Where an order was sought declaring immovable property specially executable but no facts had been placed before the court by the defendant, the court authorised the sale.

The court held that to deny an order declaring a property specially executable where the summons clearly draws a debtor’s attention to their right to lead evidence and the debtor only provides vague and unspecified facts of their personal residence, would cause significant uncertainty, and arguably serious damage to the efficient provision of credit in the economy.

FirstRand Bank Limited (FNB) provided a credit facility of R250 000 to NPGS Protection and Security Services CC (NPGS). The second defendant, Llewellyn Rwaxa (Rwaxa), who is also the sole member of NPGS, stood surety for the credit facility. The credit facility was further secured by a mortgage bond over Rwaxa’s immovable property.

FNB issued summons for judgment against the defendants jointly and severally for payment of an amount of R649 197.39 as a result of NPGS’s default, as well as an order declaring Rwaxa’s immovable property specially executable. FNB asked for summary judgment. The lower court granted summary judgment for the payment of the claimed amount and declared the property specially executable. The matter was taken on appeal.

The appeal against granting the summary judgment was dismissed. With regard to the granting of special execution, the court rules provide that the judgment debtor must be informed that before an application to attach and sell their property is heard they have a right to set out grounds of opposition to the application. The court must consider the specific circumstances of the debtor and whether there are alternative means by which the debt may be repaid taking into account whether the remedy sought meets a test of proportionality between the legitimate contractual rights of the creditor and the rights of the debtor to adequate housing in s 26(1) of the Constitution.

Rwaxa was made aware of the need to place the facts why his section 26 right to housing would be affected. His affidavit opposing summary judgment did not contain such facts and the court was only informed by his counsel in court that the immovable property was Rwaxa’s primary residence. The lower court dismissed this contention on the basis that a surety is not entitled to rely on the provisions of the National Credit Act in order to protect a primary residence in the circumstances, a finding which was overturned on appeal.

The court held that Rwaxa was not entitled to judicial oversight of the execution over the house because the credit facility was obtained as working capital for the business as opposed to purchasing his primary residence. Rwaxa had continuously and consistently refused to place before the court any relevant circumstances regarding why there should not be execution against his property despite being legally represented throughout the proceedings. The sale in execution was confirmed.

The case is NPGS Protection and Security Services CC & another v FirstRand Bank Ltd.