Fixing our phone rights

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MobilePhones

Cape Town - The theme of this year’s World Consumer Rights Day over the weekend was “Fix our phone rights” – a cause that resonates with many South African consumers, if my inbox is anything to go by.

And the campaign – by Consumers International (see box) – wasn’t a one-day wonder, but the launch of a consumer agenda for fair cellphone services worldwide, including access to a reliable service, the security of our data, and fair contracts and billing – the issues most affecting consumers.

In this country, one of the issues most often raised by consumers is the run-around they’re given when their cellphones – either bought outright or as part of a post-paid contract – malfunction.

The Consumer Protection Act’s Section 56 allows consumers to choose their remedy if something they’ve bought fails or malfunctions within six months of purchase. That’s provided the problem was not caused by the consumer – dropping the phone into water, for example.

The supplier may have the phone technically assessed to rule out such user abuse. And if such evidence is found, the warranty falls away, of course.

But gone are the days when the supplier can unilaterally repair a defective item.

That doesn’t stop many from trying, though, as it’s the least costly remedy.

With that in mind, here’s what happened to Sabine Dedering of Sandton.

Dedering has several business and personal cellular contracts with Nashua Mobile.

A few months ago, she renewed her daughter’s contract and received a BlackBerry handset, which was faulty from the start.

“I called the Nashua Mobile call centre and spoke to a consultant, then his supervisor. Both told me the only option was to take the phone in to be repaired,” she told Consumer Watch.

“Shouldn’t I have the right to choose between a repair, refund or replacement? I asked a few times and said I wanted a replacement, but they said I was wrong; that it was Nashua Mobile’s choice, and they chose to repair the phone.”

Nashua Mobile later confirmed that the handset was defective.

When Dedering continued to insist on a replacement, she received a written explanation from the service provider.

“The device is currently being assessed by a specialist and will be referred to the manufacturer- certified repair centre to attend to the faults.

“We understand your request for a replacement device – please note, however, these are issued at the discretion of the repair centre.

“Replacement devices are only issued in the event that the fault on a device is irreparable or may take a lengthy time to resolve.”

On what grounds does Nashua Mobile refuse to allow their customers to choose the remedy if their handsets malfunction within six months?

Here’s what Dedering was told: “You have entered into a continuous subscription agreement with Nashua Mobile in terms of which you received a mobile device as well as the connection of your services to a network operator for the fixed-term period.

“According to our interpretation, Section 56 (2) of the CPA is applicable only to goods which are sold to a consumer. You were provided with a handset as part of your chosen package for the subscription agreement for the supply of services.

“The supply of products in terms of the agreement for services is, therefore, not a sale of goods as contemplated in Sections 55 and 56 of the CPA. It is a supply of services covered by Section 54 of the CPA.

“Accordingly, Section 56 (2) does not apply to the agreement between Nashua Mobile and you, and you are therefore not entitled in the circumstances to demand a new device.

“In any event, the act does not specify that a replacement of any defective goods is required to be new goods.

“Where the repair centre’s recommendation is that the unit be replaced, it’ll be replaced with a refurbished device. This means the device is ‘as new’ but does not come in a sealed box. This fulfils our legal obligation to remedy the defect in the goods provided as part of the service supplied.”

As far as I’m aware, Nashua Mobile is the only cellular service provider with this approach.

Often, a cellular outlet will insist a repair is the only remedy for a defective handset, but when I take up the case at head office, an apology and replacement are swiftly issued.

So I ran Nashua Mobile’s stance past national consumer commissioner Ebrahim Mohamed.

“The commission does not agree with the view that Section 56 (2) is not applicable to handsets acquired through a fixed-term contract that includes provision of a cellular device,” he began.

“That section implies that if a product (cellular device) becomes faulty within the first six months after it was bought – in this case, after a fixed contract was signed – a consumer has an option of returning the product to the supplier and is entitled to either a replacement, repair or a refund.

“The act is not specific in terms of the nature of agreement or transaction through which the product was acquired. The intention of the section is to ensure the consumer is placed in an equivalent position to the one they were in before the product became faulty,” Mohamed said.

But, he pointed out, the act does not specify that a replacement product must be new.

So Nashua Mobile is correct in that respect.

But he said: “There might be circumstances where a consumer may have to be granted a new phone, but such circumstances will have to be properly assessed and investigated based on the merits of each case.”

Armed with Mohamed’s response, I approached Nashua Mobile’s chief operations officer, Barry Venter, for comment.

In short, the service provider is content to carry on regardless.

“Nashua Mobile does not agree with the legal interpretation of Section 56 (2) of the CPA as quoted by you,” Venter began.

Well, as relayed by me, to be precise. The opinion is that of Mohamed, on behalf of the National Consumer Commission, the body which is mandated to enforce the act.

“In our view, and based on expert external legal advice received from a reputable firm of attorneys, Section 56 (2) of the CPA is applicable to goods sold to a consumer,” Venter said.

“Ms Dedering was provided with a handset as part of her chosen package for the fixed-term agreement for the supply of cellular and data services.

“Ms Dedering will note from our standard terms and conditions that although risk and possession of the handset supplied to her as part of the fixed-term agreement transfers to her upon delivery, Nashua Mobile retains ownership of the product supplied for the duration of the fixed-term agreement.

“The supply of products in terms of the agreement for services is, therefore, not a sale of goods as contemplated in Sections 55 and 56 of the CPA.

“It is, however, a supply of services covered by Section 54 of the CPA.

“Accordingly, Section 56 (2) of the CPA does not apply to the agreement between Nashua Mobile and Ms Dedering and she is therefore not entitled in the circumstances to demand the recourse in terms of Section 56 (2).

“As indicated to Ms Dedering, she is entitled to the rights to good-quality goods provided as part of a service as set out in Section 54 of the CPA. This section of the act provides that in the performance of services, if the goods are required for the performance of the services, then a customer is entitled to the use and delivery of goods that are free of defects and of a quality that people are generally entitled to expect.

“If the goods supplied do not meet these standards, then the consumer has a remedy in Section 54 (2).

“This section provides that the customer may require the supplier either to remedy any defects in the quality of the services performed, or goods supplied, or refund to the customer a reasonable portion of the price paid for the services performed and goods supplied, having regard to the extent of the failure.

“The repair centre has assessed Ms Dedering’s handset and recommended to repair the handset in terms of the manufacturer’s warranty.

“In addition to the repair, Nashua Mobile is also prepared to reimburse her the portion of monthly subscription fees paid for the period when she did not have use of the handset, in full and final settlement.

“According to our knowledge, there has to date not been any court ruling on the specific interpretation of the aforesaid sections of the CPA.

“Until such time, Nashua Mobile is confident on the advice received and that our repair policy is compliant with the provisions of the CPA.”

Dedering is unimpressed.

“I wasn’t demanding a new phone,” she said. “I’d have been happy with a working, refurbished one.”

So there you have it.

The ball is now in the commission’s court – Nashua Mobile will not amend its policy until a court tells it to.

Something to bear in mind when choosing a service provider.

And a compelling reason not to assume that all players in the industry have the same terms and conditions.

Where there is a law, there are a variety of self-serving interpretations. - Cape Times


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