Weddings and functions have become a reasonably lucrative industry in South Africa (and the world over) with over a 150 000 marriages taking place every year according to the Consumer Goods And Services Ombud’s (CGSO) advisory note on cancellations.
It is unclear statistically how many of these functions are cancelled annually but from the author’s own experience it appears to be a considerable percentage.
The cancellation of wedding functions poses problems both for the wedding service providers, be it the venue, the decorators, caterers and/or any other service providers and the party who made the booking or advanced reservation.
In our experience, couples feel hard done by when service providers refuse to refund deposits upon cancellation of the function, especially where the notice period is such that consumables such as food and beverages have not yet been purchased by the supplier (which is a tangible expense in the eyes of the consumer).
The converse of this when it comes to the point of view of the supplier is that is holding a date open for the couple, the vendor in all likelihood would have had to turn down other potential functions for that specific date. Further to this by the time the booking party has accepted the supplier’s quotation and concluded the agreement, the service provider/vendor may have already spent hours in consultation with them in planning the most important day in their lives.
What does the Consumer Protection Act(CPA) say?
Section 17 of the CPA deals specifically with the Consumer’s right to cancel and advanced reservation, booking or order. In accordance with the Section, a consumer is entitled to cancel an advanced booking, reservation or order for the supply of goods or services to be supplied at a later or specified date.
A supplier or service provider may request a consumer to pay a deposit in respect of advanced booking, in the case of weddings or functions, payment of the required deposit usually secures the date of the function.
In the event of premature cancellation of an advanced reservation, the supplier may impose a reasonable charge for cancellation. The question follows as to what is deemed “reasonable”?
Section 17 (4) stipulates that a charge is unreasonable if it exceeds a fair amount having regard to the following:
- The nature of the goods or services that were reserved or booked;
- The length of notice of cancellation provided by the consumer;
- The reasonable potential for the service provider, acting diligently, to find an alternative consumer between the time of receiving the cancellation notice and the time/ date of the cancelled reservation, and;
- The general practice in the relevant industry.
It must be noted that a service provider may not charge a cancellation fee in the event that the cancellation is due to the death or hospitalisation of the person for whom the reservation was made.
The purpose of provision for “damages” is to place the aggrieved/innocent party being the service provider in the same position had there not been a cancellation.
The problem currently lies in the fact that there is no hard and fast rule of specific guidance as to what is deemed reasonable in this specific industry- whilst the Act gives general guidelines as above, there is little or no case law providing specific percentages or time frames in respect of reasonable notice.
In absence of the above the CGSO has recommended that the relevant industry bodies come together and provide guidelines to service providers as to appropriate cancellation policies, to this end they have suggested that such policies at least include:
- The taking of a fair & reasonable deposit given the loss that the supplier is likely to suffer in the event of a cancellation;
- A possible graduation/ sliding scale of forfeiture given the length of notice
Finally, it is always recommended that the booking party be made aware of the service provider’s cancellation policies prior to the booking being made in accordance with Section 49 of the CPA, and as is always our advice, the agreement should be recorded in writing and signed by both supplier and consumer.
In conclusion, the topic of this article remains a very grey area which most certainly needs to be addressed in the spirit of fair and equitable dealings between service providers and consumers.
ABOUT THE AUTHOR
Carmen Ronne is currently employed as a Consumer Protection & POPI Legal Advisor at SEESA Durban. She gained experience with both draftings of Consumer documentation for clients, as well as consumer complaints.