Vodacom contract increase legal, says attorney

Cape Town - Vodacom contract customers upset that the operator is increasing its pricing may not have much of a legal chance of blocking the increase.

Vodacom last week announced that it was marginally increasing pricing for both new and existing contract customers.

Many people voiced their displeasure on Fin24's comment section, arguing that unilaterally changing a contract was not binding.

"Isn't this in breach of contract?" wrote News24 user CJ Venter.

"This really irks me... Should be given the option to cancel then if I wish. I signed for 24 months at R499 not to have a price increase five months in," said Sandra De Jesus.

Legal muster

But a legal expert has disagreed.

"Yes, a company can change its pricing unilaterally. The issue is if the particular price change is lawful in terms of relevant legislation," Russel Luck, a technology attorney, told Fin24.

Luck is an attorney with SwiftTechLaw and said that as far as cellphone contracts are concerned, buyers have to beware.

"Contract terms are provided on a 'take it or leave it' basis where the mere use of services demonstrates a form of consent to those terms by that user. Before services were provided online, contractual terms were provided on a 'take it or leave it' basis in places like theme parks, car garages and hotels," Luck said.

However, he added that while such contracts were acceptable, changing terms would need to pass legal muster.

"The users were deemed to 'accept' these contracts merely by using those services. Yes, the service provider can change the terms unilaterally. Whether that change of terms would stand up in court is an entirely separate issue."

The South African Consumer Protection Act (No 467 of 2009) indicates that a supplier is not allowed to "market any goods or services, or negotiate, enter into or administer a transaction or an agreement for the supply of any goods or services, in a manner that is unfair, unreasonable or unjust".

Flexible

However, many contracts such as insurance products, satellite TV, and housing bonds stipulate pricing reviews at the discretion of the company concerned.

"If a corporation enters into an agreement with a bank the law would apply more rigidly than an agreement where a large corporation enters into a contract with a person earning minimum wage," said Luck.

He added that as far the public is concerned, courts view contracts with more flexibility.

"There is more flexibility in the second scenario for the contractual terms to be varied in favour of the minimum wage earner because the law tries to protect vulnerable members of society."

- Follow Duncan on Twitter

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
15.82
-0.4%
Rand - Pound
19.88
-0.2%
Rand - Euro
16.87
-0.1%
Rand - Aus dollar
11.20
-0.0%
Rand - Yen
0.12
-0.6%
Gold
1,855.74
+0.1%
Silver
21.75
-0.2%
Palladium
2,009.50
+0.5%
Platinum
953.00
-0.6%
Brent Crude
113.42
+0.8%
Top 40
61,788
0.0%
All Share
68,367
0.0%
Resource 10
74,616
0.0%
Industrial 25
73,018
0.0%
Financial 15
15,916
0.0%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot