Cape Town - So what happens when the jeans you've tried on
in the store don't fit when you get home, or the lawnmower you've bought works
only on a specific type of grass - contrary to what the advertisement claims?
What are your rights?
Danie Strachan, partner at Adams & Adams, wraps up the
dos and don'ts of returns in the retail space.
Many retailers have standard policies that deal with returns
and repairs relating to defective products.
Some of these policies may have been drafted long ago and
have probably become outdated due to changing legislation.
The Consumer Protection Act (CPA) contains provisions that
have a direct impact on these policies. The CPA introduced standard warranties
for goods supplied to consumers.
There are also remedies for consumers who purchased goods
that do not comply with those warranties. There has been some confusion about
when consumers may return goods to suppliers, or request refunds or
replacements.
Prescribed warranties
The CPA prescribes four warranties for products. These
warranties constitute standards all products supplied to consumers must comply
with.
Suppliers must warrant that their goods:
- are reasonably suitable for the purposes for which they are generally intended;
- are of good quality, in good working order and free of any defects;
- will be usable and durable for a reasonable period of time;
- comply with any
applicable standards set under the Standards Act, 1993 or any other public
regulation.
Suppliers may not exclude the warranties mentioned above,
and a store's returns policy may not limit the rights consumers have under the
CPA. For instance, the policy may not state that sale goods may not be returned
if those goods do not comply with CPA warranties.
The first two warranties may be excluded if the supplier
expressly informs the consumer that the goods are offered in a specific
condition and the consumer expressly accepts the goods in that condition.
This may sound similar to the "voetstoots" provisions
in our common law, but it is much more limited. Firstly, the retailer will have
to make sure that they disclose the product defect to the customer and
secondly, the customer must make it clear that they accept the product in that
condition.
What if a product does not meet the standards?
If a product does not comply with the prescribed warranties,
the consumer may return the product to the supplier within six months after
delivery.
For example, if a customer bought a kettle and it stops
functioning within six months, the customer can return the kettle to the
retailer.
The supplier may not charge a penalty for the return (such
as a handling or administration fee). The goods will also be returned at the
supplier's risk and expense. This means that the retailer must pay for the
costs related to returning the product to the supplier.
If a product does not comply with the CPA's standard
warranties, the consumer has the discretion to request the supplier to either:
- repair the product;
- replace the product; or
- refund the purchase
price paid by the consumer for the product.
The customer can choose any of these three remedies and a
retailer cannot force them to choose the repair option if they would like a
refund.
A consumer cannot return a product for just any defect - it
needs to be a material imperfection in the manufacture of the product which
makes it less acceptable than persons generally would be reasonably entitled to
expect.
A defect can also be any characteristic of the product which
makes it less useful, practicable or safe than people generally would be
reasonably entitled to expect.
The CPA lists some factors that must be considered when one
has to determine whether a product complies with the standard warranties. These
factors include the manner in which, and purpose for which, the products were
marketed.
The instructions for use of the goods and any warnings must
also be taken into account. For example, if a kettle is marketed for boiling
water, a customer should not be able to return it because they could not cook
soup in it or if the kettle malfunctioned because the customer tried to boil
muddy water.
However, the manufacturer and retailer must make sure that
the product information explains the purpose of the product and sets out any
limitations. Product labelling and instructions must be comprehensive.
If a retailer repairs a defective product, but it appears
that the defect has not been fixed or a further defect is discovered, the
retailer must replace the product or refund the purchase price to the consumer.
This means that there is no further repair option. This
remedy is limited to three months from the date of repair.
Other returns
The consumer's right to return goods, as discussed above, only relates to a situation where the goods do not comply with the CPA's standard warranties.
However, there are also other instances in which consumers
can return goods. This is regulated by section 20 of the CPA.
According to this section, goods may also be returned by a consumer if:
- the consumer purchased the goods as a result of direct marketing and the customer has cancelled the transaction within the period allowed by the CPA;
- the consumer did not have the opportunity to examine the goods before delivery and the consumer rejects them because they are not of the contemplated type or quality or do not meet the material specifications of a special order;
- the supplier delivered goods that were mixed with other goods that were not ordered; or
- the consumer
expressed a particular purpose for the goods and, within 10 business days after
delivery, the goods are unsuitable for that purpose.
Retailers must update returns policies
These provisions may afford consumers much wider rights than
allowed for by many retailers' current refund policies. Suppliers therefore
need to check that their policies comply with the CPA's provisions.
The consumer's right to request a refund can also pose a
risk to suppliers. Suppliers would therefore have to be careful to check
whether products are returned within the six-month period provided for by the
CPA.
Retailers must take note that the National Consumer
Commission (NCC) is serious about enforcing the CPA and has already done spot
checks at some stores to check their returns policies.
If a retailer's policy does not comply with the CPA, a
customer could report the retailer to the NCC. The retailer could face
substantial penalties if the policy is not corrected.
- Fin24