Abstract

The sale in execution of immovable residential property amounts to a deprivation of property in terms of s 25(1) of the Constitution. Since no law may permit arbitrary deprivation of property, it is necessary to ensure that the law of mortgage foreclosure also avoids this unconstitutional result. The principle is that a deprivation of property will be arbitrary if there is ‘no sufficient reason’ for such an interference with a debtor’s property. If residential property is sold in execution despite the fact that there are alternative ways to achieve the mortgagee’s purpose (namely, debt enforcement), the resultant deprivation will be arbitrary, since there is no sufficient nexus between the purpose of the deprivation and the effect that it has on the individual debtor. The need to scrutinise mortgage foreclosures on a case-by-case basis is especially important in the poverty and justice context, since the forced sale of and eventual eviction from the home will often cause or exacerbate the debtor’s socio-economic hardship. Based on the subsidiarity principles, it is argued that the requirements of s 25(1) can be fulfilled through the correct interpretation and application of the National Credit Act’s debt relief mechanisms — especially debt rearrangement — to the degree that they serve as viable alternatives to sales in execution.