Fairness a slippery concept : the common law of contract and the Consumer Protection Act 68 of 2008
| Pages | 116-135 |
| Author | Yeukai Mupangavanhu |
| Date | 01 January 2015 |
| DOI | 10.10520/EJC173469 |
| Published date | 01 January 2015 |
116
Fairness a slippery concept: The common
law of contract and the Consumer
Protection Act 68 of 2008
Yeukai Mupangavanhu
LLB LLM LLD
Senior Lecturer, Faculty of Law, University of the Western Cape
OPSOMMING
Billikheid is ’n Glibberige Konsep: Die Gemeenregtelike Kontraktereg en die
Wet op Verbruikersbeskerming 68 van 2008
Die kontraktereg is in die verlede gekritiseer, onder andere vir die
volgende redes: eerstens, vir die klassieke libertynse grondslag daarvan;
tweedens, omdat dit nie grondwetlike waardes ten volle omsluit het nie;
en, laastens, omdat dit daarvan weggeskram het om aan regverdigheid en
billikheid uiting te gee in die aanwending van tersaaklike regsreëls. Die
kwessie of howe na behore ’n balans tref tussen kontrakteervryheid en
pacta sunt servanda enersyds, en billikheidsoorwegings andersyds bly een
van die probleme wat die moderne kontraktereg in die gesig staar. Heelwat
gewysdes dui daarop dat howe voorkeur verleen aan pacta sunt servanda
bo billikheidsoorwegings aangesien die howe daarna streef om reg- en
handelsekerheid te verseker deur die handhawing van kontrakte wat vrylik
deur die partye daartoe gesluit is, al is dié kontrakte somtyds onbillik. Die
Wet op Verbruikersbeskerming 68 van 2008 (WOV) het ten doel om, onder
andere, die sosiale en ekonomiese belange van Suid-Afrikaanse
verbruikers te bevorder, billike besigheidspraktyke aan te moedig, en
verbruikers teen gewetenlose, onregverdige en onbehoorlike besigheids-
praktyke te beskerm. Die doel van hierdie artikel is om te bepaal of die
regspaternalisme onderliggend tot die uitvaardiging van die WOV wel
daarin slaag om van die kritiek aan te spreek wat in die verlede teen die
gemeenregtelike kontraktereg geopper is, by uitstek ten opsigte van die
billikheidskwessie.
1Introduction
“This is a court of law, young man, not a court of justice”.1
The principles of freedom and sanctity of contract are rooted in the
political and economic philosophies of laissez-faire liberalism and
individualism.2 This classical model of law is based on the assumption
that parties generally have a real freedom of choice and that parties enjoy
more or less equal bargaining power.3 Parties are thus free to accept or
1 Oliver Wendell Holmes as quoted by Walters Justice is God’s idea: Man has
corrupted and destroyed it! (2012) 24.
2 Hutchison & Pretorius (eds) The Law of Contract in South Africa (2012) 23.
3Idem 24.
How to cite: Mupangavanhu ‘Fairness is a slippery concept: The common law of contract and the Consumer
Protection Act 68 of 2008’ 2015 De Jure 116-135
http://dx.doi.org/10.17159/2225-7160/2015/v48n1a7
The common law of contract and the Consumer Protection Act 68 of 2008 117
reject any terms of a contract. The classical model of law is based on the
assumption that there is near perfect competition in the market, and that
parties actually negotiate the terms of their contract.4 Although it is
axiomatic that these assumptions are incorrect, contract law remains a
domain where individual autonomy finds prominent expression.5
Contractual autonomy, and the consent of the parties, is the basic
legitimating factors behind the binding force of a contract. Finding the
right balance between freedom and sanctity of contract, and
considerations of fairness, remains one of the problems facing modern
contract law.6 Much of the jurisprudence shows that sanctity of contract
prevails over fairness as courts seek to promote legal and commercial
certainty by enforcing contracts that are freely and properly entered into
by the parties, even if they are sometimes unfair.7
The first part analyses the question whether the common law of
contract has fully embraced constitutional values to import fairness into
contractual relations. This question remains unanswered not only in
South Africa, but in other countries as well. This state of affairs has
resulted in governments intervening in markets across the globe to
alleviate poverty and some of the hardships caused by unbridled
capitalism, particularly in consumer contracts.8 The rationale behind
contract regulation and legal paternalism through the enactment of the
Consumer Protection Act9 (CPA) is to control the exercise of power and
ensure fairness in contractual relations. The main aim of this article is to
assess whether legal paternalistic interventions by the State, through the
enactment of the CPA, is a solution for the problem of infiltrating the
application of rules in contract law with equity and fairness. It is argued
that healthy legal paternalism is crucial in any given society as it can be
a vehicle for addressing the problem of balancing sanctity of contract
with fairness. However, the effectiveness of the CPA in doing so remains
to be seen.
The second part examines the extent to which the law of contract has
embraced constitutional values in view of the fact that the Constitution
of the Republic of South Africa, 1996 (the Constitution) is the supreme
law of the land. It also discusses the interaction between sanctity of
contract and fairness, as well as equity in terms of the common law of
contract. The discussion also deals with how fairness is generally
imported into the common law of contract, and the extent to which
courts are prepared to balance the competing goals. The third part
assesses the role of the CPA as an instrument that has been designed to
promote fair business practices and to protect consumers from
4Ibid.
5Cserne Freedom of Contract and Paternalism: Prospects and Limits of an
Economic Approach (2012) 81.
6 Hutchison & Pretorius 22.
2002 6 SA 21 (SCA); Brisley v Drotsky 2002 4 SA 1 (SCA).
8 Hutchison & Pretorius 24.
9 68 of 2008.
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