Exam (elaborations)
LPL4801 Assignment 1 Semester 2 2024 (526694) - DUE 26 August 2024
- Course
- LPL4801 (LPL4801)
- Institution
- University Of South Africa
LPL4801 Assignment 1 Semester 2 2024 (526694) - DUE 26 August 2024
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LPL4801 Assignment1 Semester 2 2024
(526694) - DUE 26
August 2024
QUESTIONS WITH COMPLETE ANSWERS
[School]
[Course title]
, LPL4801 Assignment 1 Semester 2 2024 (526694) - DUE 26 August
2024
Question
Forever You (Pty) Ltd is a well-known clothing store in South Africa. They
offer store cards to customers who buy clothing on credit and are a
registered credit provider in terms of the National Credit Act 34 of 2005.
When customers buy clothing on credit, an interest rate of 20% per annum
is charged on the outstanding amount. Judy, a customer, opens an account
on 1 May 2024 at Forever You (Pty) Ltd. Based on her salary slips and the
credit assessment performed by Forever You (Pty) Ltd, she is allowed a
credit limit of R5,000. On the same day, she spends R5,000 on new
clothes. She pays the first instalment on 1 June 2024, but fails to make any
further payments. You are acting as Forever You (Pty) Ltd’s legal
representative. It transpires that Judy has obtained legal advice from Kenny
Y Attorneys. The attorneys have addressed a letter to your client with the
following allegations: That the credit agreement between Forever You (Pty)
Ltd and Judy is a credit facility in terms of the National Credit Act 34 of
2005, and that the interest rate that is charged by your client is excessive,
rendering the agreement between your client and Judy null and void. It is
further alleged that the clothing was of bad quality and that Judy is entitled
to return the clothing in terms of the Consumer Protection Act 68 of 2008.
In the alternative, it is stated that your client entered into a reckless credit
agreement with Judy, rendering the credit agreement null and void.
(a) Advise your client in full whether the National Credit Act 34 of 2005 (the
NCA) is in fact applicable to the said agreement. (4)
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