Home defences
The Cancellation of Contracts made in a Consumer’s Home or Place of Work etc Regulations 2008 came into force on 1 October 2008. In a nutshell, the regulations give a consumer the right to cancel a contract for the supply of goods or services made during a visit to the consumer’s home or place of work by a trader.
A consumer is defined as a natural person not acting in the course of his trade or profession, and trader as someone acting in his commercial or professional capacity. Solicitors are therefore caught and necessarily become tradesmen. It does not matter whether the visit was solicited or unsolicited. The visit could be to the home of an individual other than the consumer concerned. The total value of the contract has to be over £35. A cooling-off period of seven days, within which the contract can be cancelled, has been set.
It is important to note that the regulations do not permit any contracting out. Any inconsistent term, particularly one that imposes any duties or liabilities on the consumer additional to or different from those in the regulations, is void.
They also require the cancellation rights to be clearly and prominently set out in any written contract, or otherwise provided in writing if there is no written contract. Failure to provide this information is an offence that carries a fine not exceeding level 5 on the standard scale. The written notice of the right to cancel must be dated, legible and contain the information prescribed by part 1 of sched 4.
This comprises the identity of the trader (including his trading name, and any contract reference number), a statement of the cancellation rights and how they may be exercised, the address to which such notice may be sent, and that the notice is deemed served once posted or emailed.
A cancellation form must be provided as a detachable slip and completed with the salient information by the trader. The consumer must also be told that he can use the cancellation form if he wishes. However, the notice need not be in that or any prescribed form, as long as the intention to cancel is plain. As a practical rule, the notice being served once posted, a prudent trader will allow additional time before starting work as the notice may be posted by second class post on the seventh day.
The regulations do not apply to certain contracts (known as excepted contracts), set out in sched 3. They include a contract for the sale or rental of immoveable property. Therefore, they will not apply, for example, to conveyancers.*
However, they have clear implications for litigation lawyers, particularly those who see clients at home and conduct work on a conditional fee basis and accept work from accident management companies. The definition of trader includes someone acting in the trader’s name or on his behalf. Indeed, the trader who makes the visit need not be the trader that supplies the goods or services.
There will need to be clear documentation to show that there has been compliance, otherwise not only is the contract unenforceable, but criminal sanctions can follow. While there is a defence of due diligence, it is an unwise solicitor who would rely on it. It must be shown that the commission of the offence was due to the act or default of another or due to reliance on information given by another. Solicitors will need to satisfy themselves that everything is in order.
For limited liability partnerships, corporate liability is imposed where it can be shown that the offence was committed with the consent, connivance or otherwise due to neglect by an officer of the corporate body.
A duty to enforce these regulations has been imposed and considerable powers given for this purpose. The enforcement authority can require the production of a document relating to the business. Furthermore, any documents can be seized or detained if the investigating officer has reasonable grounds to believe that they may be required as evidence. “Document”, of course, means information recorded in any form. Legal professional privilege is however retained, as is the right to silence. It is otherwise an offence intentionally to obstruct an officer carrying out his functions under the regulations.
What about a client that wants work to commence straightaway? Regulation 9 provides that is possible in respect of certain contracts, provided the consumer makes the request in writing. The supply of services of any kind is one such contract. In addition to the consumer’s written request, it must also be explained, again in writing, that the consumer may be required to pay for goods and services supplied during that period. Unless this is done, not only must any money paid be refunded but there is no right to charge for any work done but not paid for.
Solicitors need to ensure that any staff who see clients at home are aware of all that they need to do.
District Judge Pal Sanghera sits at Coventry County Court. This is an edited version of an article first published in the Law Society Gazette (England & Wales) and is reproduced with permission.
*But will apply to estate agency: see Journal, August 2009, 55.
In this issue
- Forward thinking
- Renewal of transitional guardianships
- End the navel-gazing
- Who speaks for lawyers?
- Reasons to be hopeful
- The full picture
- Hearing and speaking
- Law of unintended consequences
- More prejudicial than probative?
- One giant leap
- If the cap fits
- Half a century of strife
- From the Brussels office
- Law reform update
- Send in the SaaS
- Ask Ash
- Words and sentences
- Two in one
- Enough to turn you to drink
- Uncertain security
- Protections with legs
- Working for the estate
- Home defences
- Splitting from the taxman
- Scottish Solicitors' Discipline Tribunal
- Website review
- Book reviews
- Route to freedom
- Steady as she goes is market forecast