Ina Opperman

By Ina Opperman

Business Journalist


Signing a contract? Watch out

It is not that simple to just sign on the dotted line. You can be signing your life or finances away if you do not read a contract first.


Signing a contract is something you should approach with caution. If you sign a contract that is not completely filled out or one that contains unfair conditions, you can create endless trouble for yourself.

You have rights when you sign contracts, but prevention is better than cure. It is much better to think before you sign than to struggle afterwards to get the contract cancelled. One of the most important tips to keep in mind when you sign a contract, is never to sign a contract that is not fully and properly filled out.

If you do, the other party can fill in anything in the open spaces and you will struggle to prove it was not there when you signed. Never let salespeople pressure you into signing with stories like the offer will expire soon and you will lose out if you do not sign now. Rather pay more later than sign that will become a huge regret.

How the Consumer Protection Act protects you

Section 48 of the Consumer Protection Act (CPA) protects you against unfair, unreasonable and unjust contract terms. This section provides that suppliers must not enter into a contract with you for the supply of goods or services in an unfair, unreasonable or unjust manner.

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According to section 48, suppliers are not allowed to:

  • require you to waive your rights, assume an obligation, or indemnify them from liability based on unfair, unreasonable, or unfair negotiations;
  • use contracts that are excessively one-sided in favour of anyone other than you;
  • use contracts that contain false representations;
  • use contracts that rely on a false, misleading or fraudulent representation;
  • use contracts concluded on the basis of negotiations, conditions or notices that are unfair, unreasonable, unjust or unscrupulous, or contain facts that have not been properly explained.

Conditions to beware of

Regulation 44(3) of the CPA stipulates that these terms in a contract are unfair, unless the supplier can prove in the circumstances that it is not unfair.

Conditions are unfair when it:

  • Excludes or limits the supplier’s liability for the death or personal injury of the consumer, if caused by the supplier’s actions or negligence;
  • Removes or limits your legal rights to claim fair compensation from the supplier or any other party doing something wrong. This includes your right to withhold money that you must pay if you claim against the supplier;
  • Limits the supplier’s duty to fulfil his agents’ agreements;
  • Limits the supplier’s joint liability (where one person is responsible for the actions of others) for his agents;
  • Forces you to accept responsibility for paying for the merchant’s liability to other parties;
  • Excludes or limits your right to rely on the statutory defence of prescription;
  • Modifies the normal rules regarding the distribution of risk to the detriment of the consumer;
  • Allows the supplier to change the original price agreed upon, without giving you a chance to cancel the contract;
  • Allows the trader to change the terms of the contract, which include the nature of the goods or services;
  • Gives the trader the right to determine whether the goods or services were provided in accordance with the contract;
  • Gives the supplier the exclusive right to interpret any condition of the agreement;
  • Allows the supplier to cancel the agreement unilaterally without you being able to do this as well;
  • Allows the supplier to cancel an open agreement without fair notice, except if you have breached an important part of the contract, such as not paying;
  • Obliges you to fulfil all the conditions, while the supplier does not have to;
  • Allows the supplier only to sidestep or limit the execution of the agreement;
  • Allows only the supplier to decide whether to renew the agreement or not;
  • Allows the supplier to take an unreasonably long time to fulfil the agreement;
  • Allows the supplier to retain a payment you made when you fail to conclude or perform the agreement, without giving you the right to be compensated in the same amount if the supplier fails to conclude or perform the agreement;
  • Requires you to pay more than the trader’s damages if you fail to comply with the agreement;
  • Allows the supplier to demand a very high fee from you for use, right or performance or expense when one of you cancels the contract;
  • Allows the supplier to transfer his duties to someone else without your permission or to your detriment;
  • Limits your right to sell the goods by setting a limit on the portability of any trade guarantee;
  • Forces you to acknowledge a fact or make a statement that is not in your favour, unless you had enough time to consider the statement or acknowledgement. It is then also the supplier’s duty to direct you to the statement and explain its meaning to you;
  • Provides for assuming that a statement from the supplier, which is important to you, has reached you, unless it has been sent by registered mail;
  • Excludes or limits your right to take legal action or any other lawful means of obtaining compensation. This includes requiring that a complaint be resolved through arbitration, which is not covered by the Act or other legislation;
  • Limits the evidence available to you or places a burden of proof on you that is usually the responsibility of the supplier;
  • Establishes a limitation period that is shorter than the usual period in which you can take legal action;
  • Gives the supplier the right to claim legal or other costs that are more than usual if you do not have the same right.

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