When getting a new phone is not your call

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• Double trouble for disappointed consumer

Pretoria - The problem with the Consumer Protection Act, as with other pieces of legislation, is that it’s open to various interpretations.

Naturally, it’s the bits least appealing to companies that have given rise to interpretations which favour companies.

One of those bits is Section 56, the “implied warranty of quality” which allows consumers to return defective goods with six months “without penalty… and the supplier must, at the direction of the consumer, either repair or replace the failed, unsafe or defective goods; or refund the customer the price paid for the goods”.

If the consumer opts for repair, and the goods fail within three months, the company may not repair it again: they have the option of refunding the customer or replacing the item.

Before the CPA came into effect on April 1, 2011 – retailers and their suppliers usually opted to repair defective goods. It’s the cheapest option for them, and if that meant the customer had to do without their sofa, microwave or cellphone for weeks, it wasn’t their concern.

Companies can continue to determine their own policies regarding warranties from six months after purchase, but that initial six-month period “belongs” to the CPA.

So, as I’ve mentioned in this column before, every week I hear from consumers whose cellphones, less than six months old – either cash purchases or acquired on contract – break in some way, and when they return them for a replacement, they are told that’s not an option; the phone must be sent for repair. Yoleshen Pillay of Joburg recently wrote for advice, having contacted his service provider, Nashua Mobile, regarding an upgrade.

“When it came to the terms and conditions, I was advised that if I returned a faulty phone after seven days of ownership, I would have to get it repaired. I told them that if the phone was faulty in the first six months, due to a manufacturing defect, I could request a new phone of the same model, but they declined this. Is this lawful?”

I turned to Nashua Mobile’s spokeswoman, Michelle Barnes, for answers. Her response surprised me.

“We believe that the CPA prescription of replacing a faulty device within six months of purchase or providing a refund does not apply to phones acquired with a contract that includes the provision of cellular services for a fixed term,” she said.

“According to our interpretation, Section 56(2) of CPA applies only to goods which are sold to a consumer.

“We will always do our best to meet the act’s requirement in that we remedy the defect in the quality of the goods supplied, or refund to the consumer a reasonable portion of the price he or she paid for the services and goods in line with the extent of the failure. In line with Nashua Mobile policy, our repair centre would assess Mr Pillay’s phone and determine whether it should be repaired or replaced with a refurbished device.

“Our refurbished devices are ‘as new’ but do not come in a sealed box.”

In other words, Nashua is of the view that Section 56 does not apply to its contract subscribers, as they don’t buy their phones outright – the cost is built into the monthly subscription, thus they “pay them off” over two years – and therefore they don’t get to choose their remedy if the phone breaks in the first six months.

“The act also does not specify that a replacement of any defective goods must be new,” Barnes said.

“We are however committed to ensuring that our clients have a fantastic experience with every product and service we supply.

“We do our best to repair a faulty device or replace it with a refurbished one within 15 working days, and provide a loan unit to subscribers while their devices are in for repairs.”

Interestingly, no other player in the cellphone industry has, to my knowledge, taken the view that Section 56 does not apply to contract cellphones.

Using that interpretation, consumers who buy furniture or any other goods by means of an installment contract would also have no right to insist on a replacement.

A consumer attorney said the argument was “specious” and would hold no water in court.

Then I sought the view of acting national consumer commissioner Ebrahim Mohamed. He said the commission did not agree with the view that Section 56(2) did not apply to phones acquired through a contract that includes the provision of cellular services for a fixed term. “The act is not specific in terms of the nature of the agreement or transaction through which the product was required.”

 

That means a cellphone company cannot force a contract subscriber to have a phone which is less than six months old repaired if it breaks.

But Ebrahim went on to point out something which hadn’t occurred or been pointed out to me before.

“The intention of the act is to ensure that the consumer is placed in the same position they were in before the product became faulty.

“In this regard the legislation talks about replacement of the faulty handset, and does not make it a requirement that such replacement must be brand new. The discretion lies with the supplier to make an assessment on whether to replace with a brand new product or a refurbished product of the same standard, bearing in mind that the consumer must receive goods which are safe, of good quality and free of defects.

“In determining the nature of the replacement, factors such as the condition of the handset when returned, the nature of the fault and the price of the product might be considered. The commission agrees that there may be circumstances where the consumer may have to be granted a new phone.”

I must confess to having taken cellphone companies to task for replacing defective phones of less than six months old with refurbished ones, when, in fact, they have a right to do so, provided a refurbished phone is defect-free and of the same model and age as the defective one.

With contract phones, a refund isn’t a practical option, but with goods bought outright, you don’t have to accept a refurbished replacement – in terms of the act, you can insist on a refund. Bottom line – no matter whether you acquired your cellphone by paying for it outright, or via a contract, if it breaks within six months, the service provider has no right to insist that it be repaired, rather than replaced. - Pretoria News

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