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Random Questions regarding the Consumer Protection Act

When may you be held liable for damages caused by goods? The producer or importer, distributor or retailer of any goods is liable for any harm caused wholly or partly as a consequence of: supplying any unsafe goods; a product failure, defect or hazard in any goods; or inadequate instructions or warnings provided to the consumer pertaining to any hazard arising from or associated with the use of any goods, irrespective of whether the harm resulted from any negligence on the part of the producer, importer, distributor or retailer, as the case may be.  Liability of a particular person in terms of the aforementioned does not arise if: Continue reading “Random Questions regarding the Consumer Protection Act” »

Legal Update July 2011

Directors: Delinquency Declarations (And Other Dangers)   Directors – beware the additional risks and obligations imposed on you by the new Companies Act.     In addition to an increased risk of incurring personal liability to creditors and other stakeholders, directors now also face the danger of being declared “delinquent” or being placed under “probation” – in some cases even if they are merely negligent rather than deliberate in their non-compliance. Continue reading “Legal Update July 2011” »

Business Rescue

 DEFINITION Business rescue (“BR”) means proceedings to facilitate the rehabilitation of a company that is “financially distressed” by providing for certain procedures.   CONCEPT   The concept of business rescue is designed to provide a mechanism to a company that has financial difficulties  but has not reached the stage of insolvency.  That is the “financially distressed” company. Financially distressed in reference to a particular company, at a particular time-means that; Continue reading “Business Rescue” »

Specific matters regarding the Consumer Protection Act

Cancellation of advance orders?   A consumer has the right to cancel an advance order however a supplier may require a reasonable deposit and charge a reasonable fee should the consumer cancel an advance order.   In determining a reasonable fee the following must be considered: the nature of the goods or service; the notice period of cancellation;  the possibility to obtain another consumer; and the general industry practice. Continue reading “Specific matters regarding the Consumer Protection Act” »

Legal Update June 2011

Forfeiture Clauses – Penalties And Prejudice   Property sale agreements commonly provide for the buyer to pay a deposit up front, often coupled with a forfeiture provision to the effect that, should the sale be cancelled through the buyer’s default, the seller can retain the deposit in full as “pre-estimated damages” – in other words, without having to prove the actual damages suffered.   The exact wording of such a forfeiture clause will vary from agreement to agreement, and the terminology may become very confusing. For example, the clause may purport to be a “rouwkoop” clause, which is in fact a different concept altogether (the distinction is of great interest to lawyers, but too complex to go into here!). Both sellers and buyers should obtain proper advice before signing anything along these lines – there are many subtleties of wording involved! Continue reading “Legal Update June 2011” »

Accounting obligations in terms of the Companies Act 2008

All companies, large and small must prepare annual financial statements. All companies must maintain accurate accounting records. All companies must have a financial year. It is an offence to falsify or fail to keep proper records or to publish false financial statements. All financial statements given to another person must bear a disclosure statement. The Commission will direct private companies to prepare audited Financial Statement if a certain threshold is attained. All companies must file annual returns with the Commission. A company must prepare annual financial statements within 6 (six) months after the end of its financial year end.  Continue reading “Accounting obligations in terms of the Companies Act 2008” »

Obligations in terms of the Companies Act when “Financially distressed”

The new Companies Act of 2008 (“the Act”) entails fewer criminal offences, but there is a greater risk of personal liability arising from actions which contravene the Memorandum of Incorporation (MOI) of a company or the provisions of the Act. The Act further states that a company must not carry on its business recklessly, with gross negligence, or with intent to defraud anyone. Continue reading “Obligations in terms of the Companies Act when “Financially distressed”” »

New Companies Act effective from 1 May 2011

 A new Act was born. The new Companies Act is in full force and effect. The Companies and Intellectual Property Commission (“CIPC”)is also in operation today from 08h00, check out CIPC’s website for information and detail. The website was not in operation on 1 May and with all the public holidays there was news as to whether the CIPC would be, as promised, in operation on 3 May.  The office hours are: Continue reading “New Companies Act effective from 1 May 2011” »

Franchise or “similar” agreements and the Consumer Protection Act 68 of 2008

In terms of the Consumer Protection Act 68 of 2008, a franchise agreement is defined as: “An agreement between two parties, being the franchisor and the franchisee, respectively-  a)    in which, for consideration paid, or to be paid, by the franchisee to the franchisor, the franchisor grants the franchisee the right to carry on business within all or a specific part of the Republic under a system or marketing plan substantially determined or controlled by the franchisor or an associate of the franchisor; Continue reading “Franchise or “similar” agreements and the Consumer Protection Act 68 of 2008” »

Franchise or “similar” agreements and the Consumer Protection Act 68 of 2008

In terms of the Consumer Protection Act 68 of 2008, a franchise agreement is defined as: “An agreement between two parties, being the franchisor and the franchisee, respectively-  a)    in which, for consideration paid, or to be paid, by the franchisee to the franchisor, the franchisor grants the franchisee the right to carry on business within all or a specific part of the Republic under a system or marketing plan substantially determined or controlled by the franchisor or an associate of the franchisor; Continue reading “Franchise or “similar” agreements and the Consumer Protection Act 68 of 2008” »

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