Civil Procedure

Sequestration

Sequestration is the legal process of declaring an individual insolvent. The insolvent's estate is surrendered and administered by a trustee for the benefit of creditors.

Legal Definition

Governed by the Insolvency Act 24 of 1936. Sequestration can be voluntary (surrendering your own estate) or compulsory (creditors apply to court). Requirements: the estate must be insolvent (liabilities exceed assets) and sequestration must be to the advantage of creditors.

📖 Constitutional / Statutory Basis: Section 34, Constitution of the Republic of South Africa, 1996; Insolvency Act 24 of 1936

Practical Example

You owe R600 000 but your assets are worth R200 000. Creditors apply to sequestrate your estate. A trustee is appointed, your assets are sold, and the proceeds distributed among creditors.

Frequently Asked Questions

What are the consequences of sequestration?

You cannot carry on a business without trustee consent, hold certain public offices, or incur credit. Your assets vest in the trustee.

When am I rehabilitated after sequestration?

Automatically after 10 years, or earlier by court order (typically after four years if all creditors proved and no opposition).

Is sequestration the same as debt review?

No. Debt review restructures repayments and keeps you solvent. Sequestration surrenders your estate and you are declared legally insolvent.

Related Terms

Know the law. Know what to say.

The Advocate trains you to use your rights out loud — 389 real scenarios grounded in South African law and Scripture with exact rebuttals and law references. Free to start.

Browse Rights Scenarios — Free

or get a free checklist