LENDING MONEY TO FRIENDS IN THE SPIRIT OF CHRISTMAS

Busisiwe loaned her nephew money to buy a Christmas gift for his girlfriend. But when it came to paying her back, he wouldn’t answer her calls or open the door when she showed up at his house. AZIKHIPHI! That’s not on! Because he’s family, Busisiwe didn’t want to get the law involved, but had no choice when he kept making excuses. As a Scorpion Legal Protection member, she was able to get advice on this matter.

What does the law say?

The best way to collect the debt is to create a contract or a written promise to pay before you lend the money. This should specify:

·         The sum borrowed

·         Any agreed interest

·         The repayment terms

This way, you’ll have a legally binding document as evidence if they don’t pay. They may have a valid reason for not paying, so first find out. If you can’t come to an agreement, you can get a professional debt collector involved or take the case to the Small Claims Court if the amount is less than R15 000.

Using a professional debt collector

Getting a professional debt collector can increase your odds of getting paid: they’ll be more persistent than you would be and they are not emotionally involved. They can be expensive though, and might not be worth it for the amount you’re owed.

Going to the Small Claims Court

The Small Claims Court handles civil claims. You represent yourself, in other words you won’t need a lawyer. Before going to the Small Claims Court, the following steps should be followed: 

· Contact the opposing party in writing about your claim and ask that they pay you back and respond within 14 days. If you are a Scorpion Legal  Protection member, they can write a Letter of Demand on your behalf.

·  If they don’t respond after 14 days, report to the clerk of the court and present evidence that the written demand was received.

·  For your hearing at the Small Claims Court, you must appear in person and take all the relevant documents with you.

· The court will pass judgment.

· If you lose, you may be asked to pay any costs the opposing party may have incurred.

The way forward

Scorpion members get legal advice and assistance with such matters.