Between: INDEMNITY Consumer Protection Act 68 of 2008 ( CPA ) Name of company Registration number VAT Reg no Physical address Postal address Contact number Fax number e-mail address Contact person (herein after referred to as the service provider ) And Name of company Registration number VAT Reg no Physical address Postal address Contact number Fax number e-mail address Contact person (herein after referred to as the supplier )
Preamble 1. The supplier is legally bound to offer consumers safe products of good quality. Quality is not a differentiating factor that marketers can use but it is a minimum requirement that a consumer can insist upon. It refers to goods that are in good working order, free of defects and capable of being used for a reasonable period of time. 2. As you are aware, the Consumer Protection Act, No 68 of 2008 ( the Act ) has been promulgated. The Act came into effect on 01 April 2011. 3. The introduction of the Act has brought with it some major changes in the nature of the relationship between the suppliers, the service provider and the consumers we service. The Act seeks to protect the consumers. In doing so it also places significant power in the hands of consumers with respect to product liability and the Act requires all parties in the supply chain to take all reasonable precautions both in bringing the product to market and through provision of new consumer rights post purchase. 4. Strict liability is enforceable against producers, importers, distributors and retailers and installers who can be held collectively and individually liable, for any harm caused to a consumer wholly or partly as a consequence of: 4.1 the supply of unsafe goods; 4.2 a product failure, defect or hazard in any goods ; or 4.3 inadequate instructions or warnings provided to the consumer pertaining to any hazard arising from or associated with the use of the goods. 5. The Act further emphasises certain fundamental consumer rights, of which the following are important to our industry: 5.1 the right to disclosure of information; 5.2 the right to fair and responsible marketing; and 2
5.3 the right to fair value, good quality and safety. 5.3.1 Right to Disclosure of Information 5.3.1.1 The consumer is entitled to receive information in plain and understandable language and this information may not mislead the consumer. 5.3.1.2 Section 24 of the Act states that a person may not apply a trade description to any goods that is likely to mislead the consumer as to any matter implied or expressed in the trade description. 5.3.2 Right to Fair and Responsible Marketing 5.3.2.1 Section 29 of the Act sets standards to govern the marketing of goods and services to consumers: namely that the producer, importer, distributor, retailer or service provider must not market any goods or services in a manner that is reasonably likely to imply a false or misleading representation concerning those goods or services which are being marketed to the consumer. 5.3.3 Right to Fair Value, Good Quality and Safety 5.3.3.1 Section 55 of the Act states that a consumer has a right to receive goods that are of good quality, in good working order and free of any defects, which will be useable for a reasonable period of time and it requires that the goods must comply with any applicable standards set under the Standards Act No 29 of 1993. 3
6. The principle of strict liability will apply irrespective of whether the harm resulted from any negligence on the part of the producer, importer, distributor or retailer or service provider who may be collectively or individually held liable for harm caused, in terms of section 61 of the Act, even without negligence. Therefore we are putting in place control measures to ensure that the goods we provide to consumers are safe, are not subject to failure, defect or hazard and that they contain adequate instructions and warnings pertaining to any hazard arising from or associated with the use of the goods. 7. For a fuller understanding of the Act, your attention is drawn to the following sections: 7.1 Section 20: Consumer s right to return goods 7.2 Section 22: Right to information in plain and understandable language 7.3 Section 24: Product labeling and trade descriptions 7.4 Section 29: General standards for marketing of goods or services 7.5 Section 41: False, misleading or deceptive representations 7.6 Section 55: Consumer s rights to safe, good quality goods 7.7 Section 56: Implied warranty of quality 7.8 Section 58: Warning concerning fact and nature of risk. 8. Requirements Relative to the Consumer Protection Act: 8.1 The parties must ensure that their respective staff are trained on the products supplied and installation procedures, and the supplier will update the installation and user guide(s) from time-to-time, and will specifically bring to the attention of the installer such changes to the relevant guide(s). 4
9. It is required that: 9.1 The parties must be in possession of an up to date version of the Consumer Protection Act 68 of 2008 and Regulations there under, and must be familiar with the contents and stipulations thereof, and must comply with the Act and regulations. 9.2 The service provider is responsible for having a return system in place and all goods returned by the Consumer in terms of the provisions of the CPA will in return be returned to the supplier for either a replacement or refund as elected by the service provider. 9.3 The supplier must ensure that it complies with all relevant legislation and industry guides applicable to its goods or process it uses for the manufacturing of goods. 9.4 Both parties must ensure that accurate written records are kept of all products batch numbers for product traceability. 9.5 Both parties must ensure no false advertising or misleading claims are made on packaging and in advertising and ensure that no factual claims are made without substantiated proof. 10. Mutual indemnity 10.1 It is now a requirement that all service providers enter into a mutual indemnity arrangement in terms of which and the supplier and the service provider indemnify one another in respect of certain harm suffered by a customer arising out of the use of any product supplied by the supplier and installed by the service provider. 5
IT IS NOW THEREFORE AGREED THAT: 1. Definitions 1.1 In this indemnity, the following terms have the meanings assigned to them below, namely: 1.1.1 Consumer Protection Act means the Consumer Protection Act 68 of 2008; 1.1.2 Harm means harm, as described in section 61(5) of the Consumer Protection Act; and 1.1.3 Parties means the parties set out at the beginning of this document and Party means either one of them, as the context dictates. 1.2 Unless a contrary intention clearly appears, the terms used in this indemnity shall have the meanings assigned to them in section 1 or section 53, as the case may be, of the Consumer Protection Act. 2. Indemnity in Relation to the Consumer Protection Act 2.1 It is recorded that in terms of an existing agreement between the Parties, one of the Parties purchases the goods of the other Party, which goods are ultimately installed at the premises of consumers. 2.2 The Parties acknowledge that in terms of section 61 of the Consumer Protection Act, the producer, importer, distributor, retailer, and/or service provider, may be jointly and severally liable for any harm caused wholly or partly as a consequence of: 2.2.1 supplying any unsafe goods; or 2.2.2 a product failure, defect or hazard in any goods; or 6
2.2.3 inadequate instructions or warnings provided to the consumer pertaining to any hazard arising from or associated with the use of any goods, 2.2.4 irrespective of whether the Harm resulted from any negligence on the part of the producer, importer, distributor, retailer or Supplier, as the case may be. 2.3 Each Party ( Indemnifying Party ) hereby indemnifies and holds harmless the other Party from and against any and all claims, actions, liabilities, damages, costs and expenses asserted against, imposed upon or incurred by such other Party as a result of or arising out of any harm alleged or proven by a consumer himself or herself, or other person contemplated in section 4(1) of the Consumer Protection Act, to the extent such harm is attributable to the negligent or intentional conduct of the Indemnifying Party or any contravention by the Indemnifying Party of any applicable law. 3. Status of this Indemnity Notwithstanding anything contained to the contrary above, the supplier hereby indemnifies the service provider subject to the condition that the service provider strictly abides in all respects with the installation and user guide(s) in respect of the goods supplied at all times. Notwithstanding anything contained to the contrary herein or any other agreement, either party may terminate this indemnity by giving the other party 90 (calendar) calendar days notice in writing. 7
Dated at on this the day of 20 For: The Supplier Signature: Name: Witness: Witness: Who warrants that he/she is duly authorised to sign this indemnity and to bind the entity identified in clause 1.1.3.2 to the terms and conditions contained herein (Print Name) (Signature & Print Name) (signature & Print Name) Dated at on this the day of 20 For: The service provider Signature: Name: Witness: Witness: Who warrants that he/she is duly authorised to sign this indemnity and to bind the entity identified in clause 1.1.3.2 to the terms and conditions contained herein (Print Name) (Signature & Print Name) (Signature & Print Name) 8