What is an Administration Order?

Administration is an option you may have taken in the past if your debts at the time were less than R50 000 and you were not able to pay off or service these debts. An administrator would have been appointed to collect from you an affordable amount of money at regular intervals. Such amounts would be distributed to your various creditors that are encompassed in the administration order.

An administration order is granted in terms of section 74Q (1) of the Magistrates’ Court Act 32 of 1944. The process of administration orders was initiated as a means of debt relief for people who are overwhelmed by debt and whose estate is so small in that the costs of sequestration proceedings will swallow it. This is done in order to assist a debtor during financial difficulties without going through the route of sequestration.

​

When can Administration Order be Erased?

An administration order can be cancelled if “good cause” can be demonstrated to the court. Examples of good cause include:

​

• change in financial circumstances, for instance, you earn more today or have less debt;

• the creditors are not being paid timorously. For instance, the administrator is making payments to the creditors on a trimonthly basis whereas the debtor can make payments directly to the creditors on a monthly basis.

•  the administrator is not duly performing their duties as an administrator or the administrator’s charges are in dispute.

​

In addition to the “good cause” requirement, an administration order can also be rescinded when all the debts that were under administration have been paid.