Customer regulations: hidden impact of EU regulations
Just think about it
5 May 2016
Milton Silverman draws attention to the hidden impact of EU consumer regulations on surveyors, valuers, estate agents and many others
EU directives have had a bad press in the UK over the years. They direct EU member states to implement specific, workable national legislation in line with generalised proposals; but sometimes these directives and the subsequent legislation have effects beyond those envisaged. This is arguably the case with Council Directive 2011/88/EU and similar directives, which aim to protect consumers in respect of contracts negotiated somewhere away from the provider’s business premises, and distance contracts negotiated by email or phone.
The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (the regulations) came into force in June 2014 and apply to valuers, estate agents, surveyors, including approved inspectors and many others. They aim to protect vulnerable consumers from pressurised selling where they have no chance to reflect or compare prices. The actual effects are more wide-ranging, however. The regulations do not apply to councils’ building control bodies, who do not have the same contractual relationship with their customers.
The importance of the regulations is that sellers of goods or services to consumers, but not businesses, must provide certain information and documentation and a 14-day cooling-off period from the time of purchase, failing which consumers are entitled to their money back for more than a year afterwards.
- apply only where businesses are selling goods or services to a consumer who is acting in an individual, personal capacity
- require consumers who enter into most distance or off-premises contracts to be provided with a 14-day cooling-off period following their agreement to sign up for or purchase the goods or services
- require provision of information and documentation (detailed in the regulations) that sets out rights to cancellation for the consumer before they are bound by the contract.
Failure to provide the requisite information and cancellation documentation can be a criminal offence, and there are fines and provisions for enforcement. Most importantly, if the service provider does not give such information, the client has the right to cancel an off-premises or distance contract, and reimbursement of any sums paid for one year and 14 days after the time when the cancellation period would otherwise have commenced (i.e. normally 14 days, although only if all is done properly from the beginning). A customer who has not been supplied with the relevant information will not have to pay.
In relation to service providers, there is provision to enable the customer to request that a provider commence work during the cancellation period (effectively waiving the regulations), provided that the requisite information and documentation has been properly supplied. As long as the customer has received the paperwork on their rights relating to the 14-day cooling-off period, they can waive those rights and request immediate commencement.
In 2014, the Supreme Court considered the case of Robertson v Swift  UKSC 50. The owner of a removal business failed to supply the relevant information to the customer. Their Lordships ruled that the owner was not entitled to his outstanding fees and he had to repay the deposit.
It is far better and simpler to get the paperwork organised beforehand, send it to the client and, having received their signed instructions, to commence work.
The statutory information can be set out on two sides of A4; how best to integrate it into your business practice and PR will require more thought.
Suggested sample forms are shown below, but please note they are drafts only, and you should take legal advice prior to using them.
Email to clients
If, when you have read the information below, you would like me to commence work immediately (specify the work if not already clear from the context), please email me as follows:
“I have read the information below, and attached Request for Immediate Commencement (the request). I now ask you to commence work immediately in accordance with the provisions of the request.”
Information for clients
Where we are acting for you as an individual in your personal affairs (and not in a business capacity) the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 will apply to your engagement of our services. These require us to provide you with certain information when the contract is made. In this regard, your attention is drawn to the consumer provisions and other information below.
You have the right to cancel your engagement of our services (the agreement) within 14 days of the date hereof. You can do so without giving any reason: your attention is drawn to the attached Notice of the Right to Cancel and the Request for Immediate Commencement of Work.
Should you have any complaint concerning our engagement (to include the advice you have been given/fees you have been charged) please contact (name).
Request for immediate commencement
For return to Super Surveyors Co. Ltd
If you require us to commence work immediately (specify the work), please email confirming such request or sign and date the form below.
Instructions to commence work immediately
To Super Surveyors Co. Ltd
(address and contact details)
I hereby instruct you to commence work with immediate effect.
I am aware of the following:
(Signed and dated by customer)
Notice of right to cancel
You, the client, have a right to cancel the agreement referred to in the accompanying email within 14 days of the date hereof (the cancellation period). You can do so without giving any reason. To exercise that right, you must inform us (name of organisation, registered, address, phone and email details) in a clear, written statement of your decision to cancel.
You may use the cancellation form below, but this is not obligatory. A dated letter or email to the above address setting out your clear decision to cancel will also suffice. To meet the deadline, your communication must be sent before the cancellation period has expired.
Effects of cancellation
If you exercise your right to cancel, we will not undertake any services on your behalf and you will not incur any charges. However, if you request work to begin on your instruction during the cancellation period, and subsequently cancel the agreement after work has started as requested but before the expiry of the cancellation period, we may charge you any fees, disbursements and applicable VAT reasonably incurred during that period.
This is only to be returned if you do not wish us to continue to act for you in respect of your instruction before the end of the cancellation period
To Super Surveyors and Co. Ltd
I (client name) hereby give notice that I wish to cancel the agreement (dated ...) for the provision of valuation/survey services (as applicable).
(Signed, dated, printed name and address of signatory)
Milton Silverman is a senior partner at Streathers Solicitors LLP