Navigating the Consumer Protection Act 68 of 2008

December 1st, 2014
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By Neels Coertse

The Consumer Protection Act 68 of 2008 (CPA) came into force on 1 April 2011. It is here to stay and it regulates the relationship between a supplier of goods and/or services to a consumer. It therefore applies to services rendered by attorneys.

The full impact of the CPA is set to be massive but stands to be developed to the full in time.

It created the following nine fundamental consumer rights:

  • The right of equality in consumer market (s 8 – 10).
  • The consumer’s right to privacy (s 11 – 12).
  • The consumer’s right to choose (s 13 – 21).
  • The right to disclosure and information (s 22 – 28).
  • The right to fair and responsible marketing (s 29 – 39).
  • The right to fair and honest dealing (s 40 – 47).
  • The right to fair, just and reasonable terms and conditions (s 48 – 52).
  • The right to fair value, good quality and safety (s 53 – 61).
  • The supplier’s accountability to consumers (s 62 – 67).

Impacts on civil procedure and fundamental rights protected and enforced by various entities

The CPA impacts drastically on civil procedure in the widest sense of the word. Life was ‘simple’ under the old dispensation – there were more or less only the courts and arbitrations to contend with.

In summary these fundamental rights are protected and enforceable by –

  • the National Consumer Commission;
  • the National Consumer Tribunal;
  • consumer courts;
  • consumer protection groups;
  • an ombud with jurisdiction;
  • an accredited industry ombud;
  • a person or an entity providing conciliation, mediation or arbitration services; and
  • the courts.

It is beyond the scope of this article to discuss how these entities will protect and enforce these rights.

Impacts on the rules of legal interpretation and the principle of stare decisis

The crisp rules pertaining to legal interpretation and consequently the principle of stare decisis are fundamentally re-written in that the Act prescribes how it may be interpreted or applied (s 2(1) and (2)).

When the CPA is interpreted or applied, a person, court, tribunal or the commission may consider the following –

  • appropriate foreign and international law;
  • appropriate international conventions, declarations or protocols relating to consumer protection; and
  • any decision of a consumer court, ombud or arbitrator in terms of the CPA, to the extent that such a decision has not been set aside, reversed or overruled by the High Court, the Supreme Court of Appeal or the Constitutional Court.

We surely can learn a lot from the international community on how to protect consumers against exploitation by suppliers. But the converse is also valid in that suppliers will also benefit from foreign and international law, conventions, declarations or protocols.

It is of some concern that the CPA seems to allow the decision of one decision making body to have some influence on another, or even on an ombud or an arbitrator. While it is uncertain how this will meet with the approach of one judgment of a particular court not binding another (see Hollington v F Hewthorn and Company Limited [1943] 2 All ER 35) the cross implementation of such findings will likely create uncertainty, unpredictability and unreliability, these being the very essence of the stare decisis principle (as was again expressed in Afrox Healthcare BPK v Strydom 2002 (6) SA 21 (SCA) at 40E) as it is unsure how every individual court, ombud or arbitrator will interpret and apply the CPA in a manner that is consistent and sustainable.

Freedom and sanctity of contract replaced by constitutional contractual model

The classical theory of freedom and sanctity of contract between a supplier and a consumer has been replaced by the constitutional model enshrined in the CPA and, so it seems, only applicable between a supplier and a consumer.

The exceptio doli have been revived

The Appeal Court, as it then was, delivered the death knell to the exceptio doli and Joubert AJ delivered the obituary in Bank of Lisbon and South Africa Ltd v De Ornelas and Another 1988 (3) SA 580 (A) in these very strong words: ‘All things considered, the time has now arrived, in my judgment, once and for all, to bury the exceptio doli generalis as a superfluous, defunct anachronism. Requiescat in pace’ (see 607B) (my emphasis). However, it has been revived (see: Section 40 (unconscionable conduct); s 48 (unfair, unreasonable or unjust contract terms) and reg 44 (the blacklisted terms and conditions, which are presumed not to be fair and reasonable).

The opening words of the Afrox case are enlightening to say the least: ‘Is ’n kontraktuele beding wat ’n hospitaal teen aanspreeklikheid vir die nalatigheid van sy verpleegpersoneel vrywaar, geldig en afdwingbaar? Dit is die kernvraag in hierdie appèl.’ In 2002 the court held that it is valid and enforceable. With the advent of the CPA in 2011, I am of the opinion that in light of ss 40, 48 and reg 44(3)(a), it would in all probability be held to be invalid and unenforceable. These sections and regulation would also strike at the heart of even the De Ornelas case.

Impact on five common law principles

In the article ‘The Consumer Protection Act and Five Common Principles’ by Sarah-lynn Tennant and Vuyokazi Mbele (2013 (Jan/Feb) DR 36) it is pointed out that the following common law principles were severely impacted on by the CPA:

  • Caveat subscriptor.
  • Freedom to contract.
  • Passing of the risk rule.
  • Parol evidence rule.
  • The voetstoots clause.

Impacts on the procedural and substantive fairness in respect of the enforcement of consumer rights

The impact was also investigated in another article by L Hawthorne ‘Public Governance: Unpacking the Consumer Protection Act 68 of 2008’ (2012) 75 THRHR 345. He discusses inter alia:

  • procedural fairness –

–        information obligations;

–        unconscionable conduct;

  • substantive fairness –

–        right to fair, just and reasonable terms and conditions (the general terms);

–        absolutely prohibited terms, conditions or transactions (the blacklisted terms); and

–        terms and conditions presumed to be unfair (grey listed terms and conditions).

Impact of plain language

Section 22 requires that a document or visual representation should be in plain language. There is no definition of ‘plain language’ in the CPA. What then does it mean? Section 22(2) gives us a hint as to what it might be –

‘… a … document or visual representation is in plain language if it is reasonable to conclude that an ordinary consumer of the class of persons for whom the … document or visual representation is intended, with average literacy skills and minimal experience as a consumer of the relevant goods or services, could be expected to understand the content, significance and import of the … document or visual representation without undue effort …’.

The reasoning behind ‘the plain language’ phenomenon is that the reader should –

  • easily find what he or she needs;
  • understand what is written; and
  • use the information easily.

Is it applicable to statutes? I would argue and say more so, especially in a statute that enshrines that very right. That being the case let us randomly apply it to the CPA. I submit that it fails miserably for the following reasons:

  • It is voluminous: There are 122 sections.
  • These 122 sections are extremely complicated to circumnavigate. It is divided into seven Chapters, which are in turn subdivided into various parts.
  • It is difficult to ascertain and understand which sections were amended, restricted or extended. It is cumbersome hard reading and really requires undue effort.
  • The transitional provisions are clearly beyond the average consumer (see: Section 121 and schedule 1 and 2).
  • Accessing the string of amended statutes in schedule 1 is beyond the capabilities of the average consumer. I wonder how many of my colleagues would be able to access these statutes.
  • The average consumer should be able to decipher the extent of the application to pre-existing agreements (see: Paragraph 3 of schedule 2). The reader is confronted with a table and a long list of sections and subsections in the CPA.

I suggest that the CPA is neither plainly understandable nor easily accessible to the average consumer or even to me as a privileged seasoned educated consumer.

The preamble to the CPA states categorically that ‘… apartheid and discriminatory laws of the past have burdened the nation with unacceptable high levels of poverty, illiteracy and other forms of social and economic inequality …’. It follows that these very consumers will be at a loss as to how this statute grants them relief – it is once again left to lawyers to assist these unfortunate consumers.

It is entertaining to read articles about the plain language phenomenon. When the authors get going it becomes very academic and is completely off the mark and no longer written in plain language. So, the question remains? What is meant by plain language?

Conclusion

RH Christie The Law of Contract 5ed (Durban: LexisNexis 2006) at 12 states that the De Ornelas case ‘… has been justly criticised for its positivist and over-scholarly method of historical reasoning and absence of an in-depth discussion of general policy considerations or the responsibility of a court to ensure justice …’. I suggest that this critique applies to the Afrox case.

This Act sets the record straight – if you can circumnavigate your way through the maze of chapters, parts, sections, subsections and regulations.

Neels Coertse BIur LLB (UJ) is an attorney and notary at CJ Coertse Attorney in Johannesburg.

This article was first published in De Rebus in 2014 (Dec) DR 27.

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