Liquidating a cc

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The close corporation was at that stage not yet finally wound up and deregistered.

The court was thus called upon to determine whether the term “liquidation proceedings” found in section 131 of the Act could be interpreted to include the winding up process after a liquidator had been appointed.

Just more than three years have passed since the Act became operational.

In terms of section 131(4) the court may, on application brought by an affected person, make an order placing the company under supervision and commencing business rescue proceedings, if it is satisfied that the company is financially distressed, the company has failed to pay over any amount in terms of an obligation under or in terms of a public regulation or contract with respect to employment related matters, or it is otherwise just and equitable to do so for financial reasons.

In addition, there must be a reasonable prospect for rescuing the company.

Alternatively, the court may dismiss the application and make any further necessary and appropriate order which includes an order placing the company under liquidation.

Should the court decide to place the company under supervision and to commence business rescue proceedings as provided for in section 131(4), it has the power to make an order for the appointment of an interim practitioner nominated by the affected person who brought the application.

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