Investec Bank v Bruyns
Claim for summary judgment against defendant based on suretyship executed by the defendant in the plaintiff’s favor for the debts of two companies in respect of which applications for business rescue had been issued.
The court distinguished between sections 131(6) and 131(7) and found that “[s]ection 131 (7) is a provision which applies where an affected person has not made a business rescue application under s 131 (1) but the Court nevertheless considers, in the course of liquidation proceedings or in the course of proceedings to enforce any security against a company, that it would be appropriate to make a business rescue order.
The court considered whether business rescue proceedings have already commenced or whether they will only commence if and when an order is made by the court for purposes of enforcement of claims against a company based on guarantees and sureties.
The parties were ad idem that the commencement date of business rescue proceedings in the present case fell to be determined with reference to section 131(1)(b) of the Act rather than section 132(1)(c).
The Count found it to be unnecessary to decide and held in favour of section 132(1)(b). Despite the court failing to rule on whether a creditor may enforce a surety on the full pre-business rescue debt, in the circumstances where that principal debt is compromised in terms of a business rescue plan, it held that a creditor may sue a surety for the debts of a company in business rescue despite the moratorium on claims against the company.