LPL4801 Assignment 1 2025 Due 29 August 2025

LPL4801 Assignment 1 2025 Due 29 August 2025

LPL4801 ASSIGNMENT 1 2025
DUE 29 AUGUST 2025

Question
Patricia concludes a written agreement for the purchase of a free standing Jacuzzi from
Luxury Pools (Pty) Ltd on 1 June at her home. The purchase price of the Jacuzzi is
R52, 000 which is payable in twelve equal monthly instalments. The agreement also
makes provision for Patricia to pay interest at 18% per annum to Luxury Pools (Pty) Ltd
in respect of the deferred purchase price and that ownership of the Jacuzzi shall be
retained by Luxury Pools (Pty) Ltd until Patricia satisfies all her financial obligations
under the agreement. At the time of conclusion of the contract the repo rate is 7% and
the prime rate is 10.5%. The Jacuzzi is delivered to Patricia on 2 June. Patricia
approaches you for legal advice on 10 June. She explains that although she can afford
the Jacuzzi she has changed her mind and no longer wishes to continue with the
agreement. She also informs you that she paid the first instalment on 2 June and would
like to claim back this instalment. It appears that Luxury Pools (Pty) Ltd did not do a
proper credit assessment prior to the conclusion of the agreement.

(a) Advise Patricia on whether the National Credit Act (“the NCA”) is applicable to
the agreement.

The National Credit Act (NCA) applies to the agreement between Patricia and Luxury
Pools (Pty) Ltd if it constitutes a credit agreement as defined in section 8 of the NCA.
The agreement is an instalment agreement under section 8(4)(c) of the NCA because it