Tacit responsibilities assigned to the drafter of a credit agreement by the National Credit Act 34 of 2005 with particular emphasis on contractual consensus: A critical analysis

Abstract

The National Credit Act 34 of 2005 came into full operation on 1 June 2007, effectively replacing the Credit Agreements Act 75 of 1980 and the Usury Act 73 of 1968. The main aim of this piece of  legislation is to prevent the granting of so-called “reckless credit” to consumers, and in doing so protecting consumers from credit which may be, or may become, unmanageable. However, the act has placed some heavy responsibilities on certain areas of the law, especially the law of contract. The reason for this is that the relationship between the grantor of credit and the recipient thereof is almost entirely governed by contracts. If the recipient of credit enters into a contract, the contents which he or she is oblivious or uncertain of, it would not be too bold to state that consensus would be lacking in such a case, and no valid contract would come into existence. This article aims to identify specific obligations placed upon the drafter of a contract of credit specifically by the National Credit Act, but also exposes some problems that may arise from the Act, as far as consensus as prerequisite for a valid contract is concerned.