The application of the at arm's length principle in terms of the National Credit Act 34 of 2005

Abstract

Arm s length is an idiomatic English phrase which refers to a metaphor that uses the human body as a measure. The hand is not directly joined to the body, it maintains an undeniable distance from the body, equivalent to the length of an arm. In this sense, the metaphorical meaning of being at arm s length means to be at a certain distance, not too close and not too far away. The expression is often used in contract law, and a contract concluded between parties at arm s length will ensure that the parties are independent and on equal footing when concluding the agreement. The National Credit Act applies to every credit agreement between parties dealing at arm s length . Arm s length is a novel concept in the South African credit vocabulary and not defined in the Act. This mini?dissertation therefore discusses the theoretical and practical application thereof in terms of the National Credit Act.