Blog Post

Know your consumer rights: terms to look out for when contracting with suppliers

Why is the Consumer Protection Act important?

The Consumer Protection Act, Act No. 68 of 2008 (“the CPA”) is a landmark Act in South African statutory law as it is directed at the protection of consumer interests. As stated in the CPA itself, the purpose of the CPA is “to promote and advance the social and economic welfare of consumers”. Courts and tribunals are obliged to be mindful of this purpose when adjudicating matters brought in terms of the CPA.

Who is protected by the Consumer Protection Act?

A “consumer” under the CPA includes natural persons and small business enterprises which have “entered into a transaction with a supplier in the ordinary course of the supplier’s business”, unless the transaction is specifically exempt under the CPA.

It is important to note here that the CPA does not apply where goods or services are not supplied “in the ordinary course of business”. Therefore, the protection afforded by the CPA would not extend to agreements with private, non-professional sellers (like Johannes from Gumtree who sold you his “barely used” Bakkie from 1987).

How does the Consumer Protection Act help me?

In terms of the CPA, consumers are afforded various rights, one of the most important being the right to just and reasonable terms and conditions. In order to give effect to this right, Section 51 of the CPA sets out a list of terms and conditions which suppliers are no longer permitted to include in their contracts. Despite this, however, suppliers often incorporate prohibited clauses into their standard terms and conditions. Examples of terms to look out for are:

Exemption and limitation clauses – 

Traders and manufacturers often purport to exclude or limit the risks, obligations or liabilities imposed on them by the CPA. For example, traders might purport to exclude liability for harm or economic loss caused by a defective or unsafe product supplied by them. Here, suppliers avoid liability by creating the impression that you are legally bound by the terms of the contract which you have signed. This prevents you from taking action against them when, in fact, you have the right to do so.

No-representation clauses – 

Suppliers often reinforce their apparent lack of liability by requiring buyers to sign an acknowledgement that the supplier concerned did not make any false representations or warranties in respect of the goods or services before and at the time the contract was concluded. These terms are incorporated so as to ensure that aggrieved customers do not later attempt to hold suppliers to a prior representation or warranty made by them regarding the characteristics, standard or quality of their goods or services. These terms deceive customers into believing that they cannot insist that products or services be delivered as previously described or of the standard or quality advertised.

Waivers – 

Another way for suppliers to safeguard their interests is to require consumers to waive (forfeit) rights granted to them by the CPA. For example, a supplier might include a term stating that you waive your right to a refund, repair or replacement of defective goods or services. This is to create the illusion that, simply because you signed a contract, you can no longer enforce your rights under the CPA and thus have no way of holding the supplier accountable.

The contract terms and conditions described in Section 51 are strictly prohibited.

However, suppliers often times do not comply with the CPA as they can generally rely on the fact that most consumers either do not know their rights, or believe their rights to be unenforceable.

The truth is that these terms are prohibited regardless of whether or not you have signed the supplier’s contract. Inevitably, should the issue come before our Courts, any prohibited term or condition in a consumer contract will be considered void and will be severed from the rest of the contract.

How can I enforce my consumer rights?

The first step should always be to resolve the matter either by approaching the supplier yourself or by appointing an Alternative Dispute Resolution Agent. If both fail, the next port of call is to lodge a complaint with the Consumer Ombudsman or the National Consumer Commission. If necessary, the matter will then be referred to the National Consumer Tribunal for adjudication.

Failing that, seek legal advice.