Appointment of Trustee; Effects of Sequestration

Section 23

Rights and obligations of insolvent during sequestration

(1) Subject to the provisions of this section and of section twenty-four, all property acquired by an insolvent shall belong to his estate.

(2) The fact that a person entering into any contract is an insolvent, shall not affect the validity of that contract: Provided that the insolvent does not thereby purport to dispose of any property of his insolvent estate; and provided further that an insolvent shall not, without the consent in writing of the trustee of his estate, enter into any contract whereby his estate or any contribution towards his estate which he is obliged to make, is or is likely to be adversely affected, but in either case subject to the provisions of subsection (1) of section twenty-four.

(3) An insolvent may follow any profession or occupation or enter into any employment, but he may not, during the sequestration of his estate without the consent in writing of the trustee of his estate, either carry on, or be employed in any capacity or have any direct or indirect interest in, the business of a trader who is a general dealer or a manufacturer: Provided that any one of the creditors of the insolvent’s estate or the insolvent himself may, if the trustee gives or refuses such consent, appeal to the Master, whose decision shall be final.

(3)bis Where a trustee has given his consent to an insolvent to enter into a contract, or to carry on a trade in terms of subsection (2) or subsection (3), as the case may be, he shall forthwith forward to the Master a copy of such consent. Any trustee who does not so forward such consent within one week after it has been granted, shall be deemed to have contravened the provisions of paragraph (b) of section sixty.
[Sub-s. (3)bis inserted by s. 13 of Act No. 16 of 1943.]

(4) The insolvent shall keep a detailed record of all assets received by him from whatever source, and of all disbursements made by him in the course of his profession, occupation or employment, and, if required thereto by the trustee, shall transmit to the trustee in the first week of every month a statement verified by affidavit of all assets received and of all disbursements made by him during the preceding month. The trustee may inspect such record at all reasonable times and may demand the production of reasonable vouchers in support of any item in such accounts and of the expenditure of the insolvent for the support of himself and those dependent upon him.

(5) The trustee shall be entitled to any moneys received or to be received by the insolvent in the course of his profession, occupation or other employment which in the opinion of the Master are not or will not be necessary for the support of the insolvent and those dependent upon him, and if the trustee has notified the employer of the insolvent that the trustee is entitled, in terms of this subsection, to any part of the insolvent’s remuneration due to him at the time of such notification, or which will become due to him thereafter, the employer shall pay over that part to the trustee.

(6) The insolvent may sue or may be sued in his own name without reference to the trustee of his estate in any matter relating to status or any right in so far as it does not affect his estate or in respect of any claim due to or against him under this section, but no cession of his earnings after the sequestration of his estate, whether made before or after the sequestration shall be of any effect so long as his estate is under sequestration.

(7) The insolvent may for his own benefit recover any pension to which he may be entitled for services rendered by him.

(8) The insolvent may for his own benefit recover any compensation for any loss or damage which he may have suffered, whether before or after the sequestration of his estate, by reason of any defamation or personal injury: Provided that he shall not, without the leave of the court, institute an action against the trustee of his estate on the ground of malicious prosecution or defamation.

(9) Subject to the provisions of subsection (5) the insolvent may recover for his own benefit, the remuneration or reward for work done or for professional services rendered by or on his behalf after the sequestration of his estate.

(10) The insolvent may be sued in his own name for any delict committed by him after the sequestration of his estate, and his insolvent estate shall not be liable therefor.

Any property claimable by the trustee from the insolvent under this section may be recovered from the insolvent by writ of execution to be issued by the registrar upon the production to him of a certificate by the Master that the property stated therein is so claimable.

(12) The insolvent shall at any time before the second meeting of the creditors of his estate held in terms of section forty, at the request of the trustee assist the trustee to the best of his ability in collecting, taking charge of or realising any property belonging to the estate: Provided that the trustee shall, during the period of such assistance, give to the insolvent out of the estate such an allowance in money or goods as is, in the opinion of the Master, necessary to support the insolvent and his or her dependants.

(13) The insolvent shall keep the trustees of his estate informed of his residential and postal addresses.

(14) Any notice or information which is to be conveyed to an insolvent in terms of this Act, may be delivered to him personally or may be delivered at or sent in a registered letter by post to an address given by the insolvent to the trustee in terms of subsection (13).