The South Gauteng High Court in Johannesburg has dismissed an application for summary judgment brought by Absa Bank Limited against a customer in a dispute over a financed vehicle, ruling that the car owner raised honest defence that must proceed to trial.
The matter concerns a 2018 Mazda 3 1.6 Dynamic financed under a written instalment sale agreement concluded in February 2021.
Absa sought confirmation of the cancellation of the agreement and the return of the vehicle, alternatively that the sheriff attach and return it, along with ancillary relief.
Absa argued that Thulani Mbucane fell into arrears on his monthly instalments and was in breach of the agreement. As of November 2023, the bank claimed he owed over R16,600. The bank subsequently cancelled the agreement, accelerated the outstanding balance and issued summons the same month.
The bank then applied for summary judgment, arguing that his plea failed to disclose a bona fide defence and was filed merely to delay proceedings.
A summary judgment is a court ruling granted without a full trial when one party demonstrates no dispute over material facts, making a trial unnecessary.
Mbucane disputed that he breached the agreement, maintaining that he honoured his monthly instalments. He claims the bank insured the vehicle on his behalf without informing him.
He argued that he was unaware he was obliged to insure the vehicle for the duration of the agreement and denied liability for the insurance premiums added to his account. According to his plea, the premiums — which made up the alleged arrears — were not part of the instalment agreement as he understood it.
The defendant further contended that the bank failed to inform him that it had insured the vehicle on his behalf and did not provide policy documents. He stated that the vehicle was involved in two collisions, but he did not submit insurance claims because he was unaware of any policy in place.
He also challenged the certificate of balance relied upon by the bank, arguing that it was insufficient to sustain the claim without a full statement of account. In addition, he denied that the agreement had been properly cancelled or that a section 129 notice had been dispatched to him in compliance with the National Credit Act.
After reviewing the evidence, Judge Lebogang Modiba reaffirmed that a defendant opposing summary judgment must disclose a bona fide defence with sufficient detail but is not required to show that the defence is likely to succeed at trial.
The court noted that while a person who signs a contract is generally presumed to understand and accept its terms, Mbucane had provided a version of events explaining the circumstances under which he signed the agreement. He stated that the dealership’s sales consultant handled the finance application and that he had no direct interaction with the bank. Although he was told the vehicle had to be insured, he believed he could cancel the insurance if he could not afford it.
Judge Modiba found that Mbucane was indeed unaware of an ongoing obligation to ensure the vehicle — and if the bank failed to inform him that it had taken out insurance on his behalf — this could constitute a legally recognisable defence, particularly given the alleged prejudice he suffered when he did not claim for accident damage.
Although the court held that the bank had complied with its obligations regarding the section 129 notice, this alone was insufficient to dispose of the matter.
Judge Modiba concluded that Mbucane had raised triable issues, especially concerning the insurance premiums and the calculation of the alleged arrears. As a result, the court dismissed Absa’s application for summary judgment and granted Mbucane leave to defend the action.
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Sinenhlanhla Masilela
iol.co.za
