Nwadeyi v Tiegert Trucking CC (NCT/106318/2018/75(1)(b)) [2019] ZANCT 30 (26 February 2019)

IN THE NATIONAL

CONSUMER TRIBUNAL

HELD IN

CENTURION

Case number: NCT/106318/2018/75(1)(b)

In the matter between:

PAUL

CHIKWE

NWADEYI

APPLICANT

and

TIEGERT

TRUCKING CC

RESPONDENT

Coram

Dr. L. Best - Presiding Tribunal Member

Adv. F. Manamela – Tribunal Member

Ms. M. Nkomo – Tribunal Member

Date of Hearing – 24 January 2019

Date of Judgment – 26 February 2019

JUDGMENT AND

REASONS

THE PARTIES

1. The Applicant in this matter is Paul Chikwe Nwadeyi, an adult male, residing in Queenstown, Eastern Cape (the “Applicant”).

At the hearing Mr Nwadeyi appeared in person and represented himself.

2. The Respondent is Tiegert Trucking cc, a Close Corporation with its principal place of business at 23 Napier Street, King Williams Town, Eastern Cape (the “Respondent”). At the hearing the Respondent was represented by Mr Norman Prigge from SEESA (Pty) Ltd. The Respondent’s Tiens Hattingh participated in the hearing via Skype, as led by his attorney, Mr Prigge.

APPLICATION

TYPE

3. This is an application in terms of Section 75(1)(b) of the Consumer Protection Act, 68 of 2008, (hereinafter referred to as “the

CPA”).

4. Section 75(1) of the CPA states the following –

“If the Commission issues a notice of non-referral in response to a complaint, other than on the grounds

contemplated in section 116, the complainant concerned may refer the matter directly to –

(a) …

(b) the Tribunal, with the leave of the Tribunal.”

JURISDICTION

5. Section 75(5) of the CPA states that:

“The Chairperson of the Tribunal may assign any of the following matters arising in terms of this Act to be heard by a single member of the Tribunal, in accordance with section 31(1)(a) of the National Credit Act:

(a)…

(b) an application for leave as contemplated in subsection (1)(b)”

6. The inter-locutory application for leave to refer the matter directly to the Tribunal was heard by a single member of the Tribunal in accordance with section 75(5)(b) of the CPA, and leave was duly granted.

7. This judgment follows a hearing of the matter on the main merits.

BACKGROUND

8. The Applicant owns a logistics and cartage business. During February 2017 one of his trucks experienced mechanical problems and he took it to the Respondent for repairs. Prior to any repair work commencing on the truck, the Applicant requested a quotation. The Respondent provided a quote for the repairs, on the basis of which the Applicant authorised the engine overhaul to be done. Having accepted the Respondent’s quote, the Applicant paid the Respondent R10 000 for the labour with the understanding that the Applicant would provide all the parts, which the Applicant duly did. On 14 March 2017 the Applicant took a used engine to the Respondent for installation into the truck. After installing the engine the Respondent informed the Applicant that the used engine had seized and needed engineering work done on the engine block.

9. The engine block was taken to KWT Engineering for the work to be done in May 2017. The work was done and KWT Engineering required payment of R20 978.00 before it would release the engine block.

10. The Applicant regarded the amount of R20 978.00 as excessive and alleges that he never received a quote for the engineering work and never authorised the engineering work. He obtained quotes from other suppliers for the same work and received quotes averaging R12 000.00. The Applicant offered this amount as final settlement for the engineering work done, but this was declined.

11. The Applicant first lodged a complaint with the Motor Industry Ombudsman of South Africa (MIOSA) in 2017. On 4 September 2017 MIOSA issued a recommendation that the Respondent must repair the truck at an agreed price, noting that the Applicant had offered to pay between R9000.00 and R12 000.00 for the engineering work done on the engine block. It appears that the Respondent failed to settle the matter on this basis.

12. The Applicant then lodged a complaint with the National Consumer Commission (the “NCC”). On 19 March 2018 the NCC issued a letter of non-referral stating that it would not make a recommendation that the vehicle be released without any payment being

made.

13. The Applicant then filed an application for leave to refer the complaint directly to the Tribunal on 18 April 2018, together with supporting documents and proof of service. Judgment was issued dated 24 July 2018 granting the Applicant leave to refer the matter to the Tribunal in terms of section 75 (1)(b).

14. Importantly, the judgment dealt with two points in limine, the first being that the Applicant owns a registered company called Lyncess Resources International cc and it was the Respondent’s

view that the services were provided to the Applicant in his capacity as representative of the company. Therefore, the Respondent argued in the inter-locutory hearing that the Applicant could not pursue this matter in his own name and further had to put to the proof that his annual turnover is less than R2 million as required by the CPA for him to qualify as a consumer. In the judgment it was ruled that the Respondent did not provide the basis for a finding that the Applicant did not have any standing nor that the action should have instead been instituted against a juristic person.

15. The second point in limine was that the Respondent further alleged that the Applicant cited the incorrect party as a respondent in the matter, because it was KWT Engineering that provided the engineering services directly to the Applicant. The Respondent argued that it only provided the contact details for KWT Engineering to the Applicant whereafter the Respondent delivered the engine block to KWT Engineering, as agreed between the Applicant and the Respondent. The Respondent further put it to the Tribunal that the Applicant interacted directly with KWT Engineering from that point on. The Respondent could therefore not be held responsible for the cost of the work done or the fact that no quote was provided by KWT Engineering. In response, the Applicant argued that he at all times dealt with the Respondent directly and specifically instructed the Respondent not to have any work done on the truck without providing him with a quote.

16. In the judgment, the second point in limine was ruled as a dispute of fact between the parties as to whether or not KWT Engineering provided its services to the Applicant or the Respondent. Given that neither party had testified at the inter-locutory hearing, nor was there any evidence submitted by

either party to substantiate their respective allegations, the point in limine was regarded as a dispute of fact which could possibly only be resolved by the calling of relevant witnesses, including a representative of KWT Engineering.

17. At the time of the hearing, the Applicant’s truck remained at the Respondent’s premises, the engine block was kept at KWT Engineering, and no payment had been made to KWT Engineering for the engineering work done. The Respondent had not returned the parts supplied by the Applicant for the repair of the truck and it must therefore be assumed that the parts remain with the Respondent.

THE

HEARING

18. Following the judgment granting the Applicant leave to refer the matter directly to the Tribunal, a hearing was scheduled for 24 January 2019, the current proceedings.

The Applicant’s Submissions

19. At the hearing, the Applicant went to great lengths and confirmed his submissions in his founding affidavit as well as his submissions

presented at the hearing where he sought leave to refer his matter directly to the Tribunal, in terms of section 75 (1)(b). These

submissions have been summarised in the Background as set out earlier in the judgment.

20. The Applicant indicated that as a business person himself, he is aware of the need to provide a quote on the basis of which a customer provides authorisation before any work commences to be undertaken. He, in return, insists on a quote whenever he requests services from another business.

21. The Applicant cited as confirmation of this practice that he requested a quote from the Respondent before the Respondent commenced the initial repair work. The Applicant only gave authorisation for work to proceed once he had interrogated the detail in the quote and was satisfied that it was value for money.

22. The Applicant indicated that while the Respondent was repairing the truck, the Respondent had indicated that repairs on the clutch were required. The Respondent had indicated that he did not have the expertise to perform work of this nature but could arrange a service provider with the requisite expertise to undertake the repairs. In line with his practice of always requesting a quote before giving authorisation for work to commence and services to thus be provided, the Applicant had requested that the Respondent obtain a quote from the specialised service provider who could undertake this work. The Respondent had obtained a quote from the expert external service provider, on the basis of which the Applicant gave the Respondent the go ahead to arrange the repairs to the clutch by the service provider.

23. The Applicant submitted that when the Respondent informed him that engineering work was required on the engine, and that the Respondent

did not have the expertise to perform this work, the Applicant requested the Respondent’s assistance to identify an engineering service provider. The Respondent indicated that he had a friend in the engineering business and accordingly identified KWT Engineering.

24. The Applicant submitted that he had on numerous occasions insisted that the Respondent arrange a quote for the engineering work so that he could interrogate this, before giving authorisation for any work to commence. The Applicant believed that the Respondent would follow the same modus operandi to facilitate the quote as he had done when an expert service provider was arranged to repair the clutch.

25. The Applicant submitted that he never received any quote or estimate of costs and as a result he had not given authorization that any engineering work proceeds on the engine. Rather, he was provided with an invoice on the Respondent’s letterhead, dated 15 June 2017, for the amount of R20 978.00. The invoice states: “this is the cost for the engineering could you please at your earliest convenience pay this money to us in order for us to continue with the engine”. This invoice was received after the engineering work had been done on the engine by KWT Engineering.

26. The Applicant confirmed that indeed he had had personal interaction with KWT Engineering, but the purpose of this was to enquire as to progress with the engineering work on the engine as this was taking a long time to be completed and the Respondent did not seem to be pursuing completion of the work with any vigour.

27. The Applicant further submitted that in all of his interactions with the staff and the owner at KWT Engineering, they had been categorical

that they had no contractual relationship with the Applicant and would only communicate with the Respondent.

28. Despite not receiving a quotation before the engineering work commenced, in order to get his truck back so that he could resume his cartage business, the Applicant was prepared to pay R12 000 to KWT Engineering for the engineering work done on the engine of his truck, as this constitutes the average of various other quotes that he obtained from service providers operating in the geographical area. This offer was rejected by KWT Engineering.

29. The Applicant was also consistent in his request that the Respondent complete the repairs to his truck.

The Respondent’s Submissions

30. The Respondent disputed that it made arrangements with KWT Engineering to perform engineering work on the truck and submitted that it merely provided the Applicant with KWT Engineering’s telephone number. Thereafter the Applicant had himself made the arrangements with KWT Engineering for the engineering repair work.

31. The Respondent freely admitted that its representative knows the owner and staff of KWT Engineering due to being in the motor repair

industry for over 30 years; and KWT Engineering also being a service provider in the motor repair industry in the same town. The

Respondent further stated that knowing these colleagues has no material bearing on the case.

32. The Respondent submitted that there is no nexus between itself and KWT Engineering in relation to the case at hand. However, no evidence was submitted to substantiate this.

33. The Respondent acknowledged that the document dated 15 June 2017 is an invoice that it provided to the Applicant after KWT Engineering had completed the engineering repair work on the engine. The Respondent’s representative further confirmed that the document was not a quote, and that it was issued on his business’s letterhead.

34. The invoice provides very specific detail about various engineering work and the cost of each such aspect. The Respondent’s

representative submitted that he was able to provide all this technical detail on the invoice about the engineering work specifics

and the prices for each aspect of work performed; because of his length of experience in the motor repair industry. He, however, also confirmed that he does not have engineering expertise; and hence the need for an engineering expert to have done this work, as KWT Engineering had done on the Applicant’s engine.

35. The Respondent’s representative submitted that the only information KWT Engineering provided him with was the total cost of the repairs, when he contacted them telephonically, in order to prepare the invoice for the Applicant.

36. The Respondent’s version is that it invoiced the Applicant for the engineering work because the Applicant and KWT Engineering were in dispute about the amount to be paid for the engineering work. The Respondent offered that the Applicant could settle the invoice with it and it in turn would then pay KWT Engineering on behalf of the Applicant for the engineering repair work that was done.

37. The Respondent also indicated that when the engineering work was done, the amount due was approximately R17 000. According to the

Respondent, the Applicant had requested that the Respondent pay this amount as the Applicant did not have the total funds to do so at that time, but committed that he would refund the Respondent later. The Respondent informed the Applicant it would charge a mark-up hence the invoice was for an amount of R20 900 which included its mark-up. In his view, this was an indication of its intentions to see the matter resolved. The Applicant refuted the claims made by the Respondent about the mark-up fee. He asserted that he heard about this arrangement, for the first time at the hearing of this matter.

38. The Respondent submitted that it cannot negotiate on behalf of KWT Engineering as it views itself as a third party, and therefore;

cannot be expected to know what discussions and possible agreements were between KWT Engineering and the Applicant; regarding engineering

work required on the truck engine.

39. The Respondent did not call any witnesses to support any of its submissions.

40. The Respondent did not pursue the first point in limine that was raised during the inter-locutory hearing and which was subsequently also ruled upon in the judgment pertaining to the interlocutory hearing.

ISSUES TO BE DECIDED

41. The issue that the Tribunal is required to decide, is whether the Respondent was required by the CPA to provide the Applicant with a quotation, prior to the commencement of the engineering work on the engine. Thereafter, the Tribunal must determine if there was a contravention of section 15 of the CPA, and further, if so, whether this constitutes prohibited conduct.

42. However, in consideration of the points in limine raised by the Respondent, the Tribunal must also decide whether or not the correct parties are before it.

Points in limine - Citation of the Correct Parties

43. Before the Tribunal can properly apply its mind to the matter on the main merits, it must ensure that the correct parties are before the Tribunal.

44. Section 69 of the CPA states:

“Enforcement of Rights by Consumer:

A person contemplated in section 4 (1) may seek to enforce any rights in terms of this Act or in terms of a transaction or agreement, or otherwise resolve any dispute with a supplier, by –

(a) Referring the matter directly to the Tribunal, if such a direct referral is permitted by this Act in the case of the particular dispute;

(b) Referring the matter to the applicable ombud with jurisdiction, if the supplier is subject to the jurisdiction of any such ombud;

(c) If the matter does not concern a supplier contemplated in paragraph (b) –

(i) Referring the matter to the applicable industry ombud, accredited in terms of section 62(6), if the supplier is subject to any such ombud….”

45. In order for the Applicant to seek to enforce his rights under the CPA, the correct service provider responsible for providing a quote for the engineering work on the engine must be identified in order to be before the Tribunal as the Respondent in the matter.

46. The judgment on the leave to refer application stated unequivocally that the calling of relevant witnesses, including a representative of KWT Engineering, may be necessary to determine whether or not the

Respondent should answer to allegations before this Tribunal.

47. The Respondent had ample time since receiving the Notice of Set Down to arrange for the calling of witnesses in support of its assertion that it should not be before the Tribunal. On his own admission, the Respondent’s representative has known KWT Engineering

colleagues for many years, yet did not see fit to call staff and/or the owner of KWT Engineering as witnesses. Moreover, the Respondent

was assisted by an attorney, who may have advised the Respondent accordingly, should any doubt have arisen, that the parties are

wrongly cited.

48. At the hearing of this matter, and when asked about the calling of any witnesses, counsel for the Respondent confirmed to the Tribunal that the Respondent’s representative was the only witness.

49. The Tribunal could not identify any attempts by the Respondent to call witnesses to support its assertion that the Respondent should not be before the Tribunal. In the absence of this, the Tribunal holds the view that it is indeed the Respondent who should be before the Tribunal.

50. The undisputed instance of the Respondent securing a quote from another expert service provider before work was done to repair the clutch supports the Applicant’s understanding that the Respondent was the single window of co-ordination for communication about all secondary or expert services required, and related to the repair of the truck. This in essence was a form of sub-contracting by the Respondent.

51. There is thus a legitimate expectation on the part of the Applicant that the Respondent would ensure that quotes were available prior to the authorisation of any work to be performed in relation to repairs to the truck.

52. What is also patently clear; and not in dispute between the parties; is that the invoice was issued by the Respondent on its letterhead.

53. In the absence of evidence to the contrary, the Tribunal is satisfied that the Respondent is the correct party before it. Therefore the point in limine regarding the correct party to being before the Tribunal, as raised by the Respondent, fails.

54. At the hearing, the Respondent did not pursue the other point in limine raised in its submissions at the interlocutory hearing, namely: that the registered company owned by the Applicant and called Lyncess

Resources International CC, should be the Applicant in the matter. Indeed this point was dealt with in the interlocutory hearing

judgment, in which it was ruled that the Respondent did not provide the basis for a finding that the Applicant did not have any standing; nor that the action should have instead been instituted against a juristic person. The Respondent did not call any witnesses or provide any evidence to dispute the ruling in the interlocutory hearing. The point in limine is thus moot and of no practical value or importance; it being unproven and thus hypothetical in nature.

CONSIDERATION OF THE

EVIDENCE AND THE LAW

55. Section 15 the of the CPA is abundantly clear regarding the rights of a consumer regarding pre-authorisation of repair service, stating:

“Pre-authorisation of repair or maintenance services

15. (1) This section applies only to a transaction or consumer agreement—

(a) with a price value above the threshold prescribed in terms of subsection (5); and

(b) if, in terms of that transaction or agreement, a service provider supplies a repair or maintenance service to, or supplies or installs any replacement parts or components in, any property belonging to or in the control of the consumer, and—

(i) the service provider has, or takes, possession of that property for the purpose contemplated in this paragraph; or

(ii) in any other case, the consumer requests an estimate before any services or goods are supplied.

(2) A service provider to whom this section applies, must not charge a consumer for the supply of any goods or services contemplated in subsection (1), unless—

(a) the supplier or service provider has given the consumer an estimate that satisfies the prescribed requirements, and the consumer has subsequently authorised the work;…. “

56. It is undisputed that the Respondent provided the Applicant with quotes for the initial work to repair the engine and for work to be undertaken by an expert service provider to repair the clutch. By the Respondent’s own admission, the only documentation that it provided to the Applicant for engineering services, was an invoice for the amount of R20 978.00.

57. It is clear that despite the Applicant’s numerous and insistent requests for an estimate for the engineering work on the truck

engine, he did not receive this. As a result, the Applicant was not placed in a position to authorise the engineering work to the engine as is his right in terms of section 15 of the CPA. Yet, after the fact, he was presented with an invoice for this work by the Respondent.

58. Section 15 (2)(a) specifically prescribes that the Respondent must not charge the Applicant for the engineering work because the Respondent did not provide an estimate for this work before these services were provided and consequent to this, the Applicant could not and did not authorise this work.

59. Another very important consideration in this matter is the clear intention of the CPA to ensure that the rights of consumers are protected. There are numerous sections in the CPA where this intention is made very clear. The CPA’s Preamble explains that the promotion and protection of the interests of consumers are the very reasons why the CPA was introduced. Further section 4(2)(b)(2) of the CPA provides that in any matter brought before the Tribunal or a court in terms of this Act the Tribunal or court, as the case may be, must—

(i) promote the spirit and purposes of this Act; and

(ii) make appropriate orders to give practical effect to the consumer’s right of access to

redress, including, but not limited to—

(aa) any order provided for in this Act; and

(bb) any innovative order that better advances, protects, promotes and

assures the realisation by consumers of their rights in terms of this Act.

60. Section 4 (3) provides that if any provision of the CPA can reasonably be construed to have more than one meaning, the Tribunal or court must prefer the meaning that best promotes the spirit and purposes of the CPA, and will best improve the realisation and enjoyment of consumer rights.

61. The fundamental aim of consumer protection legislation is access to justice. The improvement of access to justice is regarded as one of the ‘over-arching goals of consumer protection legislation’.[1] In the policy document setting out the reasons why the South African legislature deemed it necessary to introduce consumer protection

legislation, the drafters highlighted in particular the difficulties that consumers face when it comes to accessing justice.[2] This includes having to approach the normal civil courts if suppliers fail to deal with legitimate complaints.[3] Even when claims are sufficiently large to be of some serious concern to consumers, approaching the civil courts is notoriously

expensive.[4] Litigation is also very intimidating and most consumers have no idea about how to launch civil proceedings. Consumers who do take the time to complain often find that their complaints are ignored and they do not know who to turn to next.

62. In the case of Imperial Group (Pty) Ltd t/a Cargo Motors Klerksdorp v Dipico and another[5] the court pointed out that “the purposes of the Act are to promote and advance the social and economic welfare of consumers in South Africa by, amongst others,

providing a consistent, accessible and efficient system of consensual resolution of disputes arising from consumer transactions; and an accessible, consistent, harmonised, effective and efficient system of redress for consumers”.[6] The Applicant in this matter is precisely the kind of consumer for whom this legislation was enacted and the evidence before the Tribunal indicates just how difficult it has been for him to resolve the problems he has experienced with repairs to his truck in order that he continues to be economically active in his trucking and cartage business.

63. Section 27 of the National Credit, Act No 34 of 2005, (the NCA) extends the following functions to the Tribunal:

‘The Tribunal or a member of the Tribunal acting alone in accordance with this Act or the Consumer Protection Act, 2008 may─

(a) adjudicate in relation to any─

(i) application that may be made to it in terms of this Act, and make any order provided for in this Act in respect of such an application; or

(ii) allegations of prohibited conduct by determining whether prohibited conduct has occurred and, if so, by imposing a remedy provided for in this Act;

(b) grant an order for costs in terms of section 147; and

(c) exercise any other power conferred on it by law.’

64. Section 4(1) of the CPA provides for various persons who allege that a consumer’s rights in terms of that Act have been infringed,

impaired or threatened, or that ‘prohibited conduct’ has occurred or is occurring, to approach a court, the Tribunal or the Commission.

65. Prohibited conduct is defined in section 1 of the CPA as “an act or omission in contravention of the Act”.

66. The Tribunal is bound to consider the Applicant’s application and to determine if the Respondent contravened the CPA by not ensuring the provision of a quote, and that consequent to that, prohibited conduct had occurred. Should prohibited conduct be declared, the parties would do well to be reminded of the legal principle that no gain is permissible under such circumstances.

CONCLUSION

67. There is no doubt that the Applicant did not receive an estimate or quote for the engineering work to be performed on the truck’s engine. The Applicant was thus not placed in a position to authorise the work; or to negotiate the price; or to decline the service. This is a contravention of Section 15 of the CPA and constitutes prohibited conduct. The Respondent contravened section 15 of the CPA by not providing the Applicant with a pre-authorisation quotation.

68. When considering the order to be made, it needs to be noted that in his papers the Applicant had included in his prayers that he was willing offered to pay R12 000 towards the engineering work. His view was that this was a reasonable market-related price. At the hearing, the Applicant withdrew this offer, in view of the degree of difficulty he had subsequently experienced over a very lengthy

period, attempting to arrive at an amicable solution. However, the situation of the Applicant’s truck his truck was not being repaired, impacted negatively on the economic viability of his cartage business.

ORDER

69. Accordingly, the Tribunal makes the following order –

69.1. The Respondent is ordered to settle all outstanding monies that are required to enable the release of the engine of the Applicant’s

truck from KWT Engineering;

69.2. The Respondent is to complete the overall repair work on the truck as initially agreed; authorised; and paid for upfront by the Applicant, at the Respondent’s own costs. Said repairs to carry a mandatory guarantee for repair-work as provided for in the CPA;

69.3. The Respondent is directed to return the truck to the Applicant in good working order within 20 business days from receipt of this judgment; and

69.4. No order is made as to costs.

THUS DONE IN CENTURION ON THIS 26TH DAY OF FEBRUARY 2018

[signed]

Dr L. Best: Presiding Member

Adv. F Manamela (Tribunal Member) and Ms M Nkomo (Tribunal Member) concurring

[1] Rickett & Telfer, ‘Consumer access to justice, an introduction’ in Rickett & Telfer (eds), International Perspectives on Consumers’ Access to Justice (Cambridge 2003)

[2] DTI, Draft Green Paper on Consumer Policy Framework GN 1957 in GG 26774 of 9 September 2004 at 40.

[3] See Woker, T, ‘Why the need for consumer protection legislation? A look at some of the reasons behind the promulgation

of the National Credit Act and the Consumer Protection Act’ (2010) 31(2) Obiter 217.

[4] See Van Heerden & Barnard, ‘Redress for consumers in terms of the Consumer Protection Act 68 of 2008: a comparative discussion’(2011) 6(3) Journal of International Commercial Law and Technology 131 at 132.

[5] Northern Cape Division Kimberley Case No 1260/2015 handed down on 1 April 2016.

[6] Ibid para 25, where the court quoted s3 (1) (g)-(h) of the legislation.