A recent judgment confirms that the National Consumer Tribunal (NCT) has the jurisdiction to enforce compliance notices, that administrative fines are a vital tool to ensure compliance, and that remedies under the Consumer Protection Act (CPA) are enforceable and cannot be avoided through delay or procedural objections.
On 18 September, the High Court in Pretoria dismissed, with costs, the appeal of Kimberley vehicle dealership Lambons (Pty) Ltd, confirming an administrative penalty of R200 000 for its failure to comply with a compliance notice issued by the NCC.
Acting Judge Mercedes Mokadikoa-Chauke’s judgment also compels Lambons to comply with the notice, which required the dealership to refund the purchase price of a defective vehicle (less permissible deductions) or provide a replacement of equivalent value.
For consumers, the decision underscores the protection provided by the CPA and the NCC; for suppliers, it highlights the importance of responding promptly and lawfully to compliance notices, to avoid substantial penalties.
Welcoming the judgment, acting Commissioner Hardin Ratshisususaid said: “These judgments of the High Court show that firms that have no regard to consumer rights will face consequences. The judgments should deter suppliers from engaging in the same conduct and rather address and resolve consumer complaints expeditiously.”
Vehicle plagued with defects
The dispute arose from the purchase of a GWM Steed 2.5 TCI single-cab 4×4 by Wilhelmina Johanna Bernardo in February 2012. The vehicle, financed through GWM Finance (a division of WesBank), developed persistent mechanical and technical defects within the first month.
Between February and November 2012, Lambons undertook several repair attempts. However, the dealership later refused to release the vehicle unless Bernardo signed an acknowledgement that it had been satisfactorily repaired – a step she declined to take without first testing the vehicle. The vehicle has remained in Lambons’s possession since.
Bernardo lodged a complaint with the NCC, which referred the matter to the Motor Industry Ombudsman of South Africa (MIOSA). MIOSA recommended that Lambons either refund the purchase price, less permissible usage deductions, or replace the vehicle. Following litigation initiated by Bernardo, the NCC issued a compliance notice in November 2021 ordering Lambons to do so.
Tribunal’s jurisdiction and powers
Lambons challenged both the compliance notice and the Tribunal’s ruling, claiming procedural unfairness and irregularity.
The High Court emphasised that the NCT acted fully within its powers under the CPA.
The Court noted that the NCT’s jurisdiction is limited to determining whether a compliance notice has been issued and whether it has been lawfully ignored. The Tribunal cannot set aside or review the notice itself – that process is reserved for internal review under section 101 of the CPA. The Tribunal’s role is to enforce compliance and, where necessary, impose administrative penalties.
In Lambons’s case, the Tribunal was empowered to confirm non-compliance and impose an administrative fine, which it did by ordering the R200 000 penalty. The High Court emphasised that this enforcement mechanism is essential to uphold consumer rights and ensure suppliers respect binding compliance notices.
Remedies: refund or replacement
The compliance notice required Lambons either to refund the purchase price, less legally permissible deductions, or to replace the vehicle with one of equivalent value, under section 56(3) of the CPA. These remedies are intended to restore consumers to the position they would have been in if the defective goods had not been supplied.
The Court said Lambons could not avoid these obligations through procedural arguments or by delaying action. Section 56(2)(a) clearly obliges suppliers to cover the costs needed to remedy defects. By refusing to comply, Lambons left the consumer without recourse, necessitating the NCC’s enforcement action and the Tribunal’s fine.
Deliberate non-compliance and costs
The High Court found that Lambons had deliberately ignored the compliance notice, withheld the vehicle, demanded acknowledgement of repairs, and delayed filing a review application by 18 months without seeking condonation.
“Such conduct warrants censure, as it demonstrates not only disregard for statutory authority but also an abuse of judicial process,” the judgment stated.
Lambons was ordered to pay attorney-and-client costs, including those of two counsel where employed, reflecting the seriousness of its obstructive conduct and the need to indemnify the NCC and Tribunal for the expenses incurred.
