LIQUIDATION

Leeuwner Maritz can advise and assist should you feel that your company is in danger of liquidation

A Company or Close corporation may be liquidated by the court for a variety of reasons in terms of the Companies Act.  It is a structured method of closing down a company in a legal manner.

It means to wind up the financial affairs and contractual obligations that brought the company into existence and is a structured method of closing down the company in a legal manner.

Commercial insolvency (an inability to pay debts as and when they become due in the ordinary course of business) needs to be established in liquidation applications.

The Company/Close Corporation and its affairs are placed under the control of a liquidator who’s main aim is to realize the assets and to divide the yield from the sale of assets amongst creditors fairly in order of priority and to dissolve the Company/Close Corporation in an orderly manner in accordance with the Companies Act.

The two forms of liquidation:

a) Voluntary – This is by a shareholders/members resolution;

b) Compulsory – This is done by a court order, which would usually be done by one of the company’s creditors.