The Supreme Court of Appeal has aligned itself with a statement by the high court that where the liquidation of a company will occasion significant collateral damage both economically and socially and destroy wealth and livelihoods, the Companies Act recognises that business rescue is the better option. Adverse socio-economic consequences like job losses should be avoided where reasonably possible.
In the matter in which this was said however, the company being liquidated owned only one asset, derived its business from rental only, had only one tenant, had no employees and placing it under business rescue would not have saved any jobs or livelihoods. These were relevant factors in the court deciding to liquidate the company rather than placing it under business rescue. The court also granted a final liquidation order because a provisional liquidation order would simply delay the inevitable.