Stander v Bates and Another (NCT/367710/2024/141(1)(b)) [2025] ZANCT 33 (13 May 2025)

IN THE NATIONAL CONSUMER

TRIBUNAL

HELD IN CENTURION

Case number: NCT/367710/2024/141(1)(b)

In the matter between:

MARTHA

CORNELIA STANDER

APPLICANT and

VANESSA

ANN BATES

FIRST

RESPONDENT

NATIONAL

CREDIT REGULATOR

SECOND

RESPONDENT

Coram:

Adv C Sassman - Presiding Tribunal member

Ms P Manzi-Ntshingila - Tribunal member

Dr A Potwana

- Tribunal member

Date of hearing

- 6 May 2025

Date of judgment - 13 May 2025

JUDGMENT AND REASONS

THE PARTIES

1. The applicant is Martha Cornelia Stander (the applicant). The applicant is a consumer, as defined in section 1 of the National Credit Act 34 of 2005 (NCA). At the hearing, the applicant represented herself.

2. The first respondent is Vanessa Ann Bates (the first respondent). The first respondent is a registered debt counsellor with registration number NCRDC2499. Adv Ross Bowles, instructed by VHT Attorneys, represented the first respondent at the hearing.

3. The second respondent is the National Credit Regulator (NCR), an organ of the state and a juristic person established in terms of section 12 of the NCA to regulate the consumer credit market and ensure compliance with the NCA.

4. The NCR did not oppose this application, but Ms Louise Page, employed in its Debt Review department, attended the hearing to observe the proceedings.

TERMINOLOGY

5. A reference to a section or form in this judgment refers to a section or form contained in the NCA and its Regulations.

APPLICATION TYPE

6. This is an opposed application in terms of section 141(1)(b), in which the applicant, with leave granted by the Tribunal, seeks redress against the first respondent. The applicant alleges that the first respondent placed her under debt review despite her cancelling her application, soon after applying.

BRIEF BACKGROUND

7. The applicant alleges that she contacted the first respondent telephonically for assistance with debt review due to an unforeseen financial situation with her bank. She submits that she signed a Form 16 to apply for debt review, but the process was not explained to her, and the first respondent misled her regarding the restructured amount she would be required to pay towards her debt each month. Once she realised how much she would be repaying each month, she cancelled her application, but the first respondent persisted in negotiating with her creditors, and she now finds herself under debt review without her consent. The first respondent opposes the application and disputes the allegations made by the applicant. The first respondent maintains that she complied with all her statutory obligations as a debt counsellor and provided the applicant with the relief she sought when applying for debt review.

THE APPLICANT’S

SUBMISSIONS

8. The applicant submitted that when she contacted the first respondent on 28 August 2024, she was not in arrears with her credit accounts. She was told she would pay a restructured amount of R5 000.00 per month, which she found acceptable. She was never advised that this was only a provisional amount subject to approval by her creditors.

9. The Form 16 was sent to her mobile phone for signature. However, no content or documents were visible when she signed the form. As a result, the form did not accurately reflect the expenses she provided to the first respondent telephonically.

Although she recalls signing Form 16, she cannot explain how her signature ended up on other forms she never had sight of.

10. On 5 September 2024, she was told that she would be required to pay R6 200.00 per month. At this stage, she cancelled her application, and the first respondent confirmed the cancellation in an email on the same day. Despite her cancellation, the first respondent negotiated with her creditors on her behalf, and although a final court order has not been granted, she finds herself under debt review.

11. The first respondent did not clearly explain the various steps in the process and the legal consequences of applying for debt review. She was also not given a chance to review and understand all the documents provided to her before signing. Therefore, her initial consent cannot be considered informed consent, and the process should not have proceeded. When approaching the first respondent, she did so in good faith, trusting that she would receive honest, transparent and professional assistance tailored to her situation. She relied on the first respondent to guide her through the process with the necessary clarity and integrity that the law requires of a registered debt counsellor.

12. The applicant has lost all faith and trust in the first respondent and seeks an order removing the debt review flag from her name on the credit bureaus.

THE FIRST RESPONDENT’S

SUBMISSIONS

13. The first respondent submits that the applicant electronically signed Form 16, declaring her income and expenses and providing a power of attorney to act on her behalf. The first respondent was entitled to rely on the information provided by the applicant to draft a sustainable debt restructuring plan. She followed all the steps required under section 86 and regulation 24.

14. When the applicant requested to cancel the application, the formal requirements for exiting debt review were explained to her. At no stage was the first respondent’s conduct malicious, fraudulent or intended to mislead the applicant.

15. The applicant’s averments regarding the R5 000.00 agreed amount for monthly distribution to her creditors are misconstrued and impermissible, as the amount was only a preliminary estimate which was subject to approval by her creditors.

16. All the necessary forms and documents involved in the process were emailed to the applicant. She had every opportunity to read, verify and request clarification on any part of the process before signing the application form. A fundamental principle in South African contract law is caveat subscritor, which provides that a party who signs a contract is presumed to have read, understood and agreed to its terms unless proven otherwise through justus error, misrepresentation, duress or undue influence.

17. The applicant’s allegations that the process was not adequately explained to her or dishonestly explained are unsupported by the evidence before the Tribunal. Furthermore, the law does not permit the first respondent to remove the applicant from debt review as she requests. The applicant’s allegations cannot override the established legal principles in this regard, and the

application must be dismissed.

CONSIDERATION OF THE

EVIDENCE

18. The NCA makes no provision for a consumer to cancel the debt counselling process after completing Form 16 and applying for debt review. Once the applicant applied for debt review, the first respondent’s statutory obligations under the NCA and duties laid out in her conditions of registration as a debt counsellor were automatically set into motion. The NCA further does not provide a debt counsellor with the discretion or authority to withdraw a debt review application where a consumer wishes to exit the process.[1]

19. There is a lacuna in the NCA in that it does not provide for consumers to change their minds and cancel an application for debt review once made. Section 121(1) and (2) provide consumers with a cooling-off period when concluding certain credit agreements somewhere other than the registered premises of the credit provider. A consumer is afforded five days after signing such an agreement to cancel it. No such cooling-off period exists when it comes to debt review, and a consumer who applies is instantly bound by the restrictions and obligations of the process, pending the outcome of the debt counsellor’s assessment.[2]

20. The evidence before the Tribunal indicates that on 28 August 2024, the first respondent sent the applicant an email with five attachments and a link to proceed with her application. The attachments included a debit order cancellation form, a new debit order consent form, an application pack, a draft payment schedule and a comparison between debt consolidation and debt review. At the hearing, the first respondent confirmed that the “application pack” email attachment included copies of the first respondent’s terms and conditions and power of attorney. The email further stated: “If you have any questions, please feel free to contact me”.

21. The Tribunal does not have jurisdiction to authorise the applicant’s release from the debt counselling process or the removal of the listing on the credit bureaus while she is under debt review. This is so, simply because such a remedy cannot be found within the four corners of the NCA. In Van Vuuren v Roets and Others,[3] the Court was tasked with determining whether a High Court had jurisdiction to release a consumer from the debt counselling process

and confirmed that no interpretation of the NCA could support such a notion. Instead, the Court laid out the remedies available to a consumer to exit the debt counselling process.

22. The Court held that a consumer who has applied for debt review but was not yet the subject of a Magistrates’ Court order in terms of section 87 may, together with the proposal of the debt counsellor, present any additional facts to the Magistrate to bring about a rejection of the proposal, thereby releasing the consumer from the process. In this case, the first respondent submits that the applicant cancelled her mandate and no longer wished to proceed. She, therefore, could not proceed with such an application to a Magistrates’ Court without the applicant’s cooperation. She accordingly suspended her debt counselling services[4] and issued a Form 17W(b) to all the applicant’s creditors.[5]

23. The Court further held that where a Magistrate has already granted a debt restructuring order, the only way for the consumer to exit the process is by obtaining a clearance certificate under section 71. Under section 71(3), the Tribunal may order a debt counsellor to issue a clearance certificate to a consumer, but such an order can only be made if the consumer has complied with the requirements for a clearance certificate as prescribed in section 71(1). The applicant has not proven that those requirements have been met in this case.

24. At the hearing, the applicant confirmed that she is unable to pay all her creditors at present and has a reduced monthly income. In a case where a consumer remains in need of debt review but is no longer satisfied with the services of a particular debt counsellor, the NCR Withdrawal Guidelines[6] provide for consumers to transfer to a new debt counsellor. The debt review process does not start afresh, and the receiving debt counsellor must continue from where the previous debt counsellor stopped. The receiving debt counsellor may not charge a new application fee, administration fee, restructuring fee or legal fee if these fees were already paid by the consumer to the previous debt counsellor. This option remains available to the applicant in this case.

CONCLUSION

25. The Tribunal finds that by completing the prescribed Form 16 and applying for debt review, the applicant bound herself to the prescribed legislative requirements of the debt counselling process.

26. The Tribunal further accepts that the first respondent provided the applicant with the necessary information regarding the debt counselling process and its consequences before she signed the application form. Furthermore, the applicant was free to contact the first respondent for any clarifications before completing the application form. Therefore, the Tribunal is unconvinced that the applicant’s consent to apply for debt review was uninformed, as she alleges.

27. The Tribunal does not have the requisite jurisdiction to grant the applicant’s release from debt counselling, nor has she proven to have met the requirements for a clearance certificate to be issued. Therefore, the application stands to be dismissed.

ORDER

28. Accordingly, the Tribunal makes the following order:

28.1 The application is dismissed; and

28.2 There is no cost order.

Adv C Sassman

Presiding Tribunal member

Tribunal member Ms P Manzi-Ntshingila concur.

Dissenting Judgment

1. I have read the above majority judgment. Respectfully, I cannot concur with my colleagues’ reasoning and the subsequent order. My reasons and the order I would have made are stated below.

2. The contents of paragraph 9 of the NCR Withdrawal Guidelines 2021 and Form 17W(b) referred to in paragraph 22 of the main judgment are not relevant to the current proceedings because there is no evidence before this Tribunal that the applicant did not cooperate with the first respondent. The applicant’s refusal to accept the debt- rearrangement plan and cancellation because the amount she was told she would pay after being placed under debt review, R6 200.00, differed significantly from what was initially communicated to her by the first respondent, R5 000.00, cannot be construed as non-cooperation. The applicant had every right to compare the amount the first respondent communicated to her after their initial interaction, R5 000.00, with the amount the first respondent later communicated to her, R6 200.00, and choose to either accept or reject the increased amount of R6 200.00.

3. The NCA does not compel consumers to accept whatever proposals are made to them by debt counsellors or credit providers. Compelling consumers to accept whatever proposals made to them by debt counsellors or credit providers would shatter one of the cornerstones of our law of contract, the freedom to contract, as consumers would no longer be able to enjoy their autonomy and to determine the relationships they would prefer to have with other parties. Instead of violating the freedom to contract, the legislature wisely enacted section 86(8) which states –

“If a debt counsellor makes a recommendation in terms of subsection (7) (b) and—

(a) the consumer and each credit provider concerned accept that proposal, the debt counsellor must record the proposal in the form of an order, and if it is consented to by the consumer and each credit provider concerned, file it as a consent order in terms of section 138; or

(b) if paragraph (a) does not apply, the debt counsellor must refer the matter to the Magistrate’s Court with the recommendation.”[7]

4. It is common cause that the applicant immediately rejected the first respondent’s recommendation to pay R6 200.00 and cancelled.

There is not even a shred of evidence before the Tribunal that supports the first respondent’s claim that she advised the

applicant from the outset that the amount of R5 000.00 was a preliminary estimate and was subject to adjustment. Instead, the evidence before the Tribunal shows that on 3 September 2024, the first respondent informed the applicant in unequivocal terms that the applicant would pay R5 000.00 on 30 September 2024, 30 October 2024 and onwards.[8] Again, on 4 September 2024, the first respondent or her agent sent an email to the applicant stating that “Only the R5000 will be deducted.”[9] This was pursuant to a telephone conversation the applicant had with the first respondent’s agent about a DebiCheck. It was only after the applicant had cancelled that she was informed that the amount of R5 000.00 was an estimate.[10]

5. If the amount of R5 000.00 was an estimate, the first respondent could have easily stated so in the very same correspondence in which she informed the applicant that she would pay R5 000.00. She did not. This omission discredits the first respondent’s claim that she informed the applicant that the amount of R5 000.00 was an estimate and lends credibility to the applicant’s version that she was never told that the amount of R5 000.00 was an estimate. In addition, the applicant’s immediate rejection of the amount of R6 200.00 and immediate cancellation lends further credence to her claim that she was not informed that the amount of R5 000.00 was an estimate. Her version of events is consistent, cohesive, and coherent and has a ring of truth.

6. Unlike paragraph 9 of the NCR Guidelines, paragraph 1.3 of the guidelines is relevant. It states-

“A consumer who is not yet the subject of a Magistrates’ Court debt re- arrangement order in terms of section 87 of the NCA, may together with the proposal of the debt counsellor present the additional facts to the court to bring about a rejection of the proposal.[11] If the proposal is rejected by the Magistrate, every credit provider and every credit bureau should be notified of the relevant order. This means that in cases where a debt re-arrangement order has not yet been granted, the debt counsellor and consumer must place the new facts in front of the Magistrate who can then declare the consumer not over-indebted.”

7. It is imperative to point out that the above-quoted paragraph of the NCR Guidelines is in line with section 86(8) which states –

(a) the consumer and each credit provider concerned accept that proposal, the debt counsellor must record the proposal in the form of an order, and if it is consented to by the consumer and each credit provider concerned, file it as a consent order in terms of section 138; or

(b) if paragraph (a) does not apply, the debt counsellor must refer the matter to the Magistrate’s Court with the recommendation.”[12]

8. The provisions of section 86(8)(b) are peremptory. They compel a debt counsellor to refer a matter to a Magistrate’s Court if a consumer and each credit provider concerned do not agree on a plan of debt re-arrangement. Under item 5d of the Power of Attorney that the applicant gave to the first respondent, the applicant mandated the entity for which the first respondent apparently works, DebtBusters, “by virtue of the power of Attorney to review her financial situation and “make proper recommendations.”[13] This means that when the applicant informed the first respondent that she wanted to cancel, the first respondent had a professional

responsibility to inform her, the applicant, that cancellation was no longer possible because section 86(8)(b) compelled her, the first respondent, to refer the matter to a Magistrates’ Court.

9. In addition to the above, the first respondent had a professional responsibility to inform the applicant that she could present the additional facts to bring about a rejection of the proposal, as stated in paragraph 54.2 of Van Vuuren v Roets and Others,[14] (Van Vuuren) where the High Court declared that:

“A consumer who is not yet the subject of a Magistrate’s order in terms of section 87 may, together with the proposal of the debt counsellor, present the additional facts to bring about a rejection of the proposal. If a Magistrate has already made a re-arrangement

order, section 71 regulates the only route to termination of debt review, and its terms must be met.”

10. Furthermore, paragraph 3 of the NCR Guidelines reiterates the High Court’s declaration by stating that “A consumer who is not yet the subject of a Magistrates’ Court debt re-arrangement order in terms of section 87 of the NCA, may together with the proposal of the debt counsellor present the additional facts to the court to bring about a rejection of the proposal.”

11. In the present matter, it is evident that the first respondent chose not to inform the applicant to present additional facts to bring about a rejection of the debt review proposal and did not refer the matter to a Magistrate’s Court as required by section 86(8)(b) and as stated in paragraph 54.2 of the Van Vuuren judgment. Instead, on 30 September 2024, she issued NCR Form 17. W notifying the applicant’s credit providers that she had suspended providing services to the applicant due to the applicant’s request. This was not true. The applicant did not request the first respondent to suspend her services. She told her she wanted to cancel. The first respondent’s unwarranted issuance of NCR Form 17. W probably amounts to an abuse of this form.

12. I now turn to consider whether the applicant was entitled to cancel. No provision in the NCA entitles a consumer to cancel debt-review instructions with a debt counsellor. Thus, the instruction to cancel was misguided. If she did not want to be placed under debt review, she had to present additional facts to the first respondent to bring about a rejection of the debt review proposal when the latter referred the matter to a Magistrate’s Court.

13. It is apt to mention that by choosing to suspend her services instead of informing her client of the proper legal route of referring the matter to a Magistrates’ Court as required by section 86(8)(b) and as stated in the Van Vuuren judgment and the NCR Guidelines, the first respondent’s decision has severely prejudiced the applicant who now finds herself listed as undergoing debt-review with credit bureaus whilst not undergoing under debt-review and receiving the benefits thereof. This is very unfortunate and could never have been the intention of the legislature.

14. On a conspectus of the evidence before the Tribunal, I would have found that by failing to comply with the provisions of section 86(8)(b), the first respondent committed prohibited conduct and ordered her to either refer the applicant’s matter to a Magistrate’s Court together with the applicant’s additional facts to bring about a rejection of the debt review proposal or, in view of the relationship breakdown, transfer the applicant’s matter to another debt counsellor who would do so.

Dr Andisa Potwana

Full-time Tribunal Member

[1] Rougier v Nedbank Ltd (27333/2010) [2013] ZAGPJHC 119 (28 May 2013) at paragraph 12.

[2] Refer to section 86(7).

[3] Van Vuuren v Roets and Others (37407/2018) [2019] ZAGPJHC 286; [2019] 4 All SA 583 (GJ); 2019 (6) SA 506 (GJ) (3 September 2019) at paragraphs 54.2 and 55.2.

[4] NCR Withdrawal Guidelines 2021 at paragraph 9.

[5] See page 142 of the case record.

[6] 2021 at paragraph 12.

[7] Underlines added.

[8] Annexure “F” to the applicant’s replying affidavit on page 190 of the Tribunal’s bundle.

[9] Annexure “G” to the applicant’s replying affidavit on page 195 of the Tribunal’s bundle.

[10]Annexure “H” to the applicant’s replying affidavit on page 201 of the Tribunal’s bundle.

[11] Underline added.

[12] Underline added.

[13] Page 139 of the Tribunal’s bundle.

[14] [2019] 4 All SA 583 (GJ), 3 September 2019.