SLIDE 18 DEBT COLLECTION Flashcards
Procedure for execution and sale of immovables
- Execution of immovables will take place if the movable property has been excused in terms of Rule 45 or court must have declared such property as “specially executable” and obtain judgement for it.
- Primary residence- summons must include notice in terms of section 26 of Constitution.
- A writ of execution against immovable property must contain sheriff’s return in terms of movable property.
- Immovable property should be attached by means of a written notice sent by the sheriff, by prepaid registered post to 3 people (owner, Registrar of Deeds, Occupier)
- After attachment, creditor instructs sheriff in writing to proceed with sale
- Sheriff determines encumbrances & bonds on the property along with names and addresses of persons in whose favour such bond and encumbrances are registered.
- Creditor must send a written notice by prepaid registered post to all preferent creditors (the bank) and the local authority (if property is rateable)
- Written notice to the preferent creditors and local authority must call upon these people to stipulate within TEN court days, a reasonable RESERVE PRICE.
- Sheriff to appoint a date for sale
- Creditor must prepare the notice of sale which contains: short description of property, location, time & place of sale, invitation to inspect conditions of sale at office of the sheriff.
- not less than 20 days before sale- creditor prepares conditions of sale and send to sheriff
- not less than 10 days- 1 copy of notice of sale to be sent to every creditor who attached property and affix one copy on notice board and as close as possible to where sale will take place.
- Execution of sale will be held.
- Sheriff will prepare distribution plan for proceeds.
- Copy of plan to be forwarded to Registrar and Sheriff to lie for inspection for 15 days and written notice to be given to all parties that have lodged writs.
- Parties may object before a judge for review on 10 court days notice to the sheriff and said persons.
What are the three types of warrants in the Magistrate’s Court?
- Warrant of ejectment
- Warrant for delivery of goods
- Warrant of execution against property.
What does Section 129 Notice of NCA aim to do?
It must draw attention to the consumer for their default and propose that the consumer refer the credit agreement to a debt counsellor, Alternative Dispute Resolution agent, Consumer Court or Tribunal with jurisdiction. The purpose for this is to allow parties to resolve their dispute or agree on a plan to bring payment under the credit agreement up to date.
What is the significance of of Section 129 of National Credit Act?
Section 129 must be complied with. when a consumer is in default, the credit provider may not commence any legal proceedings for the enforcement of a credit agreement before serving the consumer with a Section 129 Notice.
In addition to complying with section 129, one must also satisfy the requirements of section 130, what are they?
A credit provider may approach a court if:
a) the consumer remains in default for at least 20 days.
b) at least 10 days have elapsed since credit provider delivered the notice and consumer has either not responded to the notice or has responded by rejecting the credit providers proposal,
c) matter is not pending Tribunal
What is the general rule for sale and attachment of immovable property?
The registrar will not issue a writ of execution against a judgement debtor’s immovable property until he is certain that the judgement debtor does not possess sufficient movable property to satisfy the judgement debt amount.
–Movables must be executed before immovables
What are the exceptions to the general rule of sale and attachment of immovable property?
In instances where the debtor’s immovables are declared as “specially executable” by the court. This means that you may issue a writ of execution against the judgement debtor’s immovable property without first having to issue a writ against the movable property.
What happens if judgement debtor does not have enough movable property to cover debt?
The sheriff will provide you with nulla bona return, then you are able to proceed to have a writ of execution issued against the immovable property of judgement debtor.
What are the procedural steps of attachment of MOVABLES
The sheriff will proceed to the residence or place of employment of the debtor or the addressed instructed then:
1. He must first demand satisfaction of the writ
2. if debtor fails, sheriff must demand that he points out to the attachable movable property belonging to him
3. If debtor refuses to point out, sheriff must search the place for attachable property and attach them
4. Once sheriff has located the property, he must: a) make an inventory of the property
b) take property in his custody
5. Once goods are taken into custody, they must be kept in a safe place and police officers should be permanently placed to keep the property safe.
6. After attachment, sheriff will leave a copy of writ of execution with attorney of debtor, file the original together with his return of service with registrar of the division, and give the attorney of creditor those copies along with inventory of attached goods.
Steps of Sale of Movables
- Sheriff send the return of attachment to judgement creditor attorney with inventory
- The attorney prepares a notice of sale and sends it to the sheriff
- Sheriff advertises sale in two circulating newspaper within the district in which the property was attached
- Attorney prepares conditions of sale
- Provide notice, conditions, proof of advertisement and security to sheriff prior to the sale.
In which instances will the sheriff not take custody of the property?
- if the creditor asked him not to do so
- Debtor undertakes in writing that if the attachment has not been legally lifted by the day of sale, he will produce the goods attached on that day. This will need a surety.
- Another person makes a claim to the property, and the creditor fails to give the sheriff an indemnity holding him harmless from any loss or damage which result from the seizure.
What is the primary inquiry of Rule 46A with regards to Residential immovable property?
Whether the immovable property is the primary residential property of the judgement debtor and for court to consider alternative by which debtor can satisfy judgement debt, other than by way of execution against immovable property.
