What is the Consumer Rights Act 2015?
The introduction of the Consumer Rights Act 2015 on 1st October 2015 brought in important changes for consumers and traders. The Act is a mix of new law and a consolidation of the existing laws surrounding contracts between consumers and traders. Business-to-business contracts are not caught by the new law. The new rules will apply to contracts entered into on or after 1 October 2015 and to consumer notices provided from 1st October 2015.
The Consumer Rights Act 2015 is split into three parts:
- Part 1 clarifies the standards that consumers can expect when purchasing goods, services and digital content and the remedies available to them when these standards are not met;
- Part 2 consolidates and updates the law on fairness in contract terms and notices
- Part 3 contains provisions relating to miscellaneous areas such as enforcement powers of regulatory bodies, letting agent fees and private actions in competition law.
What Laws Have the Consumer Rights Act Replaced?
The Act replaces wholly or in part a number of statutes pertaining to consumer law, including the Sale of Goods Act 1979, the Unfair Contract Terms Act 1977, the Supply of Goods and Services Act 1982, the Unfair Terms in Consumer Contracts Regulations 1999 and the Sale and Supply of Goods to Consumers Regulations 2002.
Some important provisions relating to consumer rights remain in the Sale of Goods Act 1979 as well as some provisions under the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 ("Consumer Contract Regulations 2013") including those concerning cancellation rights of the consumer in respect of distance contracts (contracts entered into without the physical presence of the consumer and the trader, such as online purchases).
Summary of Consumer Rights Laws in the UK
All products, physical or digital, must be of satisfactory quality, fit for purpose and they must be supplied as described. The main changes brought in by the Consumer Rights Act 2015 in relation to the supply of goods are the provisions that apply when a trader breaches these standards. A three-tier structure for such remedies replaces the previous two-tier system.
‘The Five R’s’
The three-tier structure can be summarised as follows:
- Short term right to reject
Within the first thirty days of the goods being supplied, (except where the expected life of the goods is shorter), the consumer is entitled to reject the goods and receive a refund, but they must make the goods available for collection by the trader. This is a new provision under the Consumer Rights Act 2015.
- Right to repair or replacement
The trader must provide the repair or replacement within a reasonable time, without causing significant inconvenience to the consumer and at no cost to the consumer. If the goods still do not meet the consumer's rights, whether because the original issue persists or a new one has arisen, the consumer can exercise their right to a price reduction or final right to reject.
- Right to a price reduction or final right to reject
Where a repair or replacement is unsuccessful, impossible or not provided within a reasonable timeframe or without significant inconvenience to the consumer, the consumer can choose to keep the goods and claim an appropriate reduction in price (taking into account the circumstances), or return them and claim a refund.
Sales of Digital Content
The standards which apply to digital content are the same as for good in that the content must be of satisfactory quality, fit for purpose and as described. A two-tier statutory remedy structure has been introduced to deal with remedies for when those standards are breached:
Where the standards of the digital content have not been met, you have the right to a repair or replacement. If a repair or replacement isn't possible or doesn't fix the situation, you can ask for a price reduction of up to 100%.
The above rights and remedies will not apply where digital content is genuinely being supplied for free. However, the retailer will have to compensate you if any device or other digital content you own is damaged as a result of the faulty digital content you've downloaded. ‘Reasonable care and skill' must be exercised in the provision of the digital content in order to make a claim, and you may make a claim even where the digital content was supplied free of charge.
Laws Relating to Consumer Services
Prior to the Consumer Rights Act 2015, consumers had no remedy in law where services were of poor quality or defective except where the services were in breach of any express or implied contract term that the supplier would use reasonable care and skill in carrying out the service.
In all contracts for services the following rules apply:
- The service must be performed with reasonable care and skill.
- Where the consumer relies on spoken or written information, the trader will be contractually liable.
- Where the price is not agreed beforehand, the service must be provided for a reasonable price.
- The service must be carried out in a reasonable time, where a timescale has not been agreed.
The CRA also establishes a new two-tier statutory remedy for when these standards are breached:
- Repeat performance
Where the trader fails to exercise reasonable care and skill, or has not complied with information they have given about the service the trader must repeat the service properly. The work must be carried out within a reasonable timeframe, without causing significant inconvenience to the consumer and at no extra cost to the consumer.
- Price reduction
A price reduction up to 100% can be claimed where repeat performance is impossible or cannot be done within a reasonable time or without significant inconvenience to the consumer. A reduction must also be given if the service is not performed within a reasonable time or in line with information given about the trader.
Delivery of Goods
The retailer is responsible for goods until they are in your physical possession, or in the possession of someone appointed by you to accept them. This means that retailers are also liable for the courier service of the goods rather than the delivery service providers.
There is a default delivery period of thirty days, during which the retailer needs to deliver unless a longer period has been agreed. If the retailer fails to deliver within the thirty days, or on the date that has been agreed, and it was essential that it was delivered on time, then you have the right to terminate the purchase and get a full refund. If the delivery isn’t time-essential but another reasonable delivery time can’t be agreed, you’re also within your right to cancel the order for a full refund.
Unfair Contractual Terms
The Consumer Rights Act 2015 has consolidated rules under the Unfair Contract Terms Act 1977 and the Unfair Terms in Consumer Contracts Regulations 1999 giving consumers protection against contractual terms that may give traders an unfair advantage. Some limited changes have also been introduced.
A term is deemed to be unfair if "it causes a significant imbalance in the parties' rights and obligations under the contract to the detriment of the consumer".
There are certain aspects of EU legislation or case law that are now made more explicit via inclusion in the CRA. For example, the CRA sets out that the courts must consider the fairness of terms in consumer contracts even where the parties to a case do not raise it as an issue, so long as the court has sufficient information to allow it to do so.
What the Consumer Rights Act Means for Businesses
Businesses should ensure their standard terms of business and marketing and sales practices comply with the law to ensure their contract terms are enforceable, to mitigate regulatory and legal implications, and to ensure that their liability to consumers is effectively managed.
- Compliance-checking any provisions of other consumer sales contracts;
- Checking Contracts and arrangements with suppliers and distributors to ensure there are no potential liability gaps;
- Compliance-checking cancellation, returns and complaints handling policies;
- Ensuring standard terms and conditions of sale are compliant
- Checking statutory references in all relevant documentation are up-to-date;
- Ensuring any pre-contractual information that is supplied to consumers, including notices, advertisements and announcements should be up-to-date;
- Ensuring relevant staff are adequately trained on consumer rights and remedies.
Contact our Expert Consumer Contract Solicitors London
How Selachii Can Help
Selachii is a dynamic litigation and dispute resolution law firm based in Kensington, London. We work with both businesses and private individuals, giving them bespoke legal advice and support tailored to their exact requirements.
We can dissect your business issues so that we understand every element before designing the best and most cost-effective way of getting you to the outcome you want.
If would like further information about the Consumer Rights Act 2015, and how Selachii can help ensure your business is compliant, contact us online or call us on 02077925649.