Capitec wins over R2.1 million legal battle against company and director over unpaid loan
The KwaZulu-Natal High Court has granted judgment in favour of Capitec Bank Limited against Mountain Meadow Investments (Pty) Ltd and its director, ordering them to pay more than R2.1 million plus interest and legal costs.
Judge Robin George Mossop found that the respondents, Mountain Meadow Investments and its director, Jivesh Rajendran Pather, had failed to present any valid defence to Capitec’s claims arising from a loan and overdraft facility originally concluded with Mercantile Bank, which later became a division of Capitec.
The court heard that in August 2022, Mercantile Bank advanced Mountain Meadow Investments a loan facility of R1.8 million, repayable over 62 monthly instalments. As the company director, Pather, signed a deed of suretyship securing the company’s obligations, with his liability capped at R1.95 million.
Mountain Meadow Investments subsequently fell into arrears and stopped making payments altogether in October 2023. By February 2025, the outstanding balance on the loan had grown to over R2 million. The company had also defaulted on an overdraft facility of R150,000, leaving a further balance of R4,543.47.
“The first respondent (Mountain Meadow Investment), however, did not pay all its instalments to the applicant and fell into arrears with its obligations, which eventually reached the amount of R783, 338,23.
“The simple mathematical exercise of dividing the arrear amount by the amount of each instalment demonstrates that the arrear amount equates to approximately 21 unpaid monthly instalments,” read the judgment.
Capitec cancelled both facilities and approached the court for judgment after demands for payment went unanswered.
The respondents raised several technical objections, including challenges to Capitec’s authority to bring the application, the validity of the loan and suretyship agreements, and allegations of reckless lending under the National Credit Act. However, Judge Mossop rejected all these arguments, describing them as contrived and lacking merit.
Judge Mossop held that the agreements were properly concluded and enforceable, and that the National Credit Act did not apply because Mountain Meadow Investments was a juristic entity with assets exceeding the statutory threshold.
The court ordered the respondents to pay the outstanding amounts jointly and severally, with interest calculated at 12.5% on the loan and 22.1% on the overdraft. Meanwhile, Pather’s liability was limited to R1.95 million in terms of the suretyship.
In addition, they were also ordered to pay Capitec’s legal costs on the attorney-and-client scale.
sinenhlanhla.masilela@iol.co.za
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