The impact of the COVID-19 pandemic has wrought disaster on our economy, as a result of this many consumers are no longer able to pay their monthly instalments on their mobile phones, motor vehicles or mortgage bonds on their homes. This unfortunately has resulted in a very desperate situation for many consumers. Default of payment no longer has the safety net provided during the initial lockdown by financial institutions. A majority of the workforce were forced to stay home, unable to earn an income. This situation has resulted in desperate consumers signing any document put before them to make the creditors go away and allow them to live in peace, however, this is where bigger problems may arise. This article aims to make consumers aware of the, sometimes, dire consequences of attaching your signature to documents without being fully aware of the consequences thereof.
The concept of caveat subscriptor which loosely translates as “let the signatory beware” is a remnant of Roman Dutch Law which underlines South African Contract Law when attaching your signature to any document. This concept holds that a signatory is liable to the terms and conditions of documents they sign whether or not he or she has read or understood them. Consumers tend to sign documents without fully analysing the content of said documents. They sign documents to acquire a service or product irrespective of the terms and conditions they bind themselves to, as they are usually more concerned with acquiring said product or service. This is also applicable when agreeing to the terms and conditions of online services. This may result in detrimental consequences and could easily result in the attachment of your home or other valuables in cases of a default on repayment of credit agreements.
The case of George vs Fairmead is an ancient example of the consequences of simply signing, but not considering the document you are attaching your signature to. In this case the signatory merely signed, but, did not read the clauses of the agreement. As a result of this when he tried to hold the hotel, he was staying in, accountable for lost property, he found that he had no recourse available to him as he had attached his signature to a clause which indemnified the hotel of liability, even in the event of the hotels gross negligence. This concept is still applied by South African courts and as such a defence of ignorance is not a valid one.
The third situation which consumers should be aware of is that of the signature provided on your behalf by a third party. Allowing a third to party to sign on your behalf does not indemnify you from responsibility. The third party may be acting on your behalf, but you are still liable, as such signature is affixed with the intent to bind you and not the third party to the agreement.
In conclusion, signatories should be aware of and understand the documents to which they attach their signatures, both wet ink signatures and electronic ones. Should you have any contractual obligations, contracts you wish to be looked over or queries with regards to contract law, contact us, and we will gladly assist you.