It may be in contract, but is it legal?

Comment on this story

iol travel dec 23 st wendy contract


COOLED OFF: Alta du Plessis of Pretoria changed her mind about a contract she had signed, but could not cancel it with the company. She turned to ConsumerWatch.

Johannesburg - Many people succumb to high-pressure, high- energy “hard sell” presentations, only to realise later – away from the influence of the slick pitch and insistent sales people – that they don’t really want, or can’t afford, what they agreed to buy.

Or, on reading the fine print of the contract for the first time, it dawns on them that the bits the presentation didn’t touch on are a deal breaker.

It’s for this reason that legislators the world over have given consumers a rare “out” when it comes to direct marketing deals. It’s called a cooling off period – usually about a week – in which they can cancel the deal, without having to give a reason, and get whatever money they’ve paid refunded.

Our Consumer Protection Act, Section 16, states that a consumer can cancel a direct marketing deal “by notice to the supplier in writing, or another recorded manner, and form, within five business days after… the transaction was concluded.”

Clearly the last thing such companies want is to lose a sale and have to refund the customer, so some have come up with rather elaborate means of thwarting people’s attempts to deliver that written cancellation within those five business days.

In some cases, no contact details are provided to the consumer, or they are given e-mail addresses which don’t exist. One woman told me when she tried to hand-deliver her cancellation letter to a company she’d signed a deal with after a demonstration in her home, the staff, who had a camera focused on the solid street gate, refused to open for her.

Last week Alta du Plessis of Pretoria turned to Consumer Watch for help when the “travel club” she’d signed up with refused to refund her, despite her having sent them her written cancellation within the cooling off period of five business days.

She’d received one of those “you’ve won a holiday” calls and attended a presentation in a Centurion hotel on Saturday, November 9, hosted by Cape Town-based Vacation Hub International (VHI).

The company’s website describes its activities thus: “a membership-based wholesale travel club giving its members access to industry professionals, pre-negotiated rates, guaranteed discounts from rack rates for accommodation and car hire.”

It all sounded wonderful, and Du Plessis walked away from the presentation having had her credit card swiped for a R9 174 deposit, and having put her signature to a contract that committed her to paying a whopping R1 202 a month for the next 24 months.

Unsurprisingly, Du Plessis soon had second thoughts and decided to cancel the contract.

She called the offices countless times during the following days, she says, begging to know what she had to do to cancel. She says she was told by two employees that she could send a fax, and one gave her the company’s e-mail address as well.

So on November 11 she faxed and e-mailed her cancellation, and, just to make extra sure, she went on to the company’s website and sent a letter by “fast mail” to the PO Box address she found there.

Member liaison manager Hannelie Jacobs e-mailed her early this month, acknowledging receipt of her cancellation and saying she just needed a signature to process it.

But in a letter dated December 13, Du Plessis was told by VHI that she did not “meet the criteria for withdrawal” as laid out in the termination clause of her contract.

That clause reads that the consumer may cancel the agreement within five business days from signing by giving the company written notice “at the address set out in Clause 22”.

So instead of finding the address right there in the cancellation paragraph, the consumer has to jump through another hoop and find Clause 22, which provides a residential address.

And that’s what Jacobs told me when I took up this case with her.

Du Plessis may have sent written cancellation, in time, to VHI’s fax number, e-mail address and PO box address, and she may have received an e-mail acknowledging receipt of that cancellation, but according to VHI, it’s not valid because she didn’t comply with the contract and send it to their residential address.

Fortunately for consumers, the CPA trumps any notice, clause or condition which a company chooses to come up with.

So, Du Plessis’s cancellation notifications were valid, and she is entitled to a refund of her R9 174, plus a release from her obligation to pay that R1 202 for the next two years – and I told Jacobs as much.

I also pointed out that the VHI contract was illegal in respect of its Clause 18, which states that should someone choose to cancel within five business days, in terms of the CPA’s direct marketing provisions, they would be liable to pay half the monthly service fee for the full duration of the contract, would not be refunded any fees already paid and, on top that that, are obliged to pay a cancellation fee.

What an outrage! And the company has the gall to claim that it is CPA-compliant.

Unfortunately, while I was awaiting a response from Jacobs, Du Plessis, in a panic about the prospect of her bank account being debited by VHI in January, and realising that its offices were about to close until the new year, sent an e-mail to Jacobs, agreeing to her offer allowing her to pay “just” R199 a month for the next 10 years. And no refund of her R9 174.

And so, instead of addressing the issue of VHI’s non-CPA compliant terms and conditions, Jacobs responded to my e-mail on Friday morning, by saying simply: “We have resolved this matter with our member.”

When I repeated that Du Plessis’s initial cancellation was valid and she was thus owed a full refund with a full release from the contract, she responded: “Kindly refer to my earlier answer.”

There are several similar complaints about VHI on consumer complaints website Hello Peter.

I shall be pursuing the case with the National Consumer Commission.

It’s worth remembering that this saga began with a call telling Du Plessis that she was a winner. - The Star

Get our new, free Travel newsletter - subscribe here...

sign up

Comment Guidelines

  1. Please read our comment guidelines.
  2. Login and register, if you haven’ t already.
  3. Write your comment in the block below and click (Post As)
  4. Has a comment offended you? Hover your mouse over the comment and wait until a small triangle appears on the right-hand side. Click triangle () and select "Flag as inappropriate". Our moderators will take action if need be.


Business Directory