Bodies Corporate: Before You Sequestrate to Recover Arrears…

KVV Inc Attorneys

Published on: 04/03/2025

Sequestrating a debtor, like a sectional title owner, to recover arrear levies can backfire. While tempting, the Body Corporate, as the petitioning creditor, risks bearing the full cost of sequestration if the insolvent estate lacks funds. Even if levies are paid before property transfer, as legally required, this doesn't absolve the Body Corporate's responsibility for potential shortfalls. Secured creditors, like banks, can often protect themselves from these costs.