LPL4801 ASSIGNMENT 1 SEMESTER 1 2023
, LPL4801 LAW OF LEASE ASSIGNMENT 01 2023 SEMESTER 1
UNIQUE NO.258088
(a) The main point to establish whether the National Credit Act 34 of 2005
(hereinafter referred to as the NCA) is applicable to this credit agreement
is to apply section 8 of the NCA. According to section 8(1) of the NCA a
credit agreement falls under a credit facility, a credit guarantee, and or a
credit transaction. The agreement discussed herein is that of a credit
transaction, more particular in terms of section 8(4) of the NCA, that is, an
instalment agreement.
To further qualify that the agreement is a credit transaction in the form of
an instalment agreement, under section 8(4)(c) of the NCA, the elements
of an instalment agreement should be established in the given scenario.
The elements of an instalment agreement are: whether the sale is of
movable property?, whether all or part of the purchase price will be
deferred?, whether the purchase price is paid by periodic payments?,
whether there is provision made for interest fees or fees payable relating to
the amount which has been deferred?, whether possession and use of the
property has been transferred to the consumer?, and finally, whether
ownership has been retained by the seller or it may be reclaimed on
default?
Applying the above elements to the facts in question, all elements are in
the affirmative. There is an immovable property in the form of the
Volkswagen Caddy. The purchase price will not be paid immediately but in
monthly instalments. There are 36 monthly periodic instalments to be
made. Provision is made for fees payable for the amount deferred. There
is an explicit statement that the vehicle was handed over to Thandi
immediately. There is a clause which retains ownership by Prestige Bank
until all financial obligations by Thandi under the contract have been
satisfied. Thandi is a consumer in terms of the NCA, and is protected as a
natural person. The NCA ultimately applies to this agreement.
(b) There are three possible remedies for Thandi to apply in a manner which
, LPL4801 LAW OF LEASE ASSIGNMENT 01 2023 SEMESTER 1
UNIQUE NO.258088
(a) The main point to establish whether the National Credit Act 34 of 2005
(hereinafter referred to as the NCA) is applicable to this credit agreement
is to apply section 8 of the NCA. According to section 8(1) of the NCA a
credit agreement falls under a credit facility, a credit guarantee, and or a
credit transaction. The agreement discussed herein is that of a credit
transaction, more particular in terms of section 8(4) of the NCA, that is, an
instalment agreement.
To further qualify that the agreement is a credit transaction in the form of
an instalment agreement, under section 8(4)(c) of the NCA, the elements
of an instalment agreement should be established in the given scenario.
The elements of an instalment agreement are: whether the sale is of
movable property?, whether all or part of the purchase price will be
deferred?, whether the purchase price is paid by periodic payments?,
whether there is provision made for interest fees or fees payable relating to
the amount which has been deferred?, whether possession and use of the
property has been transferred to the consumer?, and finally, whether
ownership has been retained by the seller or it may be reclaimed on
default?
Applying the above elements to the facts in question, all elements are in
the affirmative. There is an immovable property in the form of the
Volkswagen Caddy. The purchase price will not be paid immediately but in
monthly instalments. There are 36 monthly periodic instalments to be
made. Provision is made for fees payable for the amount deferred. There
is an explicit statement that the vehicle was handed over to Thandi
immediately. There is a clause which retains ownership by Prestige Bank
until all financial obligations by Thandi under the contract have been
satisfied. Thandi is a consumer in terms of the NCA, and is protected as a
natural person. The NCA ultimately applies to this agreement.
(b) There are three possible remedies for Thandi to apply in a manner which
