Dear PatrickThis Question is related to:...

Asked by mvdventel on 22-06-2021 18:03:06
Question posted in the Consumer Protection Law category relating to Western Cape

Dear Patrick

This Question is related to:

https://www.salegaladvice.co.za/question/7439/dear-patrick-i-have-another-question-it-is-related-to-this-one-but-separate-https.php

I'm under Debt Review.My DirectAxis Loan account was R62000 when it was sold to Shackelton Credit Management.Now its being handled by LMB Attorneys who says that Shackleton Credit Management is their client.They want me to Pay them R125 000 - they say it's interest. They have emailed me a Judgement Order which they haven't executed yet. Plus they have Issued a Summons to me with Return of Service proof.

My Debt Councillor has totally left me in the lurch, He does not respond to my messages (email / mobile)

Yesterday (21 July 2021) I have managed to convince Shackelton / LMB to reduce the amount payable to R70 000.

In an earlier communication with them, I had told them that this Debt has Prescribed.They then informed me that they have interrupted prescription by serving a summons on my home address.

On closer inspection I realised that the Debt had indeed Prescribed like I told them.Because the Last payment made to them was in 2016 and NOT September 2017 as they have claimed.

This is the Message that I sent them yesterday:

"I have double-checked my records again and can confirmed that the Debt has indeed Prescribed.The Last Payment towards the outstanding  amount was made in 2016. (more than 3 years ago).I did not make any Payments towards the outstanding amount from Jan 2017 to date. (more than 3 years)I did not have any correspondence with DirectAxis/ Shackelton about the outstanding amount between Jan 2017 to July 2020. (more than 3 years)Shackelton / DirectAxis did not correspond with me on the outstanding amount  between Jan 2017 to July 2020. (more than 3 years)

The Summons that was served in March 2020 was after the Prescribed period of 3 years.So therefore this Debt has prescribed."

They (LMB) responded by saying that they would get back to me after discussing this with their client Shakleton.

My Question is:What period of time would it be reaonable for me to give them to respond.Can I send them an email saying that I would like them to respond in e.g. 2 weeks time? What do I do when they dont respond?Then depending on their response I would have to consult with you again.

I dont want this issue to drag on, I would like to close this chapter and move on with my life.I cannot count on my Debt Councillor to assist me with this. I have actually managed to pay off 8 of my 12 Creditors with lump sums.

The only 4 left now are:DirectAxis, ABSA, Nedbank & FNB

Answer to the Question

Posted by Att. Patrick on 22-06-2021 20:55:31

Regarding the Judgement Order, does it look like this was issued by the Court? Is it a Judgement? Or is it a document that is really a letter of demand? Does it have a court stamp, and a case number?

Was the summons served on you by the sheriff? Does the return of service confirm that the summons was properly served?

To me, it doesn't sounds like the Judgement Order is actually a court order. Rather, a scare tactic.

If they say that they interrupted prescription, does the sheriff's return confirm that it was served before the 3 year date?

Sorry... just read the rest of your message now. It is a good message that you sent them. Well done! 

WHAT YOU CAN'T DO, is to ignore the summons.

YOU NEED TO enter an appearance to defend! You need to look at the summons, find the appearance to defend, sign it, and send it back to LMB. This is VITAL. Otherwise, they could take a default judgment against you. DO THIS! 

Q: What period of time would it be reaonable for me to give them to respond? --> I think that they are playing for time. Ignoring your correspondence. Secretly, taking a default judgment against you. 

Q: Can I send them an email saying that I would like them to respond in e.g. 2 weeks time? --> No. Stop with the correspondence. Enter the appearance to defend. 

Then, when they demand, you need to file a plea. It is your defence. In the plea, you will need to explain that the claim has prescribed and you must ask that their claim is dismissed with costs. 

Once you file your appearance to defend, you stop them being able to take a default judgment against you. Once you file your plea, they then have to decide: do nothing and let sleeping dogs lie, or apply for a trial date and fight it. 

My only concern is your statement that "Yesterday (21 July 2021) I have managed to convince Shackelton / LMB to reduce the amount payable to R70 000." ... Did you admit to them that you owe them the money? Because if you did, that might interrupt prescription.

But I think that the attack that you need is to argue that, as at March 2021, the claim HAD ALREADY prescribed, and anything you did after that (i.e. in July 2021) didn't interrupt prescription because the debt had already prescribed.

Information provided by client

Dear Patrick

Thank you for getting back to me.

The Judgement Order looks legitimate - it has a Case number & Court stamp on it.

I only have the electronic copy of the Summons.
The original Summons I never received - they say the Sheriff served it at my home address. they attached the Sheriff's Return of Service.

[YOU NEED TO enter an appearance to defend! You need to look at the summons, find the appearance to defend, sign it, and send it back to LMB. This is VITAL. Otherwise, they could take a default judgment against you. DO THIS! ]

Ok Patrick What does that mean? Where do I find the appearance to defend, What does it look like? Is it a paragraph and Where do I sign it? Then I email them the signed Summons - although it was served last year in March 2020?
Isnt it too late to do that now?
I only found out about the Summons last year in October 2020, eight months after it was served.

[My only concern is your statement that "Yesterday (21 July 2021) I have managed to convince Shackelton / LMB to reduce the amount payable to R70 000." ... Did you admit to them that you owe them the money? Because if you did, that might interrupt prescription]

Yes I'm afraid I have done this - telephonically.. But at the time I believed that I really would have to pay them all this money. I have asked them to send me a Settlement Letter to confirm that the full & final amount is R70 000.

Please Can I ask you this:
What if I was to ask you to be my Attorney in this case? What would the Costs involved be... I'm afraid I will mess this up further, if I go at it alone. My Debt Councillor does not respond to my messages and has abandoned me to sort this out on my own.

I can email you the Summons, the Judgement Order and the Settlement Letter that they have sent me.

Thank you & Best Regards
Michelle

Answer to the Question

Posted by Att. Patrick on 23-06-2021 10:18:08

Can you email it to me at caselawja <at> outlook.com?

Information provided by client

Dear Patrick
I have emailed it to you from this address:
mvdventeltlabs.ac.za

Thank you & Best Regards

Answer to the Question

Posted by Att. Patrick on 23-06-2021 14:18:00

Thank you for sending through the documents. From what I can see, the summons is a legitimate summons, and so is the sheriff's return of service, also the default judgment.

What I'm not too sure about it - 

1. Why do they go on about the balance as at 22 August 2017? Why is that date important?

2. If the loan was entered into in March 2016, hasn't their claim prescribed? I mean, did you make any repayments of the loan after March 2016 which would have interrupted prescription? This should all be evidence that should be led in court to prove their claim.

3. If you only found out about the Summons last year in October 2020, eight months after it was served, there is a possibility that you could apply for the rescission of the default judgment. But you would need to explain to the court WHY you only found out about the Summons last year in October 2020, eight months after it was served, and you would need to explain what your defence is. 

I think that the defence part might be easy - prescription. 

But why did you find out so late ...

Also, this means that YOU will need to bring the application for rescission. You would need to be proactive in order to undo the default judgment. If you succeed, that would be the end of their claim - completely. 

Otherwise, you must offer to pay them Rxxx per month for the next xxx months until the full amount is settled in full. But then they will want interest, and they will want the full amount. They are only offering a cash discount if you settle in 1 lump sum.

Q: What if I was to ask you to be my Attorney in this case? What would the Costs involved be? --> I'm afraid that I would ask for a deposit of about R20,000 to take the case on, and prepare the application for rescission, and enroll it for hearing in court. There would also be advocates costs. 

But this is something that you could do yourself.

Information provided by client

Dear Patrick

Thank you for getting back to me. Apologies I took so long to answer. I wanted to make sure I've gone through all my documentation & correspondence relating to the Direct Axis Loan. And that I have all my Dates correct.

Also I'm grappling to understand exactly what it is I need to do.
Is "bring the application for rescission" and "enter an appearance to defend" the same thing?

To answer your questions:
1. Why do they go on about the balance as at 22 August 2017? Why is that date important?

This I also don't know. I have seen that they keep on emphasizing this particular Date in the Summons.
It could be that the account was handed over to Shackleton Credit Management on this date.

2. If the loan was entered into in March 2016, hasn't their claim prescribed? I mean, did you make any repayments of the loan after March 2016 which would have interrupted prescription? This should all be evidence that should be led in court to prove their claim.

The last payment I made to Direct Axis was in 2016 (more than 3 years ago).I did not make any Payments towards the outstanding amount from Jan 2017 to date. And I did not have any correspondence with them or from them, until last year July 2020.
If the Debt has prescribed Do I still have to bring the application for rescission?

3. If you only found out about the Summons last year in October 2020, eight months after it was served, there is a possibility that you could apply for the rescission of the default judgment. But you would need to explain to the court WHY you only found out about the Summons last year in October 2020, eight months after it was served, and you would need to explain what your defence is.

I only found out about the Summons in October 2020, because I contacted them to confirm that this Debt has prescribed (because my Debt councillor was not assisting me). The Summons was never handed to me in-person, I did not receive any correspondence about a Summons served to me. Also the Sheriff could not have put the summons in my post box because its too small & its locked. So they could only have put it in front of my door. And I never saw such documentation lying outside my front door.

4. Also, this means that YOU will need to bring the application for rescission. You would need to be proactive in order to undo the default judgment. If you succeed, that would be the end of their claim - completely.

So what exactly should I do & How.
I need to bring the Application for rescission. What does that mean in practical terms.
Is "bring the application for rescission" and "enter an appearance to defend" the same thing?
Does it mean I have to sign it and send it back to them like you said in earlier communication.

You said I should do this below:
YOU NEED TO enter an appearance to defend! You need to look at the summons, find the appearance to defend, sign it, and send it back to LMB. This is VITAL. Otherwise, they could take a default judgment against you.

Where on the Summons do I find this Section to Sign?

Thank you & Best Regards
Michelle






Answer to the Question

Posted by Att. Patrick on 05-07-2021 15:04:33

Q: Is "bring the application for rescission" and "enter an appearance to defend" the same thing? --> Definitely no. A rescission of judgment is basically what Zuma is trying to do now. It un-does a judgment which has already been granted. Entering an appearance to defend is you formally defending a summons which has been served on you. It shows that you want to dispute the claim. 

Re 1) understood. But it would still have prescribed.

Re 2) Yes, because they took a judgment. You need to un-do the judgment, based on your defence that the claim has prescribed. 

Re 3) You need to include these reasons in your application for rescission. They are good reasons. 

Re 4) You need to launch an application in court, supported by an affidavit, setting out the story, and what you want the court to do, and why. You need to give reasons why the court should come to your assistance. 

I really do think that you need a lawyer to assist you.

If they have already taken a judgment (which you clarified the other day) then it is too late to enter an appearance to defend the claim. 

Information provided by client

Dear Patrick

Thank you for clearing this up for me.
rescission of judgment has to do with the Judgement and appearance to defend has to do with the Summons
I cannot enter appearance to defend because they have already taken out a judgement.

Yes I would prefer for a Lawyer to assist me. Would you recommend a Service like Legal Wise?

Best Regards
Michelle

Information provided by client

Dear Patrick

Q: What if I was to ask you to be my Attorney in this case? What would the Costs involved be? --> I'm afraid that I would ask for a deposit of about R20,000 to take the case on, and prepare the application for rescission, and enroll it for hearing in court. There would also be advocates costs.

If you would be able to do this I would happily pay R20 000 for this to be solved.
But is this only a Deposit? There would be more costs involved? And How much would that be?

If I were to ask you to assist me with 3 Debt accounts in total:
I've managed to pay off all my other Debts and now have 4 big ones still left.
ABSA, Direct Axis and Nedbank. How much would that Cost me?
Direct Axis you already know the story.
ABSA is similar - also prescribed, but they say it's not.
Nedbank: I would like to launch an application of Reckless lending. My Debt councillor said I have a good case, but has now since gone AWOL.

Thank you & Best Regards
Michelle



Answer to the Question

Posted by Att. Patrick on 05-07-2021 17:02:14

Hi Michelle,

Unfortunately, I have no idea what direction the case will go in, so I can't even give you an estimate as to the costs. The R20k will be a deposit, which should cover the consultation, considering the documents, the preparation of the application, service of the application, and receiving their opposing affidavit. Where to from there, I don't know.

The total cost for the rescission application could be as much as R35k, for DirectAxis, if they didn't agree to abandon the judgment themselves because of the prescription issue. 

ABSA, would be similar. Also a rescission application.

Regarding the application of reckless lending, I don't know because I don't know the facts. What I do know is that it is hard to get right, and perhaps you should try find a lawyer who has done a lot of NCA reckless lending cases, and ask him?

Perhaps what I can suggest is that I can refer a lawyer to you to assist with the DirectAxis case, with the idea that he writes a letter to DirectAxis asking them to abandon the judgment, and if they refuse, then you can decide what you want to do. The cost of the letter will be much cheaper than a rescission application. 

Would you be happy with that?

The lawyer will ask you -

1) What correspondence did you have with DirectAxis between Jan 2017 and the date that the court order was granted.

2) What correspondence did your debt counsellor send DirectAxis?

3) Exactly when your last payment was made?

4) What did you do about the summons since you found out in  October 2020, to date?

Information provided by client

Dear Patrick

Yes thank you. If you can refer a Lawyer to me I would greatly appreciate that. since finding one myself feels bit like a minefield
And if you also know of a Lawyer that has done NCA Reckless Lending cases that would be great too!

Best Regards
Michelle

Answer to the Question

Posted by Att. Patrick on 06-07-2021 10:58:24

It's a pleasure.

Answer Accepted

This answer was accepted on 08-07-2021 13:34:59

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