Enrolment contracts and the CPA's notice rule
Whether a South African independent school can hold parents to a full term's notice, given the Consumer Protection Act's rules on fixed-term agreements.
By Achekam · · 5 min read · For Education businesses in South Africa
An independent school's enrolment contract in South Africa may well contain a clause like this: a parent who withdraws a child must give a full term's notice in writing, or pay a term's fees instead. Schools rely on it because their staffing and budgets are set term by term, and a gap in the class list mid-year cannot easily be filled.
Parents who leave at short notice sometimes push back, citing the Consumer Protection Act (CPA) and its shorter notice period for fixed-term agreements. This article explains what the CPA's text says, what the Independent Schools Association of Southern Africa (ISASA) has published about it, and what a school can do in the contract and in the books. It is not legal advice; a school revising its enrolment contract should have an attorney review it.
Enrolment contracts as fixed-term consumer agreements
An enrolment contract between a school and a parent is, in the ordinary case, an agreement between a supplier of services and a consumer, often for a fixed period such as a school year. ISASA notes that section 14(2)(b)(i)(bb) of the CPA provides that, under a fixed-term consumer agreement, the consumer is only obliged to give 20 business days' notice to terminate the agreement, and that this has implications for independent school enrolment contracts.
ISASA's article on the Consumer Protection Act and school enrolment contracts explains why the notice provision matters to its member schools and refers to the tribunal decision discussed below.
Twenty business days, and the school's own notice duty
The CPA text published on the government's site lets a consumer cancel a fixed-term consumer agreement at any time on 20 business days' written notice. The same section requires the supplier to notify the consumer 40 to 80 business days before the fixed term expires. That is section 14 as originally published; the section does not apply to transactions between juristic persons.
Two consequences follow for a school:
- A term's notice clause can collide with the CPA's twenty business days. A parent can argue that the Act allows them to leave on shorter notice than the contract asks for. Whether the school can still recover a term's fees, or some other amount, depends on the rest of section 14 and on how the contract is written. Read the whole section, and take advice before relying on any clause about what a departing family must pay.
- The school has a notice duty too. Before a fixed-term enrolment agreement expires, the school must notify the parent within the 40 to 80 business-day window. Diarise it every year, for every family, and keep proof that the notice went out.
Where the paying party is a company, for example an employer paying a staff member's child's fees under a contract in the company's own name, the transaction may be between juristic persons and outside section 14. Check who the contracting party really is.
The Heronbridge College decision, and what is published about it
ISASA reports that on 6 November 2018 the National Consumer Tribunal decided National Consumer Commission v Heronbridge College NPC. The case concerned a parent who sought a full refund of enrolment deposits despite not giving the term's notice required by the school's enrolment contract.
ISASA's public page does not summarise the outcome; its summary of the findings sits behind a member login. So a school should be careful about what it says the case decided. If you are an ISASA member, read the summary in full and discuss it with your attorney. If you are not, ask your attorney for the tribunal's decision itself rather than relying on second-hand accounts.
Plain, understandable language in the contract
The dtic's booklet on the CPA, dated April 2020, says consumers have the right to information and contracts in plain and understandable language. An enrolment contract that buries the notice clause in dense wording, or uses terms parents cannot follow, sits uneasily with that right and invites a dispute when a family leaves.
A practical check of the contract's notice and fees sections:
- Can a parent tell, in one reading, how much notice to give and how to give it?
- Does the contract say what happens to fees already paid, deposits and any credit?
- Does it explain the school's own notice before the term of the agreement ends?
- Are the dates expressed in a way a parent can calculate, such as business days or a fixed date?
Signing the contract electronically with the paying parent
The person who signs should be the parent or guardian who will actually pay. In Achekam, any document can be sent for electronic signature with signature and initials fields placed on it, signers in order or all at once, an expiry and reminders, and the signed PDF and a completion certificate are filed back into Documents. Where both parents are to be bound, add both as signers. A saved template means every family signs the same, current version of the contract.
When a family leaves: credits, refunds and balances
When a family gives notice, the fee account has to reflect what the school and the parent agree, or what the contract and the law allow. In Achekam:
- Reducing fees invoiced in advance. A credit note is issued from the invoice it corrects, in full or for chosen lines, posted to the ledger, and can be downloaded as a PDF or e-mailed to the parent. Any leftover credit is held for the customer. There is no credit note without an invoice.
- Dealing with money already paid. Customer payments are recorded against one invoice or spread across a family's invoices, a part payment leaves an invoice part-paid, and any extra is held on the customer's account. A receipt can be re-allocated, and administrators can refund or reverse it.
Whether a credit is refunded or held, for example for a younger sibling still at the school, is a decision to record in writing with the parent. Overpaid fees and leavers covers those choices, and families paying in instalments are covered in fee instalments and part payments.
Before next year's enrolment contracts go out, have the notice clause reviewed against section 14 of the CPA, and add the school's own renewal-notice date to the bursary calendar.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
