Let the seller beware!

The new Consumer Protection Act has shifted the onus from the buyer to the seller in the world of commerce. Farmers should read the Act to protect themselves, and see how they will be protected by it in turn.

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For the seller of goods orservices it used to be a case of “let the buyer beware”. The onus was on the purchaser to make sure the product or service bought was of good quality. And so competition in commerce got rid of shady dealers over time.But a new set of rules for commerce has been drafted. Due to come into effect in April 2011, the new Consumer Protection Act puts the onus on the providers of goods or services to ensure that their customers are treated fairly. So if a person promises more than they deliver, or if goods are sold on onerous terms, or if a consumer is hurt by shoddy products or services, the provisions of the Act may be triggered.

Consumers with fixed-term contracts, as with cellphones, will have better rights when it comes to cancelling such contracts. It seems that automatic rollover of such contracts will be a thing of the past.
But I imagine that the average South African farmer supplies high-quality produce in any event. And it seems hard to imagine how food producers on a primary level might be negatively affected by the Act’s provisions. In fact, the agricultural community might actually benefit by the application of this law.

Two areas where the new Act is an improvement on the status quo are:
Losing the Latin. Farmers use financial institutions’ products to get finance. The new Act states that the language of any agreement relating to goods or services in commerce must be clear to the recipient of the goods or services. The Latin clauses in banking and loan agreements must be a thing of the past, because these are far from clear to most consumers. The Latin clauses in loan and surety agreements especially serve to limit the defences a consumer might have against the bank. More equitable contracts. The new Act states that any inequitable contract – one that favours the supplier over the consumer – is liable to be set aside.

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These provisions are a positive step as far as insurance or financial products are concerned. But the Act’s preamble is worrisome. It states that the Act is put in place to alleviate the effects of poverty caused by the discriminatory laws of the past. When will South Africa ever shrug off that past and move forward? Sanctions that might be imposed under the Act are fines of up to R1 million, damages awarded against “sharp” sales practitioners, and court action. I strongly suggest that every farmer find a copy of the Act on the internet and study it. Farmers who run guesthouses, for example, should note the provisions regarding the right of consumers to cancel bookings. But that’s just the tip of the iceberg. Read the Act, protect yourself, and see how you’re protected in turn.     |fw