Debt Collection In South Africa The Shock Effect Of A Liquidation Application

In order for people to understand the term ‘liquidation’ when it comes to companies and closed corporation becoming liquidated or insolvent, Wikipedia, the free encyclopaedia on the internet defines the term as quote “In law and business, liquidation is the process by which a company (or part of a company) is brought to an end, and the assets and property of the company are redistributed. Liquidation is also sometimes referred to as winding-up or dissolution, although dissolution technically refers to the last stage of liquidation. The process of liquidation also arises when customs, an authority or agency in a country responsible for collecting and safeguarding customs duties, determines the final computation or ascertainment of the duties or drawback accruing on an entry.

Liquidation may either be compulsory (sometimes referred to as a creditors' liquidation) or voluntary (sometimes referred to as a shareholders' liquidation, although some voluntary liquidations are controlled by the creditors” end quote. Debtors have to decide whether to do business with a client or creditor again, after the debtor knows that their company or closed corporation is penniless or to insult their customer or creditor by serving a liquidation application. Ivan Zartz an attorney with his offices in Johannesburg South Africa who has provided legal assistance when it comes to debt collection and debt recovery on behalf of creditors has come to the conclusion that companies served with liquidation applications will suddenly discover the money to pay their creditors as it is very expensive to oppose a liquidation application and file affidavits, when in in most cases, there is no defence for this action from the debtor.

In a liquidation application, the technical defences a debtor can use, when they are faced with a summons being issued against them, are diminished so that creditors normally gets paid, as opposed to waiting years for the respective payment. The prospect of the business, company or closed corporation being closed down, which is the effect of a liquidation order, overshadows all other concerns. Then there is the issue of restructuring securities. One of the main and ultimate advantages of liquidation is that all those securities which are out of date, for example where there are new directors in the company or business can be re-signed. That being said, if there are no sureties then these can be attained when or if the company or closed corporation finally decides to pay back the money that they owe to their creditors in the form of a lump sum or by means of monthly or regular instalments.

Visit http://ivanzartzattorneys.co.za/debt-collection/ to contact him and his attorneys in Johannesburg to solve your debt collection recovery matters.

To learn more about the legal assistance provided by attorney Ivan Zartz in Johannesburg concerning debt collection and debt recovery visit this link Debt Collection Recovery Collectors South Africa.