The two have become overnight celebrities with SABC, E-TV networks and radio stations falling over themselves to interview them on this ground-breaking Constitutional Court ruling.
A greatly relieved Van Zyl said it should be an eye-opener that the constitution provides some protection towards citizens. In terms of Art 26 (1) every person is entitled to adequate housing. "You can imagine, once you are thrown out onto the street (having fallen behind on your bond payments) - how slim your chances will be to ever own property again."
Ms Gundwana, assisted by the Socio-economic Rights Institute (SERI) argued that the process by which the bank had sold the property in execution, was unconstitutional because the Registrar of the High Court should not be empowered to take away ownership of a home. That function, she argued, should be reserved for a Judge, who must carefully weigh the circumstances of a case before deciding whether a sale in execution can be justified. One of the most important factors will always be the amount a bond holder is in arrears at the time the bank seeks to execute. It may not be justifiable to order a sale where the amount of the debt outstanding is very small and there are other ways to collect a debt.
Gundwana who looked smart in a tribal style beaded top, said the legal battle against losing her house began four years ago when she fell behind in her payments. She had left her job to turn her double-storey home into a ‘Bed and Breakfast’ with a bond she took out with Nedcor. She had paid intermittently, but had not realised she was accumulating interest on her debt whenever she was in arrears. It was a horrible shock when after she had made an arrangement to pay off her arrears, her house was suddenly sold off by Nedcor. It was when she had returned from Cape Town after assisting a terminally ill family member, that she was made aware of this fact, when she became aware of the imminent sale.
Fight not over
"I look after my two grandchildren who live with me, I had no intention to be evicted without putting up a fight."
An elated Gundwana said this week that she realised that the fight is not over. But having won the first round was heartening. She has to go back to the High Court to have the debt judgement against her rescinded so that the sale of her house can be reversed.
The Constitutional Court Judge J Froneman, writing for the full court held that ".. where execution against the homes of indigent debtors who run the risk of losing their security of tenure is sought after a judgment on a money debt, further judicial oversight by a court of law . . . is a must".
The Court went on to hold that while execution against mortgaged property is an ordinary part of economic life, an agreement to put one’s property at risk as security in a mortgage, does not equate to a licence for banks to sell a property in bad faith, or where it would otherwise be a disproportionate way to recover a debt.
The Court accordingly declared Rule 31 (5) unconstitutional, set aside the eviction order made against Ms Gundwana, and referred the case back to the High Court for her to challenge the sale of her home on the particular facts of her case.
Banks should be fair
Van Zyl said banks must now be on their guard to ensure that they conduct themselves fairly and constitutionally towards their mortgage customers. He is hoping that Nedcor will settle the matter out of court.
The legal battle had cost R500 000 so far, which had been funded by Seri and the Legal Aid Board who had flown them to Johannesburg where the Constitutional Court is situated.
Ms Gundwana was represented in Court by Adv Anna Marie de Vos SC and Adv Stuart Wilson (SERI’s Director of Litigation). Francois van Zyl Attorneys, George and the SERI Law Clinic, Johannesburg acted as her attorneys.
* The Socio-Economic Rights Institute of South Africa (SERI) is a non-profit organisation providing professional, dedicated and expert socio-economic rights assistance to individuals, communities and social movements in South Africa.
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"We were with our backs against the wall, but decided to give it a go," said George attorney, Francois van Zyl.
ARTICLE AND PHOTOS: PAULINE LOURENS
