Many Namibians continue to fall into financial ruin by signing contracts without understanding the implications of their signatures, particularly when agreeing to stand as surety.
It is for this reason that legal experts have warned the public to read before signing any contract to avoid suretyship risks.
The latest episode of The Wheels of Justice on NBC centred on this warning, delving into the delicate distinction between a witness and a surety.
Legal practitioners Andi Jamellee Janke, Tukondjeni Nanhapo and Monika Angula cautioned that people often sign documents to help a friend or witness a deal, only to discover later that they are legally bound to pay when things go wrong.
"You have the right to ask for the agreement, to take it home for you, and to go and consider it in your time. It's just unfortunate that most of the time, people don't exercise that right. People don't exercise; even when, for example, engaging with banks, people don't exercise that right. Really, they are so hungry, if I can say that. That's very sure. Yes. It's urgent. I need your help now. Can you? But you may be putting yourself in hot soup, like you said," said Janke.
Nanhapo said suretyship agreements are enforceable contracts, and ignorance of the law offers no defence.
"I would strongly advise that surety is something very serious. It's not something that someone has to take for granted or because the person is close, is a friend, or is a colleague. You are actually putting yourself in the shoes of the debtor, the person who borrowed money, the person who is going to use that particular money. And you don't want to find yourself in a situation where you are paying money that you have never borrowed. You don't even know how that money was used. So you have to truly scrutinise."
The experts further explained that both individuals and companies can stand as surety for others, but such acts should be supported by legal advice and clear authority.
Angula said, "I urge Namibia to ensure that you agree to the terms of any agreements you enter into, that you understand what you are agreeing to, and the obligations you have as a result."
The discussion also examined the remedies available when a surety is compelled to pay, including the right to recover losses from the principal debtor, though such recoveries, they warned, are often difficult and costly.