Consumer Contract Regulations and Pitfalls for Traders – The Consumer is (Nearly) Always Right
In our previous two blogs dealing with the Consumer Contracts Regulations 2013 (the “CCR”) we have outlined the CCR and the situations in which they might apply, and the requirements imposed by traders under the CCR. In this final installation of our three-part blog series, we will look more specifically at the potential consequences if a trader does not comply with the CCR.
In short, if the requirements of the CCR are not complied with, the sanction could be that the trader is not entitled to charge for any work undertaken and must refund anything paid by the consumer. Even worse, in certain very common situations a failure to comply with the CCR could see a trader with a conviction for a criminal offence with a fine of around £5,000 per offence.
The importance of getting it right, therefore, cannot be overstated – and sole traders and small business owners should act now to ensure that their business is compliant to avoid potentially career-ending financial and criminal consequences later down the line.
What happens if I don’t give the information required by the CCR?
The requirement to provide information is an implied term of any consumer contract, and as such the CCR confirms that if you fail to provide the information required, this will be an automatic breach of contract. As a result, a consumer has a variety of options including the potential to rescind the contract, depending on the severity of the breach.
Where the contract is an off-premises contract and you fail to provide the cancellation form and information about the right to cancel, the following consequences will apply:
- The consumer is entitled to cancel the contract at any time until 14 days after you give them the cancellation form in writing. If you never give them the form, then the CCR allows them to cancel the contract at any time until 12 months and 14 days after the contract was formed.
You are not entitled to charge for any work undertaken in the cancellation period, and must refund any payments received during the cancellation period, in the event that the consumer cancels the contract within the cancellation period (which could in theory be up to 12 months from the date the contract is concluded and the works completed).
The above does not apply if the consumer specifically requests that you start work during the cancellation period – but they must do so in writing. A verbal confirmation for you to start work is not sufficient, and the consumer can still cancel the contract and refuse to pay you.
- You will be committing a criminal offence liable on summary conviction to a criminal record, as well as a £5,000.00 fine.
It is therefore extremely important that, as a trader, you ensure that no matter what you are doing, your contracts comply with the CCR and that you provide the required information and cancellation form – to avoid the harsh and draconian consequences of a CCR breach.
How can we help?
If you are a trader and are facing a claim for breaching the CCR, or simply want to check your current procedures to make sure you are compliant, our specialist team of Commercial Dispute Resolution Solicitors have substantial experience of dealing with this area. To speak to a member of the team and discuss your options and potential liabilities, call 01202 525333 or send an email.