Rose is a teacher in a rural school, based in Zamdini outside Durban. She earns a gross salary of R15 000.00 per month. In 2015, while visiting the Midland Meanders close to Pietermaritzburg she noticed a "FOR SALE" sign outside a Spanish Bungalow. After initial investigations she signed a purchase and sale agreement with the agent. The deal was approved subject to Rose obtaining a bond from Vladimir bank. The bond for Rose was approved for One million Rands with a monthly installment of R6000.00. In order to accommodate for the recent load shedding Rose decides to install solar and wind generating systems to replace ESKOMS electricity. She obtained three written quotes of which Banjo's was the cheapest. Rose decided to use the services of Banjo's although Banjo's is not a certified technician. During the installation an electrical error results in a fire damaging part of the house. This reduced the valuation of the house to R 500 000.00 from one million Rands. Before the fire Rose purchased a Mercedes Benz from "WE SELL CARS AND TRACTORS" for R 200 000.00 with a monthly installment of R4 500.00. Over the weekend she parked outside Games. Once the looting began the car was damaged. The cars value declined to R100 000.00. Rose's son requires a new cellphone to the value of R25 000.00. His hobby is gaming and his friends have purchased the latest in gaming technology. The new cellphone is gaming friendly and will assist him in keeping with the current trends as well as, giving him an advantage over his friends. Roses installment for the cellphone is R1 500.00 per month. Rose uses her credit card to pay for her son's cellphone. Roses monthly installments are as follows: 1.Tax 3500.00 2.rates 1400.00 3.cellphone contract 500.00 4.Insurance 1000.00 5.Groceries 3000.00 6.Bond 6000.00 7.credit card 1500.00 8.light account 1000.00 9.medical 1000.00 TOTAL 18 900.00 The value of the house has dropped from R1000 000.00 to R500 000.00 The value of the car has dropped from R200 000.00 to R100 000.00 Rose's expenses exceed her income. Her creditors are demanding payment.

QUESTIONS 1.Rose now approaches you for advice. Explain to Rose the Acts of insolvency as indicated in the Insolvency act of 24 of 1936. Enlighten Rose which act of insolvency applies to her. (30)