In South Africa, the pro-creditor approach of insolvency law has been said to potentially violate the fundamental human rights enshrined in the Constitution of the Republic of South Africa, 1996. Particularly, this approach can be seen as conflicting with the right to dignity as outlined in Section 10 of the Constitution, as well as the right to property found in Section 25.
The pro-creditor approach often prioritizes the interests of creditors over the rights of debtors, which can lead to situations where individuals facing insolvency are deprived of their basic means of survival, thereby undermining their dignity. Additionally, Section 26 of the Constitution, which addresses the right to have access to housing, could also be implicated in cases where debt recovery leads to loss of home and shelter.
Thus, the interaction between insolvency law and fundamental human rights raises important considerations about the balance between protecting creditors and ensuring the rights and dignity of individuals in financial distress.