The Consumer Protection Act No. 68 of 2008 ('the CPA') has been hailed as the end of the voetstoots clause in sale agreements as we know it. While the provisions giving rise to the consumer protection bodies and those authorising the creation of regulations came into effect on the 24th April 2010, the remaining provisions, which apply to most businesses only came into effect on the 1st April 2011, this date being called the 'effective date' of the CPA. As such, the CPA is now the cornerstone of consumer rights in South Africa.
Section 55 of the Act sets out the Consumer's rights to safe, good quality goods and states as follows:
'Except to the extent contemplated in subsection (6), every consumer has a right to receive goods that-
(a) are reasonably suitable for the purposes for which they are generally intended;
(b) are of good quality, in good working order and free of any defects;
(c) will be useable and durable for a reasonable period of time, having regard to the use to which they would normally be put and all the surrounding circumstances of their supply; and
(d) comply with any applicable standards set under the Standards Act, 1993 (Act No. 29 of 1993), or any other public regulation.'
There is however an exemption to this section which may give suppliers certain relief, and in this regard section 55(6) reads as follows:
'Subsection (2)(a) and (b) do not apply to a transaction if the consumer-
(a) has been expressly informed that particular goods were offered in a specific condition; and
(b) has expressly agreed to accept the goods in that condition, or knowingly acted in a manner consistent with accepting the goods in that condition.'
The words 'specific condition' have not been defined in the Act, and accordingly their natural meaning must be assigned to them, that being the condition that the goods are currently in, the goods being either new or second hand goods. Section 61 of the Act sets out the supplier's liability for damage caused by goods sold.
Section 61(1) reads as follows:
'Except to the extent contemplated in subsection (4), the producer or importer, distributor or retailer of any goods is liable for any harm, as described in subsection (5), caused wholly or partly as a consequence of-
(a) supplying any unsafe goods;
(b) a product failure, defect or hazard in any goods; or
(c) inadequate instructions or warnings provided to the consumer pertaining to any hazard arising from or associated with the use of any goods, irrespective of whether the harm resulted from any negligence on the part of the producer, importer, distributor or retailer, as the case may be.'
The Act contains the following definitions in relation to this section:
'defect' means (i) any material imperfection in the manufacture of the goods or components, or in performance of the services, that renders the goods or results of the service less acceptable than persons generally would be reasonably entitled to expect in the circumstances; or (ii) any characteristic of the goods or components that renders the goods or components less useful, practicable or safe than persons generally would be reasonably entitled to expect in the circumstances;
'failure' means the inability of the goods to perform in the intended manner or to the intended effect;
'hazard' means a characteristic that- (i) has been identified as, or declared to be, a hazard in terms of any other law; or (ii) presents a significant risk of personal injury to any person, or damage to property, when the goods are utilised; and
'unsafe' means that, due to a characteristic, failure, defect or hazard, particular goods present an extreme risk of personal injury or property damage to the consumer or to other persons.
As you will note from the definition of 'defect', specific goods will only be 'defective' if those goods suffer from a material imperfection in their manufacture, and renders those goods less acceptable than persons generally would be reasonably entitled to expect in the circumstances. The result of these narrow definitions of the above terms which apply to section 61 is that goods that are sold in the ordinary course of your business, and which goods have been inspected by your quality controller (or similar) and are found notto be defective, unsafe or a hazard to your customers, will not cause you to be liable for future harm suffered by customers under section 61(1) of the Act.
Further limiting a supplier's liability for damage caused by goods is section 61(4), which reads as follows:
'Liability of a particular person in terms of this section does not arise if-
(a) the unsafe product characteristic, failure, defect or hazard that results in harm is wholly attributable to compliance with any public regulation;
(b) the alleged unsafe product characteristic, failure, defect or hazard (i) did not exist in the goods at the time it was supplied by that person to another person alleged to be liable; or (ii) was wholly attributable to compliance by that person with instructions provided by the person who supplied the goods to that person, in which case subparagraph (i) does not apply;
(c) it is unreasonable to expect the distributor or retailer to have discovered the unsafe product characteristic, failure, defect or hazard, having regard to that person's role in marketing the goods to consumers; or
(d) the claim for damages is brought [after it has prescribed].'
Accordingly, if the second-hand good (after a careful inspection) was not found to be defective, unsafe or a hazard to your customers at the time that it is sold, then the fact that it becomes defective, unsafe or a hazard at a later point and causes damage or harm, will not result in a supplier's liability. Are you a supplier of second hand goods in South Africa? Are you concerned about the provisions of the Consumer Protection Act and the consequences?