It has told a Cape Town court considering the constitutionality of processes surrounding the administration of EAOs that magistrates need to consider the size of EAOs in relation to the salaries they’re taken from to provide effective judicial oversight and protect human rights.
Friend of the court
The SAHRC has joined as a friend of the court, an application brought by the University of Stellenbosch’s Legal Aid Clinic (LAC) in the Western Cape High Court, that seeks to have sections of the Magistrate’s Court Act (MCA) dealing with debt collection declared unconstitutional.
Although not recommending a hard-and-fast cap, SAHRC’s advocate Jason Brickhill suggested a red flag should be raised when the EAO exceeded 30% of the debtor’s salary.
Limits on EAOs are common in other countries – in the US, the cap is 25%; in Australia it’s AU$447 (R4 063).
Flemix & Associates, a firm of attorneys administrating EAOs and one of the respondents, said it “strongly supports the idea of a cap”, but submits, to work effectively a national EAO register must first be drawn up.
“While being sensitive to the possible improvement of the EAO system by the legislature, Flemix & Associates contends the present system is not unconstitutional,” its principal, Alanza Flemix-Jordaan, said in a statement.
The LAC says the MCA is unconstitutional because it does not insist on magisterial oversight of EAOs.
So clerks of court process EAOs without regard to the effect on the borrower – an infringement of the constitutional right to dignity where excessive deductions are made.
Piet Louw SC, representing Flemix, argued judicial oversight was exercised when the magistrate handed down judgment, which occurred before the EAO was issued. Insisting on judicial oversight again on issuance was unnecessary, Louw argued.
He insisted that, in issuing an EAO, the clerk did nothing other than put into effect the magistrate’s judgment.
Brickhill had argued earlier a second one was needed when the EAO was finally granted, as circumstances might have changed.
Brickhill also suggested magistrates’ courts should assess the following: the circumstances in which the debt was incurred (ie whether or not it was reckless); previous attempts to repay the loan to date; evidence of the income and expenses of the debtor; and whether there were any other EAOs imposed.
Louw submitted that prior to a “rule change” by the justice minister in July 2014, clerks of court were allowed to issue judgments. So judicial oversight was not historically a requirement of the Act and no changes were now required.