lN THE HIGH COURT OF SOUTH AFRICA
NORTH WEST DIVISION, MAHIKENG
In the ex parte application of:
JOSIAS PAULUS GERINGER
and
MICHELLE GERINGER
Coram:
Heard:
Reserved:
Wessels AJ
1 8 September 2025
24 October 2025
Not reportable
Case no:510 /25
First Applicant
Second applicant
Delivered: This judgment was handed down electronically, circulated to the
parties' representatives via email, uploaded to CaseLines, and released to
SAFLII. The date and time for the handing down of the judgment are deemed to
be 1 0h00 on 1 7 March 2026.
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Summary: Insolvency - Voluntary surrender - Appl ication for - Applicants
previously entered debt review in 2019, which was terminated - Applicants
failed to provide information regarding investigation into reckless credit as
mandated by s 86(6) of the National Credit Act 34 of 2005 - Applicants'
monthly expenses exceed income, resulting in monthly deficit even before
payments to creditors - Applying principles in Ex parte Van Staden, the mere
statement that debt review was terminated , without further information,
leaves court unable to cons ider reckless credit - Sequestration is remedy of
last resort - Applicants fa iled to demonstrate why remedies under NCA,
includin g invest igation into reckless credit and debt restructuring, would not
be more appropriate - Advantage to creditors not established - App lication
dismissed.
JUDGMENT
WesselsAJ
Introduction
[ 1] This is an application for the voluntary surrender of the joint estate of
the applicants, who are married in community of property. The matter served
before me on the unopposed motion roll on 11 September 2025. On that date,
I stood the matter down to 18 September 2025, pend ing the outcome of the
Full Court judgment of this Division in Ex parte Van Staden
1, which dealt
with similar issues. When called on 18 September 2025 , counsel who
1 Reported as Van Staden v Van Staden (FC2/25; 1536/24) (2025] ZANWHC 210 (23 October 2025).
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appeared initially in the matter (on 11 September 2025) indicated that he was
not briefed aga in for the appearance on 18 September 2025, and I stood that
matter down pending the handing down of the Full Court judgment . The
judgment in Van Staden was subsequently handed down on 23 October 2025.
The princip les enunciated therein are directly app licab le to the present
application.
The applicants' case
[2] The first applicant is employed as a store manager earning R29 496.87
per month. The second app licant is unemployed. The ir joint monthly
expenses total R31 940.00, resulting in a monthly shortfall of approx imately
R2 443.13. The total liabil ities of the parties amount to R175 434.27 , owed
to three creditors: Standard Bank (R49 188.33), Woolworths (R 76 044.20) ,
and Direct Axis (RSO 20 1.74). All of these are credit agreeme nts regulated
by the Nationa l Credit Act2 ('NCA ').
[3] The parties' assets consist solely of movable property, valued at R22
000.00 on a forced-sa le basis, and cash of R46 000.00 held in their attorney's
trust account. This cash amount was ra ised through fami ly assistance, the
sale of some assets , and the conversion of accumulated leave.
[ 4] The applicants state that they entered debt rev iew in 20 19, but the
process was terminated when they cou ld no longer afford the monthly
instalments.
2 Nati onal Credit Act 34 of200 5.
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(5] The reasons for applicants' financial woes, as cited in the application,
inter alia include the rising cost of living and the first applicant's relocation to
Rustenburg, which increased rental expenses . The applicants calculate a
dividend of approximately 20 cents in the rand after deducting sequestratio n
costs of R33 446.60 from total unencumber ed assets of R68 000.
The requirements for voluntary surrender
[6] The requirements for an application for voluntary surrender have been
dealt with extensively in Van Staden. For purposes of this judgment, I need to
deal with these requirements cursorily.
[7] Section 6(1) of the Tnsolvency Act3 ('Insolvency Act') requires a court
to be satisfied that the provisions of s 4 have been complied with, that the
estate is insolvent, that there is sufficient realisable property to defray
sequestration costs, and that it will be to the advantage of creditors if the estate
is sequestrated. The use of the word 'may' confers a discretion on a court,
even where all requirements are met. The advantage to creditors is the
paramount consideration, and the test in voluntary surrender is more stringen t
than in compulsory sequestration app lications to the extent that a court must
be satisfied that it will be to the advan tage of creditors, not merely that there
is reason to believe so. Sequestration is a drastic remedy and one oflast resort,
to be considered only if alte111ative remedies have proved unsuccessful or are
inapplicable.
[8] Flowing from Van Staden, the followin g principles, are binding on this
Court; First, the advantage to creditors is the paramount consideration, and
3 Insolvency Act 24 of 1936.
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the test in voluntary surrender is more stringent than in compulsory
sequestration: a court must be satisfied that it will be to the advantage of
creditors, not merely that there is reason to believe so; Second, sequestration
is a drastic remedy and one of last resort, to be considered only if alternative
remedies have proved unsuccessful or are inapplicable; Third, the NCA
provides a range of remedial relief that can be tailored to the justice of a
particular case, and s 85 applies to any court proceedings in which a credit
agreement is being considered, including voluntary surrender applications;
Fourth, where a debt counsellor has conducted an assessment, s 86(6) of the
NCA requires an investigation into reckless credit. The mere statement that
debt review was terminated, without providing further information on its
implementation or failure, has the effect that a court cannot consider the issue
of reckless credit; Fifth, applications for voluntary surrender are ex parte in
nature and the utmost good faith. Compliance with formal requirements does
not mean that an application should consist of a mere tabulation of the bare
mm1mum.
Application of the Van Staden principles to this matter
[9] Measured against the principles laid down in Van Staden, the present
application must fail. The applicants state that they entered debt review in
2019 and that it was terminated. Applying the principle from Van Staden that
the mere statement that debt review was terminated, without further
information on its implementation or failure, leaves a court unable to consider
the issue of reckless credit. I find that the applicants have failed to place
sufficient information before this Coutt. What is conspicuously absent is any
information regarding what · investigation the applicants' debt counsellor
conducted into reckless credit as mandated bys 86(6) of the NCA, whether
any recommendation was made in terms of s 86(7) , whether the possibility of
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a declaration of reckless credit was exp lored, the applicants ' financial position
at the time each credit agreeme nt was conc luded or any attempts made to
renegotiate paym ent terms directly with creditors befo re resorting to
sequestration.
[10] The appl icants' calcu lation of a 20-ce nt dividend depends ent irely o n
the forced sale of the ir movable assets. l am enjoined to consider whether the
machi nery of the NCA might yield a better result for creditor s. Upon careful
consideration, I find that such consideration weighs against the granting of
the order .
[11] The applicants have a combined monthly income of R29 496 .87. Their
expenses, excludin g payments to creditors, total R3 1 940. This means t hat
even before making any payment to creditors, the applicants have a month ly
deficit. On these figures, it is difficult to see how the credit granted to the
applic ants could be anything other than reckless when one considers the
statutory affordability assessments that ought to have been conduct ed.
[12] The NCA provides various remedies that cou ld potentially assist the
app licants without the drastic consequences of sequestration. A declaration of
reckless credit could result in the suspension of agreements or the setting
aside of obligations . Debt rearrangement could extend repayment periods and
reduce monthly instalments. These remedies would preserve the app licants'
assets while still ensuring that respo nsible creditors receive payment. The
appl icants have failed to demon strate why reme dies available under the NCA
would be less appropriat e in their circumstances.
[13] The source of the R46 000 in the attorney's trust acco unt is expla ined
as family assis tance, sale of assets , and conversio n of accumulated leave
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remuneration. However, what is not explained is why these funds could not
have been applied to the debt review process or to negotiating settlements
with creditors. The founding affidavit largely mirrors the statement of affairs
and provides for little beyond the statutory minimum. This Court was required
to be furnis hed with sufficient information to exercise its discretion , which
the app licants failed to provide.
Conclusion
[14] I am not satisfied that it will be to the advantage of creditors to
sequestrate the applicants' estate. The applicants have failed to demonstrate
why the remedies available under the NCA, including an investigation into
reckless credit and potential debt restructuring, would not be more
appropriate in their circumstances. The scant information available regarding
the terminated debt review process leaves me unable to assess whether those
remedies were properly explored.
[15] In the last instance , although the formal requirements of s 4 of the
Inso lvency Act have been met, the advantage to creditors, which is the
paramount consideration, has not been established.
Order
[ 16] In the result , the following order is made:
The application for the voluntary surrender of the applicants' estate is
dismissed.
M WESSELS
ACTING JUDGE OF THE HIGH COURT
NORTH WEST DIVISION, MAHIKENG
Appearances
For applicant
Instructed by
:Adv B Riley
:Herman Scholtz Attorneys
:Mahikeng
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