Know The Law - Cancellation Rights

As a general rule, customers cannot get out of a binding contract simply because they change their mind. This would be considered to be a breach of contract on the customer's part and may mean that the customer will have to pay the innocent party compensation to cover any loss of profit and expenses.

However, there are certain cases when a customer can cancel a contract without incurring a penalty.

Consumer Credit Agreements

• Withdrawal
  When you sign a credit agreement you may withdraw from the contract at any time before the agreement is signed by the other party on behalf of the lender. There is no contract until all parties have agreed. This applies whether you have signed at home or on business premises.
• Cancellation
  If you sign a credit agreement at home following face to face contact with the supplier you must be given written notice of your cancellation rights. These should be written into the agreement you sign and you should be given a copy of this agreement at the time you sign it.
  In addition, you should receive either a second copy of the agreement signed by the finance company through the post, or a separate notice of your cancellation rights. You have five days from when you receive this second copy or notice to cancel the agreement.

  If you cancel, you are entitled to recover any deposit that you have paid.

Contracts made in a Consumer’s Home or Place of Work

At the time the contract is made, the trader must provide you with a written notice explaining your rights to cancel. This will then give you 7 days to cancel the contract starting the day the cancellation notice is received. If you do cancel, you will be entitled to recover any deposit made.

You may have to pay a reasonable charge if you agree in writing to work starting or consume goods within the seven day period and then cancel.

How To Cancel

• Cancel within seven days of receiving your cancellation notice;
• Write to the trader telling them that you are cancelling the agreement, as you are legally entitled to do. Complete and return any cancellation slip provided.
• Obtain a certificate of posting or keep of a copy of your email as proof of cancellation
• Keep any goods supplied safe until collected.

Failure To Give Notice Of Cancellation Rights

For further advice on any of these issues, contact The Trading Standards Advice Line.

This page revised December 2009

Copyright © Wirral Trading Standards Division 2009