Reading (in) between the lines: winding up close corporations

Prior to the enactment of the Companies Act (71 of 2008) (the new Act), the winding up of close corporations and companies was regulated by the Close Corporations Act, (69 of 1984) (the CC Act) and the Companies Act (61 of 1973) (the old Act) respectively. Section 68 of the CC Act provided the grounds upon which a court could liquidate a close corporation. Section 68(c), in particular, stated that a close corporation could be wound up by a court if the corporation was “unable to pay its debts”. In terms of s 69, a close corporation would be deemed unable to pay its debts, when, inter alia, a creditor to whom an amount of no less than R200 is due, serves a demand upon the close corporation at its…
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