A single line of text hidden among the countless stories regarding the Vodacom and Cell C price hikes indicates just how badly Vodacom may have blundered as they, unthinkingly and almost as an aside, announced in March 2015 that they would be unilaterally increasing contract prices effective from May 1, 2015.
The line quoting a National Consumer Commission source reads as follows:
”As part of our investigation, we will also assess the contracts of consumers who have complained to us about the proposed tariff increases to establish if there is any contravention of the Consumer Protection Act.”
And that, ladies and gentlemen, is something none of Vodacom’s mighty legal team could have foreseen when they okay-ed the price hike, which would effect not just new customers but existing ones as well.
Sadly for MTN and Cell C and the other cell-phone service providers, Vodacom has undone in one act of stark big business arrogance what countless legal teams have been striving to do for years – Stay away from close scrutiny by the National Consumer Commission and its mostly untested court legislation enshrined in the Consumer Protection Act (CPA).
Let’s face it, a hard look at the contracts may allow people to be released early from contracts without massive penalties. T’s & C’s could be undone and a whole lot of legal jargon the big service providers rely on to protect them from such things as paying for services that are not used could fall away…
What makes the CPA so scary for big business is that nobody actually knows how South African courts will enforce the Act. By that I mean, most SA legal experts fear it as, almost every single time it is used in court, it sets a new and uncharted precedent. Legal precedents that businesses rely on to carry out somewhat dubious and often unfair acts could, with a single court ruling, become illegal.
I once had the privilege of hearing a very great legal mind (no name mentioned, as I do not have his permission) say to me it was the only legislation he feared. Because it was not just new, but it was very straight forward. If it is unfair, it is illegal. Now how many times have you thought when dealing with a large corporate, they are being so unfair? But their lawyers will quote some 1960s case against John Smith and Company X…
Well, the CPA does not care about history! Section 43 of the CPA only cares about: Is it fair or unfair to the consumer? 90 per cent of every contract you will ever sign would fall foul of being unfair, hence big businesses do everything in their power to avoid anything that may cause their contracts to fall under the scrutiny of lawyers tasked with upholding consumer fairness…
Ah, Pandora’s Box is a powerful thing indeed…
Vodacom, take a deep breath and prepare to reap the whirlwind!
