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Unfair, unreasonable and unjust contract terms and the Consumer Protection Act

Article written by Tian de la Rey (Labour, Consumer Protection & POPI Legal Advisor SEESA)

When stipulating the terms and conditions in the contract and/or agreements between suppliers and consumers the Consumer Protection Act clearly stipulates in Section 48 that unfair, unreasonable and unjust contract terms are strongly prohibited.

The Consumer Protection Act 68 of 2008 was drafted and implemented to ensure that South Africa establish a legal framework that ensures social and economic welfare for consumers. In its objective (Section 3) the act emphasises the importance to protect the consumers of the unfairness of the past and to ascertain that consumers will benefit from the act.

In section 48 it should be noted that all agreements and/or contracts should entail terms and conditions which offers a price as well as terms for the consumer that is reasonable, just and fair. These obligations are inflicted on the suppliers to ensure that both the supplier and the consumer benefit from the contract, agreement and/or transaction. A contract that does not
stipulate the price and/or obligation on the consumer will be unreasonable.
No contract, agreement or transaction can be of such nature which requires a consumer to waive any rights; to assume any obligation and/ or waive any liability of the supplier. No contract can entail clauses which stipulate that the consumer will be held liable for the negligence of the supplier or let the consumer waive his/her rights and remedies when agreeing.

To ensure that all suppliers meet the requirement of no unreasonable, unjust or unfair terms in any contract and/or agreement, it takes the following into consideration with reference to the contract and/or agreement:

  1. That the contract and/or agreement favours the supplier and/or any other person more than the consumer;
  2. The terms of the agreement are too unfavourable for the consumer;
  3. That the consumer relied upon a false/misleading statement and as the statement was misleading it has an adverse effect on the consumer;
  4. That the terms were not explicitly brought under the attention of the consumer and are now unfair to the consumer.

With the above mentioned in mind, it is of utter importance to ensure all suppliers see to it that their contracts and/or agreements are in simple and understandable language to prevent any consumer from alleging that there was a false and/or misleading term in the contract and/or agreement.

Contact your nearest SEESA office to ensure that all agreements and contracts meet the obligations as set out in the Consumer Protection Act.

Resources:
The Consumer Protection Act

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