WRITTEN SUBMISSIONS ON THE DRAFT NATIONAL CREDIT BILL
COMPILED BY ADV W H HEATH

HEATH FORENSIC INVESTIGATORS AND CONSULTANTS CC T/A HEATH EXECUTIVE CONSULTANTS

SUBMISSIONS

  1. BACKGROUND
  2. In August 2004, the Department of Trade and Industry published a draft National Credit Bill. The Portfolio Committee will be holding public hearings on this bill on 5, 8, 10 and 17 August 2005.

    We will attend the public hearing on 17 August 2005 to make our submissions personally, but in the interim we herewith serve you with our written submission. Please note that this is a summary of our contentions and that we will deal with it in detail on 17 August 2005.

  3. INTERPRETATION
  4. One of the main concerns of the proposed Bill is the repealing of the Usury Act retrospectively. Claims under the Act will be limited to three years prior to the promulgation of the proposed National Credit Bill. Furthermore, Section 168 of the proposed legislation determines that no claim will be entertained by the Tribunal or consumer court more than three years after a course of conduct or continued practice, the date that the conduct or practice ceased.

    During 1994 the Court of Appeal ruled in the matter Kruger vs President Insurance Co Ltd 1994 2 SA 495 [D503G] that no legislation can be retroactively repealed if there is a disadvantage for the consumer.

  5. OUR CONTENTIONS
    1. The proposed Bill creates rights and obligations, particularly with reference to credit agreements.
    2. Rights and obligations relating to credit agreement had been created at the time of the drafting of the Bill arising out of existing law.
    3. Consumers and credit provisions had acquired rights arising out of credit agreements up to date and in particular as at the date of the Bill.
    4. Section 166 of the Bill seeks to destroy and/or limit such pre-existing rights. It furthermore seeks to destroy or limit such pre-existing rights retrospectively. This borne out by the Provisions of Section 4 of Schedule 3.
    5. Section 10 of Schedule 3 makes limited provision for continued enforcement of repeated laws. There is a presumption against the retrospectively of statutory provisions. The effect of applying the legislation retrospectively would be intrinsically unfair.
    6. The issue of whether pending claims will be entertained for amounts overcharged for periods more than three years prior to the promulgation of the proposed Credit Bill (where such overcharges does not relate to a practice as referred to in section 168) needs to be addressed.

Signed at Durbanville on the 29th day of July 2005

ADV W H HEATH

CEO

HEATH EXECUTIVE CONSULTANTS

Duly authorised