Question posted in the National Credit Act Law category relating to Eastern Cape
Question value: R 200.00
I've been under debt review since 2016. Std Bank sent a summons to me a few months ago to proceed with a judgment against my name and repossession of my vehicle, even though it was included in the debt review court order. All payments were up to date. I requested the letter notifying my debt counselor of the cancellation of the vehicle from the debt review (which was never received). Std bank eventually forwarded the letter which was dated 2016! Is that even legal to only take action 3 yrs later? Anyway, to avoid the fight which wasn't getting me anywhere, I sent a repayment offer to the attorneys acting on behalf of Std Bank and also informed them that my income is generated from this vehicle. They only replied to say they'll put it forward. I've paid every month. No feedback from the attorneys nor Std Bank. Out of the blue, my vehicle was repossessed at a shopping centre on Friday evening. The warrant was presented.
Is this a lawful repossession and what do I do now? I feel that the cancellation of the vehicle from the Debt Review order wasn't supposed to happen in the 1st place.
Answer to the Question
Hi there and thank you for your question,
I am a practicing attorney based in South Africa and I will assist you with your question. Please feel free to ask as many follow up questions in order to clarify your question. If you have a new question, you must please open a new thread.
Unfortuantely, you'll need to get a lot of information from the debt counsellor regarding the timeline of events back in 2016.
Basically, you'll need to work out exactly when you went under debt review; whether the creditors (including Standard Bank) accepted the debt review proposal; whether it was made an order of court; whether your debt counsellor made the payments in accordance with the debt review procedure; and whether or not Standard Bank was actually entitled to withdraw from the process back in 2016.
I unfortunately can't answer any of those questions for you.
What I can tell you is that if Standard Bank legally refused to accept the debt review procedure in 2016 (or they agreed, but then subsequently in 2016 cancelled the procedure) then they would have been entitled to receive the payments and STILL proceeded with the summons in 2019.
There is nothing stopping Standard Bank from sitting back for 1 or 2 or even 3 years accepting payments, and then proceeding with a summons.
What you SHOULD have done was to defend the summons when it was served on you. That would have put a stop on the legal procedure. Instead, what you did was to (basically) ignore the summons and instead make offers to Standard Bank's attorney regarding the matter. That meant that Standard Bank was legally entitled to take a default judgment against you, and then proceed with the recovery of the motor vehicle using a warrant.
The repossession sounds lawful, but what you can also do is to visit the court and inspect the court file to see if Standard Bank's attorney complied with all of the rules of court in getting from summons --> warrant. Again, I can't answer the question because I don't know what steps they took, and when.
If, after your investigations with the debt counsellor and at court, it appears that Standard Bank were not entitled to proceed with a summons, then you need to bring an urgent application in court to - set aside the default judgment; set aside the warrant; and order Standard Bank to return the motor vehicle to you.
If there is a part of the answer which you need more advice on, or clarity please continue in this same thread instead of opening a new question.
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Information provided by client
In terms of the historical events with the Debt Counselor. I have the supporting docs, is there a way for me to send to you or attach here somehow?
1. Court Order dated 22 Jan 2016. This order states that 'the first payment to the credit providers in terms hereof shall be due at the end of the 2nd month following the month in which this order is granted."
2. The termination letter was dated 30 March 2016.
3. The 1st payment made by the PDA was on 17 March 2019 for the amount stated on the order. This info is as per the statement from Std Bank.
So there was no cause for the cancellation.
The debit orders continued to be processed on the account despite the debt review payments being received monthly and incurred unpaid fees each month. In addition, 2 large finance charges were added to the account on 22 Jan 2016 for R44,000.67 and on 5 June 2016 for R47,653.69.
The summons was issued in December 2018. I didn't receive this document, however the debt counselor did and notified me of same. They discussed the matter with the attorneys to resolve the issue. When Std Bank wouldn't accept or acknowledge the fact that the account should not have been removed from debt review, the debt counselor sent it back to me. I then communicated with them on a payment plan as advised.
What I don't understand is, where is the so called protection with the debt review process when it seems that the creditors can change their minds as and when they want to?
Answer to the Question
When you say that "The 1st payment made by the PDA was on 17 March 2019 for the amount stated on the order", I think that you mean 17 March 2017?
If yes, then there is no cause for the cancellation of the debt review process.
There is also no reason why the debit orders should have continued to operate and be processed each month. Standard Bank should have suspended that, because of the debt review process. They should also now reverse all of the unpaid debit order fees which were incurred each month.
What on earth are the finance charges for? Could they possibly be legal fees incurred? Surely not.
Unfortunately, the debt counsellor or you should have defended the summons like I said above. Now, there is a default judgment and a warrant for the recovery of the vehicle, and Standard Bank has already recovered the vehicle. All of this just makes it harder to reverse what has happened.
The protection is that the debt counsellor or you should have defended the summons on the basis that you are currently under debt review, and that an order has been made regarding your monthly payments, and accordingly you are not in default with your obligations to Standard Bank.
Then, Standard Bank would not have been able to get a judgment against you. They would have been stopped in their tracks.