Fulton v National Credit Regulator (NCT/130744/2019/Section56(1)) [2019] ZANCT 146 (10 September 2019)

Fulton v National Credit Regulator (NCT/130744/2019/Section56(1)) [2019] ZANCT 146 (10 September 2019)

The Tribunal found that while Regulation 11 does not prohibit debt counsellors from receiving payment for their own fees, the Applicant's conditions of registration explicitly require all payments, including debt counsellor fees, to be received and distributed via a payment distribution agency approved by the National Credit Regulator. The Applicant's interpretation that he could receive fees directly from consumers was rejected, as the clear wording of the special condition prevails. The Tribunal also held that the 2011 Debt Counselling Fee Guidelines limited aftercare fees to 5% of the monthly instalment up to a maximum of R400, and the Applicant was not entitled to charge more even...

Citation
[2019] ZANCT 146
Parties
Applicant: Mark James Fulton; Respondent: National Credit Regulator
Court
National Consumer Tribunal
Jurisdiction
South Africa
Judgment Date
10 September 2019
Case Number
NCT/130744/2019/Section56(1)
Procedural Posture
Review Application / Objection to Compliance Notice Under Section 56 of the National Credit Act
Outcome
Application to modify the compliance notice is granted. The compliance notice is modified to require the Applicant to cease charging excessive aftercare fees, refund Ms Viljoen the overcharged fees, and cease collecting fees without using a payment distribution agency. No order as to costs.
Judges
Tanya Woker, H Devraj, M Peenze
Legal Topics
National Credit Act Compliance, Debt Counsellor Registration, Fee Guidelines Interpretation, Payment Distribution Agency, Regulatory Investigation
Banking and Finance Administrative Law National Credit Act Compliance Debt Counsellor Registration Fee Guidelines Interpretation Payment Distribution Agency Regulatory Investigation

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Parties

Mark James Fulton

Applicant

National Credit Regulator

Respondent

Procedural Posture

Review Application / Objection to Compliance Notice Under Section 56 of the National Credit Act

Legal Issues

  1. 1 Whether the Applicant contravened the National Credit Act and his conditions of registration by receiving fees directly from consumers without using a payment distribution agency.
  2. 2 Whether the Applicant charged aftercare fees in excess of the prescribed rates under the Debt Counselling Fee Guidelines.
  3. 3 Whether the compliance notice issued by the Respondent should be confirmed, modified, or cancelled.

Ratio Decidendi

The Tribunal found that while Regulation 11 does not prohibit debt counsellors from receiving payment for their own fees, the Applicant's conditions of registration explicitly require all payments, including debt counsellor fees, to be received and distributed via a payment distribution agency approved by the National Credit Regulator. The Applicant's interpretation that he could receive fees directly from consumers was rejected, as the clear wording of the special condition prevails. The Tribunal also held that the 2011 Debt Counselling Fee Guidelines limited aftercare fees to 5% of the monthly instalment up to a maximum of R400, and the Applicant was not entitled to charge more even...

Court Disposition

Application to modify the compliance notice is granted. The compliance notice is modified to require the Applicant to cease charging excessive aftercare fees, refund Ms Viljoen the overcharged fees, and cease collecting fees without using a payment distribution agency. No order as to costs.

Orders

  • The application to modify the compliance notice is granted.
  • The Applicant must cease charging aftercare fees in excess of prescribed rates.