Reverse-mortgage interest uncapped pre-death; SARS customs forms effective today

Regulation Gazette 12019 (Government Gazette 54939) carries six notices. Most urgently, R.7656 amends SARS customs and excise rules to introduce mandatory SAD 509 customs worksheet forms for electronic submission, effective 3 July 2026. Three bargaining council collective agreements are extended to non-parties: R.7652 extends the Furniture Bargaining Council's amending agreement (new minimum wages until 30 April 2028); R.7653 extends the Motor Ferry Industry Bargaining Council's agreement (R600/month wage increases over two years); and R.7655 extends the SARPBAC main collective agreement for road passenger transport until 31 March 2027 — all binding from the second Monday after publication. R.7654 publishes an application by the Contract Cleaning Industry Bargaining Council to vary its scope to cover eight provinces (excluding KZN), with a 30-day objection window. R.7651 invites comments on proposed continuation and increase of statutory levies on lucerne seed and hay for 2026–2030, with comments due by 17 July 2026.

A credit provider advanced a R300 000 reverse (lifetime) mortgage to an elderly borrower. Under the agreement, no repayment was due during the borrower's lifetime; the full settlement value — principal plus capitalised interest — became payable only on death. By the time the borrower died, the balance had grown to R1 322 223,32. The executors of the deceased estate resisted enforcement, arguing that the in duplum rule capped total interest at the principal amount throughout the life of the loan.

The court held: The court held that s 103(5) NCA caps interest only from the date of default, and that no default arose during the borrower's lifetime because nothing was yet payable. Pre-death interest was therefore uncapped. Post-death, the cap applies but is measured against the unpaid balance of the 'principal debt' (R300 000), not the closing balance swollen by capitalised interest. The common-law in duplum rule does not operate in parallel with s 103(5) to cap pre-default interest on NCA-governed agreements. The court also held that cession of the mortgage bond to an SPV did not transfer the personal claim, preserving the credit provider's standing, and that s 129 NCA notice was not required because the sole repayment event (death) had occurred and there was nothing to cure or reinstate. The property was declared specially executable with a reserve price of R3 200 000.

Legal impact: This is the first reported judgment addressing the in duplum rule for reverse/lifetime mortgages under the NCA. It establishes that where a credit agreement defers all repayment to a single future event, no 'default' arises before that event and interest accrues uncapped in the interim. The ruling directly validates the commercial model underpinning equity-release lending. However, the court expressly flagged that the law is 'presently in motion' and a higher court may reach a different conclusion — either by interpreting s 103(5) differently or by developing the common law. The judgment also clarifies that capitalised interest does not enlarge the 'principal debt' for purposes of the statutory cap, consistent with Oneanate and Sekunjalo. The standing analysis — that cession of a mortgage bond to an SPV as security does not transfer the personal claim — is relevant to securitisation structures generally.