Bank 'double-dipping' case a first for SA
In a case due to come before the Eastern Cape High Court this month, Standard Bank is accused of double charging the arrears amount owed by a mortgage client, resulting in a guest lodge being repossessed and sold at auction for a fraction of its market value, says a Moneyweb report.
Guest lodge Homewood in Albany in the Eastern Cape was repossessed in January 2017 after falling R833 000 in arrears on an outstanding loan of R3.77m.
The lodge owner is now asking the court to compel Standard Bank to provide a detailed breakdown of its arrears calculation, which he says was grossly overstated and resulted in him losing the lodge. He says he was forced to approach the court after the bank had failed to respond to several requests for this information.
Standard Bank replies that the case has no merit, and has already been decided in its favour by the court. What is unusual about this case, notes Moneyweb, is that Homewood has accused the bank of ‘double dipping’ or charging twice for the same thing.
This is believed to be the first time this has been argued in a South African court, though similar cases have been decided in favour of banking clients elsewhere in the world.
The bank is asking for the case to be dismissed with punitive costs, saying the allegations are speculative and unsupported by evidence.
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