THE APPLICABILITY OF THE CONSUMER PROTECTION ACT TO CONSTRUCTION CONTRACTS

The applicability of the CPA to the Construction Industry is illustrated as follows:

Where the Act applies the employer consumer is protected by the provisions of the act regardless as to whatever is contained in any agreement. In other words nobody can contract out of the provisions of the Act.

Here are some important provisions of the Act:

• Any provisions in a contract that limit the risk or liability of the supplier must be brought to the attention of the consumer in plain language and the consumer must have an opportunity to receive and understand any such provisions.

• The definition of “consumer” in the Act includes the end user regardless as to whether or not the user was a party to the transaction. In the context of the construction industry this means that the employer would be regarded as a consumer in respect of goods or services supplied by a nominated or selected subcontractor. 

• The Act prohibits a service provider (i.e. a contractor) from marketing any goods or services in a misleading, fraudulent or deceptive manner. This includes the price at which goods are to be supplied.

• The Act does not apply where goods or services are supplied to the state.

• The consumer is entitled to a free copy of any written agreement.

• The consumer is entitled to a 5 day cooling off period after the agreement was concluded or the the goods were delivered, whichever the later.

• The consumer is entitled to timely performance and reasonable notice of any unavoidable delay.

• Should a supplier fail to provide the services to the standard as contemplated by the parties the consumer may require the supplier to either remedy the defective performance or refund to the consumer a reasonable portion of the price paid having regard to the extent of the defective performance.

• The Act provides for a mandatory implied warranty that the goods are suitable for their intended purpose, are free of defects, will be durable for a reasonable period of time and will comply with the Standards Act of 1993. Failure to comply with this will entitle the consumer to return the goods within 6 months after delivery in which event the supplier must repair or replace the goods or refund the price.

• The act provides that producers, importers, retailers and distributors of goods are liable for damage caused resulting from the supply of any unsafe or hazardous goods. This applies regardless as to whether or not any such party was at fault. A supplier of services who supplies such hazardous goods as part of the service is regarded as a supplier of the goods and will therefore also be liable for any harm caused by the goods. The consumer may elect to enforce his rights against any or all of the suppliers whose liability will be joint and several.

• If the Act does not apply to a transaction by virtue of the fact that the consumer is a juristic person with assets or turnover of more than R3M ,the goods supplied to the consumer will nevertheless  remain subject to the provisions of the act relating to liability for damage caused by the goods, safety monitoring and recall of the goods.

Bruce Lyle