Less debt distress reported

2010-12-21 00:00

THE latest statistics regarding liquidations, insolvencies, and civil cases for debt back a cautiously optimistic view that fewer companies and individuals are in distress.

Although the figures remain high by historical standards, the total number of civil judgments recorded for debt declined by 23% year-on-year in October 2010, while the number of civil judgments for the first 10 months of the year also declined by 15,9%.

In addition, the number of liquidations recorded for the first 11 months of 2010 declined by 2,2% year-on-year — although the number of company liquidations grew by 5,1% year-on-year to 1 742 cases for the first 11 months of this year. The number of insolvencies declined by 23,1% year-on-year in October 2010 to 317 cases, while the number of insolvencies in the first 10 months of the year also declined by 32,2% year-on-year.

Statistics SA attributed the decline in the number of civil cases for debt to declines in the “money lent” and “goods sold” categories.

The number of civil cases recorded in Pietermaritzburg in October 2010 amounted to 2 019 compared with 2 478 in October 2009 — marking an 18,5% decline.

The number of civil cases recorded in Pietermaritzburg in the first 10 months of 2010 decreased by 9,9% year-on-year to 18 083. Liquidation refers to the winding up of the affairs of a company or CC when liabilities exceed assets — and it can be resolved by voluntary action or by an order of the court. Insolvency refers to an individual or partnership which is unable to pay its debt and is placed under final sequestration.

Civil judgments are decisions taken in a civil matter or a dispute between two people or parties, while civil summonses are notices to appear before the court of law where a dispute between two parties or people has to be heard.

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