In Jili v Firstrand Bank Ltd, the Supreme Court of Appeal (SCA) held that if a debtor has breached a debt re-arrangement agreement, a creditor has the right to enforce its rights without further notice to the debtor and may issue summons immediately after the breach.
In this case, the appellant had failed to pay instalments due and had entered into a debt re-arrangement agreement with her creditors. The consumer didn’t make her reduced payments for two months and the Kwa-Zulu Natal High Court granted a summary judgment against her –without her having received notice of the proceedings -, on the basis that she had no defence to the Bank’s claim, and that she had defended the litigation just to delay it. The consumer claimed that the creditor had no right to proceed without notifying her and those similar to her who were a party to a debt restructuring agreement. On appeal, the SCA disagreed, and confirmed that when a consumer has breached a debt restructuring agreement, a creditor, such as the Bank, may obtain judgment against that person, without giving any notice of its intention to do so.
Read the judgment here: http://www.saflii.org/za/cases/ZASCA/2014/183.html
Share this Post