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Few can argue that the existing framework of consumer law in the UK did not need updating. Set out in over a hundred separate pieces of legislation, it represents a potential minefield for anyone, layman or lawyer, to navigate through. The Consumer Rights Act 2015 which substantially came into force on 1 October 2015, has been touted by some as a welcome consolidation of a number of pre-existing consumer protection laws. Is it a revolutionary piece of legislation or a re-hash of existing ones? We briefly summarise the effectiveness of some of the changes introduced by the Act below.
Data supplied in digital formats such as music, films, software and computer games are now covered where supplied for a price or supplied as a free incentive on the purchase of other goods or services (except where it is supplied as a marketing enticement in exchange for personal data). The Act seeks to provide the same consumer rights in respect of digital content as those that currently apply to goods. Therefore where a trader provides digital content to a consumer it should be fit for purpose, of satisfactory quality and match the product’s description.
Where the digital content does not comply with these statutory requirements, the consumer can request for it to be repaired or replaced. If this is not possible or does not occur within a reasonable time the consumer has the the right to a price reduction, up to the full amount. Unlike with goods, there is no right to reject, this is because there is no way to return purely digital content. Nevertheless, a consumer can require a full refund if the seller had no right to supply the digital content in the first place.
The remedy of a price reduction where digital content cannot be repaired or replaced, or the trader fails to do so, could lead to savvy consumers creating quite a few problems for traders.
Overall, it is a welcome reform, ensuring that consumers who have purchased digital content by downloading it are protected to the same degree as a consumer who has purchased digital content on a disk.
Unfair Consumer Contract Terms
Prominence of terms: key terms as to price and the subject matter of the contract must now be made fully transparent and in plain English. It also should be prominent enough that an objectively careful consumer would be aware of them.
Individual terms can now be deemed unfair even if they have been specifically negotiated with the consumer and fairness has to be considered by the courts even if not raised by the consumer - meaning businesses must be all the more careful to ensure their terms could not be regarded as “unfair”.
Unfair and unenforceable terms: the law already recognised certain terms as being likely to be unfair and unenforceable. There are now specific additions to that list, namely terms which:
Additional information forming part of the contract
Pre-contractual information provided by the trader to the consumer (for example about payment and delivery) is now treated as a term of the contract. This includes oral statements if they persuaded the consumer to enter into the deal. These additions will make life easier for the consumer - he/she will be able to sue for breach of contract (rather than misrepresentation which can be less straightforward).
Right to Reject Goods
The right to reject goods and claim a full refund used to be available to consumers within a “reasonable time”. This is now set at 30 days, giving much greater certainty. Even after this 30 day period, the consumer can request the trader to repair or replace the goods. The trader has one opportunity to repair or replace and, if the attempt is unsuccessful, the consumer has the option of a price reduction or final right to reject and claim a refund.
Enhanced Remedies for Sale of Services
As a general rule there used to be no specific statutory remedies if a supplier failed to provide services with reasonable care and skill as implied under the Supply of Goods and Services Act 1982.
However the Act now provides that if a trader fails to provide services with reasonable care and skill, the consumer can request that the services are re-performed (at the trader’s expense) or, if this is not possible or the trader fails to do so within a reasonable time, the consumer is entitled to an appropriate price reduction up to the full amount.
The Act specifies that every services contract includes a term that the trader must perform the services with reasonable care and skill. Liability for breach of this term cannot be excluded but it can be limited to the price paid by the consumer provided such limitation is fair.
The Act has taken some necessary steps to rectify the previous out of date and complex framework of legislation, in particular making provision for the sale of digital content. Although some parts of the Act simply consolidate pre-existing law or what should have been best practice in the first place, there are some subtle but significant adaptations which need to be considered if B2C retailers wish to avoid the reputational and monetary cost of handling consumer claims under the new regime.
Businesses selling goods and/or services to consumers should review their terms and conditions and marketing material, as well as their sales processes and policies, in light of changes introduced by the Act. They should also consider what staff training is needed to reduce the risk of falling foul of the Act, bearing in mind that non-compliance can in some cases lead to considerable wasted time and cost not to mention possible reputational damage.
No longer will it be correct for consumers to assume that they have rights under what is now, in its majority, a defunct collection of consumer protection legislation from the last century – the new Act replaces the Unfair Terms in Consumer Contracts Regulations 1999, the Unfair Contract Terms Act 1977 (in relation to consumer contracts), most of the Sale of Goods Act 1979, and the Supply of Goods and Services Act 1982 (in relation to consumer contracts).