The South African Constitutional Court confirmed that a loan that is repayable on demand becomes due and, accordingly, prescription begins to run as soon as the loan is advanced to the debtor. This is because the creditor has the exclusive power to demand performance whenever they choose to do so.
However, the Court accepted that the parties may agree that demand is required to render the debt "due", thereby delaying the commencement of prescription until demand is made. The Court required a "clear indication" that this was the parties' intention, given the policy consideration that a creditor should not be able to delay prescription unilaterally.
To avoid the unintentional commencement of prescription, parties should contract expressly and unambiguously stating that the formal written demand for repayment of a loan amount shall constitute a condition precedent to the underlying debt falling due for repayment. By doing so, prescription will only commence when such formal written demand for repayment has been made.