Other than listing it and referring to it in general and in the context of franchising, Adv NJ Melville does not really seem to discuss or clarify the concept in The Consumer Protection Act Made Easy. In Chapter 10 of A Guide to the Consumer Protection Act, Dr Evert van Eeden devotes some discussion on the topic.
How will I know that I am charging a fair price? I can agree with my neighbour that we will charge the same price but that will be a contravention of the Competitions Act and might in any event be regarded as unfair or unconscionable in terms of the CPA. If the price I charge is fair, will it automatically be regarded as just and reasonable? If so, why does the Act use all three discriptions?
Section 2(2)(a)of our CPA empowers our courts to apply appropriate foreign and international law. In this context, section 8 of the Business Practices and CPA of British Columbia, Canada, has already been referred to by commentators. It states that the circumstances the court must consider to determine whether an act was unconscionable, include the following:
ReplyDelete(a)...
(b)...
(c) that, at the time the consumer transaction was entered into, the total price grossly exceeded the total price at which similar subjects of similar consumer transactions were readily obtainable by similar consumers; and
(d) that, at the time the consumer transaction was entered into, there was no reasonable probability of full payment of the total price by the consumer;
The first yardstick regarding price sounds much like a comparison to the fair market value.
The second yardstick has to do with the probability that the consumer would fully pay. This last one indicates amongst other things that where a consumer can clearly not afford a price, the supplier must think twice before supplying the goods or services at that price.