THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Reportable
Case No: 568/2024
In the matter between:
ANDRIES JOHANNES DREYER N O FIRST APPELLANT
ERICA MARCIA DREYER N O SECOND APPELLANT
and
STANDARD OF SOUTH AFRICA LIMITED RESPONDENT
And
Case No: 387/2024
In the matter between:
NEDBANK LIMITED FIRST APPELLANT
BANKING ASSOCIATION
OF SOUTH AFRICA SECOND APPELLANT
and
CELEST FELICIA ABRAHAMS FIRST RESPONDENT
ZIBUSENI MALINGA SECOND RESPONDENT
KGOMOTSO NKUNA THIRD RESPONDENT
PULE ELIAS MOSHANE FOURTH RESPONDENT
NOBUNTU ROSE NDZONDA FIFTH RESPONDENT
ANDREW CHOUNYANE SIXTH RESPONDENT
2
Neutral citation: Dreyer N O and Another v Standard Bank (568/2024);
Nedbank Limited and Another v Abrahams (387/2024)
[2026] ZASCA 74 (22 May 2026)
Coram: MAKGOKA, WEINER and MOLEFE JJA
Heard: 28 August 2025 and 18 September 2025
Delivered: 22 May 2026
Summary: National Credit Act 34 of 2005 – whether s 127(8) confers exclusive
jurisdiction on the Magistrate s’ Court and ousts the High Court ’s jurisdiction –
Magistrates’ Court Act 32 of 1944.
3
ORDER
In case number 568/2024 (Dreyer N O and Another v Standard Bank):
On appeal from: North West Division of the High Court, Mahikeng (Mfenyana J
sitting as court of first instance):
1 The appeal is dismissed with costs, including costs of two counsel.
In case number 387/2024 (Nedbank and Another v Abrahams and Others):
On appeal from: Gauteng Division of the High Court, Pretoria (Gilbert AJ sitting
as court of first instance) : judgment reported sub nom : Nedbank Limited v
Abrahams [2024] ZAGPJHC 31; 2025 (2) SA 545 (GJ):
1 The appeal is upheld with no order as to costs.
2 The order of the Gauteng Division of the High Court, Pretoria, is set aside.
3 The six applications are referred back to the Gauteng Division of the High
Court, Pretoria, for adjudication on the merits.
JUDGMENT
Makgoka JA (Weiner and Molefe JJA concurring):
[1] This judgment concerns whether s 127(8) of the National Credit Act 34 of
2005 (the NCA) ousts the High Court’s jurisdiction and confers exclusive
jurisdiction on the magistrates’ court. The provision applies where a credit
provider repossesses and sells go ods subject to a credit agreement, and the
proceeds of sale are insufficient to discharge the consumer’s debt to the credit
4
provider. The provision allows the credit provider to claim payment of the
shortfall.
[2] The issue on appeal arises from two applications. One was decided by the
North West Division of the High Court, Mahikeng (the Mahikeng High Court),
and the other by the Gauteng Division of the High Court, Pretoria (the Gauteng
High Court). The Mahikeng High Court held that it had concurrent jurisdiction to
consider such applications. It consequently ordered payment of the shortfall in
favour of Standard Bank of South Africa Ltd (Standard Bank), the respondent in
this Court, against the first and second appellants, Mr Andries Dreyer and
Mrs Erica Dreyer , in their capacities as trustees of the Doornfontein Trust
(the Trust). The appellants appeal against that order, with the leave of this Court.
[3] The Gauteng High Court reached the opposite conclusion, holding that its
jurisdiction was ousted and that the magistrates’ court had exclusive jurisdiction
to consider applications for payment of the shortfall. Accordingly, it dismissed
the application by Nedbank Limited (Nedbank), the first appellant in this Court,
against the first to sixth respondents, none of whom oppose this appeal. The
second appellant, the Bank Association of South Africa (BASA), supports
Nedbank’s appeal. The appeal is with the leave of the Gauteng High Court.
Factual background: Standard Bank
[4] On 14 August 2017, Standard Bank entered into three instalment sale
agreements with the Doornfontein Trust. The Trust defaulted on its obligations
under those agreements. Consequently, on 23 August 2019, Standard Bank
obtained an order from the High Court pursuant to s 130 of the NCA, requiring
the appellants to return various assets to Standard Bank. The order also provided
that if the assets were sold and the proceeds were insufficient to cover the Trust’s
5
debt, Standard Bank was entitled to apply to t he court again for an order
requiring the Trust to pay the shortfall. The Trust did not appeal that order.
[5] Standard Bank repossessed the assets and sold them at an auction, but a
shortfall remained. It returned to the High Court seeking an order for pay ment
of the shortfall. The Trust opposed the application on various technical grounds
relating to the service of a supplementary affidavit and notices in terms of the
NCA. The Trust never denied its indebtedness to Standard Bank in the amounts
claimed. At the hearing of the matter, the appellants, for the first time, challenged
the High Court’s jurisdiction to order payment of the shortfall. It contended that,
based on s 127(8) of the NCA, only a magistrate’s court was competent to grant
such an order. The High Court rejected this contention and ordered the Trust to
pay the shortfall to Standard Bank.
Factual background: Nedbank
[6] Nedbank entered into instalment sale agreements with each respondent,
under which it sold motor vehicles to them. The respondents subsequently
surrendered the vehicles voluntarily. Nedbank sold the vehicles in accordance
with s 127 of the NCA . Each sale resulted in a shortfall. Nedbank initiated
applications in the Gauteng High Court seeking payment of the shortfall (the
outstanding balance), interest, and costs in each case. None of the respondents
opposed the applications, and Nedbank accordingly enrolled the applications for
hearing.
[7] At the hearing, the Gauteng High Court, of its own accord, raised the
question of whether it had concurrent jurisdiction with the magistrates’ court to
decide the s 127(8) shortfall applications, in light of this Court’s obiter remarks
6
in Standard Bank v Mpongo (Mpongo).1 The matter was adjourned for Nedbank
to file heads of argument on the point of law raised by the court. Given the issue’s
importance to the banking industry, BASA subsequently sought and obtained
leave to be admitted as an amicus curiae (friend of the court) in the proceedings
and to make submissions.
[8] In its judgment, the court accepted that s 127(8) (a) contains no express
ouster of the High Court’s jurisdiction. However, it inferred an ouster from the
words ‘in terms of the Magistrates Court Act’ in s 127(8)(a). The court reasoned
that these words could serve no other purpose than to confer exclusive jurisdiction
on the magistrates’ court. It held that this was because the magistrates’ court
already had jurisdiction to determine legal proceedings instituted under s 127(8).
Such proceedings, the court said, constituted claims for the recovery of a sum of
money, and there is no monetary limit on the magistrates’ court’s jurisdiction in
causes of action under the NCA.
[9] As a result, the court struck each of t he applications from the roll on the
basis that it lacked jurisdiction to hear applications for payment of shortfalls
under s 127(8), as only the magistrates’ court had jurisdiction to hear such
applications.
Legislative provisions
[10] Section 127 falls under Chapter 6, which is headed ‘Collection, Repayment,
Surrender and Debt Enforcement ’. Part B of Chapter 6, under which s 127(8)
falls, is titled ‘Surrender of Goods’. Section 127(1) provides that a consumer may
surrender goods subject to an instalment agreement by giving the credit provider
written notice of termination. Section 127 also sets out the procedure for such
1 Standard Bank of South Africa Ltd and Others v Mpongo and Others [2021] ZASCA 92; [2021] 3 All SA 812
(SCA); 2021 (6) SA 403 (SCA).
7
surrender. Once notice is given, the consumer returns the goods to the credit
provider. Upon receipt of the goods, the credit provider must issue the consumer
with a written notice setting out the estimated value of the goods and then sell
them ‘for the best price reasonably obtainable.’
[11] Section 127(5) provides that after selling the goods, a credit provider must:
(a) credit or debit the consumer's account with a payment or charge equal to the
sale proceeds, less any reasonably incurred expenses by the credit provider
related to the sale ; and (b) give the consumer written notice that must include:
(i) the settlement value of the agreement immediately before the sale; (ii) the total
amount received from the sale; (iii) the net proceeds after deducting any permitted
default charges and reasonable costs as specified in paragraph (a); and (iv) the
amount credited or debited to the consumer’s account.
[12] Section 127(6) provides that if the amount credited to the consumer’s
account exceeds the settlement value immediately before the sale, the credit
provider must pay that amount to the consumer, as set out in the notice required
under subsection (5)( b). The agreement terminates once that amount is paid. If
there is a shortfall, the consumer must pay it; failing which, the credit provider
may commence legal proceedings in the magistrate’s court for payment under
s 127(8)(a).
[13] There are two pathways to recover a shortfall under s 127(8). The first
applies where a consumer voluntarily surrenders the goods under a credit
agreement to the credit provider, and all the provisions of s 127(1) t o (7) apply.
This was the basis of Nedbank’s application. The second applies where a credit
provider obtains judgment against a consumer in terms of s 131 and repossesses
the goods under the agreement. Standard Bank’s application followed this
pathway. In each case, the credit provider repossesses the goods and may sell
8
them. If a shortfall remains after the sale, the credit provider may seek judgment
for payment of the shortfall.
[14] Section 127(8) must be read with s 127(7). The provisions read:
‘(7) If an amount is credited to the consumer’s account and it is less than the settlement value
immediately before the sale, or an amount is debited to the consumer’s account, the credit
provider may demand payment from the consumer of the remaining settlement value, when
issuing the notice required by subsection (5)(b).
(8) If a consumer –
(a) fails to pay an amount demanded in terms of subsection (7) within 10 business days after
receiving a demand notice, the credit provider may commence proceedings in terms of th e
Magistrates’ Courts Act for judgment enforcing the credit agreement . . .’.
[15] The starting point in interpreting s 127(8) is the enduring principle that in
the absence of an express or clear implication to the contrary, the curtailment of
the court’s power is not to be easily presumed.2 In the absence of express words
in a statute ousting the jurisdiction of the High Court, any inference that the
court’s jurisdiction is ousted must be clear from the language of the statute.3 This
was recently affirmed by this Court in Mpongo, which emphasised that the
threshold for concluding that there is an ouster of the High Court’s jurisdiction
is ‘very high’. Thus, there is a strong presumption against the ouster of the High
Court’s jurisdiction. As explained in Mpongo, the mere fact that a statute vests
jurisdiction in one court is insufficient to imply that the jurisdiction of another
court is thereby ousted.4
[16] It is common cause that s 127(8) does not expressly oust the High Court’s
jurisdiction. The Gauteng High Court in the Nedbank matter held that it does so
2 Lenz Township Co (Pty) Ltd v Lorentz NO en Andere 1961 (2) SA 450 (AD) at 455B; see also Minister of Law
and Order and Others v Hurley and Another 1986 (3) SA 568 (A) at 584A-B.
and Order and Others v Hurley and Another 1986 (3) SA 568 (A) at 584A-B.
3 Welkom Village Management Board v Leteno 1958 (1) SA 490 (A) at 503.
4 Mpongo para 68.
9
by implication. The appellants in the Standard Bank matter support this
conclusion. Below, I first con sider the merits of the Standard Bank matter,
followed by Nedbank’s.
Merits: Standard Bank
[17] The Mahikeng High Court devoted a brief passage in its judgment to the
jurisdiction issue. It held that the NCA recognises the concurrent jurisdiction of
the High C ourt and the magistrates’ courts to adjudicate on an application for
payment of a shortfall. Accordingly, it concluded that s 127(8) does not exclude
the High Court’s jurisdiction. Consequently, the High Court dismissed the
appellant’s jurisdictional argument and ordered the Trust to pay the shortfall to
Standard Bank.
The appellants’ contentions
[18] The appellants relied on certain provisions of the Magistrates’ Court Act 32
of 1944 and its rules to support the conclusion that s 127(8) confers exclusive
jurisdiction on the magistrates’ court. They contend that these provisions afford
litigants protection not available under either the Uniform Rules of Court (the
Uniform Rules) or the Superior Courts Act 10 of 2013 . The first is s 48
Magistrates’ Court Act, which empowers the court to suspend further proceedings
on a judgment pending arrangements for its satisfaction, or to order payment of a
judgment debt in instalments. The second is s 73, which provides for the
suspension of execution of a debt on certain conditions. The third is s 57, which
obliges the court to act in terms of the NCA, dealing with over -indebtedness,
reckless credit and affordability assessment, when considering a request for
judgment in terms of this section.
[19] The fourth is rule 12(6A), which provides that where a plaintiff applies for
default judgment on a claim founded on any cause of action arising or regulated
10
by legislation, such as the NCA, the plaintiff shall file evidence confirming
compliance with that legislation. The fifth is rule 12(5), in terms of which an
application for default judgment on a cause of action based on the NC A must be
adjudicated by a court, whereas in the High Court, rule 31(5) (b) of the Uniform
Rules, the registrar is empowered to grant default judgment without referring the
matter to court.
Discussion
[20] In limited instances , the NCA confers exclusive jurisdiction on either the
High Court or the magistrates’ court, it does so expressly or implicitly. For
example, s 59(3) provides that a decision of the National Consumer Tribunal is
subject to appeal to or review by the High Court. This is the only instance in which
the High Court is granted exclusive jurisdiction.
[21] The exclusive jurisdiction of the magistrates’ court is c onferred in two
sections of the NCA. First, in s 86, which concerns debt review proceedings. In
particular, s 86(7)(c), (8)(b), and (9) make it plain that the magistrates’ court has
exclusive jurisdiction to determine all aspects of debt review proceedings, except
for enforcement proceedings following the termination of debt review, as
mentioned above. Second, in s 87, regarding the re -arrangement of consumer
obligations. The provision is self -explanatory and is titled ‘Magistrate’s Court
may re-arrange consumer’s obligations’.
[22] Section 127(8) is not part of the provisions conferring exclusive jurisdiction
on the magistrates’ court. Had the lawmaker’s intention been to confer such
jurisdiction, it would have been expressly worded accordingly, as are these
provisions. I therefore do not agree that any of the provisions relied upon by the
appellants serve as textual or contextual indications that s 127(8) confers
exclusive jurisdiction on the magistrates’ court. The architecture of the NCA
11
makes it clear that the lawmaker consciously used the term ‘court’ in most
sections.
[23] The word ‘court’ is not defined in the NCA. Therefore, it can only be
understood to refer to any court with competent jurisdiction and therefore includes
both the High Court and the magistrates’ court. Put differently, that usage was
intended to give ‘court’ a broader meaning, rather than to confer exclusive
jurisdiction on a specific court. I illustrate some of those provisions. For example,
s 16(1)(b)(ii) empowers the National Credi t Regulator to apply to ‘a court’ for a
declaratory order on the interpretation or application of any provision of the NCA.
[24] Section 83 provides that a ‘court’ may suspend a reckless credit agreement,
whereas s 85 empowers a ‘court’ to declare and relieve over-indebtedness.
Section 86(11), which concerns the enforcement of a credit agreement by a credit
provider who has terminated debt review in terms of s 86(10), provides that a
‘court’ hearing the enforcement proceedings may order that the debt review
resume on any condition it considers just.
[25] Originally, s 86(11) referred only to ‘the Magistrates’ Court ’. This was
amended by the National Credit Amendment Act 19 of 2014, which replaced ‘the
Magistrates’ Court’ with ‘court’. The amendment followed this Court’s judgment
in Collett v Firstrand Bank (Collett).5 There, it was held that because proceedings
to enforce a credit agreement may be commenced in either the High Court or the
magistrates’ court, the words ‘magistrates’ court’ in s 86(11) must be interpreted
to mean ‘the court’ hearing the enforcement proceedings. This, the Court
reasoned, would avoid issues that might arise if two courts considered related
matters. The effect of the amendment is that s 86(11) is now aligned with the rest
5 Collett v Firstrand Bank Ltd and Another [2011] ZASCA 78; (2011) (4) SA 508 (SCA); [2011] 3 All SA 585
(SCA).
12
of the credit enforcement provisions in the NCA, which may be brought in either
the High Court or the magistrates’ court.
[26] This brings one to ss 129, 130, and 131. These sections fall under part C of
the NCA, headed ‘Debt enforcement by repossession or judgment’. They set out
the required procedures before debt enforcement occurs, when a credit provider
has repossessed goods under a credit agreement or obtained a judgment against a
consumer. Section 129 provides t hat a credit provider may not commence any
legal proceedings to enforce the agreement before, among other things, providing
the consumer with a notice of their default. Section 130, in turn, provides that the
credit provider may approach a court for an order to enforce a credit agreement
only if the consumer has been in default for at least 20 business days and at least
10 business days have elapsed since the credit provider delivered a notice to the
consumer as contemplated in s 129.
[27] Section 131 provides that if a court makes an attachment order for goods
subject to a credit agreement, s 127(2) to (9) and s 128 apply to those goods. This
means that goods attached pursuant to s 130 and 131 can be sold, and if there is a
shortfall, a credit provider may, among other things, claim the shortfall from a
consumer.
[28] As mentioned, this is the pathway Standard Bank followed to enforc e the
credit agreements against the Trust. Consistent with the holding in Collett, that
proceedings to enforce a credit agreement may be commenced in either the High
Court or the magistrates’ court, Standard Bank was entitled to bring the shortfall
claim in the High Court. The effect of the interpretation of s 127(8) preferred by
the appellants would be this: after obtaining an attachment order in the High Court
and selling goods, Standard Bank cannot claim the shortfall, if any, in that court.
It would have to do so in the magistrates’ court.
13
[29] This is self-evidently absurd. It is the very anomaly that impelled this Court
in Collett to interpret the words ‘magistrates’ court’ as ‘court’, so as to ‘avoid the
issues that may arise from two different courts considering related matters.’6 It is
now settled that , in its interpretive exercise, a court must prefer a sensible
meaning to one that leads to insensible or unbusinesslike results .7 The
interpretation preferred by the appellants runs counter to this principle.
[30] It follows that the Mahikeng High Court was correct in concluding that its
jurisdiction was not ousted. The appeal must be dismissed with costs. Standard
Bank employed three counsel. Although important, the matter does not warrant
costs of three counsel. Costs of two counsel will be ordered.
Merits: Nedbank
The judgment of the Gauteng High Court
Mateman
[31] The court rejected Nedbank and BASA’s contention that it was bound by
the Full Court’s decision in Nedbank v Mateman (Mateman),8 which, it was
argued, had already decided that the High Court has concurrent jurisdiction with
the magistrates’ court in relation to claims in terms of s 127(8)(a). In that case, the
registrar of the High Court had declined to grant default judgment under
rule 31(5)(a) for claims that could otherwise have been brought in the magistrates’
court. The registrar referred the cases to the court, among other things, on the basis
that s 127(8) of the NCA ousted the High Court’s jurisdiction and conf erred
exclusive jurisdiction on the magistrates’ court.
6 Collett para 17.
7 Natal Joint Municipal Pension Fund v Endumeni Municipality [2012] ZASCA 13; [2012] 2 All SA 262
(SCA); 2012 (4) SA 593 (SCA) para 18.
8 Nedbank Ltd v Mateman and Others; Nedbank Ltd v Stringer and Another [2007] ZAGPHC 295; 2008 (4) SA
276 (T); [2008] 1 All SA 593 (T).
14
[32] The Full Court held that s 127 does not deal, and was not intended to deal,
with the jurisdiction of the High Court or the ousting thereof. The Full Court also
referred to an earlier judgment in which the court had implicitly accepted that the
High Court had concurrent jurisdiction, but transferred the matter to the
magistrates’ court. The Full Court considered this to be indicative of the fact that
the court had accepted that it had jurisdiction to deal with the matter, because
otherwise it would have struck the matter from the roll. The Full Court held that
the registrar was wrong to have declined to grant default judgments on the basis
that the High Court’s jurisdiction was ousted. Consequently, th e Full Court
granted the default judgments as requested.
[33] The Gauteng High Court distinguis hed Mateman on the basis that the
matters considered by the Full Court did not relate to shortfalls under credit
agreements falling within the ambit of s 127(8), where goods had been voluntarily
surrendered. The matters were for judgment on credit agreements, in which orders
were sought declaring immovable property executable. Those were not claims that
fall within the ambit of s 127(8). It was unnecessary for the Full Court to make
any findings in relation to s 127(8) in order to reach its decision that the High
Court had concurrent jurisdiction in relation to the matters before it.
[34] The High Court , therefore, considered the Full Court’s statements in
relation to s 127(8) as obiter. Although it considered the obiter remarks
persuasive, the court relied on the obiter remarks of this Court in Mpongo, to the
effect that s 127(8) conferred exclusive jurisdiction of the High Court. In my
judgment, t he court was correct in its conclusion that Mateman did not
authoritatively decide the question whether s 127(8) ousted the High Court’s
jurisdiction, as its remarks about s 128 were obiter and not binding on it. But as I
jurisdiction, as its remarks about s 128 were obiter and not binding on it. But as I
demonstrate below, the court’s reliance on the Mpongo dictum was unavailing.
15
The High Court’s interpretation of s 127(8)
[35] The court’s reasoning rested on three grounds. First, the use of t he word
‘may’ in s 127(8) should be interpreted as ‘must’ in light of the interpretation of
that word in South African Human Rights Commission v Standard Bank
(SAHRC),9 where the Constitutional Court’s construed s 169(1)(a)(i) of the
Constitution to mean ‘must’. Second, the words ‘in terms of the Magistrates Court
Act’ in s 127(8) would be superfluous and offend the canon of construction were
they not interpreted as conferring exclusive jurisdiction on the magistrates’ court.
Third, the obiter dicta of this Court in Mpongo suggested that s 127(8) is among
the provisions conferring exclusive jurisdiction o n the magistrates’ court. I deal
with each of these grounds in turn.
The word ‘may’ in s 169(1)(a)(i) of the Constitution
[36] In SAHRC, the Constitutional Court considered the word ‘may’ in
s 169(1)(a)(i) of the Constitution in the context of whether a court may decline
to hear a matter within its jurisdiction because another court has concurrent
jurisdiction. SAHRC was a sequel to Mpongo, in which the South African Human
Rights Commission sought leave to appeal against this Court’s orders in
Mpongo.
[37] The application turned on the interpretation of s 169(1) (a)(i) of the
Constitution, which provides that the High Court ‘may’ decide any constitutional
matter, except where, among other things, the Constitutional Court has agreed to
hear the matter directly in terms of s 167(6)(a). The issue was whether ‘may’ in
the provision meant that the High Court was entitled to decline to hear a
constitutional issue.
9 South African Human Rights Commission v Standard Bank of South Africa Ltd and Others [2022] ZACC 43;
2023 (3) BCLR 296 (CC); 2023 (3) SA 36 (CC).
16
[38] The Constitutional Court considered s 169(1) together with ss 168(3) and
170 of the Constitution, where the word ‘may’ is used in relation to jurisdiction.
The Court reasoned that interpreting ‘may’ as permissive would mean that all
superior courts were at liberty to refuse to hear matters despite having
jurisdiction to do so. To avoid this anomaly, the Court interpreted the word ‘may’
as implying that the High Court is obliged to decide a constitutional issue before
it.
[39] The Constitutional Court held that the only exceptions are whe re: (a) it
has agreed to hear a matter directly in terms of s 167(6)(a); and (b) the matter is
legislatively assigned to another court of a similar status to the High Court. The
Court also reasoned that a contrary interpretation would be inconsistent with this
Court’s holding in Agri Wire (Pty) Ltd v Commissioner of the Competition
Commission10 that courts are not entitled to decline to hear cases properly before
them.
[40] The High Court relied on SAHRC to conclude that the word ‘may’ in
s 127(8)(a) must be read as ‘must’, which, in turn, would confer exclusive
jurisdiction on the magistrates’ court. With respect to the learned Judge, this
reliance on SAHRC was inapposite. The Constitutional Court’s reas oning was
confined to the specific context of the constitutional provisions granting
jurisdiction to superior courts. It concerned whether a court may refuse to hear a
matter properly before it because another court also has jurisdiction over the
matter, not whether any court’s jurisdiction is ousted.
[41] The Constitutional Court did not establish a general rule that whenever the
word ‘may’ appears, it must be interpreted as ‘must’. In the context of s 127(8),
10 Agri Wire (Pty) Ltd v Commissioner of the Competition Commission [2012] ZASCA 134; [2012] 4 All SA 365
(SCA); 2013 (5) SA 484 (SCA) para 19.
17
the use of ‘may’ in that section must be construed according to its ordinary
meaning. Thus, it merely gives credit providers an option to initiate legal
proceedings in the magistrates’ court to recover the shortfall under s 127(8). It
does not impose an obligation to do so.
The effect of the words ‘in terms of the Magistrates Court Act’
[42] It is common cause that s 127(8) does not explicitly remove the High
Court’s jurisdiction. The question is whether it does so by implication. The High
Court considered the words ‘in terms of the Magistrates Court Act’ and concluded
that they ousted the Hig h Court’s jurisdiction by implication. It held that a
contrary interpretation would render those words superfluous, thereby offending
the interpretive canon against superfluity.
[43] I disagree. As correctly contended by Nedbank and BASA, these words
were not intended to be restrictive. Instead, they expand the magistrates’ court’s
jurisdiction without conferring exclusive jurisdiction on it or ousting the High
Court’s jurisdiction. They must be understood in this context: a magistrates’ court
is a creature of statute and can consider only matters expressly mentioned in its
empowering statute, the Magistrates Court Act.
[44] In this regard, it is necessary to note that a magistrates’ court is not
empowered to adjudicate a claim for specific performance without an alternative
claim for damages.11 Section 127(8) effectively constitutes such a claim because
it expressly refers to the ‘enforcement of the instalment sale agreement ’. In the
11 Section 46 is headed: ‘Matters beyond the jurisdiction’. Subsection (2) thereof reads:
‘(2) a court shall have no jurisdiction in matters—
(a) . . .
(b) . . .
(c) in which is sought specific performance without an alternative of payment of damages, except in—
(i) the rendering of an account in respect of which the claim does not exceed the amount determined by
the Minister from time to time by notice in the Gazette . . .’.
18
absence of the words ‘in terms of the Magistrates Court Act’ , s 46(2)(c) of the
Magistrates’ Court Act could well mean that the magistrates’ court lacks
jurisdiction to adjudicate a claim for a shortfall in terms of s 127(8).
[45] Seen in this light, the phrase is intended to confer jurisdiction on that court
if it would otherwise lack it. It does not exclude the High Court. Had the lawmaker
intended to exclude the High Court’s jurisdiction, it would have expressly stated
so. This is especially so, given that the la wmaker is presumed to be aware of the
state of the law at the time the legislation was passed. In this case, the relevant
principle is that there is a strong presumption against ousting the court’s
jurisdiction. To sum up, the words ‘in terms of the Magist rates Court Act’ in
s 127(8) do not satisfy the test for an implied ousting of the High Court’s
jurisdiction.
The Mpongo dictum
[46] In Mpongo, this Court considered the judgments of Full Courts in two
Divisions of the High Court. Those courts held, respectively, that in the context
of the NCA: (a) the High Court may decline to adjudicate a matter over which it
and the magistrates’ court have concurrent jurisdiction; and (b) the main and local
seats of a Division of a High Court may each refuse to hear a matter in respect of
which the other has concurrent jurisdiction. The majority in the second Full Court
judgment went further, holding that the NCA excluded the High Court’s
jurisdiction in all respec ts, and that all matters in terms of the NCA had to be
brought in the magistrates’ court.
[47] This Court rejected all of these conclusions. Regarding the last-mentioned
finding, this Court held that the NCA ousts the High Court’s jurisdiction only
where it e xpressly confers exclusive jurisdiction on the magistrates’ court. It
19
cited examples of such instances in the NCA. The relevant passage in this
Court’s judgment reads:
‘Sometimes, however, the NCA is specific about the Magistrates’ Court being the exclusiv e
forum to make certain decisions. In those instances, the NCA expressly stipulates the
Magistrates’ Court to the exclusion of any other court. For example: . . . s 127(8)(a) provides
that if a debtor ‘fails to pay an amount demanded in terms of subsection (7) within 10 business
days after receiving a demand notice, the credit provider may commence proceedings in terms
of the Magistrates’ Courts Act for judgment enforcing the credit agreement . . .’.12 (Emphasis
added.)
[48] The High Court treated the italicised remarks as indicating that this Court
had held that s 127(8) was among the provisions of the NCA conferring exclusive
jurisdiction on the magistrates’ court. It clearly considered itself bound by those
remarks. It is necessary to explain what is binding in a judgment. This Court, in
Pretoria City Council v Levinson,13 explained that what is binding in a judgment
is the ratio decidendi, which consists of the principle to be drawn from the case.14
That was reiterated in True Motives 84 (Pty) Ltd v Mahdi,15 where it was held that
only the ratio binds courts, not what might have been said in passing.
[49] I have explained the issues that this Court faced in Mpongo. Viewed in this
light, the obiter remarks in that decision do not form part of the ratio decidendi,
as the question of whether s 127(8) ousts the High Court’s jurisdiction was not at
issue. The remarks were not necessary to the Court’s decision on the issues in that
case. Furthermore, they were neither the product of any analysis of s 127(8)(a)
12 Mpongo para 81.
13 Pretoria City Council v Levinson 1949 (3) SA 305 (A) at 317; see also Makhanya v University of Zululand
[2009] ZASCA 69; 2010 (1) SA 62 (SCA); [2009] 8 BLLR 721 (SCA); [2009] 4 All SA 146 (SCA); (2009) 30
ILJ 1539 (SCA) para 81.
14 Collect v Priest 1931 AD 290.
ILJ 1539 (SCA) para 81.
14 Collect v Priest 1931 AD 290.
15 True Motives 84 (Pty) Ltd v Mahdi and Another [2009] ZASCA 4; 2009 (4) SA 153 (SCA); 2009 (7) BCLR 712
(SCA); [2009] 2 All SA 548 (SCA).
20
nor a considered judgment on the matter. For these reasons, the remarks were
made in passing and do not constitute binding authority.
[50] In any event, as I have demonstrated, the NCA carefully delineated, with
clarity and unambiguity, the provisions conferring jurisdiction on the magistrates’
court. Section 127(8) is not among those provisions. That provision confers
jurisdiction on the magistrates’ court for legal proceedings institut ed under it,
without excluding the High Court’s inherent jurisdiction. Thus, to the extent that
the obiter remarks in Mpongo suggest otherwise, the Gauteng High Court was
clearly wrong, and we are obliged to correct that error. This Court has, in the past,
done so where necessary. 16 It follows that the High Court’s reliance on the
remarks was misconceived.
[51] The upshot of the above findings is that, on each of the premises it relied
on to conclude that s 127(8) ousts the High Court’s jurisdiction, the High Court
erred. As demonstrated in the Standard Bank matter, other provisions of the NCA
negate the ouster of the High Court’s jurisdiction, including ss 129, 130 and 131.
The result is that Nedbank and BASA’s appeal should succeed. As regards costs,
both parties fairly accepted that, because the appeal arises from a point raised by
the court of its own accord, there should be no order as to costs.
Conclusion
[52] The appeal in the Standard Bank matter fails, whereas the appeal in the
Nedbank matter succeeds.
16 See, for example, Premier of the Western Cape Provincial Government NO v Lakay [2011] ZASCA 224; 2012
(2) SA 1 (SCA); [2012] 1 All SA 465 (SCA) para 14; Coface South Africa Insurance Co Ltd v East London Own
Haven t/a Own Haven Housing Association [2013] ZASCA 202; [2014] 1 All SA 536 (SCA); 2014 (2) SA 382
(SCA) para 25; MEC for Health, Gauteng Provincial Government v CMMS obo AAS [2025] ZASCA 91; 2025 (6)
SA 152 (SCA) paras 129-134.
21
Orders
[53] The following orders are made:
In case number 568/2024 (Dreyer N O and Another v Standard Bank):
The appeal is dismissed with costs, including costs of two counsel.
In case number 387/2024 (Nedbank and Another v Abrahams and Others):
1 The appeal is upheld with no order as to costs.
2 The order of the Gauteng Division of the High Court, Pretoria, is set aside.
3 The six applications are referred back to the Gauteng Division of the High
Court, Pretoria, for adjudication on the merits.
____________________
T MAKGOKA
JUDGE OF APPEAL
22
Appearances:
In the Standard Bank appeal
For appellants V Snellenburg SC (with him R van der Merwe)
Instructed by: HSL du Plessis Attorneys, Kroonstad
Blair Attorneys, Bloemfontein.
For respondent K Hofmeyr SC (with her A J Venter and
K Kheswa)
Instructed by: Martins Weir-Smith Inc., Johannesburg
Maree & Partners, Bloemfontein.
In the Nedbank appeal
For first appellant M Chohan SC (with him M Reineke)
Instructed by: Hainsworth Koopman Attorneys,
Pietermaritzburg
McIntyre Van der Post, Bloemfontein
For second appellant I Green SC (with him P Ngcongo and I
Hayath)
Instructed by: Edward Nathan Sonnenbergs Inc.,
Johannesburg
Mayet and Associates, Bloemfontein.