Cancellation of orders for product not in writing: Supplier should accept cancellation (20131021759, 201310281082, 201310281117, 20131119991) [2014] ZACGSO 4 (21 May 2014)

Cancellation of orders for product not in writing: Supplier should accept cancellation (20131021759, 201310281082, 201310281117, 20131119991) [2014] ZACGSO 4 (21 May 2014)

The Ombud determined that the CPA provides greater protection to consumers in cancellation scenarios, and that the supplier should accept cancellations made by the complainants, even if not strictly in writing, provided they were recorded. The supplier's refusal to accept cancellation and subsequent recovery actions were not justified under the CPA. The supplier is required to backdate acceptance of cancellation to the date of first notice and calculate refunds in accordance with the relevant statutory provisions. The supplier must also undertake remedial action to prevent recurrence of such practices.

Citation
[2014] ZACGSO 4
Parties
Applicant: Complainants (20131021759, 201310281082, 201310281117, 20131119991); Respondent: Supplier (Diversion Distributors); Respondent: Cl (Financier); Respondent: G (Warranty Provider)
Court
Consumer Goods and Services Ombud
Jurisdiction
South Africa
Judgment Date
21 May 2014
Case Number
20131021759, 201310281082, 201310281117, 20131119991
Procedural Posture
Consumer Complaint / Ombud Determination
Outcome
The supplier is ordered to accept the cancellations as valid, backdate acceptance to the date of first notice, calculate and pay refunds as required by law, and undertake remedial action to prevent recurrence.
Judges
N Melville
Legal Topics
Consumer Protection Act, Cooling Off Period, Contract Cancellation, Remedies for Breach
Commercial and Corporate Civil Procedure Consumer Protection Act Cooling Off Period Contract Cancellation Remedies for Breach

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Parties

Complainants (20131021759, 201310281082, 201310281117, 20131119991)

Applicant

Supplier (Diversion Distributors)

Respondent

Cl (Financier)

Respondent

G (Warranty Provider)

Respondent

Procedural Posture

Consumer Complaint / Ombud Determination

Legal Issues

  1. 1 Whether the supplier is obliged to accept cancellation of orders not made in writing under the Consumer Protection Act (CPA).
  2. 2 Whether the cooling off period under section 16 of the CPA or section 121 of the National Credit Act (NCA) applies to these agreements.
  3. 3 Whether the supplier followed correct procedures in responding to cancellation attempts and subsequent recovery actions.

Ratio Decidendi

The Ombud determined that the CPA provides greater protection to consumers in cancellation scenarios, and that the supplier should accept cancellations made by the complainants, even if not strictly in writing, provided they were recorded. The supplier's refusal to accept cancellation and subsequent recovery actions were not justified under the CPA. The supplier is required to backdate acceptance of cancellation to the date of first notice and calculate refunds in accordance with the relevant statutory provisions. The supplier must also undertake remedial action to prevent recurrence of such practices.

Court Disposition

The supplier is ordered to accept the cancellations as valid, backdate acceptance to the date of first notice, calculate and pay refunds as required by law, and undertake remedial action to prevent recurrence.

Orders

  • The supplier must accept the cancellation of all four agreements as valid.
  • The supplier must backdate acceptance of cancellation to the date on which each complainant first gave notice.