Legal Question in Business Law in South Africa

If a husband and wife is in community of property and the wife owns a business that it registered as a Closed Corporation and she is the only member. If she get sued by someone that her husband owes money to and someone comes and writes up everything in the business, can they take the assets of the business or can they only take her private assets???

And if the CC can not be sued, can the CC, as a legal entity, sue the person for Public humiliation? or what action can be taken against the person who sued(counterclaim)??


Asked on 4/16/12, 12:52 pm

1 Answer from Attorneys
Sam Jackson

As you correstly point out, the CC is a separate legal entity and cannot be held liable for either the husband or the wife's debts. In other words, the assets of the CC may not be attached to satisfy a debt that the husband or wife incurred in their personal capacities.

However, bear in mind that the membership interest in the CC is an asset in the joint estate, which means a creditor of either the husband or the wife may attach the membership interest in the CC as a means of satisfying a debt that they incurred in their personal capacities.

If the CC's assets are being attached erroneously, the CC's recourse would be to lodge a claim with the sheriff of the court (the person who attached the assets). The sheriff will then institute interpleader proceedings where the CC can provide proof of ownership of the assets and the sheriff will be obliged to release those assets from attachment.

I'm afraid that the CC will not have a claim for public humiliation.

Yours faithfully,

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Answered on 4/16/12, 1:47 pm


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