Concourt judgment sets precedent for indebted

THE CONSTITUTIONAL Court has handed down a landmark judgment (University of Stellenbosch Legal Aid Clinic and Others v Minister of Correctional Services and Others, CCT 127/15) delivered by Judge Raymond Zondo relating to the judicial management of emolument attachment orders (EAO).

These are called garnishee orders in ordinary legal parlance. An EAO is a court order that compels a debtor’s employer to pay his or her debt from their salary.

The fundamental change is that a garnishee order involving compulsory deductions from an employee’s salary can no longer be made by a clerk of the court, it must be made by a magistrate.

Also, the magistrate is mandated to apply two tests.

First, whether it would be just and equitable to grant the EAO and second, whether the debtor is able to afford it.

Concourt upheld seven of the eight rulings made by Judge Siraj Desai of the high court in Cape Town at an earlier time this year.

The difference between the two judgments related to section 65J(2) of the Magistrates’ Court Act, which was held to be in conflict with the constitution.

In his judgment, Judge Desai called for the relevant legislation to be amended as it did not make provision for judicial oversight to be extended for the granting of a garnishee order to the debtors themselves.

This would require the redrafting and amendment of the legislation, by its nature, a time-consuming process.

To circumvent this, Con- court decided to use the mechanism of adding words in order to make the legislation constitutional.

The net result of the addition of words was to protect the rights of economically disadvantaged persons by giving them access to justice.

This important change came into operation on the handing down of the judgment, so it is no longer necessary to refer the problematic provisions of the legislation to Parliament for it to reformulate and redraft them.

But the provisions are not retrospective.

Neither did the judgment exonerate the debtors. What it does is determine what amount is just and equitable in the cir- cumstances.

Creditors who lend recklessly will not be able to recover the owed amounts expeditiously as they did before Concourt handed down its landmark judgment.

Under the old garnishee order, the economically disadvantaged were grossly exploited by unscrupulous credit providers.

The Stellenbosch University Law Clinic deserves to be lauded for having initiated the litigation.

This also applies to Odette Geldenhuys of Webber Wentzel Attorneys, who acted as pro bono attorney for applicants who initially brought the case in the high court in Cape Town last year.

This important judgment, which will affect tens of thousands of workers, has been widely welcomed, since it will ensure that the collection of debt takes place in a more just and equitable manner.

In his judgment, Judge Zondo ruled that the amount to be deducted had to be appropriate.

It remedies a situation where in the past, mainly illiterate workers found themselves in the invidious situation where their salaries were considerably reduced by deductions in effect without their real consent or understanding of the amount involved and related circumstances.

Workers are now given a meaningful measure of protection since previously they did not know exactly where their money was going and how much was involved.

There is no doubt that the judgment has set a precedent for indebted persons.

The previous garnishee system was not only unjust, it had negative political consequences for the social and economic stability of our country, for instance, it contributed to the grievances of the platinum miners at Marikana, resulting in a catastrophic tragedy.

What is now required is for organisations such as the SA Human Rights Commission, the National Credit Regulator and relevant state departments to educate the public of their rights in terms of, inter alia, Concourt’s judgment.

It is also necessary that the relevant legislation be amended to bring it in line with the changes effected by Concourt in its judgment. George Devenish Emeritus professor at University of KwaZulu-Natal

Under old garnishee order, poor exploited