CREDIT AMENDMENT ACT TO ENSURE DEBTORS HAVE RECOURSE WHEN UNFAIRLY GARNISHED

CREDIT AMENDMENT ACT TO ENSURE DEBTORS HAVE RECOURSE   WHEN UNFAIRLY GARNISHED

The Acting Manager responsible for Investigations and Enforcement at the National Credit Regulator (NCR), Ms Jacqueline Boucher says the New Credit Amendment Act will ensure that debtors will have recourse in instances where they were found to have been garnished unfairly. She was speaking at the information-sharing session hosted by the Department of Trade and Industry (the dti) in Pretoria.

The purpose of the session was to share knowledge on the Emoluments Attachments Orders (EAO) or Garnishee Order judgements instituted against individuals.

According to Boucher, studies have found that the Short Term Credit sector was the most prevalent with EAO that were obtained fraudulently.

“The Act will also ensure the automatic removal of adverse consumer information after judgements have been paid up. It will also prohibit the sale and collection of prescribed debt,” she highlighted.

Boucher added that changes instituted within the NCR governance structure will lead to quick decision-making processes.

Mr Edward Ramolefe from the Johannesburg Magistrates Court said what was commonly termed Garnishee Order within public service was in fact an Emoluments Attachment Order.

“What usually happens is that a judgement creditor may cause an order to be issued from the court of the district in which the employer of the judgement debtor resides, carries on business or is employed. It is then that the judgement creditor approaches the employer to institute an EAO against the employee as ordered by the court,” added Ramolefe.

He said it was in fact the employer that was being garnished and not the employee.

“What the employer simply has to do is to comply with the order after satisfying certain verification and authentication measures,” added Ramolefe.

An EAO is preceded by a letter of demand or summons demanding payment as well as compliance with provisions of the National Credit Act.

“Upon receipt of the letter of demand the plaintiff can choose to ignore the letter, consent to the judgement, make payment arrangements or elect to defend against the order,” he said.

He added that in an instance where one is facing the reality of an EAO being instituted against them it was best to approach a law clinic for legal advice or a clerk of the court to advice on procedure.

Emoluments Attachment Orders (EAO) is defined as a court order to attach emoluments regulated by Section 65 (J) of the Magistrates’ Court Act 32 of 1944. Emoluments include, salary, wages or any other form of remuneration and any other allowances, whether expressed in money or not.