BUSINESS RESCUE INFORMATION Section 129 prescribes the time frames within which certain notices must be published and directs that if there is non-compliance the whole business rescue process is a nullity. The interpretation that the act does not leave room for substantial compliance and that the notices therefore have to strictly comply in every aspect was confirmed in two court rulings (Advanced Technologies v AET and Madodza v. ABSA). The latest ruling on this issue was handed down by Judge Rautenbach in Credit Suisse and Another v. Von Steen and Another. The Judge pointed out that • as the circumstances in the Advance Technologies and Madodza case differ from this matter he did not have to make a finding if these judgments were right or wrong; • section 6(9) expressly provide for substantive compliance with the prescribed manner of delivery of notices and that this enables a court to find that here was substantial compliance if it is established that all affected parties had full knowledge of the notice and its contents; • in his view the purpose of section 129 is to protect the rights of affected persons so that they could not be bypassed in an attempt to deprive them of their right to set aside the business rescue in terms of section 130; • should the court find that the non-compliance of section 129 renders the business rescue a nullity the applicants have the right to launch, in terms of section 129(5), an ex parte application to Court on good cause shown to approve the company filing a further resolution; and • on the facts before him he would have granted such application rendering the process senseless to first have the resolution declared a nullity and then on the same facts again approach the court leading to a waste of money, time and resources. Business Rescue Practitioners would welcome this decision giving clarity on a contentious and much debated issue. Disclaimer: The contents and information provided above are generalised and must not be acted upon as legal advice bvrbusinessrescue.co.za/
Posted on: Tue, 30 Sep 2014 05:25:01 +0000
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