Co-operatives Act, 2005 (Act No. 14 of 2005)

Regulations

Co-operatives Administrative Regulations, 2016

Chapter 2 : Winding Up and Judicial Management of Co-operatives

Part A : Winding-Up of Co-operatives

Voidable dispositions

95. Collusive dealings to prejudice creditors or to prefer certain creditors above others
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(1)Any collusion to dispose of property of a co-operative in a manner prejudicing the cooperative's creditors or preferring a creditor above another may at any time after the commencement of the winding-up of such a co-operative on application by the liquidator be declared void by a competent court.

 

(2)Any person being a party to any collusion declared void by the court under sub regulation (1) may summarily be ordered by the court to make good to the co-operative any decrease in the value of the assets of the co-operative caused by such collusion, and if such person is a creditor of the co-operative he or she will forfeit his or her claim against the co-operative.