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The purpose of this article is to consider the impact of some of the provisions of the National Credit Act[1] (the NCA) on sequestration applications in the form of applications for voluntary surrender, as well as compulsory sequestration. This matter is of particular relevance in view of two recent cases: in Ex parte Ford[2] the court refused to grant a sequestration order following an application for voluntary surrender since the applicant-debtors did not, according to the court, avail themselves adequately of debt relief measures provided for by the NCA where the bulk of the debt consisted of credit agreements regulated by the NCA; and in a more recent judgment, Investec Bank Ltd v Mutemeri,[3] the respondent-debtors, namely the consumers, opposed an application for compulsory sequestration on the basis that the application for debt restructuring pursuant to debt review in terms of the NCA barred the applicant from proceeding with the application for compulsory sequestration, since they argued that such an application amounted to debt enforcement. This discussion therefore considers the impact of the debt relief remedies and certain special provisions that apply to debt enforcement in terms of the NCA on sequestration procedures provided for in the Insolvency Act[4] in view of the above judgments.[1]      34 of 2005.[2]      2009 3 SA 376 (WCC).[3]      2010 1 SA 265 (GSJ).[4]      24 of 1936.

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Act 34 of 2005 (hereinafter the 'NCA' or the 'Act'). 2 S 172(4) of the NCA repeals the Usury Act 73 of 1968, the Credit Agreements Act 75 of 1980 and the Integration of Usury Laws Act 57 of 1996. See further Scholtz et al Guide to the National Credit Act par 2.2. 3 Otto National Credit Act explained; Scholtz et al (n 2) par 2.3. 4 S 3(c)(i) and (ii). 5 S 3(g). The NCA provides for debt restructuring in accordance with s 86(7(c) but does not afford a consumer a discharge, for instance, after a certain period.

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