5 min Read
27 Oct 2011

Written by Damien

Damien is one of the most widely quoted money and investment experts in the national press and has made numerous radio & TV appearances. He created MoneytotheMasses.com while working in the City when he became disillusioned with the way the public were left to fend for themselves because they could not afford financial advice.

More about Damien

Cancelling a contract – what are your rights?

signing a contract Most people think contracts are involved with the big things in life, like a house or a car, or starting a new job. However, we are all entering into new contracts, written or verbal, on a regular basis, be it for a new phone, TV or Internet connection, or employing a tradesman. We all hope that these contracts will be fulfilled and everything runs smoothly, but there are times when we need to cancel a contract so we need to know our rights.

Not all contracts can be cancelled, but there are circumstances when the law gives you a right to cancel a contract

Credit agreements

Under the Consumer Credit Directive ( came into force 1st February 2011), consumers now have 14 days to cancel a credit agreement. The legislation applies to all credit agreements whether made in person, on the phone or over the internet.

Changing your mind about the order

There are times when we change our minds about an order that has been placed with a supplier or service provider. There are two types of transaction which are covered by legislation where you can cancel a contract without having to pay anything.

Contracts made at home or place of work

If you enter into a contract at home, or at your place of work, there is a seven day cooling-off period, from the date of signing/agreeing  the contract, within which you can cancel the contract.

There are, however, some contracts where theses regulations do not apply.

- items worth less than £35

- goods delivered by a rounds person such as milk or newspapers

- contracts for the sale, construction or rental of property

Contracts made at a distance - phone, Internet, mail or fax

If you buy something over the phone or the  internet,  or by mail or fax there is a seven day cooling-off period.

If you are purchasing goods, the cooling-off period starts from the day after you receive the goods.

If you are buying services, the cooling-off  period starts the day after you agree to go ahead with the service. If you agree with service provider that the service will start immediately then you waive these  cooling off rights.

There are some  types of goods and services that are not covered by this legislation.

- financial services ( 14 day cooling-off period together with other requirements)

- holiday or travel arrangements

- tailor-made items or perishable goods, such as groceries

- CDs, DVDs, or software if you've broken the seal on the wrapping

Any refund should be paid within 30 days of cancelling the contract.

Suppliers may voluntarily give you a right to cancel a contract  longer than the minimum required by law.

Problems with the order

If you receive shoddy or mis-described goods you may be able to cancel the contract and receive a complete refund.

Under the 'Sale of Goods Act', a seller must provide goods that are 'fit for purpose', 'as described', and of 'satisfactory quality'. The supplier may offer a remedy but if this is not acceptable then you may be entitled to cancel the contract.

Making time of the essence

If you didn't buy online, or your cooling-off period has expired, you can only cancel the contract if you specified that you wanted the goods by a particular date, for example Christmas or a birthday.

You can also cancel a contract if the provider does not deliver the goods or service within a reasonable time. Sellers, however, do not normally specify a delivery time limit so defining what is 'reasonable' can be a problem.

 

 

 
Image: Jeroen van Oostrom / FreeDigitalPhotos.net

 

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