The implications of Lagoon Beach Hotel (Pty) v Lehane 2016 (3) SA 143 (SCA) for the South African cross-border insolvency dispensation

Abstract

This mini-dissertation explores the implications of Lagoon Beach Hotel (Pty) Limited v Lehane 2016 (3) SA 143 (SCA) for the South African cross-border insolvency dispensation, as this case deals with the various problems that arise in cross-border insolvency. As a result of these problems and a certain amount of uncertainty when it comes to dealing with cross-border insolvency issues, many investors are reluctant to invest cross-border. This is due to the fact that multiple countries, each with their own laws concerning cross-border insolvency, are involved. Thankfully, the United Nations Commission on International Trade Law has provided a set of guidelines in this regard, namely the Model Law on Cross-Border Insolvency. Although South Africa has enacted the Cross-Border Insolvency Act 42 of 2000, and most of the provisions provided for in the Model law have been included in the legislation, the Act still remains inoperative. Throughout this dissertation the Lagoon Beach case will therefore be critically analysed. The analysis will start off with a discussion of the common law, as it is currently the legal position in South Africa. Thereafter a detailed analysis will be conducted of the various orders of court of the Lagoon Beach case and how the courts differed or agreed in their approach. Finally, the Lagoon Beach case will be discussed in light of the Act and the issues in the case will be solved hypothetically by applying the Act to the problems discussed throughout the dissertation.