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2023
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[2023] ZAFSHC 439
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Makhoba v Standard Bank of South Africa (845/2022) [2023] ZAFSHC 439 (9 November 2023)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Reportable: NO
Of
Interest to other Judges: NO
Circulate
to Magistrates: NO
Case
number: 845/2022
In
the matter between:
THABO
JOHN MAKHOBA
Applicant
and
THE
STANDARD BANK OF SOUTH AFRICA
Respondent
HEARD
ON
:
11 August
2022 and 5 May 2023
BEFORE:
Chesiwe, J
DELIVERED
ON:
This judgment was given electronically by
circulation to the parties’ representatives by email. The date
and time for hand-down
is deemed to be at 13h00 on 09 November 2023.
[1]
The Applicant launched a notice
of motion application against the
Respondent for reckless lending in terms of section 80(1)(a) of the
National Credit Act 34 of
2005 (here in after the referred to as the
NCA). The Applicant appeared in person with the Respondent opposing
the application.
[2]
The Applicant seeks the following
relief:
“
The credit
agreement I entered into with the Respondent in 2012 is reckless in
terms of
section 80(1)(a)
of the
National Credit Act and
unlawful ab
initio in terms of
section 164(1)
of the
National Credit Act 34 of
2005
for it was in violation of
section 90(2)(a)
of the same Act;
In terms of section
83(2)(a) of the same Act I am discharged from my obligation;
My wife is reimbursed
R55 000,00 with interest so far paid towards its settlement.”
BACKGROUND
[3]
This matter was set down for
hearing on 11 August 2022. Both parties
had filed their written heads of argument. Both parties proceeded
with oral arguments.
Judgment was then reserved.
[4]
The Applicant then proceeded
to file an interlocutory application on
30 August 2022, in which he sought re-opening of his case as there
was new information
and that this information had an impact on the
main application. The reserve date in terms of the main application
was changed
to allow the interlocutory
application to proceed.
[5]
The matter was set down for 28
October 2022 for the interlocutory
application to be heard. On 28 October 2022, the Applicant
requested that the interlocutory
application be postponed to 3 March
2023 to give the Applicant the opportunity to find legal
representation. As the Applicant
was in person again, the court
granted the postponement.
[6]
I pause to mention that even
though the Applicant was in person, his
papers appeared to be well drafted by a legal person who did not
place himself or herself
on record.
[7]
If and when the Applicant obtained
legal aid assistance, the
Applicant was supposed to file further papers and heads of argument
by 13 January 2023 and the Respondent
was to file its heads of
argument by 3 February 2023 and in accordance with court practice
directives.
[8]
On 3 March 2023, parties per
agreement, postponed the interlocutory
application to 5 May 2023 with costs in the cause.
[9]
On 5 May 2023, the Applicant
did not appear nor did he give any
reason for his non-appearance. Ms Nicole Mncube, the attorney on
behalf of the Respondent contacted
the Applicant and had obtained
confirmation that the Applicant would be in attendance on 5 May 2023.
[10]
However, on 5 May 2023 the Applicant did not show up.
Mr Willem Geyer
from Legal Aid, Advocate Long and her attorney, Ms Mncube met in
chambers and it was agreed that in the consequence
of the Applicant’s
absence from Court and Mr Geyer not having instructions in the
matter, the Court indicated that the matter
would then be adjudicated
on the papers and judgment delivered in due course electronically, on
the basis of the papers already
filed by the parties. It was for the
above reasons that no oral arguments could be advanced and judgment
was then reserved.
[11]
The judgment will deal with both the Interlocutory Application
as
well as the Main Application.
[12]
The Respondent filed its answering affidavit on 9 March
2022 and it
was accompanied by a condonation application. Same was granted as
there was no prejudice against the Applicant.
INTERLOCUTORY
APPLICATION
[13]
The Applicant in the interlocutory application sought
the following
relief:
“
Leave to reopen
his case;
Copies of the
translated transcripts;
A copy of the
confirmatory affidavit of Ms Mlambo wherein she confirmed that she
listened to the translated transcripts.”
[14]
The Court granted the Applicant the relief sought.
[15]
I pause to mention that the Applicant had previously
filed three (3)
other interlocutory applications, which were withdrawn, the current
interlocutory application is the fourth.
The different
Interlocutory Applications were all under one case number with the
following court stamped dates; 5 May 2022, 22
August 2022, 30 August
2022 and 23 September 2022.
[16]
The Applicant in his founding affidavit contends that
the credit
agreement was unlawful and that there was misrepresentation on the
side of the Respondent in that the Applicant was
not informed about
the insurance that was applicable on the credit agreement.
Furthermore, the conversations between the Applicant
and the
Respondent’s representative
was in
Isizulu and Sesotho and not in English.
As a consequence of
the miscommunication, there was a
misunderstanding between the Applicant and the different
representatives’ of the of the Respondent, including the
Respondent’s
failure to provide the Applicant with verbatim
transcripts of the conversation between the Applicant and the
Respondent’s
representatives.
[17]
The Respondent contends that the Applicant has been
placed in
possession of all the transcripts and affidavits of Xolisile Mlambo,
including the annexures to the transcripts that
the Applicant has
been litigating in a haphazard manner and the Respondent had no
option, but to respondent to the allegations
raised by the Applicant.
[18]
Generally, interlocutory applications are incidental
to pending
proceedings. These applications are subordinate to the main
application yet distinct from it.
[1]
[19]
In this instance, the Applicant has haphazardly filed
interlocutory
applications without following proper rules of court as the Applicant
was in person. The Court was very lenient in
most instances.
[20]
The new information sought by the Applicant is not so
new as alleged
as all the information was provided to him and it is the same
information as in the main application. The Respondent
had to respond
to the same allegations as in the main application, which will be
dealt with later.
[21]
The Court is not in a position to advise the Applicant
on how to
handle his litigation. The Court had warned the Applicant on his
appearances in person without seeking legal assistance,
but with no
success.
[22]
In
Minister
of Finance v Oakbay Investments (Pty) Ltd and Others; Oakbay
Investments (Pty) Ltd v Director of the Financial Intelligence
Centre
[2]
,
the
following was said:
“
The Court does
not provide legal advice to the parties. Courts therefore, consider
it inappropriate for any party to come to court
for the confirmation
of a legal question which is common cause between the parties.”
[23]
The Applicant having filed different interlocutory applications
as
well as confusing the issues between the parties, insisted with
proceeding with the litigation except only for the fourth
interlocutory
application in which he requested to be given an
opportunity to sought legal representation and an indulgence which
the Court gave.
[24]
Having considered the interlocutory application, there
is nothing new
in the alleged requested information, except that it is a repetition
of the main application.
[25]
Therefore, the interlocutory application ought to be
dismissed with
costs in favour of the Respondent.
THE
MAIN APPLICATION
[26]
The Applicant’s notice of motion launched on 25
February 2022
and its founding affidavit, the Applicant alleges that the Respondent
enticed him in taking credit of R29 000,
00. Applicant
said the Respondent advised him that the credit account will have an
insurance which will cover the debt. The
Applicant took up the
Respondent’s offer as he was running a tuck shop which had
closed down. As a result of the tuck shop
having closed down, the
Applicant indicates that he could therefore not pay the credit
account given by the Respondent.
[27]
The Applicant then wrote a letter to the Respondent’s
local
branch, requesting that the insurance that was part of the offer for
the credit account, cover the debt.
[3]
Applicant said he was informed by the branch manager that
insurance does not cover the credit account debt.
[28]
Not having been satisfied with the branch manager’s
response,
Applicant wrote a letter to the Banking Ombudsman.
[4]
Applicant was not satisfied with the Banking Ombudsman’s
response and he then proceeded to the National Consumer Council
and
later to the National Credit Regulator to which responses were
given.
[5]
[29]
The Applicant’s main contention is that the Respondent’s
conduct was unlawful and deceiving and having been reckless with its
lending.
[30]
The Respondent in the answering affidavit,
[6]
contends that the loan/credit granted was not reckless nor was there
misrepresentation on the part of the Respondent. The Applicant
had
applied for credit and the transaction was concluded telephonically
with the Applicant having disclosed his income and was
deemed able to
afford monthly repayments. Applicant disclosed his monthly income as
R7 500, 00 and monthly expenses as R3 000,
00.
[7]
Further that when the card was delivered, the Applicant signed
and acknowledged receipt of same and gave his proof of residence
and
identification for verification purposes.
[8]
[31]
The Respondent attached to the answering affidavit,
the telephone
recorded conversation between the Applicant and the staff member of
the Respondent (Mr Richard Machaba). The record
shows the Applicant
being an active participant in the application for the credit card.
This was to the extent that the Applicant
asked that he pay the
repair of the bakkie,
[9]
the
following is noted:
“
MR MAKHOBA:
Okay, tell me, I was
thinking, maybe – so I can pay 1 200 per month.”
MR MACHABA:
Do you want to pay 1 200 per month?
MR MAKHOBA:
Ja, but now that I have a bakkie, but the problem –
Mr MACHABA:
Yes –
MR MAKHOBA:
– now is that the bakkie, the engine is not right on my bakkie.
So, I will need the money, maybe – so that engine, I see that
engine in the website so that the engine, that engine is costing
6 000.
MR MACHABA:
Okay.
MR MAKHOBA:
Now I do not know, if maybe I can get another money so that I can
pay
more than 600 a month, maybe 1 200 a month.
[32]
On an unknown date on the transcribed records, at page
134, the
telephone conversation between a certain Ms Nhlanhla of Standard Bank
continues where the Applicant was offered a balance
protection plan
under his credit card. It was explained to the Applicant that the
balance protection plan covers debt on the credit
card should a
person be deceased or retrenched.
[10]
[33]
The Applicant’s contention is that the balance
protection plan
must pay or should have paid for monies owing on the credit card
cannot stand as there is nowhere on the transcribed
telephonic
records where an offer is made, stating that the balance protection
plan will pay for the Applicant’s debt nor
did the Applicant
provide any evidence to the contrary.
[34]
The Applicant knowingly agreed to the credit facility, to the
extent that the he went to the bank to activate the card. The
Applicant
even went as far as applying for a credit limit increase in
2014.
[35]
This Court cannot accept the Applicant’s defence
of reckless
lending including that the balance protection plan was to pay for the
credit debt. According to the transcribed record,
the Applicant was
clearly explained to, on the applicable requirements for the payment
of the balance protection plan in relation
to the credit
facility.
[11]
[36]
The Applicant’s reliance on sections 80(1)(a),
164(1) and
90(2)(a) of the NCA, has no merit as the Respondent had conducted an
assessment as required in terms of section 81(2)
and took reasonable
steps to ensure that the Applicant understood and appreciated the
risks involved. The Applicant gave the information
of his finances as
being in a position to afford and accepted the credit facility. The
Applicant assured the Respondent that the
family business which is a
tuck shop, is doing well and it has been running since 1994.
[12]
[37]
In
SA
Taxi Securitisation (Pty) Ltd v Mbatha
[13]
,
the Court said the following:
“
Since the
enactment of the NCA, there seems to be a tendency in these Courts
for defendants to make bland allegations that they
are
“over-indebted” or that there has been “reckless
credit”. These allegations, like any other allegations
made in a defendant’s affidavit opposing summary judgment,
should not be “inherently and seriously unconvincing”,
should contain a reasonable amount of verificatory detail, and should
not be “needlessly bald, vague or sketchy”. A
bald
allegation that there was “reckless credit” or there is
“over-indebtedness” will not suffice.”
[38]
Even if the above case refers to summary judgment proceedings,
the
principles applied in this instance are the same as it is based on
reckless lending. The Respondent conducted an affordability
assessment before entering into a credit agreement with the
Applicant. The Applicant participated in the conversation including
asking questions. Annexure “
NM1”
on page 269
of the transcribed record the following is noted:
“
Mr.
Evans: And
then do you know how the credit card work, sir?
Mr. Makhoba:
Yes it is, but my problem sir is, I do
want a credit card but my problem is I do not
have this thing that
you want of…
Mr. Evans:
Of doing what?
Mr Makhoba:
What I can manage is, it is like, what I can only have is the
bank
statement. I do not have…
Mr. Evans:
We do not need a bank statement, you
are qualifying
already, Mr Makhoba. We do not need a bank
statement and we also do not need a payslip.”
[39]
During 2014, the Applicant applied for an increase on
his credit card
facility. The application was also conducted telephonically and
the Applicant proceeded to confirm his income
as R6000,00 with
monthly expenses of R3000.
[14]
Based on the information the Applicant provided, the credit limit was
increased to R29 000,00.
[40]
Section 80 (1) of the NCA is clear that an agreement
will be reckless
if the credit provider failed to conduct an assessment, irrespective
of the outcome. In this instance the
Applicant gave his income
and expenses and accepted the credit card, to the extent that he went
to the bank to activate the credit
card. In my view, the Applicant
has failed to prove that the Respondent was reckless in granting the
credit facility.
[41]
With regard to the issue of language, of which the Applicant
alleged
that he was spoken to in Isizulu, Applicant was asked by My Evans if
he speaks Sesotho and he affirmed that and the conversation
proceeded
[15]
.
The
Applicant was well conversant in court as he was in person. The
issue of the language being the consequence of the miscommunication
can therefore not stand.
PRESCRIPTION
[42]
The Respondent raised a point
in
limine
of
prescription, which the Applicant denied that the matter has
prescribed. The Applicant in the founding affidavit indicate that
he
was deceived to agree to the contract in that the balance protection
plan was to cover the debt if he was unable pay. Furthermore,
the
Applicant contends that he had a complaint with the Banking
Ombudsman.
[16]
[43]
The Respondent in the answering affidavit states that
the Applicant
failed to bring a claim arising from the alleged misrepresentation of
the credit insurance policy/balance protection
plan on 17 November
2016 as the Applicant instituted the application only on 25 February
2022 and thus the Applicant’s claim
has expired.
[44]
The provisions of section 12 of the
Prescription
Act
,
[17]
provides as follows:
(1) Subject to the
provisions of subsections (2), (3) and (4), prescription shall
commence to run as soon as the debt is due.
(2) If the debtor
wilfully prevents the creditor from coming to know of the existence
of the debt, prescription shall not commence
to run until the
creditor becomes aware of the existence of the debt.
(3) A debt shall not
be deemed to be due until the creditor has knowledge of the identity
of the debtor and of the facts from which
the debt arises: Provided
that a creditor shall be deemed to have such knowledge if he could
have acquired it by exercising reasonable
care.
[45]
The ordinary period of prescription of a debt such as
the Applicant’s
is three years from the date on which the debt became due.
[18]
[46]
The Applicant does not disclose as to what transpired
between
November 2016 and August 2019. The Applicant only mentioned that the
claim for the insurance/balance protection plan was
denied by the
bank manager and that he received the Ombudsman decision on 26 August
2019.
[19]
The Applicant
further denied that the claim has prescribed as according to the
Applicant he was deceived by the Respondent
that the credit facility
is covered by the balance protection plan.
[47]
When prescription is raised, there is two enquiries
that take
place,
[20]
as set out in
MEC for
Health, Western Cape v M C,
[21]
“
the
determination of the primary facts on the one hand, and on the other
hand, the knowledge or deemed knowledge thereof. This means
that once
the facts from which the debt arose (the primary facts) have been
determined, the enquiry turns to the creditor’s
knowledge of
the primary facts.”
[48]
The Applicant’s contention is based on a defence
of perceived
distorted facts by the Respondent. Section 72 of the Prescription Act
does not deal with distorted fact or being deceived.
It is clear that
a prescribed debt starts to run when the debtor prevents the creditor
from gaining knowledge of the existence
of the debt and the creditor
has knowledge of the identity of the debtor and of the facts from
which the debt arises.
[22]
[49]
The Respondent denied the Applicant’s claim prescription
arose
on November 2016. The Applicant received the Ombudsman’s
decision in August 2019. The Applicant has not placed before
Court
the fact as to what reasonable exercise he took to prevent or avoided
prescription of his claim. The Applicant was already
informed on
November 2016 that the claim was not covered by the balance
protection plan and he chose to ignore the said information
that
relates to the claim against the Respondent.
[50]
In my view, the Applicant had all the facts regarding
the claim. The
Applicant had knowledge of the identity of the debtor. The Applicant
further had the knowledge of the debt. The
Applicant may have acted
in person throughout the drafting of his papers he filed with the
different parties regarding the claim
to the extent that he had
drafted the written heads of argument. This simply means the
Applicant is not as ignorant as it may seem.
The Applicant could
therefore have avoided prescription in terms of section 10(a) of the
Prescription Act.
[51]
In
Yellow
Star Properties 1020 (Pty) Ltd v MEC Department Planning and Local
Government Gauteng,
[23]
the court said the following:
“
It may be that
he applicant had not appreciated the legal consequences which flowed
from the facts, but its failure to do so does
not delay the date
prescription commenced to run.”
[52]
In a recent judgment of the SCA,
McMillan
v Bate Chubb & Dickson Incorporated
[24]
,
the following was said:
“
The period of
prescription begins to run against a creditor when the creditor has
the minimum facts which are necessary to institute
action.”
[53]
Indeed, the Applicant did not only have the minimum
facts, but he had
maximum facts which he could have used to institute the action.
[54]
In my view, the Respondent’s contention that the
debt has
prescribed is correct and I am inclined to agree with the Respondent
that the plea on prescription be upheld. The Applicant
has not shown
any good cause for the relief sought. The application therefore ought
to be dismissed.
COSTS
[55]
It is a trite principle of our law that a court considering
an order
of costs exercises a discretion.
[25]
The courts discretion must be exercised judicially
[26]
.
It is also a well-established law that the general rule is that the
costs follow the result.
[56]
Counsel for the Respondent submitted that the Applicant
be ordered to
pay costs on a punitive scale due to the Applicant’s conduct
during the litigation. The Applicant appeared
in person throughout
the litigation. The Applicant is a man of straw. It would not be in
the interests of justice that the Applicant
be punished for wanting
to exercise his rights to litigation, nor to be saddled with a
punitive costs order. Therefore, each
party ought to pay their
own costs.
ORDER
[57]
Accordingly, it is ordered as follows:
1.
The application is dismissed, including the interlocutory
application;
2.
Each party is ordered to pay their own costs, including costs of the
postponements.
CHESIWE,
J
On
behalf of the Applicant:
No
appearance
On
behalf of the Respondent:
Adv.
P Long
Instructed
by:
McIntyre
van der Post Attorneys
BLOEMFONTEIN
[1]
(See Massey-Ferguson (South Africa) Ltd v Ermelo Motors (Pty) Ltd
and Others 1973 (2) ALL SA 383 (T))
[2]
2017 (4) ALL SA 150 (GP)
[3]
(Annexure C, page 12 of the Index Hearing Bundle)
[4]
(Annexure D, page 13-14 of the Index Hearing Bundle)
[5]
(Annexures A and B, page 7 to 11 of the Index Hearing Bundle)
[6]
(Page 22 of the Index: Hearing Bundle at sub-paragraph 9.1)
[7]
(Page 62 of the Index: Hearing Bundle, Annexure SB2 –
Transcript of the Telephonic Application conducted with the
Applicant)
[8]
(Pages 119 to 125 of the Index: Hearing Bundle, Annexures SB5; SB6
and SB7)
[9]
(Page 131 to 132 of the Index: Hearing Bundle, Annexure SB8 –
Telephonic Transcript in respect of the Limit Increase)
[10]
Page 136 of the Index: Hearing Bundle, Annexure SB9 –
Telephonic Transcript in Respect of the Credit Insurance
of the Credit Card)
[11]
Pages 136 to 137 of the Index: Hearing Bundle, Annexure SB9 –
Telephonic Transcript in Respect of the Credit Insurance
of the
Credit Card)
[12]
Page 71 of the Index: Hearing Bundle, Annexure SB2 –
Transcript of the Telephonic Application conducted with the
Applicant)
[13]
SA Taxi Securitisation (Pty) Ltd v Molete; SA Taxi Securitisation
(Pty) Ltd v Makhoba (51330/09, 52948/09, 53080/09) [2010]
ZAGPJHC
24;
2011 (1) SA 310
(GSJ) (30 March 2010)
[14]
(Page 129 of the Index: Hearing Bundle, Annexure SB8 –Telephonic
Transcripts in Respect of the Limit Increase)
[15]
(Page 60 of the Index: Hearing Bundle, Annexure SB2 –
Transcript of the Telephonic Application conducted with the
Applicant)
[16]
(See the Letter from the Ombudsman dated 26 August 2019 on page 13
to 14)
[17]
Act 69 of 1969
[18]
See section 10(1) read with
section 11(d)
of the
Prescription Act 69
of 1969
.
[19]
(Applicant’s Founding Affidavit, page 4 of the Index: Hearing
Bundle)
[20]
Johannes G Coetzee & Seun and Another v Le Roux and Another
(969/2020)
[2022] ZASCA 47
(8 April 2022) Van Heerden & Brummer
Inc v Bath
[21]
MEC for Health, Western Cape v M C
[2020] ZASCA 165
(SCA) para [6] –
[7]
[22]
(See Van Heerden & Brummer Inc v Bath (356/2020)
[2021] ZASCA 80
(11 June 2021))
[23]
[2009] ZASCA 25
(2009) 3 ALL 475 (SCA)
[24]
(299/2020)
[2021] ZASCA 45
(15 April 2021) at para [38]
[25]
(See Ferreirer v Levin NO and Others; Vryenhoek and Others v Powell
NO and Others 1996 (2) SA 621 (CC), 1996 (4) BCLR 441 [1996]
ZACC
27)
[26]
(see Motaung v Mukubela and Another, NNO; Motaung v Mothiba NO
1975
(1) SA 618
(O) at 631 A)