Debtfree Magazine September 2019

The court case was heard, in Gauteng, by a full bench of several judges
and involved, among others, the National Credit Regulator (NCR), Mr Neil
Roets of Debt Rescue (the Debt Counsellor), RCS, Edcon, Standard Bank,
the Law Society of SA, the Banking Association. Two different consumers’
matters were considered at the same time and expert witnesses (like Debt
Counsellor Michelle Barnard) called in to present additional information.
The Ruling
After hearing from all the experts and after considering the arguments the
court was asked to answer a number of important questions about leaving
debt review.
The ruling, in effect, says that the High Court cannot say that someone
is not over indebted once they have been declared over indebted by a
Magistrates Court. Due to the way the National Credit Act never mentions
such a situation, no High Court can rule that someone in debt review is no
longer over indebted. It may be that the law was written specifically that
way to create the situation where once a consumer starts debt review they
have to finish the process.
Obviously this traps many consumers out of the credit market. The ruling
also says that unless someone questions the constitutionality of a person
being trapped in debt review (at court) the situation will just have to continue
as is. The ruling also says that if people want to change things then the
lawmakers will have to change the National Credit Act. The courts cannot
just work around the Act.
One other interesting part of the ruling says that if a matter has not yet been
heard by the Magistrates Court and if the consumer’s situation changes a
lot then the Magistrates Court could be given new information that proves
they are not over indebted. The ruling did not however mention the credit
bureaus and if they would have to remove the flag.