You’re insolvent if you are unable to pay your debts!

Insolvency law in South African law refers to a status of diminished legal capacity imposed by the courts on individual persons, companies, close corporations, partnerships or trusts who are unable to pay their debts, or whose liabilities exceed their assets.

The insolvent’s diminished legal capacity entails deprivation of certain of his important legal capacities and rights, in the interests of protecting other persons, primarily the general body of existing creditors, but also prospective creditors.