22 June 2021 by and

Not every faulty Bluetooth should have its day in court – a discussion of consumer protection in Motus Corporation (Pty) Ltd and another v Wentzel

Robin Hood proponents will be disappointed to learn that the purpose of the protections contained in the Consumer Protection Act 68 of 2008 (CPA) is not simply to “take from the rich and give to the poor”. The Supreme Court of Appeal (SCA) recently made clear as much, when it overturned a ruling by the Gauteng High Court ordering Renault to refund a consumer the full purchase price of a Renault Kwid plus finance charges payable by the consumer to a third party.

The purpose of the CPA is to “promote and advance the economic welfare of consumers” to the extent provided for in its provisions. This means that any consumer who invokes the protections provided for in the CPA must be able to show that the supplier in question has breached the relevant provisions of the CPA, properly interpreted. In Motus Corporation (Pty) Ltd and another v Wentzel, the SCA found that the High Court misdirected itself both in the interpretation of the CPA and in the remedy ultimately granted.

Factual background

In the High Court, Ms Abigail Wentzel sought (and was granted) a refund in the amount of R256,956.84 in respect of a Renault Kwid motor vehicle purchased from Renault. The actual price of the vehicle was R176,400. However, the court ordered Renault to refund Ms Wentzel the amount of R256,956.98 which included the costs associated with financing the motor vehicle through a third party.

Ms Wentzel relied on sections 55(2) and 56(2)-(3) of the CPA for her relief. We explain these provisions below, which deal with breaches of warranty and refunds for defective goods. In summary, the relevant facts of Ms Wentzel’s claims were as follows:

  • On 7 December 2017, Ms Wentzel purchased the motor vehicle from Renault.
  • On 11 December 2017, Ms Wentzel reported a strange ticking noise in the motor vehicle and mentioned that her air conditioning was on occasion faulty.
  • On 27 December 2017, Ms Wentzel took her motor vehicle to Renault for an inspection and repairs were carried out at no charge.
  • On 23 January 2018, Ms Wentzel again took her motor vehicle for inspection, reporting issues with her brakes, the windows rattling and sound issues with her Bluetooth system. Repairs were again carried out at no charge.
  • On 23 February 2018, due to the motor vehicle reportedly making an unbearable noise, Ms Wentzel took the motor vehicle back to Renault for a service. A motor vehicle “health check” was carried out by one of Renault’s employees, who stated on affidavit that every problem Ms Wentzel had raised, had been properly attended to.
  • On 14 March 2018, Ms Wentzel escalated the matter to Renault’s principal dealer (Petzer), due to the alleged persistent problems. In response, Petzer offered to take her motor vehicle back and trade it in for a Renault Clio. Ms Wentzel declined the offer.
  • In the interim, Ms Wentzel had lodged a complaint with the Motor Industry Ombudsman of South Africa (MIOSA) and was subsequently (and incorrectly) advised that MIOSA did not have jurisdiction regarding the matter, given that legal action had already been instituted by one of the parties. At that stage, no legal action had been instituted.
  • On 16 May 2018, Ms Wentzel launched an application in the High Court alleging a breach of, among others, sections 56(2)-(3) of the CPA.
  • Renault opposed the application. It contended that all of Ms Wentzel’s complaints had been attended to, and that the remaining complaint regarding the Bluetooth system was due to the noise from the motor vehicle being driven at high speeds. Additionally, Renault raised four special pleas, including that Ms Wentzel had failed to exhaust her internal remedies provided by section 69 of the CPA, and that she should not have proceeded by way of motion proceedings given the material disputes of fact in the matter.

Judgment

The High Court made short shrift of Renault’s defences. It held that “the courts must take a robust approach towards the economic giants such as [Renault], who can flex their financial muscle to bully unsuspecting consumers to accept flawed goods…”. To drive its point home, the court a quo ordered Renault and Renault South Africa (being the group company), to jointly and severally refund the full purchase price of R256,965.84.

On appeal, the SCA briefly considered the special pleas raised by Renault before proceeding to deal with the facts of the matter. In spite of the fact that the SCA did not hear the full argument in relation to the issue of internal remedies, it made a number of remarks about restricting a consumer’s right to approach the court, given that this right is specifically entrenched in the Constitution, suggesting that it would likely have found that a failure to exhaust internal remedies does not oust the High Court’s jurisdiction. The SCA declined to deal with the remaining special pleas.

The SCA concluded that there were two mutually destructive factual versions before it: on the one hand Ms Wentzel claimed that the motor vehicle and particularly the Bluetooth system remained faulty and had not been properly repaired, whilst on the other hand Renault insisted that it had attended to all of the alleged defects and denied that the Bluetooth system was faulty at all. In this regard it held that the High Court erred in not applying the Plascon-Evans test (i.e. where a dispute of facts arises on affidavit, a final order can only be granted if the facts presented by both parties (although contradictory), justify such an order).

The SCA also conducted an analysis of the consumer rights contained in section 55(2) of the CPA and which are protected by section 56. Section 55(2) provides that every consumer has a right to receive goods that are free from any defects and which are useable for a reasonable period of time, having regard to the normal use of the goods. Section 56(3) allows a consumer to return goods after a supplier has repaired any part thereof, and within three months from the date of such repair, if the defect is not remedied or a further defect is discovered. At the heart of both of these sections lies the definition of the word “defect” as set out in section 53(1)(a) of the CPA, which relates to either (i) a material imperfection rendering the goods less acceptable than a person could reasonably expect; or (ii) any characteristics of the goods that renders it less useful than one would reasonably expect. The SCA held that clearly not every small fault constitutes a defect as defined.

Although no evidence had been led in court regarding the reasonable expectations of motor vehicle purchasers, the SCA found that a Bluetooth system was merely an accessory to the motor vehicle, and a deficiency in relation thereto did not render the motor vehicle less acceptable. The SCA expressed a similar sentiment regarding the other deficiencies complained of, but nevertheless proceeded to the second part of the enquiry, namely whether Ms Wentzel was entitled to a refund in terms of section 56. Here the SCA found that from 28 February 2018 Ms Wentzel had not reported any further defects or made complaints alleging that repairs had not been performed properly. Although the wording of the CPA refers to the term “discovered” in relation to further defects, the SCA held that the reporting of these defects is necessary in order to enforce the protection contained in that section. As such, the three-month period contained in the CPA had come and gone by the time Ms Wentzel brought the matter before the High Court.

The SCA ultimately held that Ms Wentzel had failed to make out a case under section 56(3) of the CPA, especially having regard to the serious factual disputes which arose on the papers. Insofar as the dispute could be determined on the papers regarding the nature of the defects and the repairs made by Renault, the SCA held that such dispute ought to have been resolved in favour of Renault on the ordinary approach to disputes of fact on motion.

Conclusion

This case is a testament to the fact that the CPA should not simply be brandished as a blunt weapon with which to pursue every consumer grievance. Whilst the CPA serves to protect consumers and promote their economic welfare, it is important that consumers make sure their grievance falls within the scope of the protections contained in the CPA, and that they pursue the available remedies expediently and in the legally correct manner. This judgment should also be a caution to lower courts to stay within the bounds of the CPA and not be overzealous in seeking to vindicate the rights of consumers.

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