Debt: Legally cancelling a debt over 3 years old

[Citizen X]

1. Are debt collectors hounding you by post and/or telephone for debts older than 3 years?
2. Law students at an advanced stage of LLB studies have a legal way based on the law to have such debts cancelled!!!!!
3. You will be provided with a letter stating certain sections of a certain Act that you can either post, email or take personally to the debt collector or the creditor i.e. bank or store
4. The law offers you a duel guarantee a) The creditor is obligated by law to cancel the debt, b) The creditor does not cancel the debt but sends you summons, this very act will become your defence
Eg.On 1 August 2008 you entered into a cell phone contract with xyz cell phones. You pay until 1 July of 2009, and then for whatever reason, you stop paying, The creditor has from 1 July 2009 up to and including 1 July 2012 to collect this debt from you failing which the debt can be cancelled by following a specific legal procedure.

Invitation to take part in a survey: Fill in PDF questionnaire
1. Preliminary research that I have conducted has demonstrated that many people are unaware of their rights regarding extinctive prescription claims. I have also established that certain creditors don’t have policy documents on extinctive prescription. I further established that there is a great deal of uncertainty from both debtors and creditors as to how extinctive prescription should be claimed and whether there is a difference between an extinctive prescription claim and a special plea of prescription. There is also unpredictability as to how a creditor may respond to your your claim. It doesn’t help to have a law and that law doesn’t work!!!!!
2. I believe that a section should be added to that act which places a lawful obligation on the creditor to process a debtors prescription even where the debtor has done so telephonically and confirm the same in writing.

[Modise]

Hi Viny,

What happens when a debt is bought from the creditor by the so called debt collectors? Does the 3 year period apply from the original date of debt or from the date of purchase by the debt collector? Not sure if i make sense.

[Dave A]

It seems this is what you get for your R400.00:

3. You will be provided with a letter stating certain sections of a certain Act that you can either post, email or take personally

Or you could send them a link to this thread.

[Citizen X]

Hi Modise,

It applies from the original date of debt! It is imperative that I make the following clear: The Act/legislation/statute applicable is the prescription act 68 of 1969. That being said, the creditor will not make you aware of this and will try and trick you so that the prescription period can start all over again. The most common ways they do this, is to get you to acknowledge the debt, i.e. say that you unemployed and will pay someday. Prescription will then run from the date you state this, also, if you make arrangements to pay, prescription will be interuptted and run from that date.
Bear in mind there is a very specific legal way to claim prescription!!! The fee mentioned includes not only giving you this very specific legal letter but also saving this letter as a pdf file on a disc for you so that you can also email it as an attachment. In all the cases we dealt with, the creditor immediately cancelled the debt and updated there records.

[Citizen X]

Hi Dave,

The following is given:-
1. A Detailed letter claiming prescription in terms of the Prescription Act;
2. The letter saved as a pdf file on a disc so that you can also email it as an attachment to the creditor
3. Attorney's normaly charge R2000 for this service, but becuase we are law students our price is reduced

[Modise]

Thanks Viny.

[Mr Capo]

Hi Viny.
I sold my house when I was in financial distress almost 4 years ago and was left with a shortfall amount. The bank never attempted to collect this and I am sure this over the 3 year period. If I use your services and letter could this debt be cancelled.

[Mr Capo]

If a debt collector attempts to "trick" you into a new prescription period can you use your letter to still cancel the debt?

[Citizen X]

Indeed you can! Most commonly, the creditor via an attorney will attempt to get you to acknowledge debt or make payment arrangements. Whilst these factors do cause prescription to start all over again, it is a material fact that debt collectors such as mbd, vvm, norman bisitetc donot record their telephone convesations and the person who phones you is not an attorney!

[Dave A]

If anything that has prescribed arrives in writing, just write the word Prescribed in bold letters across the statement/bill/demand/whatever and post it back to the sender.

If it's a phonecall, tell them to send you a letter setting out their claim. Then refer to the first paragraph.

[Look02]

Viny

(1)My house was repossessed in 2008 and got evicted same year. I found a new job and try to apply for new bond with different bank in November-2010; only to find out my house was never sold. Last month the bank promised to evict the people that are currently occupying the property but the interest will not be written off because the sale did not proceed. Since more than 3 years has passed, and the bank never contacted me, can i use your letter to write off interest which accumulated 4 years ago since i was under the impression that the Bank sold the property?

(2)I had credit card with “xyz” bank and stop payments in 2007 (no job no income). I found new job and open new savings account with same bank in 2010. Somehow they managed to link the credit card to my savings acc (online). Last month (November 2011) i start receiving emails from collectors demanding 2007-2011 payments with 40% discount option. I have not used the credit card in nearly 5 years and destroyed it. Can your letter help when account is still active (activated without my permission) but never used?

[Citizen X]

Hi there,

Firstly, It’s more of a legal document than a letter that I provide. It is drafted specifically to apply to your individual situation as it not only includes the actual prescription claim with references to the relevant sections, sub sections, paragraphs and sub paragraphs of the Act but also relevant case law of the Supreme Court of Appeals that apply to your specific situation.
1. With regards to your house, regrettably, the prescription period for a bond is 30 years!;
2. With regards to your credit card, yes, the prescription period of 3 years does indeed apply and I can draft a legal document for you to claim prescription for this debt and therefore have the debt cancelled. Fortunately for you a credit card is not regarded in law as a ‘negotiable instrument’ ‘bill of exchange’ or ‘promissory note’, as the prescription period for these is 6 years.
I’m bases in Lenasia, South of Johannesburg. I normally prefer personal consultations, but if this is not possible because of your geographic location I can do business with you via email.
Bishop.consultants@gmail.com

[magiclifestyle]

This is such valuable information especially if someone has been lured into unaffordable debt as happened extensively prior to the NCA.

[Dave A]

i start receiving emails from collectors demanding 2007-2011 payments with 40% discount option. I have not used the credit card in nearly 5 years and destroyed it.

I tend to be suspicious of this sort of debt collection call, particularly when they are offering a discount option upfront. Generally this is because they know that they are on shaky legal ground.

Worse still, it could be a debt collection scam.

[Citizen X]

When does a debt become due

Section 12(1) of the Prescription Act provides that: “Subject to the provisions of subsections (2) and (3), prescription shall commence to run as soon as the debt is due.”
1. This important determination of when the debt actually becomes due is fairly straight forward. A prescription claimant needs to show in the claim that prescription has started to run as at a certain date;
2. This is also important where a defendant raises a plea of prescription, that is where, the creditor still takes the matter to court;
3. “In Gerike v Sacks 1978 (1) SA 821 (A) par 827-828, the court decided that when the defendant raise the plea of prescription, the onus is on the defendant to prove his defence and to prove the date when the plaintiff acquired actual or deemed knowledge required in terms of subsection (3) of “the identity of the debtor and of the facts from which the debt arises”
4. The time when the prescription runs depends on the creditor‟s knowledge of his right against the debtor. The rules determining when prescription begins to run in respect of various kinds of debt are all subject to the general requirement that the creditor should have knowledge of the identity of the debtor and of the facts from which the debt arises. Knowledge of the identity of the debtor for practical purposes means sufficient information for a process-server to be able to identify the debtor by name and address. The creditor must in fact know the debtor‟s identity, although knowledge of such facts will of course be relevant in determining whether the creditor exercised reasonable care to establish the debtor‟s identity. ;
5. To conclude, if a creditor sends you statements, if your details are on their computer systems then the creditor is deemed to know the identity of the debtor. The debt will become due and payable when an instalment or payment is not made, eg X takes out a credit card with abc bank in January 2007 for an amount of R50 000. He uses this entire amount by June 2007, he continues to make payments up to and including 30 November 2007 and then for whatever reason makes no further payments. The debt become due and payable 30 December 2007. The creditor then has 3 years to collect this debt, sue out summons or get an acknowledgement of debt failing which a prescription claim can be submitted as at December 2010. One must bear in mind that prescription does not take place automatically!!!