Pretoria - A Soweto family are set to have a joyous Christmas after their home - which was due to be auctioned - was saved by a court order.
This was despite the fact that the Thwala family do not owe the bank a cent.
Socio-Economic Rights Institute (Seri) attorney Tashwill Esterhuizen welcomed the judgment as it addressed the reality of many South Africans who had lost their homes “simply because financial institutions can play the game better”.
Delphin and Godfrey Thwala and their five children faced a bleak festive season as FNB went ahead and sold their home on public auction, despite the couple having paid the entire amount owed to the bank.
They had a home loan agreement with FNB for R54 000, this being 90 percent of the purchase price of their home, but they then lost their jobs 10 years ago.
The couple at first managed to repay the bank at monthly installments of R720, but fell in arrears when they lost their jobs.
In November 2002, FNB claimed payment of R54 000, interest at 18.15 percent and an order declaring the property to be executable.
The couple were in Mpumalanga when the summons was served, and they failed to file a notice of intention to defend.
In July 2003, default judgment was granted by the court in favour of FNB. A sale in execution was set for September 2003 but was cancelled. Another date was set but was also cancelled, subject to the couple paying half the amount they were in arrears for.
During 2003 the couple made three further payments. By mid-2004 they had reduced the arrears on their account, but the outstanding balance had increased to R60 778 (with interest and legal costs incurred).
Between July 2005 and April 2010, FNB proceeded with a sale of execution, only to cancel it after receipt of payments from the couple to reduce the arrears on the account.
The property was eventually sold by the bank in execution in 2010. By then the Thwalas had effectively repaid the entire amount due in terms of the judgment debt.
Setting aside the sale in execution, Pretoria High Court Acting Judge Andre van Niekerk said that throughout the seven years, FNB continued to operate the bond account as if judgment had not been taken. This meant that although the amounts reflected as overdue comprised only the value of installments that were not up to date, FNB continued to debit and credit the bond account as if no judgment had been taken.
“It continued to charge compound interest and add legal and other expenses to the account which were not provided for in the default judgment.
“In particular, legal costs in regard to the collection of arrears payments and the (numerous) sales of execution cancelled were debited to the applicant’s account,” the judge said.
Last year, the new owner of the house launched an eviction order against the family, but they approached Seri.
Seri’s lawyers established that by the time the house was sold, the Thwalas had in fact paid R500 more to the bank than what they owed, which they said rendered the sale void.
Judge Van Niekerk agreed and said there was no lawful basis for FNB to have proceeded with the sale in execution.