Republic of South Africa 
IN THE HIGH COURT OF SOUTH AFRICA 
(WESTERN CAPE HIGH COURT, CAPE TOWN)
CASE NO: 4985/2010
Before: The Hon. Mr Justice Binns-Ward In the matter between:
FIRSTRAND BANK LTD formerly known as FIRST

and

JUDGMENT DELIVERED: 17 JUNE 2011

BINNS-WARD J:

[3] In a further affidavit opposing summary judgment delivered on 31 May 2011 the defendant avers that the loan agreement which forms the basis of the plaintiffs claim contains a provision that renders the whole agreement unlawful in terms of the [National Credit) Act'. He invoked the provisions of s 90(2)(a)(ii), read with s 90(3), 90(4) and 89(5) of the NCA in this connection.

[4]     Section 90(2)(a)(ii) of the NCA provides:

(2) A provision of a credit agreement is unlawful if

(i) …....................;
(ii) deceive the consumer; or
(iii)...................;

Sub-sections 90(3) and 90(4) of the NCA provide;
3. In any credit agreement, a provision that is unlawful in terms of this section is void as from the date that the provision purported to take effect.
4. In any matter before it respecting a credit agreement that contains a provision contemplated in subsection (2), the court must-
(a)      sever that unlawful provision from the agreement, or alter it to the extent required to render it lawful, if it is reasonable to do so having regard to the agreement as a whole, or 
(b)      declare the entire agreement unlawful as from the date that the agreement. or amended agreement, took effect, 

and make any further order that is just and reasonable in the circumstances to give effect to the principles of section 89 (5) with respect to that unlawful provision, or entire agreement, as the case may be.

and s 89(5) of the Act reads as follows:

(5) If a credit agreement is unlawful in terms of this section, despite any provision of common law, any other legislation or any provision of an agreement to the contrary, a court must order that-
(a) the credit agreement is void as from the date the agreement was entered into:
(b) the credit provider must refund to the consumer any money paid by the consumer under that agreement to the credit provider, with interest calculated -

(i) cancelled, unless the court concludes that doing so in the circumstances would unjustly enrich the consumer, or
(ii)      forfeit lo the State, if the court concludes that cancelling those rights in the circumstances would unjustly enrich the consumer.
[5] The provision in the loan agreement relied upon by the defendant for the purposes of invoking s 90(2)(a)(ii) of the NCA is clause 3.10 of the loan agreement, under the heading 'Special Terms and Conditions' which provides 'The bond and the property to be registered in the joint names of the Customers'. The clause does not read sensibly in the context of the contract document. The contract document purports on its face to evidence an agreement between the plaintiff, referred to therein as 'the Bank', and the defendant, referred to therein, in the singular, as 'the Customer*. The copy of the agreement attached to the further opposing affidavit is not a signed copy, but it provides only for the defendant's signature. No provision is made for the signature of the document by his wife.

[7] Obviously, the only manner in which the property could come to be mortgaged jointly by the defendant and his wife in favour of the plaintiff would be by the defendant first transferring ownership of an undivided half share to his wife. The mortgage bond which he caused to be registered in favour of the plaintiff makes it clear that he never did this.

[10] The clause on which the defendant relies to invoke the provisions of the NCA, quoted above, reads nonsensically in the context of the deed of contract read as a whole, but that does not mean that its general purpose or effect was to deceive the defendant. The incongruity of the clause was patent and the actions of the defendant do not support the conclusion that he was deceived thereby.

[12] In the result the defendant has failed to set out a bona fide defence to the plaintiffs claim in his opposing affidavit. The plaintiff is therefore entitled to summary judgment in-its favour. The plaintiffs counsel informed me that he had not been able to find a contractual provision entitling the plaintiff to attorney-client costs, as claimed The fixed property in question was freely given as security by the defendant and no circumstances justifying an amelioration of the consequences of its sale in execution were placed before the court.

[13]   The following order is made:

2. Erf 9720 Strand, situated in the City of Cape Town, Stellenbosch Division, Western Cape Province, held by the defendant under deed of transfer no. T79594/93 and hypothecated in favour of the plaintiff in terms of covering mortgage bond no. B075330/07, is declared specially executable.
3. Defendant is ordered to pay the plaintiff's costs of suit.

					Judge of the High Court