You break, you pay? Wait a minute…

In an online article in the Sunday Times, the Power Report by Megan Power, it was stated that the “you break, you pay” sign holds no sway. Most consumers can relate to having seen this sign and for that brief moment imagining what you would do if you had to break something really expensive.

The article by Megan Power relates the story of a consumer (Ms S) who accidentally knocked over a vase displayed in the décor store with her bag. The store had a sign up stating: “you break, you pay”. The salesperson informed Ms S that the broken vase formed part of a complete set and therefore was requested to pay for the entire set; one broken vase and one in a perfect condition.

Section 18(1) of the Consumer Protection Act 68 of 2008 (CPA) determines that in spite of any statement or notice to the contrary, a consumer is not responsible for any loss or damage to any goods displayed by a supplier, unless the loss or damage results from an action by the consumer, which amounts to gross negligence or recklessness, malicious behaviour or criminal conduct. The purpose of section 18(1) is substantiated by the provisions made for in section 51(1)(c) in that a supplier must not make a transaction or agreement subject to any term or condition if it purports to: (i) limit or exempt a supplier of goods or services from liability for any loss directly or indirectly attributable to the gross negligence of the supplier or any person acting for or controlled by the supplier; (ii) constitute an assumption of risk or liability by the consumer for a loss contemplated in subparagraph (i); or (iii) impose an obligation on a consumer to pay for damage to, or otherwise assume the risk of handling, any goods displayed by the supplier, except to the extent contemplated in section 18(1).

In a rather contradictory and surprising fashion, provision is made for notice to consumers in respect of certain terms and conditions in section 49 of the CPA. Contemplating that any notice to a consumer or provision which forms part of a consumer agreement that attempts to: limit in any way the risk or liability of the supplier or any other person; constitute an assumption of risk or liability on to the consumer; impose an obligation on to the consumer in order to indemnify the supplier or any other person for any cause; be an acknowledgement of any fact by the consumer, must be drawn to the attention of the consumer in the prescribed manner and form. In addition, section 49(2) of the CPA provides that, if a provision or notice concerns any activity or facility that is subject to any risk of an unusual character or nature, the presence of which the consumer could not reasonably be expected to be aware of or notice, or which an ordinarily alert consumer could not reasonably be expected to notice or contemplate in the circumstances; or that could result in serious injury or death, the supplier must specifically draw the fact, nature and potential effect of that risk to the attention of the consumer in the prescribed manner and form, to which the consumer must have assented to by signing or initialing the provision or otherwise acting in a manner consistent with acknowledgement of the notice, awareness of the risk and acceptance of the provision.

Therefore a supplier is entitled to hang up a sign within a store that limits the supplier’s risk subject to such notice having been written in plain language, the consumer’s attention having been drawn to such notice, the consumer having been given an adequate opportunity in the circumstances to receive and comprehend the notice. The term or condition contained in the section 49 notice must however not contravene section 18(1) of the CPA. For instance the sign will comply with the CPA if it read as follows: “you will be held liable for any loss or damages incurred due to your gross negligence or recklessness, malicious behaviour or criminal conduct”. Which just does not have the same ring to: “you break, you pay”. In addition, the supplier will be required to bring the sign to the consumer’s attention and provided ample opportunity for the consumer to comprehend the notice.

Bear in mind that every time one purchases an item from a supplier a contract of sale is concluded between the consumer and the supplier which is subject to the principles of common law and legislation. Ms S’ case did not meet the section 18(1) requirements for liability to pass to the consumer. Ms S was therefore incorrectly required to pay for the broken vase, Ms S was fortunately refunded on the principles of delict, after the intervention of a third party. One can however not ignore that through Ms S’ conduct by paying for the breaking of the vase as she acted in a manner consistent with a person having acknowledged her fault, then again it should be questioned whether she was aware of the dictates of section 18(1).

It must be emphasised, a delictual claim arose from the breaking of the vase (the cause of action) and had it not been for the provisions of the CPA, the supplier could have instituted legal action on a delictual basis and possibly be successful in doing so if it proved the elements of delict on a preponderance of probabilities, as the argument that a reasonable consumer would not have broken the vase could be entertained.

As far as the principles of contract law are concerned, there was no contract of sale concluded between the parties and it is therefore theoretically incorrect to say that Ms S “purchased” the broken vase due to the fact that she broke it. She simply accepted liability and paid for the damages suffered by the supplier, but was not required to do so in terms of the CPA and therefore it was appropriate of the supplier to refund her.

Section 18(1) is important in that the question whether the consumer is liable to pay for the damages caused by herself is to be answered based on this section. Therefore the test is whether the consumer was grossly negligent or acted recklessly, maliciously or with criminal intentions. In protection of this interest the supplier must therefore familiarise itself with section 18 and section 51(1)(c).

By

Albert Arnold
albert@dyason.co.za

Direct-to-consumer genetic tests: a treacherous road

Humans are curious creatures by nature. But what if information you gather about yourself is scarier than anticipated, or has such a dramatic impact on immediate family relations, your employment opportunities or insurability that it creates enormous tension? Would you still like to know?
A study by the University of Michigan Health System, published in the March 2015 issue of Public Health Genomics found that 59% of the total US population were interested in predictive genetic testing, to be done not only on themselves, but also on their children, even if there were risks that the outcome would not be relevant for years to come or the indicated genetic disorder did not have any cure. Although genetic testing seems to be in high demand and the test results provide a lot of data, the correct interpretation of such information is increasingly difficult, if not impossible, in Direct-To-Consumer (DTC) genetic testing, which excludes the involvement of health care practitioners.
What is DTC genetic testing?
DTC genetic testing entails a genetic testing service by means of a laboratory process, supplied directly to the customer without the involvement of a health care practitioner to examine and interpret the results and provide information about the risk of developing disease in the future or to diagnose active symptoms or active diseases.
DTC test kits, marketed via the internet or printed media, are usually mailed directly to the consumer for collection of a DNA sample by swabbing the inside of his/her cheek, or a blood sample, with the help of a local clinic. This sample is mailed to a laboratory which notifies the consumer of his/her results via mail, telephone or e-mail. These services are offered by both local and overseas service providers.
The Southern African Society for Human Genetics (SASHG) cautions, however, that the validity and utility of genetic tests for complex multifactorial disorders, such as type 2 diabetes mellitus or cardio vascular disease, being the majority of these tests, remain scientifically questionable and are only based on a few preliminary studies.
To put these tests in context, it is important to note that tests for health related genetic traits can broadly speaking be divided into two main classes:

  1. monogenic disorders involving a single gene as the direct cause of a genetic defect or pathogenic mutation causing diseases such as Huntington’s disease, cystic fibrosis and Duchenne muscular dystrophy. Genetic testing in this regard is rather straight forward as there is a clear link between cause and effect such as a mutated gene causing the likelihood that an individual might develop a certain disorder; and
  2. complex multifactorial disorders which comprises the majority of human disorders and involve genetic variation in many genes, including environmental risk factors such as nutrition and life-style choices, which increase and individual’s susceptibility for developing conditions such as hypertension, Alzheimer’s disease, prostate cancer and cardio vascular diseases. The genetic mechanics of these diseases are complex and when environmental factors are added to the equation it becomes even more difficult to unravel the disease process. Genetic tests in this regard may be premature and are not yet supported by rigorous scientific evidence.

Considering the complexity of multi-factorial genetic disorders, test results are often open for misinterpretation, and recipients are at risk of developing unrealistic expectations or increased anxiety, taking ill-informed and inappropriate medical decisions, and even committing suicide. A positive result may not necessarily mean that the individual will contract a given disease. Conversely, a negative result may not necessarily mean that an individual will never develop the disease, as he/she may harbour any one of the many other disease causing mutations and could develop the disease as a result of environmental factors, many of which are still unknown.
Legal, ethical and medical concerns
On 19 February 2015 the US Food and Drug Administration (FDA) formally permitted 23andMe, a genetics company in California, to market the first DTC genetic carrier test of Bloom Syndrome, a disorder characterized by short stature, predisposition to the development of cancer and genomic instability, to determine whether a healthy person has a variant in this gene that could possibly lead to their offspring inheriting this serious disorder. Although DTC genetic test kits have been provided to costumers on large scale in the past, this is the first time the FDA officially permitted such a kit to be lawfully marketed. This permission also followed after 23andMe was warned by the FDA in 2013 to cease providing direct health information to US customers and to stop selling this product because of its failure to obtain marketing clearance or approval to assure that the tests were accurate, reliable and clinically meaningful.
In South Africa specific guidelines and recommendations regarding DTC genetic testing is sorely lacking.
In general, informed consent safeguards any person against unwanted medical or scientific harm or exploitation and is provided for in the Constitution. Before adequate informed consent can be given a person must comprehend and appreciate the nature and extent of the harm or risk involved with genetic testing and consent to the entire procedure including its consequences. In the absence of any human interface in the DTC process and considering the multi-factorial nature of genetic disorders, the interpretation of genetic test results is complex and actually requires the services of genetic counsellors. The DTC process might not provide sufficient opportunity to alert people to the information necessary to make informed choices. Because genetic information qualifies as special personal information in terms of the Protection of Personal Information Act, the institution offering the DTC genetic tests must additionally obtain a person’s specific consent to process genetic samples and must ensure the integrity of such personal information to protect the privacy of people submitting such samples.
Although the Health Professions Council of South Africa’s (HPCSA) Guideline for Seeking Patient’s Informed Consent stipulates that, when screening or testing a healthy or asymptomatic person to detect genetic predispositions or early signs of debilitating or life threatening conditions a patient must be properly informed of the purpose, risks and uncertainties, likelihood of positive and negative findings and genetic testing, these guidelines only provides for health care practitioner assisted genetic testing and is silent on DTC tests.
The Consumer Protection Act also prohibits false or misleading marketing which includes deceptions of the nature, properties, advantages or uses of goods or services, the conditions under which and the prices at which goods or services can be supplied or any other material aspect. People may thus not be enticed into purchasing DTC genetic tests based on false information.
Genetic testing in general could further lead to possible genetic discrimination. The Council for Responsible Genetics (CRG) in the US and the Australian Law Reform Commission have documented cases of genetic discrimination by employers who forced employees to undergo genetic testing, employers who used the information provided in test results as a basis to refuse to recruit or promote otherwise suitable candidates, and health insurers who refused cover for individuals with certain genetic predispositions.
The Constitution prohibits unfair discrimination directly or indirectly based on race, gender, ethnicity or age (amongst other) which subsequently prohibits unfair discriminatory practices based on genetic test results. Although the Labour Relations Act recognises incapacity due to ill health or injury as a ground for legal dismissal, a medical condition must first manifest itself to the extent that it incapacitates an employee, before an employer may legally dismiss an employee on this basis, or risk the consequences of an unfair and unconstitutional dismissal, purely based on genetic test results providing an indication of a possible future disease onset. The Employment Equity Act further prohibits discrimination in general and only provides for employees to be subjected to medical testing if it is justifiable in light of medical facts, employment conditions or the inherent requirements of a job, social policy or the fair distribution of employee benefits.
Whatever reasons are proffered, one certainty is that companies offering DTC genetic test are renewing their ambitions in view of the recent FDA approval and in the expectation that the FDA will further expand the types of medically relevant information that consumer genetic tests can supply.
DTC genetic tests, the complexities involved in interpreting test results and the effects of possible genetic discrimination pose various risks to consumers. It is thus advisable to obtain a combination of legal and medical advice when faced with unsettling test results, forced genetic testing or discriminatory actions resulting from test results.
By
Marietjie Botes
marietjie@dyason.co.za

Commercialisation of Sport: with a specific focus on images and personality rights of sportspersons (Part 2)

Introduction
As previously mentioned in Part 1 of this article South African Law recognises that every person has a number of personality rights and that protection for the infringement upon these rights is available in the common law in the form of the right to privacy and the law of defamation. In recent years it has become a custom to commercialise the image or name of a sportsperson. Major companies and brands who offer sponsorships have realised the immense value in commercialising the image of a sportsperson and using their image to enhance the image of their brand and to promote sales of their products.

Image Rights of Sports Persons
The capacity that an individual has to exclusively regulate the profitmaking use of his name is defined in the term “image rights”. This is the physical or graphic image, character, identity, personality; nick name and or signature used in and on advertisements such as posters, commercials, billboards, prints to create brand awareness and promote sales of the products endorsed by these sportspersons. The reason that these rights have such immense value is because they can be licenced to a third party for commercial exploitation.

In South African law there is no statutory protection afforded to the ‘right of publicity’ therefore protection is found in the law of delict in the form of patrimonial damages and non-patrimonial damages suffered, as recognised by the common law, for example when there has been an interference with the recognised personality interests even though the Plaintiff’s economical position has not been affected. It is general practise in South African law that such interference in the personality rights of an individual, in this instance for example John Doe (herein after referred to as the Plaintiff), is actionable as an iniuria.

In the matter between Kumalo v Cycle Lab (Pty) iniuria is defined as the wrongful and intentional infringement of an interest of personality. Liability is based on a wrongful act intentionally done against another, which infringes his dignity and his person or his reputation. The essentials of iniuria include the wrongful act; the wrongful act must be intentional and it must violate one or other of those real rights related to personality, which every free man is entitled to enjoy. Both fama and dignitas enjoy protection in South Africa.

The unlawful infringement of the ‘good name’ is protected by way of the law of defamation where the unlawful, intentional publication of words or conduct of a person which will affect the person’s good name and reputation occur. The definition of Dignitas has a wider application which includes the whole of the legally protected personality apart from only the corpus and the fama of the sportsperson. The Dignitas is thus protected by way of the action iniuriarum therefore it incorporates a collection of interests relating to the personality of the sportsperson. It is clear that the law in South Africa provides protection of personality rights that sportspersons will usually enjoy for an alleged infringement of their personality rights due to the unauthorised use and commercial exploitation of the individual’s image rights such as that of the Plaintiff.

As there is no specific statutory protection of a sports person’s image in South Africa, the unauthorised use of the name or image of a sports personality will enable him to bring an action for invasion of privacy and it could possibly give rise to an action for breach of a trademark or copyright. Many of the rights associated with the commercialisation of sport are found in Intellectual Property law. Copyright is a creature of statute in South Africa, and all copyright is regulated by the Copyright Act, according to the Act copyright subsists automatically and no formal procedures are required for registration. Further in order to qualify for copyright protection, it must be mentioned in the Act as the Act recognises certain categories or subjects of copyright. The law regarding patents is similar to that of the law of Copyright in that it is also a creature of statute and regulated by the Patents Act.

By definition a trade mark in the new Act permits signs, which are capable of being characterised graphically and which are able to differentiate between the goods and services of one enterprise from another, can be registered as a trade mark. The protection afforded to a trade mark is found in the registration in respect of the individual.

Trade mark law is a useful source of legislation in terms of image and personality rights for sportspersons as it gives the athlete a proprietary control over his registered image or personality trade mark for a certain period of time. Preventing others from registering or even attempting to register or use a similar trademark. In South Africa an action for breach of trade mark will only succeed if that trade mark has been registered; and the registration can only be granted if the creators of the trade mark can prove that they have the intention to use the mark for a particular purpose.

Case Study: John Doe
The cause of action arose when John Doe, the Plaintiff, a striker for the national soccer team the “Golden Eagles” became aware of the fact that Ranger Digital Entertainment Inc, a Japanese video game producer, used his image or likeness in their video game without the Plaintiff’s consent or Knowledge. Thus the Defendant (Ranger Digital Entertainment Inc) by way of commercial exploitation and misappropriation of the Plaintiff’s image has caused damage and financial loss to the Plaintiff in that the Plaintiff was not approached or aware of his image being used for the economic gain of the Defendant. In other words the Defendant used the Plaintiff’s image and likeness thus the Plaintiff may have common law protection in the form of “passing off”.

The question which arises is how do all the pieces of the puzzle fit together in South African law, can protection be found in the common law or does our law offer statutory protection? I leave this thought with you to ponder on and digest the possibilities of the creation of a statute that will regulate this position in our law. In Part 3 of this article I will discuss the available protection, the reasons why statutory protection is necessary as well as the foreign term “Passing Off”.

By
Samantha Wonfor
samantha@dyason.co.za