Car payment defaulter wins against Westbank over repossessed vehicle

Banks that want to repossess a vehicle in a case where the owner has fallen in arrears with the monthly instalments are obliged to comply with the National Credit Act (NCA) to ensure that the consumer is aware that the bank is considering litigation against the payment defaulter.

This was made clear by the Gauteng High Court, Pretoria, in a case where Wesbank obtained an order by default against the vehicle owner, Charl Viljoen, because he never defended the matter in court.

Viljoen told the court that he only heard a month after the order was made that his car was now repossessed. To make matters worse, the vehicle has meanwhile been sold at auction by the bank.

He successfully turned to court to have the default judgment overturned, as he claimed he had no idea that legal proceedings were going to be taken against him.

The bank, on the other hand, maintained that he did receive a section 129 notice and that summons was subsequently issued against him. Counsel for the bank, however, could not prove that Viljoen ever saw either notice.

A section 129 notice is a formal notification required by the NCA in South Africa before a credit provider can take legal action against a consumer for defaulting on a credit agreement. It serves as a warning that the consumer is in arrears and provides options for resolving the debt.

The court said: “It is most unfortunate that, in these circumstances, the applicant’s (Viljoen) vehicle was sold as there was blatant non-compliance with the NCA.”

Although the court ruled in favour of Viljoen, the horse had already bolted, as the vehicle was meanwhile sold. The court said Viljoen may have a claim in this regard, but his attorneys can advise him of remedies possibly available to him in law.

Wesbank told the court that it made all attempts possible to inform Viljoen that he was in arrears of more than R76 000 on the Pajero. One of its agents phoned him about the arrears, but it is claimed that Viljoen dropped the call.

Later, a field agent went to his home, but it was claimed that Viljoen said he would make payments once he had regained employment, after which he drove off.

Wesbank said it subsequently sent Viljoen an email informing him that his account was in arrears and that all attempts made to contact him had been unsuccessful, ultimately resulting in the bank instituting legal action. Viljoen claimed that he never received this email.

The bank said it then sent the section 129 notice to Viljoen via registered post. It furnished the court with documentation in this regard, as well as with a post office “track and trace report.” This report pertained to Wesbank following the movements of the 129 notice sent to the Post Office.

But the court said this did not prove that Viljoen ever received the notice; it only shows the movement of the notice. The court concluded that there was never any proper service of these documents on Viljoen. The notice from the post office to inform him that there was a registered post item for him to collect was attached to the gate of what Wesbank believed to be his home address in Centurion.

Viljoen maintained he never received any documents; thus, he could not oppose the default judgment as he did not know about the pending litigation.

Ruling in his favour, the court stressed that no legal proceedings could commence without the service of the 129 notice.

Cape Times