Salary Deductions to Satisfy a Judgment Debt

A judgment does not always result in immediate full payment. Courts can consider what a debtor can reasonably afford.

What happened?

In the Gqeberha Magistrates’ Court, a debtor faced two debts totalling R367,000. The court ordered him to pay R2,000 per month on each debt, making R4,000 per month in total.

The financial inquiry

The order followed a section 65 inquiry under the Magistrates’ Courts Act. The inquiry considered the debtor’s monthly income of R16,000 and expenses, including rent, cell phone and internet costs, a vehicle instalment, insurance and ordinary living expenses.

Why the court intervened

One of the debtor’s expenses was a monthly life insurance policy of R4,262. The magistrate found that this amount should be directed toward payment of the judgment debts.

Practical point

A debtor’s expenses can be scrutinised. Creditors may use section 65 proceedings to obtain structured payments where a judgment debt remains unpaid.