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[2014] ZAGPPHC 430
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Ramaano v Firstrand Bank Limited t/a Wesbank (A458/12) [2014] ZAGPPHC 430 (23 May 2014)
IN
THE HIGH COURT OF SOUTH AFRICA
NORTH
GAUTENG: PRETORIA
CASE
NO.: A458/12
DATE:
23 MAY 2014
In the matter
between:
N.S.
RAMAANO
.........................................................................................................................
APPELLANT
and
FIRSTRAND BANK
LIMITED t/a
WESBANK
..................................................................
RESPONDENT
JUDGMENT
1. This is an appeal
against the order for summary judgement granted by this court on 27
January 2012. The order related to the
return of a Toyota Corolla
motor vehicle, the postponement of the claim for damages and the
issue of costs.
2. The background of
the matter is briefly the following: The respondent, as plaintiff,
issued summons against the appellant during
November 2011 for the
return of the said Toyota motor vehicle which the appellant purchased
from the plaintiff in terms of a written
instalment sale agreement.
The respondent also claimed damages arising from the breach of the
agreement which claim was to be postponed
pending the return of the
vehicle. The appellant failed to pay the monthly instalments due in
terms of the agreement. The appellant
applied for debt review in
terms of section 86 of the National Credit Act, Act 34 of 2005 ("the
Act"). On 10 May 2010
the Magistrates' Court made an order
pursuant to that application rearranging the appellant's contractual
obligations towards the
respondent in respect of the aforesaid
instalment sale agreement.
3. The appellant
failed to comply with his obligations in terms of the re-arrangement
and, at the time of the issuing of summons,
he was in arrears in the
amount of R4 501,96. The appellant was obviously also in arrears as
far as the credit agreement was concerned.
This resulted in the
respondent issuing summons wherein he cancelled the credit agreement
and claimed possession of the vehicle
as well as damages he may have
suffered as a result of the breach and costs.
4. The appellant
opposed the action whereupon the respondent applied for summary
judgement. The application for summary judgement
was opposed on three
grounds. Firstly, it was submitted that the respondent should have
given notice to the appellant as well as
the relevant debt counsellor
as well as the National Credit Regulator in terms of section 86 (10)
of the Act. It was submitted
that since this had not happened, the
summons was premature. Secondly, it was submitted that the deponent
of the affidavit filed
in support of the application for summary
judgement had failed to state the grounds for her alleged personal
knowledge of the matter.
Thirdly, it was submitted that the appellant
was not in arrears.
5. In respect of the
second ground, the court a quo found that the deponent's affidavit
contained sufficient allegations to prove
her personal knowledge of
the facts she deposed to. In respect of the third round, the court a
quo found that the allegations of
the appellant did not rebutt to the
allegations of the respondent and that the appellant was in fact in
arrears.
6. In respect of the
first ground, the court a quo found that, given the facts which were
common cause, it was not necessary for
the respondent to have acted
in terms of section 86 (10) of the Act and furthermore that a notice
in terms of section 129 had not
be necessary. Summary judgement was
accordingly granted as prayed for by the court a quo.
7. In the present
appeal two grounds were relied upon. The first ground relied upon was
that the respondent had failed to comply
with the provisions of
section 86 (10) of the Act prior to instituting the claim against the
appellant for the debt which had been
subjected to the debt review
re-arrangement. It was submitted that as a result of this failure,
the respondent's action was premature.
8.
There is no merit in this argument. In
Firstrand
Bank Ltd v Fillis And Another
2010
(6) SA 565
(ECP) the following was found in paragraph [14] and [15]
of the judgement:
"[14] ... The
Act provides very extensive protection to a consumer who has become
overindebted, whether it be of his or her
own making or through
circumstances beyond his or her control. Not only does a
rearrangement afford him or her alleviation from
the onerous monthly
obligations that he or she has in all seriousness undertaken to his
or her credit providers, but he or she
also enjoys the protection of
s 103(5) against the ravaging effect of escalating interest whilst he
or she remains in default under
the credit arrangement. If, however,
he or she fails to embrace this opportunity, or he or she is,
notwithstanding this very considerable
assistance, unable to comply
with his or her restructured debt commitment, the Act permits the
common law to run its course.
[15] Thus, once the
credit review process has commenced, s 88(3) of the Act prevents a
credit provider from exercising or enforcing,
by litigation or other
judicial process, any right or security under any credit agreement
until -
'(a) the consumer is
in default under the credit agreement; and (b) one of the following
has occurred:
(i) An event
contemplated in subsection (i)(a) through (c); or
(ii) the consumer
defaults on any obligation in terms of a re-arrangement agreed
between the consumer and credit providers, or ordered
by a court or
the Tribunal.’
[16]
It follows, in my view, as a matter of interpretation, that once the
jurisdictional requirement set out in s 88(3)(a) co-exists
with any
one of the jurisdictional requirements set out in s 88(3)(b),
the
credit
provider
is at liberty to proceed and to exercise and enforce, by litigation
or other judicial process, any
right
or security under his credit agreement, without further notice
."
(My
underlining)
9.
I respectfully agree with the aforesaid interpretation of the
provisions of the Act. Apart from the pertinent provisions of the
Act, il may be added that the purpose of the provisions relating to
notice to the debtor is,
inter
alia,
to
provide the debtor with the opportunity to make use of the protection
afforded by the provisions of the Act. In a case like the
present,
where the debtor has already followed such procedure to its
conclusion, there is obviously no need to notify him again.
10. The second
ground relied upon by the appellant was that at the time of
instituting its action the respondent could not rely
on the order of
the Magistrate, namely, that the rights and obligations as amended by
the re-arrarigement will be revived and be
fully enforceable should
the appellant default in terms of the said order. It was further
submitted that the Magistrates' Court,
as a creature of statute,
cannot change the law (it being the provisions of the Act) but must
merely interpret and apply it.
11.In
my view there is no merit in this second ground relied upon by the
appellant. The court a quo did not rely on any part of
the
Magistrate's order but applied the law according to the provisions of
the Act. Once the credit review process has commenced
in terms of the
Act, section 88(3) thereof prevents a credit provider from exercising
or enforcing, by litigation or other judicial
process, any right or
security under any credit agreement until, as stated in the passage
quoted above, the consumer is in default
under the credit agreement,
and,
inter alia,
the
consumer defaults on any obligation in terms of a re-arrangement
agreed between the consumer and credit providers, or ordered
by a
court.
12.
In casu
the
appellant was in default in respect of his obligations in terms of
the rearrangement and was also in default in respect of the
credit
agreement. The respondent was consequently at liberty to proceed and
to enforce its rights under the credit agreement. See
Firstrand
Bank Ltd v Fillis And Another
(supra).
13. As far as costs
are concerned, there is no reason why the costs of appeal should not
follow the event.
14. In the result
the following order is made:
1. The appeal is
dismissed with costs.
C.P. RABIE
JUDGE OF THE HIGH
COURT
I concur
S.P. MOTHLE
JUDGE OF THE HIGH
COURT
I concur
T.D. VILAKAZI
ACTING JUDGE OF
THE HIGH COURT