Bayport Securitisation Limited and Another v University of Stellenbosch Law Clinic and Others (507/2020) [2021] ZASCA 156; 2022 (2) SA 343 (SCA) (4 November 2021)

Bayport Securitisation Limited and Another v University of Stellenbosch Law Clinic and Others (507/2020) [2021] ZASCA 156; 2022 (2) SA 343 (SCA) (4 November 2021)

The Supreme Court of Appeal held that the definition of 'collection costs' in the National Credit Act does not include legal costs incurred during litigation. The court reaffirmed the common law distinction between collection costs and litigation costs, noting that legal costs commence with the issuing of summons and are subject to judicial discretion and taxation. The statutory language of the Act does not evidence an intention to include litigation costs within collection costs. Furthermore, section 103(5) of the Act does not apply post-judgment, as a judgment alters the character of the debt and only interest accrues thereafter. The court found that the high court's interpretation was...

Citation
[2021] ZASCA 156
Parties
Appellant: Bayport Securitisation Limited; Appellant: Law Society of South Africa; Respondent: University of Stellenbosch Law Clinic; Respondent: Summit Financial Partners (Pty) Limited; Respondent: Jenina Mary Matthys; Respondent: Skhumbuzo Richard Khumalo; Respondent: Frans Saulus; Respondent: Albert Robert Kleinsmith; Respondent: Gladys Seikgotla Jantjies; Respondent: Ester Kordom; Respondent: Sarah Felicity Visser; Respondent: Edgar Arnolds; Respondent: Patrick Moemedi Tladi; Respondent: Lebogang Victor Mokate
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
4 November 2021
Case Number
507/2020
Procedural Posture
Civil Appeal / Appeal From Western Cape Division of the High Court
Outcome
Appeal upheld; high court order set aside and replaced with dismissal of the application.
Judges
Ponnan, Makgoka, Gorven, Phatshoane, Molefe
Legal Topics
National Credit Act, Collection Costs, Litigation Costs, Declaratory Relief, Emoluments Attachment Orders
Banking and Finance Civil Procedure National Credit Act Collection Costs Litigation Costs Declaratory Relief Emoluments Attachment Orders

Case Brief

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Parties

Bayport Securitisation Limited

Appellant

Law Society of South Africa

Appellant

University of Stellenbosch Law Clinic

Respondent

Summit Financial Partners (Pty) Limited

Respondent

Jenina Mary Matthys

Respondent

Skhumbuzo Richard Khumalo

Respondent

Frans Saulus

Respondent

Albert Robert Kleinsmith

Respondent

Gladys Seikgotla Jantjies

Respondent

Ester Kordom

Respondent

Sarah Felicity Visser

Respondent

Edgar Arnolds

Respondent

Patrick Moemedi Tladi

Respondent

Lebogang Victor Mokate

Respondent

Procedural Posture

Civil Appeal / Appeal From Western Cape Division of the High Court

Legal Issues

  1. 1 Does the definition of 'collection costs' in section 1 of the National Credit Act include all legal fees incurred by the credit provider in enforcing a credit agreement, both pre- and post-judgment.
  2. 2 Does section 103(5) of the National Credit Act apply for as long as the consumer remains in default, including after judgment has been granted.
  3. 3 May legal fees be claimed from a consumer or recovered by a credit provider pursuant to a judgment unless agreed or taxed.

Ratio Decidendi

The Supreme Court of Appeal held that the definition of 'collection costs' in the National Credit Act does not include legal costs incurred during litigation. The court reaffirmed the common law distinction between collection costs and litigation costs, noting that legal costs commence with the issuing of summons and are subject to judicial discretion and taxation. The statutory language of the Act does not evidence an intention to include litigation costs within collection costs. Furthermore, section 103(5) of the Act does not apply post-judgment, as a judgment alters the character of the debt and only interest accrues thereafter. The court found that the high court's interpretation was...

Court Disposition

Appeal upheld; high court order set aside and replaced with dismissal of the application.

Orders

  • The appeal of the first and second appellants is upheld.
  • The order of the high court is set aside and substituted with: 'The application is dismissed.'