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South Africa Ruling

Consumer Goods and Services Ombud

Cancellation of wedding due to rain: Supplier not liable to refund (201311211256) [2014] ZACGSO 5 (13 February 2014)

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Professional case brief

Research organized from the available case record

Source document

01

Holding and result

The Ombud found that the supplier's retention of the full amount paid as a cancellation fee was not unreasonable, given that the cancellation occurred on the day of the event and the supplier was unable to rent out the equipment to another customer. Industry practice, as confirmed by the Federated Hospitality Association of South Africa, supports retention of the full amount in such circumstances. The signed contract also provided for a cancellation fee. Therefore, there is no legal basis to compel the supplier to refund the applicant.

Court disposition

Complaint dismissed. Supplier not liable to refund the applicant.

Orders

  • The supplier is not required to refund the applicant for the unused garden décor.
  • No further action is required from the supplier.

02

Material facts

Parties

Complainant

Applicant

Star Sound Productions

Respondent

Amounts and remedies

  • Refund Offered by Supplier: ZAR 10

03

Procedural history

  1. Posture

    Consumer Complaint / Final Determination by Ombud

04

Questions and positions

Legal issues

Party arguments

Applicant
The applicant contends that, since the garden décor was not used due to bad weather and the wedding was moved indoors, the supplier should refund the full amount paid for the unused décor.
Respondent
The supplier argues that the signed contract provides for a cancellation fee in the event of cancellation, with the fee determined by the timing of cancellation. As the cancellation occurred on the day of the event, the supplier is entitled to retain the full amount paid, but offered a 10% refund as a gesture of goodwill, which was declined.

05

Court’s reasoning

  1. 01

    Section 17, Consumer Protection Act

    A consumer may cancel an advance booking, but the supplier may impose a reasonable cancellation charge, which must not exceed a fair amount considering the nature of the goods or services, notice period, potential for alternative bookings, and industry practice.

  2. 02

    Section 17(4), Consumer Protection Act

    A cancellation fee is unreasonable if it exceeds a fair amount in the circumstances, including the nature of the goods or services, length of notice, potential for alternative bookings, and general industry practice.

06

Ratio, limits and disposition

Ratio decidendi

The Ombud found that the supplier's retention of the full amount paid as a cancellation fee was not unreasonable, given that the cancellation occurred on the day of the event and the supplier was unable to rent out the equipment to another customer. Industry practice, as confirmed by the Federated Hospitality Association of South Africa, supports retention of the full amount in such circumstances. The signed contract also provided for a cancellation fee. Therefore, there is no legal basis to compel the supplier to refund the applicant.

Obiter and limits

  • The Ombud noted that the supplier's initial offer of a 10% refund was a gesture of goodwill and not a legal obligation.
  • Industry practice in the hospitality sector supports retention of the full amount paid when cancellation occurs on the day of the event.

Court disposition

Complaint dismissed. Supplier not liable to refund the applicant.

  • The supplier is not required to refund the applicant for the unused garden décor.
  • No further action is required from the supplier.

Source and reliance status

Consumer Goods and Services Ombud

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Judgment text

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Source document

Consumer Goods and Services Ombud

Ruling

[2014] ZACGSO 5

Cancellation of wedding

Cancellation of wedding due to rain: Supplier not liable to refund

Complaint ref : 201311211256

Adjudicator : Bonita

Hughes

Date : 13

February 2014

1. Summary of your complaint

Your plans to have garden wedding had to be cancelled due to bad weather. The wedding was held in the chapel so the garden décor were not used.

The supplier refused to give you a full refund and was only prepared to refund 10% for the unused equipment.

You would like to be refunded in full for the décor not used.

2. Summary of the supplier’s response

The supplier advised that as per the signed contract one is liable for a cancellation fee in the case of a cancellation. The fee will be determined by the timeframe in which the cancellation occurred.

As the cancellation happened on the day of the event they are not willing to give you a refund but in an attempt to resolve the matter they offered as a gesture of goodwill 10% back of the amount paid.

The supplier advised that you declined the offer and threatened to sue them. They are therefore no longer willing to refund 10% of the amount paid.

3. Assessment

We have considered all the evidence presented by both you and the supplier and advise as follows:

You would like a refund for décor not used on the day of your wedding due to bad weather.

In this regard we would like to refer you to section 17 of the Consumer Protection Act:

A consumer may in spite of any term to the contrary, cancel an advanced order in terms of section 17(2) of the Consumer Protection Act, subject to the imposition of a reasonable charge for cancellation for the order.

In terms of 17(4) the charge will be unreasonable if it exceeds a fair amount in the circumstances, having regard to –

(a) The nature of the goods or services that were reserved or booked;

(b) The length of notice of cancellation provided by the consumer;

(c) The reasonable potential for the service provider, acting diligently, to find an alternative consumer between the time of receiving the cancellation notice and the time of the cancelled reservation; and

(d) The general practice of the relevant industry.

In this instance you cancelled the outside décor on the day of the event.

We contacted the Federated Hospitality Association of South Africa who confirmed that it is general practice to retain the full amount paid as a cancellation fee if the cancellation occurred on the day of the event.

4. Conclusion

Taking the above factors into consideration and the signed contract with Star Sound Productions which makes provision for a cancellation fee, we are of opinion that The supplier was not unreasonable by keeping the full amount paid as a cancellation fee.

The supplier was unable due to the short notice to rent out the equipment to anyone else and had to cover the full cost of the items for that day.

There is thus no legal ground upon which we can instruct the supplier to give you a refund.

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Authorities

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Cases, legislation, regulations, and constitutional provisions identified in the available record.

Consumer Protection Act

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Legislation referenced in the available case record.

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