the spouse maintenance for a fixed period of time until they are financially self-sufficient and upskilled to enable them to be gainfully employed.
In the cases where the courts grant maintenance orders, the court will have to take the following into account:
At Schwenn Incorporated we look at trying to get settlements during a divorce that are the most fair and favourable for our clients, as cost effectively as possible. If you have any questions on spousal maintenance or divorces in general do not hesitate to contact us today on 031 003 0630/ info@schwenninc.co.za.
Written by Jessica Schwenn and Charmaine Schwenn.
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WHAT IS STATUS AND LEGAL CAPACITY?
These terms are often mentioned in laws, contracts and news articles. What do they actual mean?
Status refers to your rights and responsibilities in civil and criminal law and whether you can sue or be sued.
This is further limited by your domicile (where you live and consider to be your home country), your age and your mental capacity.
Age and capacity go hand in hand, as described below :
Here are some random and interesting other facts about the law and age:
The law therefore indicates that to enter into any legal contract or litigation in general one must know of their legal status in order to peruse same legally.
For any questions on your legal status contact our offices today on 031 003 0630 or email us at Charmaine@schwenninc.co.za.
#newblog #schwenninc #legalcapacityandstatus #attorneysatlaw #litigation #contracts
The law of adoption in South Africa
Adoption can be described as the actual process where one or more people make an application to the Children’s Court to become a parent of a child that can be either biologically related to the parent or not.
Who is adoptable according to the laws of South Africa?:
Who can apply to adopt a child?:
Who needs to give consent to allow a child to be adopted?:
Can consent be withdrawn?:
Yes, a parent who gave the consent to an adoption has 60 days after consent was initially given to withdraw the consent.
Therefore the Children’s Court cannot grant an adoption until the 60 day period has expired.
When is it possible for consent not to be required?:
What is the actual procedure to adopt a child?:
For any family law matters don’t hesitate to contact our offices today on 031 003 0630 or email us at Charmaine@schwenninc.co.za.
Written by Jessica Schwenn.