sale-in-execution - eviction - rescission application - North Gauteng High Court

SERI represents a Soweto family of 7 people in a rescission application challenging a default judgment against them and the sale-in-execution of their home. The Thabethe's* bond account went into arrears after both the husband and wife lost their jobs in 2002. Thereafter, First National Bank (FNB) obtained default judgment against them in August 2003, and then entered into payment arrangements with them in terms of which the bank undertook to stop the sale in execution subject to the Thabethes making further payments towards the bond. On receiving these further payments, FNB stopped the sale in execution and continued to run the bond account as if it had never obtained a default judgment. Seven years later, the bank reneged on its agreement and proceeded to sell the property in execution without first approaching a court for leave to do so. In February 2012, the new owner launched an eviction application against the family (SERI is representing the family in this case as well).

SERI is applying to set aside the sale of the property on three grounds -

1. First, because of a typing error in the application for default judgment, which was replicated in the order, the default judgment does not include a prayer declaring the property specially executable. We argue that the sale was void for this reason alone.
2. Second, the Thabethes had satisfied the default judgment by the time execution was levied. By our calculations (which FNB does not seem seriously to dispute), we paid about R500 more than the total value of the default judgment plus interests and costs to FNB between the date on which summons was issued, and the date on which the sale took place. That, we submit, also renders the sale a nullity. FNB, on the other hand, says that it was entitled to execute on a range of other interest charges and legal fees run up on the bond account it kept operating between 2003 and 2007. We say that those charges never formed part of the default judgment, we were never summonsed for them, and that they have never been proved. FNB was accordingly barred from executing on them.
3. Third, we say that, even if the bank theoretically had the right to execute, to do so was disproportionate, and accordingly a violation of the Thabethes' rights of access to adequate housing. Here we rely on the Gundwana judgment, which declared that it is unconstitutional for a Registrar of a High Court to grant an order authorising special execution against a person's home. Gundwana applies retrospectively, subject to us being able to show that a court would not have ordered execution in 2003, and explaining why we did not bring the application to set aside the sale earlier.

The matter was heard on 22 July 2013. On 12 December 2013, the High Court handed down judgment, declaring the sale-in-execution null and void.

The Thabethes then approached the High Court to have them re-registered as the owners of their home. On 10 February 2016, the Gauteng Local Division ordered that the couple be re-registered as owners. This meant that the people to whom the Thabethes’ home was sold never became the lawful owners of the house, and that the title deed to the Thabethes’ home had to be put back in their name.

• Court checks banks over home debts, op-ed by Mbekezeli Benjamin and Lwazi Mtshiyo, Mail and Guardian (29 April 2016).
• SERI press statement (11 February 2016) here.
• High Court judgment (10 February 2016) here.
• SERI press statement (13 December 2013) here.
• Judgment (12 December 2013) here.
• Heads of argument (6 April 2013) here and practice note (6 April 2013) here.
• Notice of Motion and Founding Affidavit (22 May 2012) here.

*At the family’s request, its name has been changed to preserve its privacy.