NOVEMBER 2012 EXAMINATION DATE: 7 NOVEMBER 2012 DURATION: 2 HOURS PASS MARK: 40% (PP-50)

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1 DEBBUS NOVEMBER 2012 EXAMINATION DATE: 7 NOVEMBER 2012 TIME: 14H00 16H00 TOTAL: 100 MARKS DURATION: 2 HOURS PASS MARK: 40% (PP-50) DEBT COLLECTING THIS EXAMINATION PAPER CONSISTS OF 3 SECTIONS: SECTION A: CONSISTS OF: (i) 10 MULTIPLE-CHOICE QUESTIONS (20 MARKS) (ii) 5 TRUE OR FALSE QUESTIONS (10 MARKS) (iii) 5 MATCHING-STATEMENT QUESTIONS (5 MARKS) SECTION B: SECTION C: CONSISTS OF 10 QUESTIONS CONSISTS OF 3 QUESTIONS (47 MARKS) (18 MARKS) INSTRUCTIONS: 1. Read the following instructions carefully before answering the paper, as failure to act upon them will result in a loss of marks. 2. Write your answers in your answer book, which is provided in the exam. 3. Ensure that your name and student number are clearly indicated on your answer book. 4. Write your answers in either blue or black ink in your answer book. 5. Read each question very carefully before you answer it and number your answers exactly as the questions are numbered. 6. Begin with the question for which you think you will get the best marks. 7. Note the mark allocations for each question give enough facts to earn the marks allocated. Don't waste time by giving more information than required. 8. You are welcome to use diagrams to illustrate your answers. 9. Please write neatly we cannot mark illegible handwriting. 10. Any student caught cheating will have his or her examination paper and notes confiscated. The College will take disciplinary measures to protect the integrity of these examinations. 11. If there is something wrong with or missing from your exam paper or your answer book, please inform your invigilator immediately. If you do not inform your invigilator about a problem, the College will not be able to rectify it afterwards, and your marks cannot be adjusted to allow for the problem. 12. This paper may be removed from the examination hall after the examination has taken place. NOTE: FOR ADDITIONAL INSTRUCTIONS PLEASE TURN TO PAGE 2. Examiner: SAILT DAMELIN CORRESPONDENCE COLLEGE NOVEMBER 2012 PAGE 1 OF 9

2 ADDITIONAL INSTRUCTIONS 1. All references to sections and rules or the Act are, unless indicated otherwise, refers to the Magistrates Court Act 32 of 1944, as amended (MCA). 2. In this exam the National Credit Act will be abbreviated as the NCA. DAMELIN CORRESPONDENCE COLLEGE NOVEMBER 2012 PAGE 2 OF 9

3 SECTION A (35 MARKS) (i) MULTIPLE-CHOICE QUESTIONS Choose the correct option for each of the following. Write only the question number and your chosen answer. For instance, if you think that the correct answer for number 1 is, then write it as An action procedure is commenced by: letter of demand. summons. judgment. warrant of execution. 2. A letter of demand may be necessary: to place a debtor in default in respect of an obligation. to complete the plaintiff's cause of action. to give the plaintiff a right of cancellation of an agreement. All of the above. 3. A summons must be issued and signed by the: plaintiff's attorney. defendant's attorney. magistrate. registrar or clerk of the court. 4. The section 57 procedure refers to: a transfer of judgment. an admission of liability. an appearance to defend. a consent to judgment. 5. In terms of section 58, judgment can be obtained: as soon as the debtor has consented to judgement. after default of appearance to defend. only if the debtor does not comply with the section 58 undertaking. if the plaintiff does not prove the case. 6. An execution creditor must advertise a sale in execution: in all cases. only if the judgment debtor requests it. only if the judgment creditor wishes to advertise it. if the value of movable goods attached exceeds a stipulated amount. DAMELIN CORRESPONDENCE COLLEGE NOVEMBER 2012 PAGE 3 OF 9

4 7. A garnishee order attaches a judgment debtor's: salary. furniture. house. due debt. 8. When a debtor transfers his right to payment under an insurance contract to a third party as security for his debt, this is security in the form of a: lien. pledge. cession. surety. 9. In terms of the NCA, the body established to prohibit conduct contrary to the NCA is the: National Consumer Tribunal. Credit Control Office. National Credit Prosecutor. Panel of Banks. 10. In terms of section 130 of the NCA, a credit provider may not approach the court for relief unless the consumer has been in default for at least business days and at least 10 days has lapsed since the required notice [10 2 = 20] (ii) TRUE OR FALSE QUESTIONS Indicate whether the following statements are true or false. Should you decide that a statement is FALSE, you must explain why. 1. A debt in terms of an account for services rendered is an example of a liquidated sum of money due. 2. A section 65 financial enquiry can be brought as soon as judgment has been granted. 3. An attachment of immovable property remains in force until the judgment debt is paid or the property has been sold. 4. An application for a garnishee order can be brought on an ex parté basis. 5. The Magistrates Courts do not have jurisdiction to hear an action arising out of a credit agreement. [5 2 = 10] DAMELIN CORRESPONDENCE COLLEGE NOVEMBER 2012 PAGE 4 OF 9

5 (iii) MATCHING-STATEMENT QUESTIONS Match the statements in Column B to the statements in Column A. Write down the answers only, for example 1.. Column A Column B 1. simple summons limit of R district Magistrates Courts mediation and arbitration 3. judicial supervision to take place debt or liquidated demand 4. exempt from attachment judgment debtor's home 5. dispute settlement under NCA (e) necessary beds, bedding and clothing of judgment debtor [5] [35] DAMELIN CORRESPONDENCE COLLEGE NOVEMBER 2012 PAGE 5 OF 9

6 SECTION B (47 MARKS) QUESTION 1 Define each of the following terms: a debtor who is in mora (2) a nulla bona return of service (2) a debt counsellor in terms of the NCA (2) [6] QUESTION 2 What is required in order for the plaintiff to rely on the ground of jurisdiction that 'the whole cause of action' arose within the court's district? [3] QUESTION 3 List six supporting documents needed in order to request judgment in terms of section 57, when the action is based on a liquid document. [6] QUESTION 4 What type of judgment can the plaintiff obtain after serving a summons on the defendant, if the defendant does not defend the matter? (1) To whom will the plaintiff apply for judgment in such a circumstance? (1) If the plaintiff's claim is for an unliquidated amount, will the clerk of the court be empowered to enter the judgment? Support your answer. (3) [5] QUESTION 5 Does the sheriff immediately remove attached goods from the judgment debtor's premises? Explain. (2) When must a sale in execution be stopped? (1) What must be done with any balance of moneys left after the judgment debts have been satisfied from the money raised in a sale in execution? (2) [5] DAMELIN CORRESPONDENCE COLLEGE NOVEMBER 2012 PAGE 6 OF 9

7 QUESTION 6 What is the purpose of a section 65 enquiry? (1) At which Magistrates Court is the section 65 A(1) notice lodged? (2) Explain the procedure used to enforce a judgment of the High Court in the Magistrates Court in terms of section 65 M. (4) [7] QUESTION 7 What is an emoluments attachment order? (2) Which Magistrates Court has jurisdiction to grant such an order? (1) Name two parties that must be notified by registered mail of an impending emoluments attachment order. (2) How much commission may be recovered by the garnishee for his or her services in terms of the order? (1) [6] QUESTION 8 Explain the difference between personal security and real security. [2] QUESTION 9 In detail, explain how the NCA defines a consumer who is over-indebted (section 79 of the NCA). [4] QUESTION 10 You sue Leonard for a debt based on a cheque, which is a negotiable instrument. A period of 4 years has lapsed since the debt was due. Leonard raises prescription as a defence. What does this mean? (1) Has the debt prescribed? Give a reason for your answer. (2) [3] [47] DAMELIN CORRESPONDENCE COLLEGE NOVEMBER 2012 PAGE 7 OF 9

8 SECTION C (18 MARKS) QUESTION 1 Simon hands you an acknowledgement of debt. He wants to sue the debtor, John, for the R owing. Simon lives in Pretoria. John lives in Randburg and works in Sandton. The acknowledgement of debt states that the debt is payable 'on demand'. What needs to be done to complete Simon's cause of action? (1) What can Simon do in order to bring his claim within the jurisdiction of the district Magistrates Court? (1) Does the Sandton court have jurisdiction to hear the matter? Give a reason for your answer. (2) [4] QUESTION 2 Identify the type of security that would apply in the following circumstances: Vuyo rents out a room in his flat to Belinda. Belinda is in arrears with rental for two months for the sum of R She has left a microwave in the room she rented. No agreement was entered into between the two as far as security for any debts. (2) Kate borrows R from Isaac. As security for the debt, Kate's father signs an agreement stating that he will pay the debt if Kate doesn't. (2) [4] QUESTION 3 Raymond has installed wooden window frames and a deck for Mark Jones. Mark Jones owes Raymond R for the job. Raymond lives in Alberton. Jones lives in Randburg and conducts a business from offices in Sandton. Does the regional Magistrates Court have jurisdiction to hear the matter? Give a reason for your answer. (2) Does the Alberton court have jurisdiction to hear the matter? Give a reason for your answer. (2) Can the summons be served on Jones's son, aged 13, who is living at home with him? Support your answer. (2) How can the sheriff serve the summons at Jones's home or offices, if he keeps the house and office closed and prevents the sheriff from serving the summons on him? Give one option for service. (2) DAMELIN CORRESPONDENCE COLLEGE NOVEMBER 2012 PAGE 8 OF 9

9 (e) After judgment, the sheriff attaches Jones's movables. Jones's girlfriend claims that the computer, which the sheriff attached, is hers. If Raymond rejects her claim, what type of summons must the sheriff issue? (2) [10] [18] Section A: 35 marks Section B: 47 marks Section C: 18 marks TOTAL: 100 MARKS DAMELIN CORRESPONDENCE COLLEGE NOVEMBER 2012 PAGE 9 OF 9