Q&As

What are the options for a consumer facing business in respect of deposits or payments made where a consumer terminates a contract due to coronavirus (COVID-19)? Can I keep any deposit paid or where goods or services have been paid for in full can I provide a voucher for future supply/performance? Is the position different if the contract is terminated by the business?​

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Produced in partnership with Helen Hart of Institute of Promotional Marketing
Published on LexisPSL on 07/04/2020

The following Commercial Q&A produced in partnership with Helen Hart of Institute of Promotional Marketing provides comprehensive and up to date legal information covering:

  • What are the options for a consumer facing business in respect of deposits or payments made where a consumer terminates a contract due to coronavirus (COVID-19)? Can I keep any deposit paid or where goods or services have been paid for in full can I provide a voucher for future supply/performance? Is the position different if the contract is terminated by the business?​

What are the options for a consumer facing business in respect of deposits or payments made where a consumer terminates a contract due to coronavirus (COVID-19)? Can I keep any deposit paid or where goods or services have been paid for in full can I provide a voucher for future supply/performance? Is the position different if the contract is terminated by the business?​

The Consumer Rights Act 2015 (CRA 2015) contains provisions about unfair terms in contracts between traders and consumers for goods, services and digital content. The CRA 2015 re-implemented Directive 93/13/EEC, the Unfair Terms in Consumer Contracts Directive, into UK law.

It provides that a term or notice is unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties’ rights and obligations under the contract to the detriment of the consumer (CRA 2015, s 62).

The Competition and Markets Authority (CMA) has published guidance on unfair contract terms. The CMA guidance helps businesses understand what makes terms and notices unfair in business-to-consumer (B2C) contracts, and what the risks are if they use unfair wording. It gives advice on how organisations can make sure the B2C contract terms and notices are fair and clear.

To an extent, much will depend on the terms of a contract between a trader of goods and/or services and the consumer. However, it is unlikely

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