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INCORRECT PRICING BY ONLINE SUPPLIERS – HOW IMPORTANT ARE THOSE PESKY T’S & C’S?

 

Consider the following scenario:

 

A consumer purchases a coffee table priced as at R2599.00 by an online supplier. Two days after payment is made by the purchaser, the purchaser is notified by the supplier that the coffee table’s price was not correct and it is actually priced at R 3500. The supplier advises the consumer that it will not deliver the coffee table and that the purchaser will receive a refund. The consumer wants the supplier to deliver the coffee table and does not want a refund.

 

In a similar scenario where a complaint was lodged with the consumer services ombudsman [(20145261021) [2014] ZACGSO 1 (2 July 2014)] it was decided that the supplier is not bound to provide the consumer with an item at the incorrectly advertised price.

 

It is an established principle in our law that by placing an item for sale at a certain price, a supplier is merely inviting offers from members of the public to purchase that item at that price. It is the consumer who makes an offer to the supplier to purchase the item and the supplier is not obliged to accept the offer. This principle applies to online transactions as well.

 

If the supplier does not accept the offer by the consumer what rights does the consumer have? How does the consumer know when the sale was concluded?

 

It all depends on those pesky “T’s and C’s” so don’t be too quick to simply click “I Accept”...

 

Consumers are afforded some protection under the Consumer Protection Act 68 of 2008 (the “CPA”) and the Electronic Communications and Transactions Act Act 25 of 2002 (the “ECA”). However, certain sections of the CPA do not apply to electronic transactions if ECA applies to them.

 

According to section 23 of the CPA a supplier cannot display any goods for sale without displaying a price in relation to those goods, and a supplier cannot require a consumer to pay a price for goods or services higher than the displayed price.  However, in the case of online transactions the ECA applies and not the CPA.

 

The ECA obliges online suppliers to make all terms and conditions applicable to the transaction readily available to consumers from the website through which they transact. More particularly, section 43 of the ECA sets out a list of information that must be provided by online suppliers to consumers in respect of goods “advertised online”, and enables consumers to cancel transactions within 14 days when the suppliers do not comply.

 

Suppliers are entitled to state in their terms when an ecommerce transaction is completed, but this must be brought to the attention of the consumer.

 

Returning to the above scenario, if the supplier stipulated in its terms and conditions that the contract would be concluded only once the customer's order is accepted by the supplier, the supplier would not be bound to deliver the coffee table in return for the consumer’s payment of the advertised price i.e. R 2599.00, and the consumer would not be entitled to demand delivery of the coffee table or to refuse receipt of a refund. This is with the proviso that the supplier’s terms and conditions were brought to the attention of the consumer.

 
If, however, the supplier did not make such a stipulation, the default position is that the agreement as well as any error in the price becomes binding upon acceptance by the consumer.

 

Compiled By:  Natasha Christophers (Senior Associate)(Commercial/Litigation/Matrimonial Departments) (Johannesburg Office)
E-mail:  natasha@tmj.co.za
Tel:  011 784 2634/5