Landbank overcharged interest on trusting farmers; Court Ruling

In its judgement today the honourable Judge WRC Prinsloo of the North Gauteng High Court has ruled that the Landbank exerted compounded interest from its clients instead of simple interest and thereby overcharged the farmers on their loan accounts. The co

Mr Polla Wheplton an expert in interest calculations, has recalculated the discrepancies on the farmers accounts and Mr Schalk Botha, the attorney representing hundreds of farmers, have been working on Landbank related matters for many years . “We knew we had a good case, but every time the Landbank settled the matter before we could get to trial and obtain a judgement” said Mr Botha. “Although there are hundreds of farmers that were overcharged by the Landbank we couldn't get a judgement because the Landbank settled every time”.

Landbank also filed special pleas of prescription in certain matters (accounts that have been repaid by farmers more than 3(three) prior to the date the summonses had been issued), but the court ruled that they failed to prove same.

Well known economist, Mr Dawie Roodt, testified that he could not find any market related reasons why the Landbank increased interest rates “out of the norm”. The only “plausible” reason was that the Landbanks profit margins and balance sheet came under pressure, partly because of alleged mismanagement, and the Landbank increased their interest rates to “make more money” according to Roodt. “We were very fortunate to have had the insights of Dawie in court to explain the workings of the financial markets” said Botha.

There could still be hundreds of farmers that feel aggrieved about the way their interest calculations were conducted by the Landbank. The total claims against the Landbank may eventually run into the hundreds of millions of rands.