MRL3701
Assignment 2
Semester 1
Due 24 March 2026
, Question
With reference to relevant legislation, explain why the Constitutional Court
in Harksen v Lane NO 1998 (1) SA 300 (CC) found that section 21 of the
Insolvency Act 24 of 1936 did not infringe the applicant’s rights under the
Interim Constitution. Also explain the intended purpose of section 21.
Section 21 of the Insolvency Act 24 of 1936 provides that when one spouse is
sequestrated, the property of the solvent spouse vests temporarily in the trustee of the
insolvent estate. Harksen challenged this provision on the basis that it amounted to an
unconstitutional expropriation of her property.
The Constitutional Court rejected this argument for several interrelated reasons
grounded in the nature, purpose, and operation of section 21, read together with the
property clause of the Interim Constitution.
The nature of section 21 of the Insolvency Act
Section 21 does not permanently deprive the solvent spouse of ownership of their
property. Instead, it provides for temporary vesting of that property in the trustee for
purposes of administration and investigation. Ownership remains with the solvent
spouse throughout, subject only to the trustee’s control until the solvent spouse proves
that the property belongs to them and does not form part of the insolvent estate
(Insolvency Act 24 of 1936, s 21(2)).
The Constitutional Court stressed that vesting must be understood as a procedural
mechanism, not as a transfer of ownership to the state or to creditors (Harksen v Lane
1998 (1) SA 300 (CC)).
Assignment 2
Semester 1
Due 24 March 2026
, Question
With reference to relevant legislation, explain why the Constitutional Court
in Harksen v Lane NO 1998 (1) SA 300 (CC) found that section 21 of the
Insolvency Act 24 of 1936 did not infringe the applicant’s rights under the
Interim Constitution. Also explain the intended purpose of section 21.
Section 21 of the Insolvency Act 24 of 1936 provides that when one spouse is
sequestrated, the property of the solvent spouse vests temporarily in the trustee of the
insolvent estate. Harksen challenged this provision on the basis that it amounted to an
unconstitutional expropriation of her property.
The Constitutional Court rejected this argument for several interrelated reasons
grounded in the nature, purpose, and operation of section 21, read together with the
property clause of the Interim Constitution.
The nature of section 21 of the Insolvency Act
Section 21 does not permanently deprive the solvent spouse of ownership of their
property. Instead, it provides for temporary vesting of that property in the trustee for
purposes of administration and investigation. Ownership remains with the solvent
spouse throughout, subject only to the trustee’s control until the solvent spouse proves
that the property belongs to them and does not form part of the insolvent estate
(Insolvency Act 24 of 1936, s 21(2)).
The Constitutional Court stressed that vesting must be understood as a procedural
mechanism, not as a transfer of ownership to the state or to creditors (Harksen v Lane
1998 (1) SA 300 (CC)).
