How The Consumer Rights Act 2015 Impacts Your Business
The Consumer Rights Act 2015 (“the Act”) came into force on 1 October 2015 and applies to contracts between “Traders” and “Consumers”.
Section 2 of the Act defines a Trader as “a person acting for purposes relating to that person’s trade, business, craft or profession, whether acting personally or through another person acting in the trader’s name or on the trader’s behalf”.
Consumer is defined as “an individual acting for purposes that are wholly or mainly outside that individual’s trade, business, craft or profession”.
This article focuses on the key points traders need to be aware of when contracting with consumers for the sale of goods after 1 October 2015 and where the goods are not of satisfactory quality or fit for purpose.
Right to reject faulty goods
Prior to the Act coming into force, there was a great deal of debate as to what was a reasonable time for the purposes of establishing whether a consumer still had the right to reject faulty goods and in particular whether that right had been lost due to the consumer having been deemed to have accepted the goods.
The Act seeks to clarify this issue by creating a new short term right to reject within 30 days (“the 30 Day Period”). Assuming that the consumer can prove that the goods are faulty, they can reject the goods and claim a full refund within the 30 Day Period. The 30 Day Period runs from when ownership of the goods passed or in the case of goods on hire purchase, when possession of the goods is transferred to the consumer.
The 30 Day Period is clearly not likely to be appropriate for purchases of goods which have a life expectancy of less than 30 days. In such circumstances the short term right to reject will be determined by when the goods in question would reasonably be expected to perish.
Consumers can elect or allow the trader to carry out repairs or replace faulty goods within the 30 Day Period. In such circumstances, the clock, for the purposes of calculating the 30 Day Period stops until the goods have been replaced or returned.
There is however no requirement for the consumer to allow the trader an opportunity to carry out a replacement or repair to faulty goods within the 30 Day Period before exercising the right to reject.
Traders cannot exclude the 30 Day Period and the period only lapses due to the expiration of time.
Repair/replacement of faulty goods and final right to reject or secure a reduction in price
If a fault is identified within 6 months of delivery, it is assumed that the fault existed at the time of delivery. It is for the trader to rebut this assumption.
Within 6 months of delivery a consumer can, if it is possible, choose to have the faulty goods repaired or replaced. If the fault is not resolved the consumer can claim final rejection or a reduction to the purchase price. Save for sales of motor vehicles, traders will now be unable to make a deduction for the use of the goods that the consumer has had within the first 6 months following delivery.
Traders will now only have one opportunity under the Act to replace or repair faulty goods. A consumer, can still if he wishes, allow the trader further opportunities to replace or rectify defective goods but is not required to do so. Further opportunities do not prevent the consumer from exercising their right should it become necessary to reject the goods or require a price reduction.