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No general ‘prejudice principle’ protecting sureties

Photo of Olivia RadfordPhoto of Lisa Ellefsen
By Olivia Radford & Lisa Ellefsen on September 13, 2020

The court in Firstrand Bank Limited v Barreiro reconfirmed that there is no general ‘prejudice principle’ which holds that a debtor or surety is released from their obligations to a creditor if the creditor does anything that prejudices them. The court reiterated that a surety can be released, either wholly or in part, from their…

Posted in General

Voting against a business rescue plan

Photo of Caroline TheodosiouPhoto of Adriaan Louw (ZA)
By Caroline Theodosiou & Adriaan Louw (ZA) on November 6, 2017

Creditors of a company in business rescue do not have an unfettered vote to reject a proposed business rescue plan because their vote may be set aside by a court if it is inappropriate.

The Supreme Court of Appeal in Firstrand Bank Ltd v KJ Foods CC considered the meaning of ‘inappropriate’ relating to business…

Posted in Banking

Failure to join creditors is fatal to an application to set aside business rescue proceedings

Photo of Aslam Moosajee (ZA)
By Aslam Moosajee (ZA) on May 30, 2016

Creditors of a company have a substantial interest in an application to set aside business rescue proceedings or the adoption of a business rescue plan. A court will dismiss such an application if the creditors are not joined as parties to the application.

Giving notice of the application to the creditors does not cure the…

Posted in Banking

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Norton Rose Fulbright’s financial institutions team provides straightforward legal updates. Our lawyers offer local insights with an international perspective recognised worldwide. This blog focuses on the South African market and is about sharing knowledge with you. Blog posts are not legal advice.

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