The Supreme Court’s decision in Robertson v Swift

The Supreme Court’s decision in Robertson v Swift

I am interested to know commercial lawyers' reactions to the Supreme Court's decision in Robertson v Swift [2014] UKSC 50. It centred on the Cancellation of Contracts made in a Consumer's Home, or Place of Work etc Regulations 2008 (the 2008 regulations), which in turn implemented Council Directive (85/577/EEC). It may have wider implications than its mundane facts would tend to suggest.

I question whether this was a case deserving of the Supreme Court’s time and whether the court’s reasoning stacks up.

By the time the decision was handed down, the  2008 regulations had been replaced with the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (the 2013 regulations).

The decision is unlikely to radically change consumers' rights in practice. There should be little work for the 2008 regulations to do now that the 2013 regulations are in force. The Supreme Court may have decided a moot point. This may explain why the court was satisfied with two 'feasible' interpretations and preferred one over the other without stopping to decide on the right one.

On the other hand, the judgment may be an important addition for understanding and evaluating how courts approach statutory interpretation, particularly domestic laws which implement European directives. There is also the interplay between decisions of the Supreme Court and decisions of the Court of Justice of the European Union to be considered.

As a hypothetical exercise, if we were to markup paragraphs 7 and 8 of the 2008 regulations as they were interpreted by the Supreme Court, they would look like this:

‘7.           Right to cancel a contract to which these Regulations apply

(1) A consumer has the right to cancel a contract to which these Regulations apply within at any time prior to the expiration of the cancellation period...

8.           Exercise of the right to cancel a contract

(1) If the consumer serves a cancellation notice within at any time prior to the expiration of the cancellation period then the contract is cancelled.

(2) A contract which is cancelled shall be treated as if it had never been entered into by the consumer except where these Regulations provide otherwise.’

Then we must understand that if there is no cancellation period (as defined by paragraph 2) – because a trader does not give a consumer a notice of the right to cancel (also defined by paragraph 2) – then there is no end to the consumer's right to serve a cancellation notice under paragraph 8. That way a consumer can cancel a contract at any time.

This approach was said to be justified by a purposive construction of the legislation and the decisions of the European court. According to Lord Kerr:

To hold that the consumer did not have the right to cancel because the trader had not served written notice of the right to cancel would run directly counter to the overall purpose of the Directive in ensuring that a consumer has the opportunity to withdraw from a contract without suffering significant adverse consequences. The circumstances in which the particular contract in this appeal was made and in which Dr Robertson sought to cancel it may be out of the ordinary. There may even be reason to suppose that Mr Swift, the owner of a small business, fared rather badly out of this transaction. But if the right to cancel could be effectively nullified by a failure (or refusal) of a trader to give written notice of the right to the consumer, this would create a considerable gap in the level of protection that the Directive sought to provide.

The Court of Appeal saw things differently. It thought that if there was no cancellation period then there could be no right to cancel under paragraph 8. While a trader could frustrate paragraph 8 by failing to give a consumer a notice of the right to cancel, this was in the view of that court a fault of the 2008 regulations which the courts could not remedy. The Court of Appeal may not have the benefit of the European court's decisions (according to the Supreme Court) but it did have the plain words of the 2008 regulations.

The Court of Appeal also explained that the directive underlying the 2008 regulations had no application to solicited supplies, as was the case here.

I suspect that the decision will expose the Supreme Court to criticism that it re-wrote the 2008 regulations rather than merely interpret them. There were no competing interpretations of the wording of the regulations. The purpose of the regulations was not used as a tie-breaker. The purpose came first and the wording was stretched to fit the purpose.

This leaves me wondering why the Supreme Court would take the risk in circumstances where the 2008 regulations have been superseded and the relevant directive was not intended to cover solicited supplies. As to the latter point, the court was clearly selective in deciding which objectives to pursue. The court believed it could side step this by noting that member states are free to provide increased consumer protection. Moreover, the 2008 regulations could have easily avoided the 'gap', just as the 2013 regulations do.

The decision may cause difficulties for the Supreme Court in other contexts. The next gap could appear in tax, competition or banking and financial services legislation where the outcome is not academic. Alternatively, it may be excused on the basis that the court was applying European directives and following the decisions of the European court.

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