Debt: How to claim prescription in practice and how to enter a special plea

[Citizen X]

I’m not one to bask in my own glory and I’m not doing so right now!

[“I don’t need to have NO ambition, you know, I only have one thing that I’d really like to see happen, I’d like to see mankind live together Black, White, Chinese and anyone!”]


I’m merely reflecting with the benefit of hindsight. When I posted my first thread on extinctive prescription I was acutely aware that prescription strictly and only could be raised as a defence in court by way of a special plea.



I coined the phrase ‘extinctive prescription claim'(I need to qualify this before my detractors take a bite at me.)When I say I coined the phrase I mean claiming prescription directly from the creditor and/or their attorney as opposed to raising it as a special plea in court,’

I went through a process of literally arguing this concept with many CEO’s of banks and other financial institutions(have tons of emails to prove this). My premise was simply that if you demanding payment and if one has a comprehensive answer such as ‘the debt is prescribed and even if you do sue out summons, your action will dismally fail and you will be wasting the court’s time.’ It was the idea of completely resolving a matter before it even reaches the judicial process.

If one looks at the internet record, there were very few articles or writing on extinctive prescription and its benefits to debtors before 2011. In stark contrast the internet is literally saturated with articles on extinctive prescription today.
The power of TFSA created great awareness about extinctive prescription.
Shortly after 2011, I made written submissions to the South African Law Reform Commission about the amendment of the Prescription Act in favour of debtors, for the recognition of an ‘extinctive prescription claim,’ that day has arrived. I just didn’t apply my mind properly to which Act should be amended. As it were the NCA was amended

Originally posted by Vanash Naick 26 September 2012
This work will address the practical position of extinctive prescription claims in South Africa today. It will address the ease alternatively the difficult of claiming extinctive prescription in terms of section 11(d) of the Prescription Act 68 of 1969. It will reveal shortcomings in industry and the Prescription Act itself and perhaps more importantly it will make recommendations for the amendment of the 1969 Act. This work in and of itself is an impassioned plea to the South African Law reform commission to initiate the amendment of the 1969 Act. The purpose of such recommended amendments is to make the Act more meaningful and applicable to a debtor who is eligible for an extinctive prescription claim and simply wants to claim extinctive prescription.

26 September 2012 http://www.theforumsa.co.za/forums/s...ial-plea/page2 #12

Originally posted by Vanash Naick 26 September 2012
1. Many financial institutions and major retailers don’t have rules, regulations, policy and procedure in place to process extinctive prescription claims;
2. Many financial institutions and major retailers cannot appreciate the difference between an extinctive prescription claim and a special plea of prescription;
3. Many debt collectors and attorneys acting on instruction of financial institutions and major retailers intentionally preclude a debtor from claiming extinctive prescription and engage in unethical conduct to get a debtor to unwittingly make a payment on a debt that would otherwise be eligible for an extinctive prescription claim. The debtor then unwittingly acts to his/her own prejudice by causing the prescription period to run afresh
4. Many debt collectors and attorneys acting on instruction of financial institutions and major retailers intentionally preclude a debtor from claiming extinctive prescription and engage in unethical conduct to get a debtor to unwittingly acknowledge debt that would otherwise be eligible for an extinctive prescription claim. The debtor then unwittingly acts to his/her own prejudice by causing the prescription period to run afresh
26 September 2012 http://www.theforumsa.co.za/forums/s...ial-plea/page2 #12

I feel vindicated that section 126B has been inserted to the NCA by way of amendment:



Sale of prescribed debt prohibited; collection of prescribed debt prohibited



The National Credit Amendment Bill 19 of 2014 has been signed into law.
Seeing that I don’t ‘google’ my Legislation or Bill[I obtain them from official sites], I’m confident that the following is highly accurate:

126B.Application of prescription on debt
(1)
(a) No person may sell a debt under a credit agreement to which this Act applies and that has been extinguished by prescription under the Prescription Act, 1969 (Act No. 68 of 1969).
(b) No person may continue the collection of, or re-activate a debt under a credit agreement to which this Act applies-
(i) which debt has been extinguished by prescription under the Prescription Act, 1969 (Act No. 68 of 1969); and
(ii) where the consumer raises the defence of prescription, or would reasonably have raised the defence of prescription had the consumer been aware of such a defence, in response to a demand, whether as part of legal proceedings or otherwise.
[Proposed amendment: S. 126B to be inserted by s. 31 of Act 19/2014 w.e.f. a date to be proclaimed]

It’s this last part of section 126B that I need to look into:

[Proposed amendment: S. 126B to be inserted by s. 31 of Act 19/2014 w.e.f. a date to be proclaimed]

It's the 'with effect from a date to be proclaimed,' that I'm looking into. Has section 126B taken effect? If so when? If not when?

The credit goes to TFSA (and rightfully so), without which none of this would have even had been possible.

I therefore owe a debt of gratitude to Dave for giving autonomy with this thread.