The process of non-voluntary liquidation

The process of Involuntary Liquidation

Section 81 of the Act outlines the procedure that should be followed when a company is wound up based on an application by a creditor of the company. This section provides for a variety of instances when an application can be used to wind up a company.

The most contentious instance is when a creditor or a shareholder of the company applies to the court for a liquidation order. The court will initially grant a provisional liquidation order which results in the company being given an opportunity to oppose the liquidation order. The Master of the High Court will however already appoint a Liquidator based on the RULE NISI (Provisional) order.

Should the company not oppose the order by the specified date given by the court, the court will subsequently grant an order that the provisional liquidation is made a final liquidation order. Once the final Liquidation order is granted the liquidator will proceed to liquidate the assets of the company and pay its liabilities.


It is recommended that a business owner seeks professional advice before the situation occurs.

No company owner wants to be in a position where his/her business has deteriorated to such an extent where the company either must be voluntarily liquidated or liquidated by way of an application by a creditor of the company or its shareholders.

However, should such a stage be reached, there are certain legal procedures that need to be followed and adhered to by the business owner. Contact an attorney at Francois Uys Incorporated Legal Practitioners to guide you through the intricate legal procedures of winding up your company according to the Act to avoid exacerbating an already critical situation.

Francois Uys (Director) / 082 852 3967 /