Cession Agreements

Retrocession is the restitution of something (for example. B country) which has been ceded in general or specifically: this clause confers broad powers on practitioners and would, for example, allow the practitioner to suspend a company`s payment obligations as part of an ease agreement. It should be noted that the practitioner can only suspend obligations and not the entire contract. It is taken into account that contracts are generally a set of rights and obligations. What the law does not say is that the practitioner has the power to suspend the rights of third parties. The transfer of accounting debts confers on the bank (more generally at the transfer) rights without corresponding obligation of the Cedents. Under the civil scheme, the assignment is synonymous with assignment and, therefore, a deed by which a personal claim is transferred from the assignee (the assignor) to the assignee (the assignee). While real rights are transferred by delivery, the rights of the personality are transferred by transfer. As soon as the debtor`s commitment is transferred, the transfer client is completely replaced. The original creditor (Cedent) loses his right of claim and the new creditor (ceding) obtains that right. If the client . B is in default with the secured debt by not paying the credit, the assignee has the right, on that date, but not before, to realize his guarantee by exercising his recourse to recover the main debt and use the proceeds to settle the secured debt.

Whether the underwriter can do so with the debt guaranteed before the debt is delayed is, as noted above, a question of fact that must be determined by the terms of the commitment agreement. Except to say that at this stage it appears that the parties can structure security assignments in both directions and, if the intent is not clearly expressed, the construction of the deposit will predominate (see Fall Grobler v Oosthuizen SCA) the key claim being that, in law, the transfer by surrender of a non-existent right is a nullity (i.e. a claim that is surrendered). There are two theories on the transfer of security, the theory of deposit and a sloping assignment with the obligation to recover (reversion rights). The distinctiveness between the « collateral » and the assignment is that no formality is required for the agreement of engagement or the deed of surrender itself, although the parties may agree on formalities to which the transfer must be completed. The assignment may be express or implied or may be deducted from the conduct of the parties. While the assignment does not need to be reduced to the letter, the parties may agree that it must be written, but it is only valid if it is reduced to the letter. In drafting the security transfer agreement, it is important to ensure that the related clauses are included in the agreement, which deals with aspects related to cooperation agreements. However, the SCA found that at the time the bank abandoned the debt, nothing could be divested, as GD Brews had to pay the debts in accordance with its agreement with Brayton and JP Brews.

From a legal point of view, the transfer by transfer of a non-existent right is a nullity. The SCA also reviewed the authorized correspondence between the bank`s lawyers and the lawyers for LA DG Brews. It concluded that the parties clearly intended to transfer its full payment request to the bank. GD Brews attempted to amend its claim by stating that the assignment was a precondition for payment, but the Tribunal in particular dismissed this attempt as inconsistent with the assignment. As noted above, the obligations of a member of the assignment are determined by the law applicable to the nature of the security instrument, which creates the guarantee. The authority in this matter is in Bisnath/Absa Bank Limited; Absa Bank Limited/Bisnath and Another [2008] 3 All SA 219 (SCA) in which the SCA has ruled on a number of appeals, in particular on the question of whether the bank, as a borrower holding assets allegedly in possession of assets belonging to a judicial order, should have withdrawn the rents due and due, which should have been the subject of the debt for which a breach had been cancelled.