In this Article we will investigate whether the Consumer Protection Act 68 of 2008 (CPA) applies to second-hand goods or used goods. Will a consumer be protected under the act against defective second hand goods.
Vousvoukis v Queen Ace CC t/a Ace Motors 2016 (3) SA 188 (ECG) the court was faced with the question of whether the provisions in the Consumer Protection Act 68 of 2008 (CPA) protecting consumers against defective goods, also includes second-hand or used goods.
In the above case, Mr. Vousvoukis (the consumer), a businessman, instituted an action against Ace Motors (the supplier) for the restitution of the purchase price of a second-hand BMW motor (the vehicle) that he bought from the latter in September 2011 for the sum of R 470 000. In December 2011, having driven approximately 4 000 km the vehicle experienced mechanical problems. It was agreed that the engine would be replaced at the expense of the supplier. The repaired vehicle was eventually returned to the consumer in February 2012. In July 2012, after another 8,000 km the replaced engine experienced mechanical problems. The oil pump drive gear was badly damaged due to some unknown cause.
The consumer tendered the return of the vehicle, but the tender was rejected. He then lodged proceedings claiming termination of the agreement claiming a refund of the purchase price. In the alternative he claimed restitution in terms of s 56 of the CPA in that the supply of the vehicle contravened the implied warranty of quality provisions of s 55. In a further alternative he claimed that the second engine that was installed contained a latent defect at the time of installation. He claimed restitution under the actio redhibitoria. – (An action to cancel a sale in consequence of defects in the thing sold. It was prosecuted to compel complete restitution to the seller of the thing sold, with its produce and accessories, and to give the buyer back the price, with interest, as an, equivalent for the restitution of the produce.)
The supplier argued that the provisions of Sections 55 and 56 of the CPA were inapplicable as they did not apply to used goods and that the defect was not so serious that the buyer was entitled to rescind the contract. Section 5(1)(a) provided specifically that the Act applies to ‘every transaction occurring within [South Africa]’, unless it was specifically exempted.
Pickering J held that although there is a definition of ‘used goods’ in the CPA, the term is not referred to again in the Act. None of the exemptions were relevant to the present transaction. The court held that the generic term ‘goods’ includes used goods. There is no indication that the legislature intended to exclude used goods from the protection against defective goods in ss 55 and 56.
The court further held that even if there is uncertainty, the CPA must be interpreted in a manner which best promotes the spirit and purpose of the Act. To exclude used goods would undermine the Act and would exclude protection for that part of the population most in need of such protection, namely the socio-economically vulnerable.
The court pointed out that the protection against defective goods under the CPA lapses after the six month period stipulated in s 56(2). Equally, the protection for defective repairs lapses after three months in terms of s 56(3).
In the present case both these terms had lapsed and the consumer was not entitled to rely on the protective rights under ss 55 and 56. The replacement of the engine did not amount to a new supply of goods or separate transaction, but was a repair under the original transaction, especially since the supplier paid for the engine itself. The seller did not supply a defective engine, but a defective vehicle.
The court further confirmed that neither a court nor the National Consumer Tribunal has the power to extend the periods stipulated in s 56. However, where the statutory rights have lapsed, consumers still retain their common law rights under the aedilitian actions for latent defects. In order to terminate the agreement, the consumer must prove that the defect was serious enough to warrant termination. The test is whether a reasonable consumer would have declined to enter the transaction if he had known about the defect.
The court concluded that the latent defect was not serious enough to warrant rescission as the defect could be repaired relatively easily by replacing the oil pump at a cost of about R 15 000.
The consumer’s claim for rescission under the CPA, alternatively under the actio redhibitoria, were accordingly rejected with costs.
Credit: De Rebus in 2016 (July) DR 44.