A sequestration application can be reversed only if notices to the effect have been published in the Government Gazette and the local papers in which the original notice of intention to voluntary sequestrate has been published. In addition, the Master of the High Court must be informed, as well as SARS and the creditors.
However, the creditors can still see it as an act of insolvency and thus take the necessary steps for judgement against the debtor. Indeed, though it is possible for a sequestration application to be reversed, the creditors still have full right to then proceed with their legal action against the debtor. It is seen as unethical to have the sequestration reversed before the hearing date, as many such debtors use the process to stay a sale of execution. In this instance, one cannot blame the creditors for wanting to take legal action against the applicant.
Once the intention to apply for sequestration has been published and the applicant thus receives protection against further legal action by creditors, the applicant cannot decide not to proceed with the application, unless the applicant has a valid reason, such as being able to pay the creditors, as well as the interest, and legal fees up to date.
