ADMINISTRATIONS UNDER THE MAGISTRATE’S COURT ACT

 

WHAT IS AN ADMINISTRATION ORDER?
An administration order is granted in terms of section 74 of the Magistrates Court Act 32 of 1944,when a debtor is unable to pay the amount due to a creditor or any judgement obtained against him/her in court, or to meet his/her financial obligations. The administration order seeks to provide debt relief to debtors whose debts that are due do not exceed R50 000,00.


THE EFFECTS
It affords the debtor the opportunity to pay off his debt at a rate that enables him to, at the very least, afford his basic financial requirements.

 

THE ADVANTAGES
One monthly payment is made to the administrator, as opposed to multiple payments to different creditors. The debtor has a payment plan that is affordable.


THE PROCESS
Debtors may apply to a Magistrate’s Court for an administration order that would, if successful, in effect compel the creditors to accept a rearrangement of their debts. An administrator will be appointed to manage payments of debts due to creditors. The administrator has a duty to make regular distribution payments to all creditors. As soon as all the listed creditors’ accounts have been settled, the administrator must lodge a certificate with the clerk of the court and send copies of the certificate to the creditors, whereupon the administration order lapses.

To download and complete the Administration Order Information Sheet, please click on the MS Word Icon to the right : 


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