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IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG LOCAL DIVISION, JOHANNESBURG

 

Case number: 43908/2013

 Reportable: NO

Of interest to other judges: NO

Revised.

6 March 2017

In the matter between:

WENTZEL WERNER                                                                                        APPLICANT

and

ABSA BANK LIMITED                                                                                RESPONDENT

 

JUDGMENT

 

MATOJANE J:

[1] On 13 June 2014, default judgment was granted against the applicant in this matter. The cause of action, in terms of the summons, is based on three overdraft accounts.

[2] This is an application for rescission of a default judgment which was granted by this court on 13 June 2014.  The application is brought solely in terms of Uniform Rule 42(1)(a).  No reliance is placed on the Rule 31(2)(b) or the common law.  The applicant submits that the respondent has failed to comply with section 129 of the National Credit Act 34 of 2005. Consequently, the judgment was granted erroneously and ought to be set aside in terms of Rule 42 of the Uniform rules of Court.

[3] In paragraph 5.4 of the founding affidavit, the applicant states

“As appears from the track and trace records in regard to the section 130 notices the service in terms of section 129 does not comply with the requirements as set out in the Sebola judgment and has the Constitutional Court set out in the judgment that Mr Sebola  was entitled to rescission of judgment on account of the fact that the notices had not been properly served.”

[4] It is evident from the record that the notice in terms of section 129 of the Act was dispatched to the address used by the applicant for the purposes of serving any notices.  The track and trace report reveals that the “item”  reached the post office of Heidelberg, the area in which applicant resides. The track and trace report indicates that the item was ultimately delivered to AA POSTNET. The respondent avers that the notice did not come to his attention.

[5] It is common cause that summons, together with a copy of the notice under the National Credit Act, were served on the applicant on 4 December 2013. A notice of intention to defend was entered into on behalf of  the respondent on 11 December 2013. On 18 December 2013 the respondent launched a summary judgment application, which was served on the applicant's attorneys and to which the applicant failed to respond. Default judgment was granted on 13 June 2014.

[6] The applicant fails to explain why he had not taken any further steps, being aware of the institution of the action and the application for summary judgment.  Further, the applicant fails to make any averments as to why he had not taken action in terms of the notice that was annexed to the summons.  He does not indicate what he would have done had he received the notification, what payment arrangements he would have made and he does not deny any facts set out in the summons, safe for a dilatory defense of non-compliance with the National Credit Act.

[7] The respondent contends that the notice that was attached to the summons falls short of service as set  out in terms of the National Credit Act and does not afford him the relief set out in section 130 read with section 129 of the National Credit Act.

[8] The applicant avers that the default judgment came to his knowledge on 19 May 2015 and he only launched an application for rescission on 21 August 2015.

[9] Section 130(3) of the National Credit Act provides that a credit provider may enforce a credit agreement only where there has been compliance with section 129.  Section 130(4)(b) requires a court, where there has not been compliance with section 129, to adjourn the matter and make an order setting out the steps to be taken in order to ensure compliance by the credit provider. The subsection clearly allows for compliance to be effected after proceedings have commenced.

[10] The Constitutional Court in Sebola & Another v Standard Bank of South Africa[1] considered that where an action is instituted without prior compliance with section 129 of the National Credit Act, the summons is not void.  Cameron J said at paras 52 and 53:

”In my view the notice requirement in section 129 cannot be understood in isolation from section 130. This emerges from three considerations.

First, it is impossible to establish what a credit provider is obliged and permitted to do without reading both provisions. Thus, while section 129 (1)(b) appears to prohibit the commencement of legal proceedings altogether (“may not commence”), section 130 makes it clear that where action is instituted without prior notice, the action is not void. Far from it. The proceedings have life, but a court “must” adjourn the matter, and make an appropriate order requiring the credit provider to complete specified steps before resuming the matter. The bar on proceedings is thus not absolute, but only dilatory. The absence of notice leads to a pause, not to nullity.” (My emphasis)

[11] The purpose of section 130(4)(b) is to ensure that even though summons has been served, the consumer is still provided with a section 129 notice so that he or she knows what options are available to resolve the matter before the debt is enforced.[2]

[12] In Kubyana v Standard Bank of South Africa Ltd[3] the Constitutional Court explained at paragraph 46 that:

“The Act does not imply, and cannot be interpreted to mean, that a consumer may unreasonably ignore the consequences of her election to receive notices by registered mail, when the notifications in question have been sent to the address which she duly nominated. While it is so that consumers should receive the full benefit of the protections afforded by the Act, the noble pursuits of that statute should not be open to abuse by individuals who seek to exercise those protections unreasonably or in bad faith.”

[13] The applicant does not dispute that the notice in terms of section 129 was annexed to the summons and he was thus fully appraised of his rights to refer the credit agreements to a debt counsellor or  alternative dispute resolution agent, consumer court or ‘ombud with jurisdiction’.  The applicant has had the opportunity to do what the notice invited him to do since receipt of the summons.  He is not asking for any directions in terms of section 140(4)(b)(ii), nor does he give any indication as to what effect he could have used his rights in terms of the provision had he received the notice from the post office, or as to how he could use them now if the court were to set aside the judgment and give directions in terms of section 130(4)(b) of the National Credit Act.

[14] In my view, the applicant had the opportunity to comply with the section 129 notification and has unduly and unreasonably without explanation chosen not to exercise his rights.  The respondent has complied with section 129 of the National Credit Act and the judgment was not erroneously granted.

In the result I make the following order:

The application is dismissed with costs.

 

_________________________

K E Matojane

Judge of the High Court

Gauteng Local Division, Johannesburg

 

APPEARANCES

PLAINTIFF:                         Adv. M Halstead

Instructed by:                      Van Heerden Krugel Attorneys

DEFENDANT:                     Adv. W Steyn

Instructed by:                      Jay Mothobi Inc

HEARING DATE:                22 February 2017

JUDGMENT DATE:             06 March 2017

 

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