Section 12A: Nullity of contract
consolidated text (as at 2007). juris shows the text as it was consolidated; it does not confirm that this is the law in force today.
12A. Nullity of contract
A contract for money lending shall be null and void where—
(a) at the time the money was lent, the moneylender was not in
possession of a valid moneylender’s licence;
(b) the security taken for the money lent consists of the principal
residence of the borrower; or
(c) the value of the security taken, in whatever form, exceeds the
value of the amount borrowed by more than 50 per cent; or
(d) any agreement, including a notarial deed or a deed under private
signature, is entered into by a person carrying on the activity of
a moneylender, without being in possession of a valid moneylender’s licence, which creates a reconnaissance de dette.
[S. 12A inserted by Act 10 of 2002; amended by s. 24 (3) (b) of Act 2 of 2007 w.e.f.
7 March 2007.]