According to the common law rule and legislative guidelines that regulate mora interest, Sarah can be liable for the total amount of R11 500 as claimed by the attorneys for XYZ Panel Beaters.
Mora interest is a type of interest that is accrued on a debt when the debtor is in default of payment. In this case, Sarah failed to pay the outstanding amount after receiving a letter of demand from the attorneys. As a result, she entered into default, and mora interest started to accrue from the date of the letter of demand.
The attorneys were well within their rights to institute a claim and obtain a default judgment against Sarah in the Magistrate's Court. The total amount of R11 500 includes the original judgment debt of R10 000, the accrued mora interest on the outstanding amount, and the costs incurred by the attorneys in pursuing the claim.
Therefore, Sarah is legally obligated to pay the full amount of R11 500 to settle the debt. It is important for her to address this matter promptly to avoid any further legal action or consequences.
QUESTION 4
Sarah damaged her car when she drove into a pillar in the parking lot of a shopping mall. XYZ Panel Beaters quoted her R10 000 to repair the car. She accepted the quotation and paid a R5000 deposit. The car was repaired and returned to Sarah, and she, despite demand for payment from attorneys for XYZ Panel Beaters, remains in default for payment of the outstanding amount. Since the outstanding amount is a liquidated amount, interest has started to accrue from the date of the letter of demand. Sarah’s failure to pay the outstanding amount has led to the attorneys instituting a claim and obtaining a default judgment against her in the district court of the Magistrate’s Court. According to the attorney’s last letter to Sarah, she now owes R11 500, which includes the judgment debt, interest on the amount as well as costs. Sarah consults with you regarding this latest letter she has received. She wants to know whether it is possible for them to claim this amount of money from her when the initial debt was only R5000.
Instruction: Advise Sarah with reference to the common law rule and legislative guidelines that regulate mora interest.
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