Rid yourself of financial woes

Outstanding debt is easier to sweep under the carpet than to deal with. Initially, you might find some solace in pretending, however, as time progresses, that bulge under the carpet will eventually become stress bulges that run down your neck and keep you up at night. Eventually the sound of a phone ringing will bring about anxiety, as it could possibly be one of your creditors following up or threatening to take legal action against you. That’s not even the worst of it all. The worst phase to enter is the one where you simply lose hope.

“Hope is like the sun, which, as we journey toward it, casts the shadow of our burden behind us.” Samuel Smiles

If you are having serious trouble repaying your debts and if you are ready to embark on the road to financial freedom, we at Legal Hero have the perfect solution: debt review. We do not offer this service personally, but have truly been inspired by Karin Augustyn from Cape Debt Clinic and her team to whom we refer all our financially distressed enquiries. Karin and her team’s compassion is beyond anything we have ever experienced in the overpopulated debt review industry. *

Debt review vs being placed under administration?

Debt review is often preferred to being placed under administration. Why?

Debt review offers greater consumer protection as the fees to the debt counsellor are strictly regulated by the National Credit Regulator. A debt counsellor will assess your state of indebtedness, offer sound financial advice and facilitate a debt rearrangement with your creditors. Should your creditors not agree to the debt rearrangement one may apply to court for an order confirming same. The debt counsellor will then manage all your payments from a central distribution agency on a monthly basis on your behalf.

Administration is more expensive and the fees to the administrator managing the payments are higher. A court order is required and the debt may not total more than R50 000. There have been many reports of irregularities in that the fees to the administrator are not properly regulated and there is no central distribution agency involved. In most cases the distributions to credit providers only occur every three months and are handled by the administrators themselves.

How long does debt review take?

Nothing is a short-term fix. You will need to commit. The goal is to get you debt-free within a period of 3-5 years. Depending on your circumstances, this could happen much sooner. For a detailed timeline elaborating on what happens from day 1 – the day of your financial freedom, visit this link:

http://www.capedebtclinic.co.za/Debt_Review_timeline.html

Visit this link for answers to other frequently asked questions regarding debt review:

http://www.capedebtclinic.co.za/Debt_Review_FAQ.html

Contact Cape Debt Clinic (not limited to the Western Cape) on 021 828 2658 for a free first consultation to assess your needs.



* Please note that Legal Hero does not receive commission/ referral fees for referrals to Cape Debt Clinic.

Responsibilities towards a domestic worker

A Sectoral Determination issued by the Department of Labour for 1 December 2015 - 30 November 2016:

Note: if you are not listed in Area A, you fall under Area B. 

Screenshot/ photo cred: www.labour.gov.za

Notes:

As a Legal Hero policyholder, we can assist with a tailored domestic worker contract, salary slips and advise as to which other documents should form part of your file. Contact us today.

Yours faithfully,

Legal Hero

www.legalhero.co.za
0861 22 99 22
join@legalhero.co.za/ legal@legalhero.co.za/ admin@legalhero.co.za

Choosing a Matrimonial Property Regime

Love is wonderful but every so often it can seduce us into acting hastily and making bad life decisions. One such a decision is choosing the wrong matrimonial property regime.

What is a matrimonial property regime?
A matrimonial property regime is a big word for the financial arrangement between you and your spouse. You could either be married:
· IN community of property
· OUT of community of property; or
· OUT of community of property WITH the accrual system.

Very important:
If you are fail to register an ante-nuptial agreement BEFORE you tie the knot, you are automatically married in community of property. This means that everything your spouse OWES and OWNS also belong to you (and vice versa).

Consequences of being married in community of property:

1. This regime means that you and your spouse share everything, including that car YOU bought before you two got married;

2. There is a common estate, therefore debt incurred by your husband or wife will also become your debt;

3. If your husband or wife is then unable to pay the debt, YOUR name will ALSO be listed on ITC (in other words, you will be blacklisted);

4. If the creditors then take judgment and ask for an attachment of property order, that car you bought before you got married can be confiscated to cover your spouse’s debt!;

5. If your spouse’s spending habits lead to sequestration or debt review, you will also form part of the sequestration or debt review.


Many couples, however, prefer South Africa’s default matrimonial property regime. It may work well for women or men who choose to stay at home and raise the kids. Your spouse’s salary is then also your salary and should you decide to go your separate ways and divorce, you will receive half of everything.

Can I claim money from my fiance if he decides to break our engagement?

“I do believe that the time has arrived to recognise that engagements are outdated and do not recognise the mores of our time” (Van Jaarsveld v Bridges (344/09) [2010] ZASCA 76 para 3).

Breach of promise (to marry) could lead to two claims, depending on the circumstances:

a)      Contractual damages (wedding preparations, costs to move to a different town, renovations to the new home, etc.);

b)      Delictual damages (sentimental damages if he broke the engagement scornfully and in an insulting manner. It is not enough to feel hurt or abandoned, the test is objective).

When calculating contractual damages, the point is to place you as the ‘innocent’ party in the position you would’ve been in had you and your fiancé not agree to get married. Remember to minus payments already contributed by him (towards the wedding preparations for example).

When calculating delictual damages, it is important to note that ‘the world has moved on and morals have changed’ (Van Jaarsveld v Bridges cited above para 6). In the Van Jaarsveld case the High Court awarded Bridges R110 000-00 as delictual damages due to the manner and circumstance in which he ended the engagement (via SMS). However, on appeal, the Supreme Court found that an SMS is a perfectly acceptable way in our modern society and that Van Jaarsveld was very apologetic and compassionate by also apologizing to her mother and saying he still views her as a ‘pragtige mens’ (lovely person). 

Wishing you a lovely day, 

Legal Hero. 

www.legalhero.co.za 

Enforcement or cancellation of a contract

Question received

“Can I claim back my money? I ordered hay for my horses in November 2013 after seeing an advertisement on the internet. The man was very polite over the phone and convinced me to pay the full R3 000 in advance. He explained that the hay was fresh and the only reason for selling was to clear his storeroom. When the man came to deliver the hay I realised that the hay was OLD, MOULDY AND STALE - I have photos to prove it - and refused to accept the goods. He left with the bad hay and promised to be back at a later stage with better quality. I am still waiting!! He no longer answers my calls but I’ve managed to get his address. Should I approach him?”

Reply:

You and this man (let’s call him Mr X) entered into a verbal contract over the phone the moment the two of you agreed that the hay would be delivered in exchange for R3 000 – to be paid up front.

It is an underlying requirement that the parties to a contract act in good faith and fair dealing. As you have possibly learned, this is sadly not always the case.

The truth is that Mr X has been in breach of contract for more than a year. The type of breach here is called positive malperformance.

-          Positive malperformance happens where the supplier delivers the ordered goods on time but where the quality of the goods is improper/ incomplete/ defective;

-          The receiving party subsequently has a right to reject the improper/ incomplete or defective goods;

-          What generally happens next is that the receiving (innocent) party would demand:

a)      That the supplier replace defective goods with proper/ complete goods in an acceptable order;  OR

b)      A cancellation if the defect/ breach is material/ very serious. 

Seeing as stale/ mouldy hay can cause your horses infection and/ or hay induced-colic, the defect appears to be material in this instance! 

Van der Merwe et al (Contract, General Principles 1 ed 1993, at 255) describes a very serious breach as follows (also quoted in the case of Singh v McCarthy Motors):

“The test for seriousness has been expressed in a variety of ways, for example that the breach must go to the root of the contract, must affect a vital part or term of the contract, or must relate to a material or essential  term of the contract, or  that there must have been a substantial failure to perform.   It has been said that the question whether a breach would justify cancellation is a matter of judicial discretion.   In more general terms the test can be expressed as whether the breach is so serious that it would not be reasonable to expect that the creditor should retain the defective performance and be satisfied with damages to supplement the malperformance.”

Can you claim back your money?

Firstly, well done on tracking down Mr X’s address! This is invaluable, not necessarily for approaching Mr X (in fact, we advise against it) but for delivering the relevant legal documents to demand fresh hay or cancellation (repayment of your R3 000).

The good news is that you are able to pursue the matter via the Small Claims Court as your claim is less than R15 000. The aforementioned court is free of charge and does not allow for legal representation. Proceedings are informal and you will be able to rely on text messages and informal means of communication.

The first step is to put your claim in writing by sending Mr X a Small Claims Court section 29 letter of demand in terms of which you request fresh hay as agreed upon within 14 days, failing which you will cancel the contract and demand repayment. If you are a Legal Hero policyholder, please contact us and open a new file for assistance as soon as possible. 

It is very important to note that a civil claim prescribes (becomes invalid) after 3 years since last date of payment/ acknowledgement of the debt provided no legal action has been instituted during that time. This means that your civil claim against Mr X will prescribe in November 2016.  After November 2016, Mr X will be able to raise the special defence of prescription in court.

Lastly, based on the information provided to us, it appears that this sale was a once-off. Should Mr X, however, sell hay on a regular basis during the ordinary course of business, Mr X would be bound by the rules of the Consumer Protection Act (as a supplier). In terms of the Consumer Protection Act, a consumer may request repayment, a repair or replacement of defective goods. One could also lodge a consumer complaint via complaints@thencc.org.za.

Wishing you a fantastic day,

Legal Hero.

www.legalhero.co.za 

Debts have expiry dates too

Similar to the sell by dates found on your milk carton, debts have expiry dates too! This is for legal certainty and to protect debtors against old and inflated debts.

A creditor only has 3 years’ time to institute legal action against a debtor (since the last date of payment/ acknowledgment of debt). After the 3 year period the debtor may raise the special defence of prescription in court.

To avoid the debt’s ‘expiry date’ the creditor needs to:
a) convince the debtor to acknowledge the debt or make a payment towards the debt (this will cause the 3 year period to start running afresh) OR
b) take the matter to court before the ‘expiry date’ to request a judgment against the debtor (as a judgment debt is binding/ lasts for 30 years!).

We often see creditors take advantage of the debtor’s ignorance and demand immediate payment when in actual fact the debtor is able to raise the special defence of prescription in court. Technically only a court can confirm your special defence of prescription, however, most creditors will stop calling/ sending legal letters once you have correctly pointed out prescription. Should the creditors still decide to take you to court, remember to ask for a cost order against them (meaning that they should be held liable for your legal fees should your defence succeed).

Very important is that the defence of prescription is not something the magistrate/judge will bring up in court on behalf of the debtor. If you are unaware of this special defence, chances are you will end up with a court judgment against your name.

Please note that debts owed to the State in terms of taxation and/or levies are different and only prescribe in 30 years’ time (without the State having to go to court to obtain judgment against you). This means that the State has a full 30 years to claim from you debts resulting from municipal bills, TV licences and traffic fines.

Knowledge is power.  

Legal Hero.

www.legalhero.co.za

Legal Hero endeavours to not only provide quality legal assistance at an affordable monthly premium, but also legal education, so that everyone, in time, may become their own hero.

Legal Cost Insurance in South Africa

Statistics relating to the insurance spread in South Africa reveal that funeral policies, life cover, medical aid and vehicle insurance have widely been accepted as essential financial products within the insurance market. Legal cost insurance however has the smallest infiltration and many South Africans continue to perceive legal cost insurance as a luxury.

This is a regrettable misconception as the target group LSM 4 – 10, earning between about R2 829 and R30 323 a month, usually have the greatest need for legal assistance in an unfortunate economy where limited state resources are available. The income threshold for Legal Aid (legal assistance free of charge) stands at an income of less than R5 500 per month after tax has been deducted. If you form part of a household, you and the other members of the household need to earn a combined income of less than R6 000 per month after tax has been deducted in order to qualify for Legal Aid.

Falling outside the qualifying parameters for free Legal Aid (and bearing in mind that Legal Aid does not cover labour and certain family law cases), a few LSM groups are left in dire need of a legal hero.  

Without legal cost insurance the costs associated with a private legal professional may total in excess of hundreds of thousands, including a hefty consultation fee, deposit and billing per document/hour. With Legal Hero there are no excess fees when claiming and in return for an affordable monthly premium, policyholders are covered with up to R200 000 in annual litigation fees. Legal Hero policyholders furthermore enjoy basic legal advice, contracts, out of court negotiation (saving you time), accidental death cover and a family protection plan (family legally protected for 12 months after your passing). 

You cannot choose life’s battles and lawsuits, but you can choose your hero. Rewrite your story; choose Legal Hero for quality legal protection.

www.legalhero.co.za