Nedbank Ltd and Others v National Credit Regulator and Another

• Jurisdiction: South Africa
• Citation: 2011 (3) SA 581 (SCA)

Nedbank Ltd and Others v National Credit Regulator and Another
2011 (3) SA 581 (SCA)

2011 (3) SA p581

Citation	2011 (3) SA 581 (SCA)
Case No	662/2009 and 500/2010
Court	Supreme Court of Appeal
Judge	Mpati P, Navsa JA, Brand JA, Maya JA and Malan JA
Heard	February 21, 2011
Judgment	March 28, 2011
Counsel	O Rogers SC for the first appellant.; G Farber SC (with N Konstantinides) for the second appellant.; M Kuper SC (with J Cane SC) for the third appellant.; DE van Loggerenberg SC (with GH Meyer) for the fourth appellant.; KJ Kemp SC for the fifth appellant / second respondent.; PF Louw SC (with SG Gouws) for the sixth appellant.; CDA Loxton SC (with MA Chohan) for the first respondent.

Flynote : Sleutelwoorde B

Credit agreement — Consumer credit agreement — Debt review — Application — Consumer may not apply for review of agreement if credit provider has 'proceeded to take . . . steps . . . in section 129' to enforce it — Where credit provider gives notice under s 129(1)(a), provider has 'proceeded to C take . . . steps' — National Credit Act 34 of 2005, ss 86(2) and 129(1)(a).

Credit agreement — Consumer credit agreement — Debt review — Procedure — If debt counsellor concludes consumer is over-indebted, counsellor must issue proposal to magistrates' court — Court must then conduct hearing, and may make any of orders in s 87(1) — National Credit Act 34 of 2005, ss 86(7)(c) and 87(1). D

Credit agreement — Consumer credit agreement — Debt review — Referral to magistrates' court — Debt counsellor's referral is application within meaning of Magistrates' Courts Act and Rules and to be treated as such — National Credit Act 34 of 2005, ss 86(7)(c) and 86(8)(b). E

Credit agreement — Consumer credit agreement — Cost of credit — Once amounts (b) – (g) accruing during default, whether paid or not, equal in aggregate unpaid balance of principal debt at time default occurs, no further charges may be levied — National Credit Act 34 of 2005, ss 101(1)(b) – (g). F

Credit agreement — Consumer credit agreement — Interest — In duplum rule — Section in effect abolishing rule for agreements within ambit of Act — National Credit Act 34 of 2005, s 103(5).

Headnote : Kopnota

Section 86(2) of the National Credit Act 34 of 2005 (the Act) provides that: G

'(2) An application in terms of this section [for debt review] may not be made in respect of, and does not apply to, a particular credit agreement if, at the time of that application, the credit provider under that credit agreement has proceeded to take the steps contemplated in section 129 to enforce that agreement.'

By giving the notice envisaged by s 129(1)(a) the credit provider 'has proceeded H to take the steps contemplated in section 129 to enforce that agreement'. A debt review relating to that specific agreement is thereafter excluded. (Paragraph [14] at 590F – G.)

Section 86(7) of the Act provides that:

'(7) If, as a result of an assessment . . . a debt counsellor reasonably concludes that — I

. . .

(c)

the consumer is over-indebted, the debt counsellor may issue a proposal recommending that the Magistrate's Court make either or both of [certain] orders . . . .'

The debt counsellor must issue the proposal to the magistrates' court, and the magistrates' court must then, in terms of s 87, conduct a hearing, and may J

2011 (3) SA p582

A make any of the orders in ss 87(1)(a) or (b). (Paragraphs [27] – [29] at 597B – C, 597D – E and 598A – D.)

A debt counsellor's referral to a magistrates' court under ss 86(7)(c) and 86(8)(b) of the Act is an application within the meaning of the Magistrates' Courts Act 32 of 1944 and the Magistrates' Courts Rules, and falls to be treated as such in terms of rule 55 of the Rules. (Paragraphs [16], [26] and B [29] at 591C, 596H – 597A and 598D.)

Section 103(5) of the Act provides that:

'(5) Despite any provision of the common-law or a credit agreement to the contrary, the amounts contemplated in section 101(1)(b) to (g) that accrue during the time that a consumer is in default under the C credit agreement may not, in aggregate, exceed the unpaid balance of the principal debt under that credit agreement as at the time that the default occurs.'

Section 103(5) effectively abolishes the common-law in duplum rule insofar as it concerns credit agreements within the ambit of the Act. Once the amounts referred to in s 101(1)(b) – (g) that accrue during the period of default, D whether or not they are paid, equal in aggregate the unpaid balance of the principal debt at the time the default occurs, no further charges may be levied. (Paragraphs [38] and [49] at 601C, 601D – 602C, 607C and 607E.)

Cases Considered

Annotations:

Reported cases

Southern Africa E

Absa Bank Ltd v De Villiers and Another 2009 (5) SA 40 (C): referred to

Absa Bank Ltd v Prochaska t/a Bianca Cara Interiors 2009 (2) SA 512 (D): referred to

BMW Financial Services (SA) (Pty) Ltd v Donkin 2009 (6) SA 63 (KZD): referred to

BMW Financial Services (SA) (Pty) Ltd v Mudaly 2010 (5) SA 618 (KZD): dictum in paras [13] – [14] overruled F

Body Corporate Houghton Villas v Got Construction (Pty) Ltd 2002 (1) SA 760 (W): referred to

Briel v Van Zyl; Rolenyathe v Lupton-Smith 1985 (4) SA 163 (T): dictum at 165E – F applied

Cactus Investments (Pty) Ltd v Commissioner for Inland Revenue 1999 (1) SA 315 (SCA) ([1999] 1 All SA 345): referred to G

Casserley v Stubbs 1916 TPD 310: referred to

CIR v Delfos 1933 AD 242: referred to

Commercial Bank of Zimbabwe Ltd v MM Builders & Suppliers (Pvt) Ltd and Others and Three Similar Cases 1997 (2) SA 285 (ZH): referred to

Commissioner, South African Revenue Service v Woulidge 2002 (1) SA 68 (SCA) ([2002] 2 All SA 199): referred to H

Durban City Council v Gray 1951 (3) SA 568 (A): dictum at 580B applied

Ex parte Ford and Two Similar Cases 2009 (3) SA 376 (WCC): referred to

FirstRand Bank Ltd t/a First National Bank v Seyffert and Another and Three Similar Cases 2010 (6) SA 429 (GSJ): referred to

FirstRand Bank Ltd v Olivier 2009 (3) SA 353 (SE): referred to I

Gouws v Theologo and Another 1980 (2) SA 304 (W): referred to

Investec Bank Ltd and Another v Mutemeri and Another 2010 (1) SA 265 (GSJ): referred to

Johannesburg Municipality v Cohen's Trustees 1909 TS 811: referred to

Joss v Board of Executors 1979 (1) SA 780 (C): referred to

Lategan v CIR 1926 CPD 203 (2 SATC 16): referred to J

2011 (3) SA p583

Louw NO and Others v Coetzee and Others 2003 (3) SA 329 (SCA) ([2003] 1 All SA 34): referred to A

LTA Construction Bpk v Administrateur, Transvaal 1992 (1) SA 473 (A): referred to

Margo and Another v Gardner and Another; Gardner and Another v Margo and Another 2010 (6) SA 385 (SCA) ([2010] ZASCA 110): referred to

Meyer v Catwalk Investments 354 (Pty) Ltd en Andere 2004 (6) SA 107 (T): B referred to

Mills v Starwell Finance (Pty) Ltd 1981 (3) SA 84 (N): dictum at 87B – D applied

Minister of the Interior and Another v Harris and Others 1952 (4) SA 769 (A): referred to

Naidoo v Absa Bank Ltd 2010 (4) SA 597 (SCA): C referred to

National Credit Regulator v Nedbank Ltd and Others 2009 (6) SA 295 (GNP): confirmed on appeal

Nelson Mandela Bay Metropolitan Municipality v Nobumba NO and Others 2010 (1) SA 579 (ECG): referred to

Niekerk v Niekerk (1830) 1 Menz 452: referred to

Petker v Makda 1956 (1) SA 26 (SR): dictum at 27H – 28C applied D

Rutenberg v Magistrate, Wynberg, and Another 1997 (4) SA 735 (C): dictum at 750I – 751C applied

S v Leeuw 1980 (3) SA 815 (A): referred to

S v Thompson and Another 1968 (3) SA 425 (E): referred to

S v Tieties 1990 (2) SA 461 (A): referred to

Sanlam Life Insurance Ltd v South African Breweries Ltd 2000 (2) SA 647 (W): referred to E

Shell South Africa (Edms) Bpk v Gross h/a Motor Maintenance 1980 (4) SA 151 (T): referred to

Shenker v The Master and Another 1936 AD 136: referred to

Standard Bank of South Africa Ltd v Hales and Another 2009 (3) SA 315 (D) ([2009] 2 All SA 416): referred to F

Standard Bank of South Africa Ltd v Oneanate Investments (Pty) Ltd (in Liquidation) 1998 (1) SA 811 (SCA) ([1998] 1 All SA 413): referred to

Standard Bank of South Africa Ltd v Panayiotts 2009 (3) SA 363 (W): referred to

Starita v Absa Bank Ltd and Another 2010 (3) SA 443 (GSJ): dictum in para [12] overruled G

Stroebel v Stroebel 1973 (2) SA 137 (T): referred to

Union Government v Jordaan's Executor 1916 (1) TPD 411: referred to

Van Coppenhagen v Van Coppenhagen 1947 (1) SA 576 (T): referred to

Verulam Medicentre (Pty) Ltd v Ethekweni Municipality 2005 (2) SA 451 (D): referred to. H

England

Bank Polski v K J Mulder & Co [1942] 1 All ER 396 (CA): referred to

British Movietonews Ltd v London and District Cinemas Ltd [1951] 1 KB 190: referred to.

Unreported cases I

Mercedes Benz Financial Services SA (Pty) Ltd v Viljoen (North Gauteng case No 18995/09, 19 November 2009): referred to

Nedbank Ltd v Motaung (TPD case No 2245/07, 14 November 2007): referred to

Potgieter v Greenhouse Funding (Pty) Ltd (WLD case No 31825/2008, 26 June 2009): referred to. J

2011 (3) SA p584

Statutes Considered

Statutes A

The National Credit Act 34 of 2005, ss 86(2), 86(7)(c), 86(8)(b), 87(1), 101(1)(b) – (g), 103(5) and 129(1)(a): see Juta's Statutes of South Africa 2009/10 vol 2 at 1-585 – 1-586, 1-590 – 1-591 and 1-597.

Case Information

Appeals against a decision of BR du Plessis J in the North Gauteng B High Court, Pretoria.

O Rogers SC for the first appellant.

G Farber SC (with N Konstantinides) for the second appellant.

M Kuper SC (with J Cane SC) for the third appellant.

DE van Loggerenberg SC (with GH Meyer) for the fourth appellant.

KJ Kemp SC for the fifth appellant / second respondent. C

PF Louw SC (with SG Gouws) for the sixth appellant.

CDA Loxton SC (with MA Chohan) for the first...