FINE PRINT IN CONTRACTS

There is a trend in our courts not to enforce the provisions contained in fine print on written contracts.

In the case of Mercurius Motors vs Lopez 2008 (3) SA 572 (SCA) a motor car repairer was found to be liable for the theft of a customer's motor vehicle. The facts were that the customer signed a contract which contained certain provisions printed in inconspicuous and barely legible fine print that exempted the repairer from liability for the theft of the customer's vehicle.

This view is has now been formalised in Section 49 of the newly promulgated Consumer Protection Act which reads as follows:

 49. (1) Any notice to consumers or potential consumers, or provision of a consumer agreement that purports to—

(a) limit in any way the risk or liability of the supplier or any other person;
(b) constitute an assumption of risk or liability by the consumer;
(c) impose an obligation on the consumer to indemnify the supplier or any other person for any cause; or
(d) be an acknowledgement of any fact by the consumer, must be drawn to the attention of the consumer in a manner and form   that satisfies the formal requirements of subsections (3) to (5).

(2) In addition to subsection (1), if a provision or notice concerns any activity or facility that is subject to any risk –

(a) of an unusual character or nature; or
(b) the presence of which the consumer could not reasonably be expected to be aware or notice, or which an ordinarily alert consumer could not reasonably be expected to notice or contemplate in the circumstances; or
(c) that could result in serious injury or death, the supplier must specifically draw the fact, nature and potential effect of that risk to the attention of the consumer in a manner and form that satisfies the requirements of subsections (3) to (5), and the consumer must have assented to that provision or notice by signing or initialling the provision or otherwise acting in a mannerbconsistent with acknowledgement of the notice, awareness of the risk and acceptance of the provision.

(3) A provision, condition or notice contemplated in subsection (1) or (2) must be written in plain language, as described in section 22.

(4)  The fact, nature and effect of the provision or notice contemplated in subsection (1) must be drawn to the attention of the consumer—

(a) in a conspicuous manner and form that is likely to attract the attention of an ordinarily alert consumer, having regard to the circumstances; and
(b) before the earlier of the time at which the consumer—

(i) enters into the transaction or agreement, begins to engage in the activity, or enters or gains access to the facility; or
(ii) is required or expected to offer consideration for the transaction or agreement.

(5) The consumer must be given an adequate opportunity in the circumstances to receive and comprehend the provision or notice as contemplated in subsection (1).

The provisions of Section 49 appear to be manifestly fair to consumers. Members who may make use of any  “fine print” terms in their contract documents, particularly those referred to in Subsections (1) and (2), are advised to carefully review their documentation in order to ensure compliance with this Act.

In terms of Section 52 of the Act a court has the power to ensure just conduct, terms and conditions in contracts. Depending each set of circumstances, the court has the power to sever any offending provisions from an agreement, declare an entire agreement void or make any such order that is just and reasonable in the circumstances.

Bruce Lyle | Membership Services Manager