Absa Bank Limited v Johan Serfontein and Another (740/2023) [2025] ZASCA 11; [2025] 2 All SA 1 (SCA); 2025 (3) SA 345 (SCA) (10 February 2025)

Absa Bank Limited v Johan Serfontein and Another (740/2023) [2025] ZASCA 11; [2025] 2 All SA 1 (SCA); 2025 (3) SA 345 (SCA) (10 February 2025)

The Supreme Court of Appeal held that the AOD/POA was a supplementary agreement under the National Credit Act, as it regulated the same subject matter as the original overdraft and surety agreements. Clauses 2 and 13 of the AOD/POA were found to be unlawful under section 90(2): clause 13 attempted to exclude the...

Source-derived case information.

Citation
[2025] ZASCA 11
Parties
Appellant: Absa Bank Limited; Respondent: Johan Serfontein; Respondent: Jacobus Hendrik Serfontein
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
10 February 2025
Case Number
740/2023
Procedural Posture
Civil Appeal / Appeal From the Free State Division of the High Court, Bloemfontein
Outcome
Appeal dismissed with costs; High Court order upheld.
Judges
Molemela, Kgoele, Keightley, Koen, Dolamo
Legal Topics
National Credit Act, Supplementary Agreement, Parate Executie, Unlawful Provisions, Severance of Contract, Consumer Protection
Banking and Finance Civil Procedure National Credit Act Supplementary Agreement Parate Executie Unlawful Provisions Severance of Contract Consumer Protection

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Summary, issues, holding and outcome

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Parties

Absa Bank Limited

Appellant

Johan Serfontein

Respondent

Jacobus Hendrik Serfontein

Respondent

Procedural Posture

Civil Appeal / Appeal From the Free State Division of the High Court, Bloemfontein

Legal Issues

  1. 1 Is the acknowledgement of debt and power of attorney (AOD/POA) a supplementary agreement under the National Credit Act?
  2. 2 Does the AOD/POA contain provisions prohibited by section 90(2) of the National Credit Act?
  3. 3 Were the respondents required or induced to sign the AOD/POA?

Ratio Decidendi

The Supreme Court of Appeal held that the AOD/POA was a supplementary agreement under the National Credit Act, as it regulated the same subject matter as the original overdraft and surety agreements. Clauses 2 and 13 of the AOD/POA were found to be unlawful under section 90(2): clause 13 attempted to exclude the application of the NCA, defeating its purpose, while clause 2 granted ABSA an irrevocable power of attorney to sell the property without a court order, contravening statutory and constitutional protections. The respondents were found to have been induced to sign the agreement under threat of litigation, satisfying the requirements of section 91(2). The unlawful provisions...

Court Disposition

Appeal dismissed with costs; High Court order upheld.

Orders

  • The appeal is dismissed with costs.
  • The acknowledgement of debt and power of attorney agreement entered into on 17 March 2019 is declared void from the date it was entered into.