Ignore notices from credit providers at your peril

2014-02-20 17:08

The Constitutional Court has warned indebted South Africans that they need to be responsible when it comes to their debt.

In a unanimous judgment handed down today and penned by acting justice Nonkosi Mhlantla, the court ruled that Standard Bank was within its rights to institute legal proceedings against a customer who had defaulted on payments.

The judgment dealt with the steps a credit provider had to take before it took a customer – who had defaulted on a credit repayment – to court.

The Constitutional Court ruled that a credit provider did not have to ensure a notice of pending court action – required by the National Credit Act – was personally served on a creditor.

In the case of registered mail, the bank only had to ensure the notice was dispatched, reached the correct branch of the post office and that the customer was notified there was registered post before legal proceedings could be instituted.

The court case came after Moshomo Kubyana fell into arrears with car repayments in 2010.

When the bank took Kubyana to court, he claimed he had never been informed of the imminent legal proceedings as required by the National Credit Act.

This was because Standard Bank had sent Kubyana the notice by registered post but he failed to retrieve it from the Post Office.

The court ruled: “If a consumer elects not to respond to the notification from the Post Office, despite the fact that she is able to do so, it does not lie in her mouth to claim that the credit provider has failed to discharge its statutory obligation to effect delivery.”

The court also used the opportunity to “clarify” a previous judgment in the Sabelo case, which has caused confusion and contradictory verdicts in the high court.

In a separate but concurring judgment, Justice Chris Jafta wrote that the Sabelo judgment simply meant that the “notice must reach the consumer, but this does not mean that the notice must actually be viewed by the consumer”.

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