The Constitutional Court is expected to hand down judgment today on the validity of processes followed to grant Emolument Attachment Orders (“EOAs”) These are special types of orders, sometimes incorrectly referred to as “Garnishee orders” by the public, which allow a creditor to attach a portion of a debtor’s salary and have deductions made automatically every month, before the salary is even paid to the debtor.
In recent times the process that was historically followed for the granting of such orders has caused some controversy, as it has been uncovered that unscrupulous micro lenders and debt collectors have been able to abuse the system to such a degree that debtors, often the poorest of the poor, are left with virtually no salary after the EOA installments have been deducted. In July last year, the University of Stellenbosch Legal Aid Clinic won a major victory for the victims of such abuse in the Western Cape High Court, where Judge Desai found the EOA process to be deficient in a number of ways. He also ordered the investigation of a certain firm of debt collectors for unethical conduct.
This matter has headed to the Constitutional Court for confirmation that certain provisions of the Magistrates Court Act are invalid. If the Court upholds the earlier judgment today, it will be a major step towards clamping down on unscrupulous and cut-throat debt collectors and micro lenders.