The Consumer Contract Regulations 2013
The Consumer Contract Regulations 2013
The Consumer Rights Directive (2011/83/EU) came into force on 13 December 2011. The UK was obliged to adopt and publish measures necessary to implement it by 13 December 2013 and must apply those measures to consumer contracts in scope from 13 June 2014. This has an impact on all law firms who provide services to consumers and so you need to act urgently if you haven’t done so already.
The Directive applies to:
- Contracts made on premises, by requiring the trader to provide certain pre-contract information to a consumer.
- Contracts made at a distance. The Directive replaced Distance Selling Directive (97/7/EC), currently implemented in UK law as the Consumer Protection(Distance Selling) Regulations (SI 2000/2334) (Distance Selling Regulations).
- Contracts made off premises. The Directive also replaced the Doorstep Directive (87/577/EEC), currently implemented in UK law as the Cancellation of Contracts made in a Consumer’s Home or Place of Work etc Regulations 2008 (SI 2008/1816) (Doorstep Selling Regulations).
Consumer is defined as “an individual acting for purposes which are wholly or mainly outside that individual’s trade, business, craft or profession”.
There are a number of issues to consider before the Regulations come into force including the “cooling off” period, the information that must be provided regarding the client’s right to cancel and the information that must be provided about the nature of the contract. It is clear that there are going to be a number of practical challenges for solicitors to overcome, particularly when entering into off-premises and distance contracts. Some of the key provisions affecting solicitors and changes to the current regime are highlighted below:
All consumer contracts
- Ban on excessive payment surcharges which exceed the cost to the business of using such payment methods. Any firms using helpline premium rate telephone numbers need to check the charges being made to the clients.
“On-premises” contracts
- Information requirements for “on-premises” contracts
Where a contract is entered into between the trader and the consumer “on-premises” (i.e. in the office), there are new requirements for specific information to be provided to the consumer.
“Distance” contracts
- The increase to the statutory minimum “cooling off period” from 7 working days to 14 calendar days for distance contracts. This increase in the statutory minimum “cooling off period” is likely to affect the majority of solicitors where the contract with the consumer is not made at the solicitors premises.
- Information requirements for “distance” contracts . As of 13 June 2014 you will be required to provide certain prescribed information to a client before the client can be bound by the terms of the contract/retainer.
- Specific information requirements for distance contracts concluded by electronic means. If the client instructs a firm by electronic means and there is a requirement to pay for the services, you must ensure that the client, when instructing electronically, explicitly acknowledges that the instruction to supply the service implies an obligation to pay.
- Refunds. For the purposes of services (as will apply to law firms), the period is calculated from the day on which the solicitor is informed of the client’s decision to withdraw from the contract.
- Confirmation of distance contracts. Where a distance contract has been entered into, you will be required, no later than the time of any service being supplied under the contract, to provide the consumer with confirmation of the contract on a “durable medium” (e.g. by paper or by email).
“Off-premises” contracts
The information that the solicitor will be required to give the client is broadly similar to that which applies under distance contracts. Full details of the information requirements can be found at Schedules 1, 2 and 3 of the Regulations.
The cooling off period is the same as for distance contracts and (where the right to cancel exists), before the consumer is bound either by an off-premises or distance contract, a firm must “give” (in the case of off-premises) or “give or make available” (in distance contracts) to the consumer a cancellation form.
The other main point for consideration is that a firm cannot start work for a consumer before the end of the cancellation period unless the consumer has made an express request to do so and (in the case of off-premises contracts), this request has been made on a durable medium.
The Compl-i team at Weightmans, an MLS Advantage member, can assist if you need help on revising your client care letters/terms of business and/or website as a result of these changes and are offering discounted rates for members of MLS. Please contact Michelle Garlick, Partner, via [email protected] or Michael Black, Compliance Consultant via [email protected] for more information.
This update does not attempt to provide a full analysis of those matters with which it deals and is provided for general information purposes only. This update is not intended to constitute legal advice and should not be treated as a substitute for legal advice. Weightmans accepts no responsibility for any loss, which may arise from reliance on the information in this update. The copyright in this update is owned by Weightmans © 2014