Apart from a director or officer of a corporation or a member of
a partnership acting on behalf of that corporation or partnership,
the Legal Practitioners Act [Chapter 27:07] prohibits persons other
than registered legal practitioners from suing or threatening to
sue on behalf of other persons. Non- legal practitioners cannot
commence any action or suit in any court on behalf of others. The
Act does not however prohibit non-legal practitioners from
collecting debts per se on behalf of other persons for as long as
such collection does not extend to the issuing of process or of any
threats of such action against a debtor. There is no statute which
regulates the operations of such debt collectors and thus there is
no statutory body or authority that monitors their activities.
Debt collection by persons who are not legal practitioners can
be viewed as an informal debt recovery procedure which does not
involve the issuing of court process. Some call it the pre-action
or informal collection stage. It is the work of an agent acting on
behalf of the creditor. The agent uses informal techniques that are
designed to enquire into the creditworthiness of the debtor and to
persuade him or her to pay and avoid being taken to court. These
informal techniques help the creditor to assess the potential of
the debtor to pay the debt and once this is ascertained the
creditor informally demands payment and if this fails, proceeds to
court to recover the debt. The techniques include the use of
letters reminding the debtor of his or her obligations and may
include a threat that the creditor will institute civil
To avoid falling foul of the law, the demand for payment at this
informal stage must be confined to content which only serves the
legitimate purpose of reminding the debtor of the obligation to
pay. It must not be calculated otherwise to intimidate or threaten
the debtor. For example the demand must not threaten the immediate
seizure and sale of property. The content of the demand should not
go beyond the legitimate purpose of drawing attention to the
existence of the obligation and consequences of non-compliance.
After the creditor has exhausted the informal recovery procedures
and has been unsuccessful he or she can then seek the services of a
legal practitioner with the details of the debtor and the
latter's creditworthiness. The legal practitioner will then act
in accordance with the client's instructions.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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In the aftermath of the financial crisis, the Basel Committee on Banking Supervision embarked on a program of substantially revising its existing capital adequacy guidelines; the resulting framework is known as ‘Basel III’.
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