Towards the end of last year, a judgment by the Grahamstown High Court made it unlawful for banks to bring National Credit Act matters before the high court instead of the much cheaper magistrates’ courts. This, despite an earlier directive in February 2019, that all NCA matters should be brought in the magistrates’ courts.
Besides all these directives, it is clear from a recent Moneyweb article that banks continued suing their customers in the higher courts. “Customers are being sued by the banks in these courts for arrear amounts as low as R6 000, and high court judges have complained long and loud about the unnecessary traffic this brings them,” Ciaran Ryan of Moneyweb writes.
According to Ryan this will now become a whole lot harder as “a sharp-eyed court registrar in the Western Cape High Court recently put Standard Bank to the boot after it sued six customers for the recovery of vehicle loans.” In this case the registrar noticed that in all six cases, Standard Bank’s own agreements specified the magistrates’ court as having jurisdiction in the event of a dispute and referred the matter for a hearing in open court.
Consumer and legal activist Leonard Benjamin also highlights that the law is quite clear on the matter. “Essentially, Section 29 of the NCA says a magistrates’ court has jurisdiction in respect of any matter entailing the enforcement of a credit agreement. It does not matter what amount is being claimed,” he reiterates.
Click here to read the Moneyweb article.