The right of credit consumers to surrender the goods in terms of the National Credit Act 34 of 2005

Abstract

The National Credit Act (“NCA” or “Act”) has been hailed for its robust protective measures that seek to protect consumers entering into credit agreements with credit providers. The manner in which the Act protects consumers is multifaceted, however, the scope of this study is limited to the provisions of section 127. Pertinent is the extraordinary right of a credit consumer to cancel credit agreements specified in the Act and to rid himself of the goods forming the subject of the particular agreement through the surrender of such goods. Thus, the section 127 right permits the termination of the credit agreement in advance, before the date agreed on in the agreement for its termination and entails several benefits for the consumer. The provisions of section 127, which afford substantive and procedural protection to credit consumers, curtail the right of credit providers under the common law to seek recourse on the basis of repudiation of the contract by the consumer. Section 127, and in particular its procedural protection measures such as the question how notices in terms of the section must be brought to the consumer’s attention, came up for judicial scrutiny on several occasions. The dissertation, with the focus on the provisions of section 127 and the protection it affords to consumers, inter alia in respect of the alleviation of over-indebtedness and the prevention of contractual default, identified lacunae in the National Credit Act