Melting the Darkness Volume 1 Issue 2
South African Consumer Protection
PRESCRIPTION OF DEBT Prescription aims to bring finality to any dispute. In terms of the Prescription Act 1969 a person who is owed money has three years in which to institute legal proceedings to collect that debt, failing which the debt is “prescribed and no longer due. Before paying any money to a creditor it is important to check whether or not the debt is A client of Melting the Darkness received an attorney’s letter stating that the client owed the creditor a sum of prescribed. money. The letter was challenged on the basis that the debt was in fact prescribed and that the client would be claiming such prescription. The attorney responded that the creditor had instructed the attorney to close the file and that no further action would be taken. The saving to the client was in excess of R89,000.
If you have made any payments in the last three years, you have broken the prescription period. However if you have not made any payments and the creditor has not taken any legal action against you, that debt is no longer legally due.
A number of attorneys, especially those with large call centres, buy up debt from creditors and then collect for their own account. Many of these debts are actually prescribed. They know it, but work on the premise that you do not.
© Malcolm Larsen 2011