The Contractor And The Consumer Protection Act

A lot is been said about the new Consumer Protection Act which is about to come into law and my guess is that a lot more is still going to be said about this Act in the Court room.

The Act seems to be directed mainly at suppliers of goods but it does also deal with the suppliers of services and this is where the Contractor comes into the frame.

My impression is that the Act is concerned mainly with prohibiting unfair marketing and unfair business practices and to a large extent the Act states the law as it already is.  However there are some nasties.  I have picked out a few which I think Contractors ought to be aware of.

Firstly, note that the Act only applies where you are dealing with natural persons.  It does not apply if the consumer is a company or a close corporation.  But be on your guard, if the company or close corporation is very small with a very low asset value or turnover, the Act may apply.

Also the Act does not apply if services are supplied to the State.

So if you are a contractor who deals with other companies or with the State then this Act will not be of any concern to you.  On the other hand if you are a contractor who deals mainly with private domestic households then the Act will apply.

As I say, I have picked out a few clauses in the Act which impact on contractors if they are supplying services to a private consumer.

Pre-Authorisation Of Repair Or Maintenance Services

You supply a repair or maintenance service and a consumer requests an estimate before any services are supplied then you may not charge the consumer for anything until you have provided the consumer with an estimate and then obtained the consumer’s written authorization for the work to be done.  Furthermore, you may not charge the consumer for preparing an estimate.  So, an electrical contractor would have to be careful about charging for a callout. If he receives a call from the consumer then he should make telephonic enquiry as to the problem and send an estimate of his charges for written acceptance by the consumer before attending to a callout.  The alternative is to have the consumer decline the offer of an estimate.  But be warned – this must be in writing.

Consumer Rights With Respect To The Supply Of Service

The supplier is responsible to perform services on the agreed date and at the agreed time.  Here comes the nasty.  If you supply your services on a date and at a time that is other than what you agreed with the consumer, the consumer may cancel the agreement without penalty and treat whatever you have done up to that point as “unsolicited goods” meaning that he doesn’t have to pay you and whatever materials you may have supplied must then be removed by you.

Consumers Right To Demand Quality Service

So, if you are thinking that you had better not promise to do the job for a customer on a particular date or at a particular time that does not mean you are completely off the hook.  The Act also provides that when you undertake to provide any service, the consumer has a right to expect timely performance and completion of those services and timely notice of any unavoidable delay.  If you fail on that score then the consumer has a right to claim a refund of a reasonable portion of the contract price.

I can foresee a contractor doing a job at a consumers home, not being paid and then taking legal action to recover the amount of his invoice only to find that he is confronted with a defence that performance was not timely and that no notice of the cause of the “unavoidable” delay was given and therefore the customer claims a refund or credit.

So in conclusion, you will have to be on your toes when dealing with a private consumer and not make any promises which you cannot keep.  One of my client’s has quite a refreshing attitude towards this legislation.  He says he welcomes it and looks forward to the Act coming into force because he is confident about his own service and believes the Act will get rid of all of his competition who in the past have provided a shoddy service and got away with it!

Article by Tim Pearce
Pearce du Toit and Moodie
Attorneys : Notaries : Conveyancers
8th Floor, Mercury House
320 Smith Street, Durban 4001
Telephone:031–3046781