Can a consumer take you, the service provider, to court because they did not understand some of the terms and conditions of your signed contract?
The Consumer Protection Act came into full effect during April 2011 with the result that it is now against the law to use difficult-to-understand language in any business document or contract.
Business documents such as contracts, letters of agreement or even an instruction booklets are often written in language that is hard to understand for the average consumer, which is why there are specific plain language regulations in The Consumer Protection Act to avoid situations where consumers sign documents they do not understand.
Protecting the consumer
The Act’s express purpose is to make sure consumers are not treated unfairly and that does mean using language that a consumer can understand. The act makes the use of obscure and confusing wording, especially in binding contracts, illegal.
Too many consumers have landed up in bad situations because they haven’t understood the document they’ve signed. Contracts are often written with difficult to understand phrasing and jargon simply because it has been accepted that contracts can only be written in one way and thus unintentionally they become difficult to understand.
There are instances however where unscrupulous businesses have used complicated language on purpose, as a way to trick consumers into paying for something they can’t afford, to sign away their rights or to agree to unfair terms and conditions.
Defining plain language
The Consumer Protection Act defines plain language in Part D, Section 22 as follows:
“For the purposes of this Act, a notice, document or visual representation is in plain language if it is reasonable to conclude that an ordinary consumer of the class of persons for whom the notice, document or visual representation is intended, with average literacy skills and minimal experience as a consumer of the relevant goods or services, could be expected to understand the content, significance, and import of the document without undue effort, having regard to:
- The context, comprehensiveness and consistency of the notice, document or visual representation;
- The organisation, form and style of the notice, document or visual representation;
- The vocabulary, usage and sentence structure of the notice, document or visual representation; and
- The use of any illustrations, examples, headings, or other aids to reading and understanding.”
This means that one won’t be permitted to draft documents worded so widely that they could be understood in several ways. The Act states that if there is any doubt about the meaning of certain words or terms and conditions, the benefit will go to the consumer.
Even advertising and marketing may no longer contain any ambiguity. Advertisements won’t be allowed to exaggerate and they will have to be easy to understand, fair and honest. The Act states that service providers will have to spell out everything in words that consumers can understand; alternatively the consumers have the right to full disclosure and information in plain and understandable language.
It is important to note that the provisions only apply if the Consumer Protection Act applies to the transaction – i.e. if the supplier is contracting in the ordinary course of his business with a natural person or a juristic person, with a gross asset value or gross annual turnover of R2 million or less.
If you are unsure whether any of your business documents contracts line up with these requirements, why not give us a shout at email@example.com. We have a group of staff who have extensive insight into this area.
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice.