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MILS Case Study: Distance SellingBack

MILSLogo2The Consumer Contracts Regulations (Information, Cancellation, and Additional Charges) 2013 (hereinafter the ‘CCR’) have been operating now for 2 years. However, we still find motor traders are unfamiliar with consumers rights when selling both goods and services.

Here is a quick reminder as to the main rights and obligations of garages when selling goods at a distance.

What is a Distance Contract?

Distance contracts are defined as

“a contract concluded between a trader and a consumer under an organised distance sales or service-provision scheme without the simultaneous physical presence of the trader and the consumer, with the exclusive use of one or more means of distance communication up to and including the time at which the contract is concluded;”

It should be noted that the CCR also brought in the concept of an ‘off-premises’ contract. This is defined as a contract between a trader and a consumer which is any of these—

(a)a contract concluded in the simultaneous physical presence of the trader and the consumer, in a place which is not the business premises of the trader;

(b)a contract for which an offer was made by the consumer in the simultaneous physical presence of the trader and the consumer, in a place which is not the business premises of the trader;

(c)a contract concluded on the business premises of the trader or through any means of distance communication immediately after the consumer was personally and individually addressed in a place which is not the business premises of the trader in the simultaneous physical presence of the trader and the consumer;

(d)a contract concluded during an excursion organised by the trader with the aim or effect of promoting and selling goods or services to the consumer;

Consumer’s rights in an off-premises contract are substantially similar to those of a distance contract and it is easy to be caught out by this aspect if you have sold goods, or if you have repaired a vehicle and the initial contact was away from business premises such as a roadside recovery.

Pre-contract information

When trading at a distance consumers are entitled to certain information to be disclosed prior to the formation of the contract. The RMI have produced a checklist that will assist in assessing your terms and conditions to see if they comply with these obligations.

Cancellation rights

If members are operating a distance contract or an off-premises contract, then consumers will have a 14-day cooling off period during which they can cancel for any reason. This will apply to both sales contracts and contracts for services.

Where they are not informed of this right then this is extended to a maximum of 12 months from the date of the contract.

Service contracts

Distance contracts can also be made in relation to services. If members supply a service during the cancellation period, then the consumer ceases to have the right of cancellation for those aspects provided,

  • the consumers expressly requested the service be provided during this period, and
  • they must be informed that if they do so they would lose their right to cancellation under these regulations

Time for delivery and risk in any ‘goods’ provided

Unless agreed otherwise any goods must be provided as soon as possible and not more than 30 days from the contract.

Where goods go, missing or are damaged before or during delivery to the consumer this remains the liability of the business until the goods are delivered to them, or a delivery agent appointed by them.

Conclusion

It should be noted that we are not seeing significant numbers of issues arising out of this legislation and trader have adapted to it. However, where you get caught out the costs can be disproportionate. As such we would advise that you review your processes and if in doubt contact us at any stage for advice and assistance as appropriate.

 

Paul Carroll, Solicitor, Motor Industry Legal Services

 

Posted by Sue Robinson on 02/12/2016