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Companies Act, 1973 (Act No. 61 of 1973)

Chapter XIV: Winding-up of Companies

General

340. Voidable and undue preferences

 

 

1) Every disposition by a company of its property which, if made by an individual, could, for any reason, be set aside in the event of his insolvency, may, if made by a company, be set aside in the event of the company being wound up and unable to pay all its debts, and the provisions of the law relating to insolvency shall mutatis mutandis be applied to any such disposition.

 

2) For the purpose of this section the event which shall be deemed to correspond with the sequestration order in the case of an individual shall be-
a) in the case of a winding-up by the Court, the presentation of the application, unless that winding-up has superseded a voluntary winding-up, when it shall be the registration in terms of section 200 of the special resolution to wind up the company;
b) in the case of a voluntary winding-up, the registration in terms of section 200 of the special resolution to wind up the company;
c) in the case of a winding-up of any company unable to pay its debts by the Court superseding a judicial management order, the presentation of the application to the Court in terms of section 433(1) or 440.

 

3) Any cession or assignment by a company of all its property to trustees for the benefit of all its creditors shall be void.