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1 Sixth Annual African Consumer Protection Dialogue Conference -  Malawi 1 Sixth Annual African Consumer Protection Dialogue Conference -  Malawi

1 Sixth Annual African Consumer Protection Dialogue Conference - Malawi - PowerPoint Presentation

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1 Sixth Annual African Consumer Protection Dialogue Conference - Malawi - PPT Presentation

Topic Consumer Redress Date 8 10 September 2014 Author John Simpson NCT Tribunal Member Disclaimer This material has been developed to provide insight into consumer protection in South Africa and the provisions of the some of the South African Consumer Protection Laws ID: 690548

tribunal consumer section national consumer tribunal national section nct credit cpa protection nca court quality conduct act redress matter

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Sixth Annual African Consumer Protection Dialogue Conference - Malawi

Topic: Consumer RedressDate: 8 – 10 September 2014 Author: John Simpson – NCT Tribunal MemberSlide2

Disclaimer This material has been developed to provide insight into consumer protection in South Africa and the provisions of the some of the South African Consumer Protection Laws. It is not intended to be an exhaustive authority and a view taken by the National Consumer Commission, National Credit Regulator or the National Consumer Tribunal, in respect of the provisions of the legislation in respect of specific matters before the National Consumer Commission, National Credit Regulator or the National Consumer Tribunal,.

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Scope of the presentationPart A - Overview of consumer protection in South AfricaPart B - Selected sections from the Consumer Protection Act 68 of 2008 (CPA) Part C - Role of the National Consumer Tribunal (NCT)Part D - Selected NCT cases - redress in terms of the CPAPart E - Redress by the NCT in terms of the National Credit Act 34 of 2005 (NCA)

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4PART A: OVERVIEW OF CONSUMER PROTECTION IN SOUTH AFRICASlide5

BackgroundIMPERATIVES FOR CONSUMER PROTECTION LAWS IN SAFreedom of contract was mainstay of SA law – “Caveat subscriptor” – abuses were rifeLack of coherent system of consumer protectionLack of access to redress was endemic Constitutional imperatives of SA constitutionNeed to align to global imperatives

Internationally recognised consumer rightsUN Guidelines on consumer protection Slide6

BACKGROUND (Cont.)Lack of access to redress endemic Not maximized in coherent and cohesive wayReliance of court system

Enforcement left to consumersSlide7

BACKGROUND (Cont.)The South African ConstitutionBill of rights -Human rights and consumer rights Access to justice -Everyone has the right to have any dispute that can be resolved by the application of law decided in a fair public hearing before a court or, where appropriate, another independent and impartial tribunal or forumAdministrative justice

-Lawful, reasonable and procedurally fair, written reasons, review by court or tribunalSlide8

Delivery Model I

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Fundamental consumer rights in CPAEquality in the consumer marketPrivacyChooseDisclosure and InformationFair and responsible marketingFair and honest dealingFair, just and reasonable terms and conditions

Fair value, good quality and safetySupplier’s accountability to consumers

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PART B: SELECTED SECTIONS FROM THE CPA & NCA PROVIDING REDRESS TO CONSUMERS 10Slide11

Section 80 Credit provider must conduct an affordability assessment to determine whether the consumer can afford to repay the loan applied for. If the assessment is not done/the consumer did not understand the risks, costs, obligations/the credit agreement results in the consumer being over-indebted – then the agreement is regarded as reckless.Section 83 Tribunal can declare agreement reckless and set aside all the consumer’s obligations under the agreement or suspend the effect of the agreement.Section 128 Credit providers are required to sell repossessed goods as soon as reasonably practical and for the best price reasonably obtainable. The Tribunal can review such sales and order that an additional amount exceeding the net proceeds of the sale be paid to the consumer’s account.

Section 150 (h) If the Tribunal finds that a credit provider engaged in prohibited conduct it can order the repayment to the consumer of any excess amounts charged with interest (fees/charges etc.)

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National Credit ActSlide12

Section 54 Consumer has right to demand quality service. If quality service not provided consumer can require supplier to remedy the defect in the quality of the service or the goods or require a refund of a portion of the price paid for the services.Section 55 Consumer has a right to safe good quality goodsSection 56 If goods not safe and of good quality the consumer can return the goods within a period of 6 months and choose between a refund, repair or replacement.

Section 57 Strict liability on suppliers, producers, importers, distributors or retailers for harm caused by unsafe goods, defects, lack of warnings on goods etc.

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Consumer Protection ActSlide13

PART C: ROLE OF NATIONAL CONSUMER TRIBUNAL (NCT)

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The National Consumer Tribunal was established in terms of section 26 of the National Credit Act (NCA), Act 34 of 2005. “Tribunal” in the Consumer Protection Act (CPA) refers to the National Consumer Tribunal established by the NCA. T

he Tribunal:Has jurisdiction throughout South Africa;Is a juristic person;Is a Tribunal of record; andMust exercise its functions in accordance with the NCA orother applicable legislation – i.e. is a creature of statuteTribunal order has the status of a high court order

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Establishment and JurisdictionSlide15

Conduct of hearingsThe Tribunal has to conduct its hearings in accordance with section 142 of the NCAIn an inquisitorial manner, As expeditiously as possible, As informally as possible; and

In accordance with the principles of natural justice.

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Orders of the Tribunal The Tribunal can inter alia make the following orders:Grant Interim relief; Declare conduct to be prohibited; Issue an interdict for prohibited conduct;

Confirm Consent Orders; Condone non-compliance with its rules and procedures;Any other appropriate order required to give effect to a right as contemplated in the NCA or CPA;Impose administrative fines

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PART D : SELECTED NCT JUDGMENTS – REDRESS IN TERMS OF THE CPA

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NCT judgements7142.2012/73(3)&75(1)(b)&(2) CPA Gerhard Roelof Coertze v Rocelia YoungParties agreed that Ms Young would provide marketing related servicesR20 000.00 paid in advance. Relationship soured. Parties agreed that R17 000.00 would be repaid.

Payment not made and the Applicants approached the National Consumer Commission (NCC). Payment still not made after conciliation meeting. Applicant approached NCT. The Tribunal found that the Applicant’s claim fell under the CPA and the Tribunal granted leave for the matter to be heard. The Tribunal found that the Respondent had not rendered a quality service as required by section 54(1) of the CPA. In terms of section 54(1) the Applicants could insist on the defective service being remedied or on a refund of a reasonable amount paid for the services. The Tribunal ordered the Respondent to pay R17 000 to the Applicant as agreed to between the parties previously.

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NCT judgements cont.10686/2013/75(1) P Byleveld v Execor Twelve Pty Ltd t/a Motor City and NCCDispute regarding the defects in a motor vehicle purchased from the Respondent.Matter not resolved at the NCC and applicant approached tribunal.

The Tribunal found that non-referral notice issued by NCC sufficiently compliant therefore Tribunal could consider the matter.The Tribunal granted leave and found that the Respondent had contravened section 55(1) of the CPA - not supplied goods which were safe and of good quality. Further contravened section 54(1) of the

CPA - not provided quality services to the Applicant. The Tribunal ordered the Respondent to pay R33 000.00 to the Applicant.

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NCT judgements cont.Certificate issued to allow access to High Court for damages Section 164(3)(b) of NCA allows consumer to pursue claim for damages suffered - if certificate issued by Chairperson of NCT.In matter of NCR v Bornman and others (656.2010) the Tribunal found that the debt counsellor had engaged in prohibited conduct. Bornman

appealed decision to the High court and subsequently the Supreme court of Appeal. Both appeals were dismissed.In matter of GV Van Tonder (12846.2014) the Chairperson issued a certificate allowing a consumer affected in the Bornman matter to pursue a claim for R39 725.00 in damages in the High court. The certificate is conclusive proof of its contents and is binding on a civil court.

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PART E : REDRESS BY THE NCT IN TERMS OF THE NCA

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Orders and RedressTribunal can impose administrative penalties (section 151 of NCA)Administrative penalties awarded to date in excess of R21mWerlan matter R900 thousand fine – Credit provider overcharged very poor farm workers.Numerous de-registrations of credit providers and debt counsellors for prohibited conduct

Refunds to consumers – Bornman, Barko, African Bank – (settlement agreement of R20m)Slide23

NCT Judgments

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All judgments of the NCT are available on

www.thenct.org.za

www.saflii.org

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SAFLII website

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Our contact details

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Office Hours: Monday to Friday, excluding public holidays, from 09:00 to

16:00

Postal Address:

Private

Bag X 110

CENTURION

0046

Physical

Address

:

T

he National Consumer Tribunal

Ground Floor, Building B,

272 West Avenue

Lakefield Office

Park

Centurion

T

elephone

:

(

012) 663 5615.

F

ax

:

(012) 663 5693

.

E-

mail

:

Registry@thenct.org.za

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THANK YOU26