I recently acted for a client who instructed me to review and advise her on her existing terms and conditions. One of the key questions that she had was whether she could contract out of the Consumer Rights Act 2015 (“CRA”).
The short answer to her question was, no. The CRA must be complied with, and failure to do so may result in a hefty fine, paying out damages and suffering significant harm to the reputation of her business.
After reviewing her existing terms and conditions, it was clear that they weren’t compliant with the CRA on a number of key points and my advice to her was that she would need an entire new set of terms and conditions.
What is the CRA?
The CRA came into force on 1st October 2015, with a view to simplify and consolidate the complex area of law relating to consumer rights. The general aim of the CRA was to make it easier for consumers to understand their rights. Emphasis was put on the need for all terms to be fair and transparent.
The CRA only applies to contracts between businesses and consumers. A consumer is an individual who is not acting for the purposes of a business, trade or profession.
Contracts between businesses will remain subject to the existing legislation.
What happens if I am not compliant?
If your terms and conditions are not compliant, then consumers may be entitled to bring a claim for damages for any loss suffered as a result of the breach. This may include not only the price of the goods/services but also some additional compensation.
Trading Standards also have the power to obtain an order of the court requiring a business to comply with the CRA. Failure to comply with that order is a criminal offence punishable by an unlimited fine and up to two years imprisonment.
How do I know if I am compliant with the CRA?
The chances are that if you haven’t had your terms and conditions reviewed by solicitor in the past 18 months, they’re likely to fall foul of the CRA.
If you have had your terms reviewed in the past 18 months, but you’re still not sure if your terms are compliant with the CRA, then have them reviewed by a commercial solicitor as soon as possible.
The commercial team at Farleys have extensive experience in advising clients on their terms and conditions. Having your terms and conditions reviewed now may save you considerable costs and stress in the future. To speak to one of our commercial solicitors about having your terms and conditions reviewed to ensure that you are compliant with the CRA, please do not hesitate to get in touch by calling 0845 287 0939 or submit your enquiry online.