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Queue Politely! South African Business Rescue Practitioners and their fees in Liquidation. Diener N.O. v Minister of Justice and Correctional Services and Others [2017] ZASCA 180; [2018] 1 All SA 317 (SCA); 2018 (2) SA 399 (SCA)
Jacobs, Lézelle Burdette, David
Jacobs, Lézelle
Burdette, David
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2019-06-11
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Abstract
In May 2011 South Africa’s new corporate rescue procedure, known as “business rescue”, came into operation. The mechanism is contained in Chapter 6 of the Companies Act 2008 (the SA Companies Act) and replaces the previous corporate rescue mechanism known as judicial management. While business rescue appears to have worked quite well since its inception eight years ago, there have been a number of court judgments that have been critical of the fact that many provisions of the new procedure have not been well drafted. One of these provisions, relating to the payment of unpaid remuneration of the business rescue practitioner (BRP) where a company’s business rescue procedure is converted to a liquidation, recently gave rise to litigation with the Courts focusing on the interpretation of the relevant statutory provisions. The remuneration of insolvency practitioners is a contentious issue as much in the UK as in South Africa (and is indeed a bone of contention throughout the world). In February of this year the right honourable Frank Field MP, the chair of the UK House of Commons’ Work and Pensions Committee, commented on the £44.2 million to be paid in fees to Price Waterhouse Coopers in relation to one year’s Insolvency work on Carillion as “milking the cash cow”. This note endeavours to comment on the South African Courts’ interpretation of provisions relating to the payment of remuneration to BRPs in the event that the business rescue procedure is superseded by liquidation.
Citation
Jacobs, L. and Burdette, D., (2019) Queue Politely! South African Business Rescue Practitioners and Their Fees in Liquidation. Diener N.O. V Minister of Justice and Correctional Services and Others [2017] Zasca 180; [2018] 1 All Sa 317 (Sca); 2018 (2) Sa 399 (Sca), Wolverhampton Law Journal, 2019(2), pp. 61-69.
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Journal article
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en
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2517-8121
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2632-1343