FNB secures court victory in R2 million debt recovery case against deceased client
FNB has won a bid to claw back R2 million that a dead man owes it.
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FNB has won a bid to claw back R2 million that a dead man owes it.
The bank recently was successful in its appeal against the estate of the late Gavin Mark Baseley, after the Supreme Court of Appeal (SCA) found that there had been no valid compromise over a disputed R2 million debt.
The judgment overturned a decision by the Western Cape High Court, which had ruled that FNB’s claim had been settled.
The case involved a home loan agreement of R2.8m concluded between FNB and Baseley in March 2017, secured by two mortgage bonds.
Baseley died later that year, and his estate – administered by executrix Lourina Wilson – admitted FNB’s claim for R3.5m, which had gone up because of interest costs as well as bank charges.
In October 2021, R1.3 million was mistakenly deposited into the deceased’s loan account from Wilson’s personal property sale.
When she demanded repayment, FNB delayed responding.
On 30 November 2021, Wilson emailed the bank stating that the mistakenly paid funds would now be regarded as full and final settlement of the loan.
FNB replied the same day, rejecting the offer.
“Kindly note that there is no arrangement in place with the bank to accept the alleged erroneous payment as a full and final settlement of the indebtedness owed to the bank,” it wrote.
Despite this rejection, the bank retained the funds and allocated them to reduce the estate’s outstanding balance.
The High Court later found this conduct amounted to acceptance of a compromise.
The SCA disagreed. Justice Matojane, writing for a unanimous bench, said that “no compromise could have been reached because it was explicitly rejected.”
The court found Wilson’s later correspondence – including a January 2022 email asking the bank to “come up with a reasonable settlement”- showed she did not believe the matter was finalised.
The court also allowed FNB to supplement its court papers to show compliance with the Administration of Estates Act, which regulates proceedings against deceased estates.
The SCA found that “over seven years have passed without the estate being finalised” and that FNB, as a secured creditor with an admitted claim, had been prejudiced by delays.
The court concluded that this amounted to exceptional circumstances justifying the order allowing execution against the property.
FNB was granted judgment for R2m plus interest at 10.25% a year from 5 April 2022, and an order declaring that the mortgaged property, an 89-square-metre section in Gardens, Cape Town, could be sold to settle loan.
Wilson was ordered to pay the costs of both the application and the appeal.
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