Insolvency Act, 1936 (Act No. 24 of 1936)

81. Trustees report to creditors
Purchase cart Previous page Return to chapter overview Next page

 

(1)A trustee shall investigate the affairs and transactions of the insolvent concerned before the sequestration of his estate and shall, at the second meeting or, with the written permission of the Master obtained before the second meeting, at an adjourned second meeting of the creditors of that estate, or, if an offer of composition has been accepted by creditors in terms of section one hundred and nineteen, within one month after the acceptance of such offer of composition, submit a full written report on those affairs and transactions and on any matter of importance relating to the insolvent or the estate, and more especially in regard to—
(a)the assets and liabilities of the estate;
(b)the cause of the debtor's insolvency;
(c)the books relating to the insolvent's affairs, and the question whether the insolvent appears to have kept a proper record of his transactions, and if not, in what respect the record is insufficient, defective or incorrect;
(d)the question whether the insolvent appears to have contravened this Act or to have committed any other offence;
(e)any allowance he has made to the insolvent in terms of section seventy-nine and the reasons therefor;
(f)any business which he may have been carrying on on behalf of the estate, any goods he may have purchased for that business, and the result of carrying on that business;
(g)any legal proceedings instituted by or against the insolvent which were suspended by the sequestration of his estate which may be pending or threatened against the estate;
(h)any matter mentioned in section thirty-five or thirty-seven;
(i)any matter in regard to the administration or realization of the estate requiring the direction of the creditors.

 

(1)bis

(a)The trustee shall, at least fourteen days before the date specified in the notice in the Gazette for the holding of the meeting at which the report referred to in subsection (1) is to be submitted, send by registered post to each creditor of the estate whose name and address is known to him a copy of such report and of the inventory transmitted to him by the deputy sheriff under section nineteen and of the valuation furnished by him to the Master under section sixty-nine and shall submit therewith any recommendation in respect of any resolution or direction which in his opinion ought to be passed or given at such meeting.
(b)The trustee shall at least twenty-four hours before the time advertised for the commencement of the meeting referred to in paragraph (a) submit to the officer who is to preside at that meeting an affidavit setting out the names and addresses of the creditors to whom copies of the report, inventory and valuation have been sent in terms of paragraph (a) and containing full particulars of each resolution and direction recommended by him to such creditors under the said paragraph.

 

(2)For the purpose of any investigation mentioned in subsection (1) the Commissioner for Inland Revenue and the officers under him shall (notwithstanding the provisions of the law relating to income tax) permit a trustee to inspect any return rendered to the Commissioner by or on behalf of the insolvent in question in connection with income tax, and shall permit the trustee to make copies of any such return. At the request of the trustee the said Commissioner or any officer under him who is in charge of any such return shall certify as correct any such copy which is correct, and if any entry in such return is relevant in any proceedings, whether civil or criminal, in which the insolvent estate or the insolvent is involved, that return or a copy thereof, purporting to have been certified as aforesaid, shall be admissible in evidence in those proceedings, on its mere production by any person and any such certified copy shall have the same force and effect as the original return.

 

(3)
(a)The creditors may, at the meeting in question, direct what action shall be taken by the trustee in respect of any matter reported to them under paragraph (e), (f), (g), (h) or (i) of subsection (1).
(b)If no directions have been given by the creditors at the second meeting of creditors, any resolution or direction alleged in the affidavit referred to in paragraph (a) of subsection 80bis to have been recommended to the creditors of the estate and which could lawfully have been passed or given by the creditors at such meeting shall, if the Master so approves, be deemed to have been passed or given, as the case may be, by the creditors at such meeting.
(c)Subject to the provisions of this Act, the Master may, if no directions have been given by the creditors at the second meeting of creditors, in addition to any resolution or direction approved of by him under paragraph (b) or if no such resolution or direction has been so approved of, give such directions relating to any matter reported to the creditors under subsection (1) or to the administration or realization of the estate as he thinks fit.
(d)Notwithstanding the provisions of subsection (3) of section fifty-three, any resolution or direction approved under paragraph (b) and any direction given by the Master under paragraph (c) shall be binding upon the trustee.

 

(4)The report referred to in subsection (1) shall contain full particulars of all the facts relating to any alleged contravention of this Act by the insolvent or the alleged commission by him of any offence reported in terms of paragraph (d) of that subsection and the trustee shall furnish such further information in regard thereto as the Master or the Attorney-General may require.