Friday, 26 December 2014

Ignorantia Juris Non Excusat - Ignorance of the Law Excuses No One

(First Published in New Era Newspaper - 13 August 2014)

Dear Consumer Court,

I was very upset today when I received an SMS message informing me that I had a debt with the City of Windhoek and that I should please make a plan to pay. They gave a reference number as well as a bank account number and requested I pay at least a minimum of N$ 100.00 as part of a payment plan. I do not know of any outstanding account with CoW so contacted the number given on the SMS. The debt collection company informed me that they have been given all the debtors of CoW and they have me with an outstanding account for ambulance services. Unfortunately they did not seem to have the date of the account but were very insistent that I should start paying at least a small amount to get the debt settled. After going through my own records, I found that I had gone to hospital over 8 years ago and this could be the only time that I could have used an ambulance of CoW. My question is, “Can the debt collection company still force me to pay as they say they will put my name on the blacklist if I do not?”

I have never received an account from CoW since the incident and had no idea that they were putting me on their blacklist. I am now also worried that CoW will not allow me to open a water and electricity account etc. until I pay the debt.

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One of the readers of Consumer Court contacted me the past week complaining about a debt of over 8 years old that she was now being forced to pay. The debt collection company had informed her that she had the outstanding account for ambulance service from the City of Windhoek and if she did not pay, they would be blacklisting her name.
I contacted the debt collection company and was quite speedily assisted in getting in contact with their manager. After explaining the situation, the manager told me that the CoW had given them the debtors book, but had not provided them with the dates from which the debt originated. I immediately realised this was a tricky situation, whether on purpose or not, I do not know.
I have previously written about old debt and the fact that most debtors are not aware that a debt that is older than three years can be defined as prescribed debt.
According to the South African Prescription Act 68 of 1969 - which is also valid in Namibia, a debt is prescribed when the debtor is no longer liable for it. The “tricky” thing about this law is that the consumer must first know about this law to be able to raise the Prescription Act as a defence. A well-known quote states that “Ignorance of the law excuses no-one”.
I have previously researched this law and found very little assistance from regulatory authorities, and even less from the debt collectors that should be aware of this law. Even worse to me is that there is no debt counselling services of any note anywhere in Namibia that can assist the financially illiterate consumer.
So how does prescription work? If after three years, a consumer realises that a creditor wants to collect the debt, but they (the debtor) has not acknowledged the debt nor has a court of law summoned the debtor, the consumer can apply for prescription. (Please note that this is also valid if you have not paid any amount on the account for at least three years.)
As the consumer, you must inform the creditor (or debt collector) that the amount owed is prescribed and they are therefore not able to insist upon payment. For legal purposes, the consumer must also raise the case for prescription with the courts by sending a registered letter stating that they believe the debt has prescribed. It is very important to note that no-one can do this for you. Only the consumer can raise a case of prescription.
To put it in plain English: If you have an unpaid account that is older than three years since your last payment and the creditor has not tried to collect this debt, then your debt has become prescribed and you no longer are responsible for the account. Be aware, that the court may dismiss your case for prescription if you fail to prove that the statement was paid or that a summons was not provided.
Read that last sentence again! If you have made a payment (even after 3 years) the account becomes valid and you are liable to repay the creditor.
In our case this week, the consumer contacted me before making the payment of N$ 100 and can now insist that her debt has become prescribed and she is no longer responsible for the debt.
This week I must say shame on the City of Windhoek (and other unscrupulous debt collections) that know the debtor is no longer liable for the debt under prescription, but they trick them into making a small payment again which now keeps the debt alive.
In this case, ignorance of the consumer is blessedness for the creditors.

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