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[2021] ZAGPJHC 99
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Nedbank Limited v Niemann (4132/2019) [2021] ZAGPJHC 99 (26 July 2021)
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
LOCAL DIVISION, JOHANNESBURG)
(1)
REPORTABLE: NO
(2)
OF INTEREST TO OTHER
JUDGES: NO
(3)
REVISED.
DATE:
26
JULY 2021
Case No: 4132 / 2019
In
the matter between:
NEDBANK
LIMITED
Plaintiff
and
CORNELIUS
SALOMAN
NIEMANN
Defendant
JUDGMENT
WILSON
AJ
:
1
This matter concerns the scope of action available to a
consumer on receipt of a notice under section 129 (1) (a) of the
National
Credit Act 34 of 2005 (“the NCA”), and the
extent to which section 129 (1) (a) shields the consumer from the
enforcement
of a credit agreement while that action is taken.
Mr. Niemann’s
dispute with Nedbank
2
The plaintiff (“Nedbank”) seeks summary judgment
against the defendant (“Mr. Niemann”) in an action on an
instalment sale agreement (“the agreement”) for the
purchase of a caravan (described in the papers as an “Afrispoor
Cheetah”). Nedbank alleges that Mr. Niemann is R31 898.09
in arrears and that it has cancelled the agreement in response
to Mr.
Niemann’s breach of his repayment obligations.
3
The parties agree that this application falls to be determined
in terms of Rule 32 of the Uniform Rules of Court as it read before
its amendment on 1 July 2019 (See
Raumix Aggregates (Pty) Ltd v
Richter Sand CC, and Similar Matters
2020 (1) SA 623
(GJ)).
4
In its particulars of claim, Nedbank seeks “confirmation”
that the agreement has been cancelled, return of the caravan,
an
order declaring that Mr. Niemann has forfeited “all monies”
so far paid to Nedbank, leave to apply for what Nedbank
describes as
“damages to be calculated in accordance with section 127 (5) –
(9) of the NCA”, interest on the
damages and costs on the
attorney and client scale.
5
Mr. Minnaar, who appeared for Nedbank, accepted that only the
claims for cancellation of the agreement, the return of the caravan
and costs could properly form the subject of summary judgment
proceedings, and asked only for that relief.
6
Mr. Niemann resists summary judgment. His reasons for doing so
are set out in two affidavits drafted without the assistance of a
legal representative. Mr. Niemann was represented by Mr. Shaw at the
hearing. But Mr. Shaw did not draft or settle the affidavits
resisting summary judgment.
7
Mr. Niemann is accordingly a lay pleader. That being so, I am
enjoined to construe his affidavits generously, in the light most
favourable to him (
Xinwa v Volkswagen of South Africa (Pty) Ltd
[2003] ZACC 7
;
2003 (4) SA 390
(CC), para 13).
8
Mr. Minnaar submitted that I should disregard the second
affidavit Mr. Niemann submitted. I am not sure that this stance can
be
sustained where a lay pleader submits a second affidavit in
summary judgment proceedings. Be that as it may, in disposing of the
application, it has only been necessary for me to have regard to the
first of the two affidavits.
9
Read generously, that affidavit discloses only one defence
that might lead to the rejection of Nedbank’s claim at trial.
That
defence concerns what Mr. Niemann calls a dispute about the
amount Nedbank demands to settle the agreement outright (“the
settlement amount”). It is not necessary for me to outline this
dispute in any detail. Suffice it to say, Mr. Niemann wished
to bring
an early end to the instalment sale agreement, but did not agree with
the amount Nedbank said he would have to pay to
do so.
10
This dispute was not resolved, and Nedbank decided to take
steps to cancel the agreement. It issued a notice in terms of section
129 (1) (a) of the NCA on 28 November 2018. That notice reached Mr.
Niemann’s local post office on 5 December 2018. It is
not clear
whether and when the notice was collected.
11
Mr. Niemann says that he attempted to refer that dispute to
the banking ombudsman, but was told that he first had to address his
complaint to Nedbank itself. Mr. Niemann did this, but Nedbank
reaffirmed its position. In an e-mail dated 12 December 2018, Mr.
Niemann remained steadfast that Nedbank’s calculation was
wrong, and said he would “take the matter up to try and get
a
resolution”.
12
It is not clear from the papers whether Mr. Niemann then
approached the ombudsman once more. What is clear is that he met
Nedbank’s
further attempts to enforce the agreement with
repeated assertions that there was a dispute about the settlement
amount, and that
the cancellation and enforcement of the agreement
was premature before that dispute had been resolved one way or the
other. Mr.
Niemann took the view that he ought not to be required to
deal with Nedbank’s attorneys in these circumstances. Nedbank’s
attorney, Mr. Rowe, asserted that he had a mandate to act for
Nedbank, but nonetheless accepted Mr. Niemann’s reluctance
to
deal with him, and stated that he would advise Nedbank accordingly.
13
On 14 December 2018, Nedbank purported to cancel the
agreement. Nedbank’s particulars of claim were served on Mr.
Niemann
on 14 February 2019.
14
The question before me is whether Mr. Niemann’s
affidavit discloses a defence that, if sustained at trial, would
defeat Nedbank’s
claim.
15
With that in mind, I raised with Mr. Minnaar whether Nedbank
had not sought enforcement of the agreement prematurely, in light of
the fact that Mr. Niemann had raised a dispute about the settlement
amount long before the particulars of claim were served.
16
Mr. Minnaar argued that, whatever the nature of that dispute,
Mr. Niemann had no defence to the allegation of breach, and had
effectively
conceded that he had failed to pay the amounts due under
the agreement. He encouraged me to dismiss Mr. Niemann’s
reliance
on the disputed settlement amount as a sham defence, and to
grant summary judgment.
The NCA
17
I do not think that this case is that easy. It seems to me
that the fact of Mr. Niemann’s default is the beginning of the
enquiry in this case, not the end.
18
Once Mr. Niemann fell into arrears, Nedbank was required, by
section 129 (1) of the NCA, to draw the default to Mr. Niemann’s
attention in writing and propose that he “refer the credit
agreement to a debt counsellor, alternative dispute resolution
agent,
consumer court or ombud with jurisdiction, with the intent that the
parties resolve any dispute under the agreement or develop
and agree
on a plan to bring the payments under the agreement up to date”.
19
Section 130 (3) (c) (ii) (bb) forbids a court from enforcing a
credit agreement if it is established that Mr. Niemann has “agreed
to a proposal made in terms of section 129 (1) (a) and acted in good
faith in fulfilment of that agreement”.
20
The proposals referred to in section 129 (1) (a) are the
credit provider’s proposal that the dispute be referred “to
a debt counsellor, alternative dispute resolution agent, consumer
court or ombud with jurisdiction with the intent that the parties
resolve any dispute under the agreement” and the proposal that
the parties “develop and agree on a plan to bring the
payments
under the agreement up to date”.
21
I do not think that there is any reasonable interpretation of
Mr. Niemann’s conduct in this case other than that he seeks the
referral of the matter to the banking ombudsman. There is nothing on
the papers that suggests that Mr. Niemann has taken this stance
in
bad faith. I would be slow, in any event, to draw an inference of
this nature about Mr. Niemann’s conduct on the papers
in
summary judgment proceedings, especially since not a word is said in
Nedbank’s particulars of claim about what it must
have known
was Mr. Niemann’s desire to have the ombudsman consider the
dispute he had raised. Nedbank’s particulars
of claim make
various standard form allegations about the delivery of the section
129 notice, but are silent on Mr. Niemann’s
attempts to
activate the ombudsman. Nedbank must have appreciated that these
efforts are material to whether section 129 (1) (a)
has been engaged
on the facts of this case.
22
In these circumstances, there is a genuine prospect that Mr.
Niemann will be able to demonstrate at trial that sections 129 and
130 of the NCA have not been complied with. If he can demonstrate
that, Nedbank’s claim will not succeed, at least until the
ombudsman has been able to consider and resolve any dispute about the
settlement amount due on the agreement.
23
In resisting this conclusion, Mr. Minnaar advanced two further
arguments which it is necessary for me to address. First, Mr. Minnaar
said that sections 129 and 130 of the NCA cannot prevent the
enforcement of a credit agreement where there is no dispute that a
consumer is in default, does not take issue with the nature and
extent of the default alleged, and does not respond to the credit
provider’s proposal that a plan to bring the arrears up-to-date
be developed.
24
However, I do not think the text of section 129 (1) (a) can
sustain such an interpretation. The statutorily mandated proposal a
credit provider must make is not limited to the agreement of a plan
to eliminate the arrears. Section 129 (1) (a) makes quite clear
that
the credit provider must propose
either
that the consumer
refers a dispute under the agreement to an appropriate body
or
that a plan to eliminate the arrears be developed. In response, the
consumer may do either or both of these things. It is accordingly
clear that the declaration of a dispute on the agreement that does
not directly concern the nature and extent of a consumer’s
arrears will prevent the enforcement of the credit agreement, so long
as the dispute is declared in good faith, and the consumer
pursues
the resolution of the dispute in good faith.
25
In any event, the resolution of the dispute about the
settlement amount due, and its payment, would likely clear Mr.
Niemann’s
arrears. In that sense, I cannot conclude that the
dispute Mr. Niemann has raised is entirely distinct from the nature
and extent
of his default on the agreement.
26
Mr. Minnaar’s second argument relies on the assertion
that it was Mr. Niemann’s duty to actually refer his dispute to
the banking ombudsman, after Nedbank rejected his complaint, and that
his failure to allege in his affidavits that he had escalated
the
matter to the banking ombudsman at that point means that there is no
bar to the enforcement of the agreement.
27
Mr. Minnaar is correct to point out that Mr. Niemann does not
tell us whether he referred the matter to the banking ombudsman after
Nedbank rebuffed his complaint. However, I do not think that this
automatically means that I can be “satisfied”, as
section
130 (3) (c) (ii) (bb) requires me to be before I can grant summary
judgment, that Mr. Niemann has not responded to the
section 129
notice by agreeing to Nedbank’s proposal that he refer his
dispute to the banking ombudsman.
28
Section 130 (3) (c) (ii) (bb) does not require a consumer to
have actually referred a dispute under the agreement to a dispute
resolution
body. It states simply that a court may not determine a
matter if a credit provider has approached it despite a consumer
having
“agreed” to a proposal made in terms of section
129 (1) (a).
29
What counts as having “agreed” to the proposal? It
seems to me that agreement to a proposal to refer a matter in the
manner envisaged in section 129 (1) (a) covers a much wider range of
potential conduct on the part of Mr. Niemann than him having
actually
referred the matter to the ombudsman himself.
30
I must construe Mr. Niemann’s affidavit generously. The
least that seems to me to require is an acceptance, at least
prima
facie
, that there is a dispute suitable for referral to the
banking ombudsman, that Mr. Niemann has attempted to refer the
dispute once,
only for the dispute to be referred back to Nedbank,
and that Mr. Niemann may well have taken steps to refer the dispute
again,
or at least conducted himself in a manner that left Nedbank in
no doubt that he has agreed to do so.
31
The factual nature and legal consequences of Mr. Niemann’s
actions seem to me to be matters for trial.
32
In all of these circumstances, it seems to me that Mr. Niemann
has succeeded in outlining a
bona fide
defence that could
succeed at trial. Simply put, that defence is that he has agreed to
Nedbank’s proposal that the dispute
be referred to an
appropriate body in terms of section 129 (1) (a) of the NCA, and that
he has acted in good faith in attempting
to bring about that result.
33
Accordingly, I refuse the application for summary judgment.
Mr. Niemann is granted leave to defend the action, and I direct that
costs in this application be costs in the trial.
S D J
WILSON
Acting
Judge of the High Court
This judgment was prepared and authored
by Acting Judge Wilson. It is handed down electronically by
circulation to the parties or
their legal representatives by email
and by uploading it to the electronic file of this matter on
Caselines. The date for hand-down
is deemed to be 26 July 2021.
HEARD ON:
19 July 2021
DECIDED ON:
26 July 2021
For the Applicant:
J Minnaar
Instructed by DRSM Attorneys
For the
Respondent:
D
Shaw
Trust Account Advocate