Asked by the Customer on 12-08-2014 14:53:07
Question posted in the General Law category relating to Gauteng
Question posted in the General Law category relating to Gauteng
Please assist with advice for the following:
Schools are not governed by the NCR.
Schools become incidental credit grantors when fees are in arrears.
The schools yearly fees are determined by the governing body, acting on behalf of the parents.
These fees are agreed upon and finalised in a resolution.
Each school has its own contract with varying terms which the parent/s are required to sign in order allow their child/children to attend the school.
In these contracts the parents can be held liable for interest and debt collection/legal fees to recover any outstanding debt by a debt collector.
Debt Collectors are governed by the Council for Debt Collectors and as such have regulated fees and expenses that can be charged to the parent.
Can the school legally add the cost of collecting the debt to the parents account before handing the account over for collection?
Schools are not governed by the NCR.
Schools become incidental credit grantors when fees are in arrears.
The schools yearly fees are determined by the governing body, acting on behalf of the parents.
These fees are agreed upon and finalised in a resolution.
Each school has its own contract with varying terms which the parent/s are required to sign in order allow their child/children to attend the school.
In these contracts the parents can be held liable for interest and debt collection/legal fees to recover any outstanding debt by a debt collector.
Debt Collectors are governed by the Council for Debt Collectors and as such have regulated fees and expenses that can be charged to the parent.
Can the school legally add the cost of collecting the debt to the parents account before handing the account over for collection?
Message from the Attorney
Posted by Att. Patrick on 12-08-2014 19:07:57
Hi there CeeBee,
You are correct in most of your statements, except that schools become incidental credit grantors when fees are in arrears and interest is charged on the account. There has to be an interest component charged, otherwise it can't be an incidental credit agreement.
This is a further information request. Please continue in this same question conversation so that I can see your reply.
You ask "Can the school legally add the cost of collecting the debt to the parents account before handing the account over for collection?"
How do you mean "the cost of collecting the debt" but then "before handing the account over for collection"?
Surely the school needs to hand over the account for collection, and only then does the debt collector begin charging fees? Is that your question?
How is the school doing this? Please can you clarify?
Awaiting your further information.
Att. Patrick
You are correct in most of your statements, except that schools become incidental credit grantors when fees are in arrears and interest is charged on the account. There has to be an interest component charged, otherwise it can't be an incidental credit agreement.
This is a further information request. Please continue in this same question conversation so that I can see your reply.
You ask "Can the school legally add the cost of collecting the debt to the parents account before handing the account over for collection?"
How do you mean "the cost of collecting the debt" but then "before handing the account over for collection"?
Surely the school needs to hand over the account for collection, and only then does the debt collector begin charging fees? Is that your question?
How is the school doing this? Please can you clarify?
Awaiting your further information.
Att. Patrick
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