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CaseLaw
CaseLaw, Attorney
Category: South Africa Law
Satisfied Customers: 1292
Experience:  BCom; LLB; Masters in Law
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Can a supplier block the account of a company, who is not in

Customer Question

Can a supplier block the account of a company, who is not in arrears, because of a company, owned by the same people, who is in arrears?
Submitted: 1 year ago.
Category: South Africa Law
Customer: replied 1 year ago.
We are a South African based company.
Expert:  CaseLaw replied 1 year ago.

Hi there and thank you for your question,

As I understand your question, the company whose account has been blocked has been given a line of credit from the supplier? And the supplier has blocked that line of credit because a different company (owned by the same people) is in arrears?

YES, the supplier is perfectly entitled to do so.

There is no right in SA for somebody to give another person credit, or an account. That is a privilege.

That means that the supplier is perfectly within their rights to block/cancel the account for whatever reason it wants. ANY reason. Maybe they don't like the fact that you drive a Merc, that's a good enough reason.

My advice, get the other company to settle it's debts so that the supplier will release the account for the first company.

If my answer hasn't answered all of your questions, please send me a REPLY with follow up questions so that I can continue to assist you in this same thread for as long as you need. Let me know if you need more advice - don't just rate my answer as "bad".

If my are HAPPY with my answer then please click one of the SMILEY FACES to rate my answer and then click the GREEN ACCEPT button to accept the answer.

Good luck and best regards,

CaseLaw

Please note: This answer does not create an attorney-client relationship. Please consult a local attorney in person for legal advice. This information is being provided so you can better discuss legal matters with your attorney.

Expert:  CaseLaw replied 1 year ago.
Hi there again,
I hope that you understood the above advice and that it was useful? Please leave positive feedback for me.
If you have a further question please ask it?
Regards
CaseLaw