CONSTITUTIONAL CHALLENGE AGAINST COURT RULES GOVERNING SALES IN EXECUTION OF IMMOVABLE PROPERTY

Today, Lawyers for Human Rights appeared before the High Court in Pretoria on behalf of Mr Given Nkwane to declare unconstitutional Rule 46(12) of the Uniform Rules of Court insofar as it requires the sale of a person’s home to be conducted without a reserve price.

In this case, Mr. Nkwane’s house was sold in execution for R40 000.00 without reserve, where the market value of the property was at R380 000.00. Consequently, with his house sold for such an extremely low amount, Mr. Nkwane is left without a home and paralyzed by the considerable outstanding debt to the Bank, which he laments the unlikelihood of ever extinguishing within his lifetime.

The fact that a reserve price is not mandatory for sales in execution as well as the lack of judicial oversight over these processes have led to substantial consequences for the judgment debtor, including those with constitutional implications. It is in this vein, that LHR welcomes the amendments by the Rules Board which are in line with the relief sought by Mr Nkwane and takes seriously the need to balance both the rights of Debtors and Creditors alike. Although the new Rules have yet to be implemented, it is encouraging that in future, the property rights of debtors are safeguarded in a volatile economy.

The current provisions of Rule 46(12) unfortunately do not assist Mr Nkwane and many others who had their homes sold in execution prior to the proposed amendments of the Rule. Therefore Mr Nkwane’s case remains relevant and a just and equitable determination by the Court imperative.

The South African Human Rights Commission appeared as Amicus Curiae and presented argument in favour of Mr Nkwane and further stated that the court should consider foreign jurisprudence in deciding whether a minimum reserve price in relation to sales in execution should be mandatory.

Judgment is reserved.