Chapter 12 - Consumer Law
Consumer Rights under the Consumer Protection Act, 2008
The CPA came into effect on 1 April 2011. It sets out what the law is when consumers buy goods and/or services for cash or sign fixed term contracts. It also provides for the establishment of the National Consumer Commission (NCC), which oversees compliance of the Act by companies and service providers.
When you assist a consumer, always check the date that the contract was signed. To be able to use these laws the contract will have to be signed on or after 1/6/2007 (NCA) and 1/4/2011 (CPA). For consumers the CPA means that there is guaranteed respect and fairness when they buy goods or services, or have repairs done, or enter into gym contracts, or buy on auction. Consumers can now insist on a pre-quote for repairs, and not pay for shoddy work, return defective goods, and have goods replaced if they are repaired and remain defective. Consumers can even stop those unwanted daily calls offering loans or cellphones or insurance. And when they do not get the respect and fairness that the Act requires, consumers now have access to numerous free complaints mechanisms from existing and possibly new ombuds offices, to the new Consumer Commission which is established in terms of the Act to oversee compliance with the CPA (similarly as the National Credit Regulator oversees the National Credit Act). Consumers will also in some cases be able to have their cases referred to the National Consumer Tribunal which will hear cases in terms of breaches of both the consumer laws.
In this section some of the key rights and remedies that the Act provides to consumers are discussed. The Act is detailed and sometimes complicated, as with all laws, so if you have a specific issue, you may need to read the law itself to understand exactly what the rights and remedies are in a particular situation.
The right to privacy
Restricting unwanted communications - an ‘opt-out’ register
Consumers have the right to “opt-out” or refuse to receive unwanted sms’s, telephone calls or correspondence relating to marketing of products, by registering a “pre-emptive block” on an opt-out register which will be overseen by the Consumer Commission.
Once a person has registered, it is the responsibility of companies to ensure that these consumers are not contacted for marketing purposes.
The right to choose (including the right to choose to cancel)
Consumers can cancel a fixed term contract (for example, gym, cellphone, subscription contracts) at the end of the term. The supplier must notify them between 40 to 80 days before the term ends, of the date of termination and of any changes that would apply if they renewed the contract. The onus is then on the consumer to tell the supplier to terminate the agreement on the expiry date, or agree to renew the contract on the new terms, failing which the contract will continue on a month on month basis on the new terms.
So, it is important that consumers keep a record of when the contract ends, so that they are in control of what happens at the end of the term.
Consumers can also cancel a contract before the term has expired by giving 20 business days notice, but will be liable for “a reasonable cancellation penalty”.
The cooling-off period and cancellations from direct marketing
Consumers can cancel an agreement which they entered into as a result of direct marketing, within FIVE BUSINESS DAYS without penalty or charges with no explanation needed. If they have paid, they must be refunded in full within 15 business days of cancelling the agreement.
Cancelling advance bookings or orders
Keeping and not paying for unsolicited goods and service
Have you ever received books or Christmas cards in the post with an invoice, when you never ordered these? Or had a door salesman leave his goods with you to test out, and the company then sent you an invoice even though you never confirmed that you wanted to buy the goods?
To discourage these unethical business practices, the Act allows consumers to have unsolicited (not asked for) goods returned at the suppliers risk and expense. This includes where they received a greater quantity than they asked for (a consumer needs to pay only for what they asked).
However, goods delivered as a result of a genuine mistake are not unsolicited goods.
Where the supplier does not collect the goods within 20 business days of receipt by the consumer or the supplier being notified to collect the goods, the consumer can keep the unsolicited goods.
Not paying for damaging goods on display
A consumer is not liable for loss or damage to goods displayed by the supplier unless the consumer was grossly negligent or reckless, or their behaviour was malicious or done with criminal intent.
Getting quotes for repairs and maintenance
A supplier must provide a consumer with a cost estimate without charge, for repair or maintenance work unless the consumer turns down the offer of an estimate and authorizes the work or gives the go-ahead for charges up to a specified maximum. It is in the consumer’s interest to insist on receiving a written estimate.
A supplier may not charge more than the estimate, unless s/he has told the consumer of the estimated additional costs and s/he has approved this.
A consumer also does not have to pay for services done without their approval.
Every new or reconditioned part that is installed during a repair or maintenance contract must have a warranty of a minimum of 3 months.
The right to good quality and safety
The right to only pay for quality service and repairs
Consumers have the right to have services and repairs done “in a manner and quality that a person is generally entitled to expect”, including within good time and with proper notice of “unavoidable” delays. A consumer also has the right to expect their property to be returned in at least as good a condition as before.
Where the service or repair is faulty and not up to standard, the consumer has the choice to either insist that the mistake be fixed or that s/he be refunded a reasonable part of the price paid (“reasonable” being linked to the extent of the failure).
The right to good quality products and to return faulty goods
Consumers have the right to buy and receive goods that are good quality, in good working order and free of faults, which will last for a reasonable time, and are suitable for their intended purpose - UNLESS the consumer was told of a specific poor condition and knowing this still accepted the goods.
Where the goods do not meet the required standards, a consumer has the right to return the goods within SIX MONTHS of purchase, and have then replaced, repaired or get a refund.
If the goods are repaired, and a defect appears within a further 3 months, the supplier must replace or refund. In other words, it cannot go for repairs twice.
Warnings of risk and claims for injuries or loss caused by unsafe or defective goods
Suppliers are required to inform consumers where goods may pose a risk (as specified in the Act) including one which a consumer may not be expected to be aware of. Packagers of hazardous or unsafe goods, must also provide notices including instructions for safe handling and use.
The Consumer Commission has to oversee this so as to reduce the risk of hazardous or defective goods and substances. This oversight role includes investigating and recalling products.
A consumer can claim damages from either the producer, the importer, the distributor or the retailer of a product where the consumer has suffered harm as a result of the supply of unsafe goods, product failure, defect, hazard or failure to give adequate warnings relating to the product. “Harm” includes death, injury, illness or loss of or damage to property. The Act also allows for the consumer to claim for indirect financial loss suffered, for example, loss of income as a result of the injury.
The right to responsible marketing
Overselling and overbooking
A supplier may not accept payment for goods or services if they do not intend to supply the goods or provide the service offered.
Where a supplier commits to supplying goods or services or accepts a reservation for a specific time and date, for example, an airline ticket, the supplier is penalized if they fail to deliver on their agreement. They must then refund the consumer, with interest and compensation for costs directly linked to the breach. This does not apply if the supplier offered comparable (similar) goods or service and the consumer either accepts this, or unreasonably turns it down.
It would also not apply if the breach was due to circumstances beyond the suppliers control and the supplier took reasonable steps to inform the consumer.
Trade coupons, loyalty programs and promotional competitions
The Act sets out how promotional competitions, trade coupons and loyalty programs must be run. The , offer must be genuine and available as advertised.
Negative option marketing
A supplier may not create a sale or contract by advising the consumer that they are assumed to have accepted the offer if they do not advise that they are not taking it. Referral selling is also not allowed.
A person may not offer a consumer a rebate or commission on a purchase on condition that they assist in getting further sales, for example, by supplying names of other consumers.
Catalogue marketing - getting what is ordered
Where a consumer buys something without having an opportunity to inspect the goods, for example, by telephone or from a catalogue, s/he can refuse to accept the goods if they do not match the description in “all material respects and characteristics”.
The right to information
Prices of goods and services must be disclosed and a written record given
Prices of goods and services must be given, and in the case of goods, the price must be attached to the goods. A supplier may not charge more that the displayed price (unless it is an obvious mistake and the mistake is fixed or the consumer is informed). Where two different prices are displayed, the lower price must be charged (unless one price is completely hidden by the other)
A supplier must provide a written record of each item sold or service provided with details as required in the Act (for example, name, VAT number, address, date, description, unit price, quantity, total price).
How can consumers lodge a complaint?
As with the NCA, the Consumer Protection Act encourages consumers to first try to resolve their disputes with the company or service provider concerned. If they are not successful, they can lodge a complaint with the National Consumer Commission on 0860 266 786 or fax: 0861 515 229. Consumers can also lodge complaints with the provincial Consumer Affairs Offices: