As we’ve seen from the first three inserts, a balance has been struck between the common law rights of the consumer and that of the supplier.
Now let’s look at the very commonly used form of acquiring and promoting business namely direct marketing – This section entitles the consumer to cancel a transaction ‘resulting from’ direct marketing i.e. [Section 16 (3)]
A consumer may rescind a transaction resulting from any direct marketing without reason or penalty, by notice to the supplier in writing, or another recorded manner and form, within five business days after the later of the date on which—
(a) the transaction or agreement was concluded; or
(b) the goods that were the subject of the transaction were delivered to the consumer.
- The supplier must return to the consumer any payment received which reimbursement must be within 15 business days from the date of the notice or return of the goods [Section 16 (4)(a)]
- Notwithstanding the wording of section 16 (3) i.e. ‘without reason or penalty’, the supplier not without remedy/right of recourse i.e. the supplier may rely on section 20 (6) [Section 16 (4)(b)] i.e. the supplier may charge the consumer as follows: ‘a reasonable amount for use of the goods during the time they were in the consumer’s possession’
‘WHAT TO DO’ GUIDELINE
- Make sure you understand what is meant by ‘direct marketing’ – it is defined in the CPA as follows: when a supplier ‘approach(es) a person, either in person or by mail or electronic communication’
- So, for example, an existing or potential customer visiting your website does not constitute direct marketing
- The rights the consumer has in terms of this section are over and above any such rights he may have in law (16.2)
- Be aware of the dates – The consumer may rescind any transaction resulting from direct marketing (i.e. where the supplier approaches the consumer) within 5 (five) working days* from the latest of the following dates: the transaction is entered into or the goods are delivered (16.3) – this is the so-called ‘cooling off period’ (BUT note that if the transaction is subject to the Electronic Communications and Transactions Act, then this section will not apply & in terms of that act the period is 7 (seven) days
- Such notice may be given ‘in writing or in another recorded manner of form’ (16.3)
- It does not state that the supplier must receive the notice within 5 (five) business days of the ‘date that the agreement was concluded’;
- The supplier must in turn return to the consumer, within 15 (fifteen) working days all monies paid – the days will run from the later of the date upon which the notice of rescission if received or the date the goods returned have been received
- This must be read with section 32 which obliges the supplier to advise the consumer of the right to return goods
- Note that the calculation of the days* is addressed in section 2 (6) – days include the last day but excludes the first day, weekends & public holidays (It means when you are counting the days – as per the section – you’d not count/exclude the 1st day but count/include last day e.g. buy goods Friday, September 8th that day will not be counted – so the 5 days would be not later than close of business Friday 16th. excludes 10th & 11th being w/end & the 5 days = Monday 12th up to & including Friday 16th)
- Take note that the Act does not say the supplier must receive the notice of cancellation within five business days of the date that the agreement was concluded, only that the consumer must have given notice by then.
- Similarly, the supplier must return all monies paid to the consumer, within 15 working days. The days will run from the later of the date of cancellation if received or the date the goods returned were received e.g. as per previous bullet/explanation let’s say goods are returned Sept 19 but notice is served Sept 12, the ‘later date’ = 19th
- This section should be read with section 32 which says the supplier must advise the consumer of their right to return goods.
This newsletter/article is intended to provide a brief overview of legal matters pertaining to captioned matter and is not intended as legal advice. As every situation depends on its own facts and circumstances, only professional advice should be relied on. Please contact Adv. Louis Nel at [email protected] or on +27 83 679 4556