Tania Broughton reports on IOL :

Debt-ridden South Africans could find themselves caught in the middle of a legal dispute in which Nedbank is seeking an urgent High Court interdict against a Durban-based debt counsellor.

The bank says Johan Erik Juselius, of Fidelity Debt Counselling Services, is acting contrary to the National Credit Act in applying to magistrate’s courts for debt restructuring orders, without it and other creditors being given a say in court.

But Juselius is adamant that this is just a “bully boy” tactic and the bank is only trying to protect its own interests and not those of its many clients who cannot pay their debts.
He also says that, on the bank’s own version, the debt restructuring environment “is in disarray” and Nedbank’s staff are inexperienced at handling debt reviews.

He also argues that should the bank succeed in its interdict application against him, it will drag out what should be a cost-effective and speedy process, further prejudicing those in debt.

Under the Act, which came into effect in 2006, debt counsellors are appointed to help financially strangled consumers to restructure their debt.

The interpretation of how this is to be done has become controversial, with differing interpretations being used for processes to be followed once a debt counsellor deems a consumer to be “over-indebted”.

The differing interpretations are the subject of a declaratory order pending before the Transvaal Provincial Division.

The major banks say that debt counsellors, when applying for debt restructuring orders before magistrates, must move a proper application, notifying all creditors and setting down a hearing at which they can present their case.

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