Landmark judgment strengthens rights of vehicle finance consumers

A recent Supreme Court of Appeal (SCA) ruling has significantly strengthened the rights of South African consumers who buy vehicles on finance, particularly in the second-hand market.

The judgment confirms that banks can be held jointly responsible with dealerships when financed vehicles are defective, misrepresented, stolen, or later found to have tampered odometer readings.

The ruling arose from a case involving a North West pensioner who signed as guarantor for her son’s financed second-hand Ford Ranger.

Within weeks, serious mechanical defects emerged, including an improperly fitted gearbox.

Despite a lawful cancellation under the Consumer Protection Act, the bank continued debiting her account and later sued her for the outstanding balance.

While she initially lost in the High Court, the SCA overturned the decision, ruling in her favour with costs and interest.

Consumer law attorney Trudie Broekmann, who led the case, says the judgment is a "game changer" that will compel banks to reassess their vehicle financing practices and their dealings with dealerships.

"That really is quite a big shakeup in the motor vehicle industry as a whole."

"I think there's going to be an increase almost in the honesty of the system, as the risk has been shifted to the correct place."

She believes the ruling will lead to stricter checks, fewer unsafe vehicles on the road, and greater accountability across the motor industry.

To listen to Trudie Broekmann in conversation with CapeTalk's John Maytham, click the audio below: