Article written by Blake Liam Hamilton, Candidate Attorney, checked and released by Lisa Schmidt, Senior Associate at Schindlers Attorneys
06 September 2021
Clients often attend at an attorney’s office, seeking legal advice in respect to default judgments obtained against them, without their knowledge. In this regard it must be noted that judgments are frequently reported and registered with all credit bureaus, without people’s knowledge and this negatively affects a person’s credit record. As a result of being registered with these bureaus, credit providers may refuse to, inter alia, offer loans, credit, or insurance to listed persons. This article provides insight into what a default judgment curtails and how it may be rescinded.
HOW WAS A DEFAULT JUDGMENT OBTAINED AGAINST ME?
The procedures involved in obtaining a default judgment in the High Court or Magistrates Court will vary depending on the type of matter. For purposes of this article, the writers focus on default judgments in the Magistrates Court.
An attorney usually sends a person a registered letter of Demand in terms of Section 56 of the Magistrates’ Court Act 32 of 1994. This letter highlights the amount claimed and serves as an amicable instrument to resolve the dispute outside the ambit of court. The letter provides the debtor with an opportunity to satisfy the creditors claim or enter into a payment arrangement, more commonly known as an acknowledgment of debt.
In the event of a debtor fails to satisfy the claim outlined in the letter, an attorney will proceed to institute summons against the debtor and have it issued by the clerk of the Magistrates Court and thereafter have same served on the debtor, via a sheriff in accordance with the rules of the court. If the defendant resides within the jurisdiction of the court, the defendant will have 10 (ten) court days (business days) after service of the summons within which to serve and file a Notice of Intention to Defend. If the defendant fails to serve and file a Notice of Intention to Defend after 10 (ten) court days, the plaintiff is entitled to submit a request for default judgment to the clerk of the court.
In summary, default judgment means a judgment entered or given in the absence of the party against whom it is made and may be requested if:
- no notice of intention to defend the action is delivered;
- the defendant has failed to deliver the notice of intention to defend within the prescribed period;
- a defective notice of intention to defend is delivered; or
- the defendant has been barred in terms of rule 21B (3) from delivering a plea.
HOW TO SET ASIDE A DEFAULT JUDGEMENT?
South African law allows you to approach a court, on application, to rescind (set aside) the judgment that has been obtained against you. Accordingly, it is prudent to deploy an understanding of the procedures and processes to follow when setting aside a default judgment.
Rule 49 (1) of the Magistrates Court Rules, provides that a party in which a default judgment has been given, or any person affected by such judgment, may serve and file an application at court within 20 (twenty) days after obtaining knowledge of the judgment, and on notice to all parties to the proceedings, for rescission or variation of the judgment and the court may, upon good cause shown, or if it is satisfied that there is good reason to do so, rescind or vary the judgment on such terms it deems fit. Rule 49 (3) provides that this application must be supported by an affidavit setting out the reasons for the party’s absence or default and the grounds of the party’s defence to the claim.
THREE GROUNDS ON WHICH ONE MAY APPLY TO RESCIND A JUDGEMENT IN THE MAGISTRATES COURT
- The judgment debtor must have a valid defence to the claim that was not raised. In such a case, the judgment debtor must apply to have the judgment rescinded within twenty (20) days after obtaining knowledge of the judgment ;
- If the judgment debt has been settled within a reasonable time; and
- If the judgment creditor consents to the rescission;
In view of the above, it should be noted that when applying for a judgment to be set aside, it does not necessarily mean that the application will be granted. However, in the event of successfully rescinding a judgment, it is imperative to inform all credit bureaus so that the judgment may be removed from your credit profile.
If a default judgment has been obtained against you and you wish to have it varied or rescinded, it is advisable to consult with an attorney as soon as you become aware of the judgment, in order to ensure that your attorney has sufficient time to properly investigate the matter and decide on the best course of action to ensure that the judgment granted against you be rescinded.
This article provides insight into what a default judgment curtails and how it may be rescinded.
Disclaimer: Please note: this article is for general public information and use. It is not to be considered or construed as legal advice. Each matter must be dealt with on a case by case basis and you should consult an attorney before taking any action contemplated herein.
Senior Associate at Schindlers Attorneys
BLAKE LIAM HAMILTON
Candidate Attorney at Schindlers Attorneys