Debt: Legally cancelling a debt over 3 years old

[Dave A]

I've got a sneaking supicion in most of these cases where debt collectors are trying to collect prescribed debts (which seems to be ridiculously popular nowadays) the only response is going to be a deafening silence

[Citizen X]

That's exactly right! The creditor's and their agents are actively pursuing prescribed debts. They capitalise on consumer ignorance of their prescription right and how such right should be invoked. They simply looking for ackwoledgement of debt, payment arrangements and by doing so they keep the prescription period running and have recourse to the courts as well purely because prescription has not yet been claimed and ackowledged.

[Citizen X]

Update:
1. since we have revised our strategy by not only preparing prescription documents, but also serving them on the creditor or their attorney's we've obtained much better results!

[Citizen X]

Update:
I did encounter one client who was not at all happy with our service but due to no fault of us!
To elaborate, whenever a client procures our services, and we prefer personal face to face consultations, We summarise the Prescription Act in laymans terms. We especially emphasize that there are certain events that can interrupt or delay prescription. We make it a point of stating that you must not have acknowledged debt or made payments.
I explained this to client X. Cleint X assured me that he didn’t acknowledge debt. We serve his prescription papers on the creditor in person, via email and via registered post. The creditor replies via post and email and includes the clients acknowledgement of debt in writing 1
This is what it said, “ Yes, I do owe you the money, but I’m unemployed. I lost my job. What do you expect me to do. Where must I get the money from.”
This is a legally valid acknowledgement of debt. Prescription will start to run a fresh from the date on that letter. Don’t make this mistake.

[Dave A]

Great to hear business is good, Vanash

[Citizen X]

Thanks Dave, business is good but also very time consuming. I have not lost sight of the fact that I'm in my late 30's, I left work a few years ago to study law, I don't have employees, I have colleagues which I have to share the proceeds with. My main priority remains obtaining this LLB degree(which has been swea, blood and tears thus far) and being an evangelist!

[Citizen X]

What does “stay’ prescription mean?

1. Stay is just a legal word for delay;
2. Besides events that cause prescription to run afresh such as acknowledgement of debt and actual payments to that account, there are certain events that will not cause prescription to run afresh but rather delay prescription. Let me explain.
3. One factor which will cause prescription to stay is when you are outside the Republic of South Africa i.e. overseas;
4. To illustrate. Mr X takes a personal loan of R20 000 from xyz bank in January 2008. He pays diligently for 6 months up to and including June 2008. He then stops paying for whatever reason. In principle the creditor xyz has 3 years from the date that the debt became due to collect that debt before it prescribes and we’ve addressed that prescription never takes place automatically, you need to claim for prescription i.e. submit a prescription claim. In this example the debt would be due and payable on 30 July 2008, so on the 30 July 2011 the debt becomes eligible for a boa fide prescription claim.;
5. Mr X is aware of this and intends to submit a prescription claim. BUT Mr X has travelled extensively during this period, in 2009 he went to the USA for 3 months, in 2010 he went to Canada for 2 months and in 2011 he went to work in Britain for 4 months and as such his credit bureau reports have been updated and now show that he was employed by leech company. In practice prescription is now “stayed for 9 months, the total of the months that he was outside the country. So we need to add 9 months to the original prescription period before it prescribes. The debt will effectively be eligible for a prescription claim on 30 April 2012;
6. A meticulous creditor will pick this up on the credit bureau, it is standard practice for a creditor to first check the credit bureaus to see if the debt is still listed before they will even entertain a prescription claim;
7. No xyz has an astute attorney Mr Snake. Mr Snake picks up that Mr X was overseas and now requests a copy of Mr X’s passport to essentially prevent the prescription claim from ever taking place and the creditor loosing such money;
8. In my opinion(only my humble opinion!) I would argue that it is unreasonable based on the reasonable man concept of law to request a personal document from Mr X on the following basis: 1: The creditor is not the judiary who by way of a court order can demand a passport; 2: the credit is not the executive(police force) who by way of a search warrant can seize a passport; 3: the creditor is not an international country who in terms of international law can indeed seize a passport holder’s passport should such a person commit a crime on their territories which includes oceans, rivers and water ways; and 4: The credit is not a South African customs/airport official who can indeed seize a passport for example drug smuggling etc.

[Dave A]

In my opinion(only my humble opinion!) I would argue that it is unreasonable based on the reasonable man concept of law to request a personal document from Mr X on the following basis: 1: The creditor is not the judiary who by way of a court order can demand a passport; 2: the credit is not the executive(police force) who by way of a search warrant can seize a passport; 3: the creditor is not an international country who in terms of international law can indeed seize a passport holder’s passport should such a person commit a crime on their territories which includes oceans, rivers and water ways; and 4: The credit is not a South African customs/airport official who can indeed seize a passport for example drug smuggling etc.

And I would argue that the debtor is obliged to release the passport for examination as a previous attempt to contact the debtor had been met with a response that the debtor was currently overseas.

At which point the old passport is "lost" and a new passport is tendered

[Citizen X]

Dave, that is absolutely brilliant! I was in a real impasse here that was notoriously difficult to negotiate around. You have essentially provided a very simple solution to a rather complex and drawn out legal dilemma for the prescription claimant!

[Dave A]

Not that smart if the debtor might need the visas in the lost passport one day.

There are also other avenues of enquiry.
A persistent creditor's lawyer might also pursue tax returns - a claim for an overseas allowance might embarrass.
Credit card records and bank statements too.

Quite hard to wander overseas without leaving any trail at all.

If there was a collection call, and the creditor was told the debtor was overseas, and there's enough money on the table, you might expect more requests.