On appeal from: [2012] EWCA Civ 1794

The appellant entered into a contract with the respondent, a removal company, to move his furniture from Weybridge to Exmouth in 2011 on 2 Aug 2011. The respondent visited the appellant’s home on 28 Jul 2011 and there agreed a price. Later than day he sent an acceptance document for the appellant to sign. This was signed and handed back to the respondent on a second visit to his home that same day. This document contained a clause stating cancellation charges would apply should the contract be cancelled less than 10 days before the removal date. The appellant also paid a deposit of £1000.

The appellant telephoned to cancel the contract and sent a letter giving the same notice of cancellation on 1 Aug 2011. He refused to pay the cancellation charges in reliance on the Cancellation of Contracts made in a Consumer’s Home Regulations 2008. The respondent brought proceedings and the appellant counterclaimed for the loss of his deposit.

The CA found that the 2008 Regulations did apply in these circumstances and hence the respondent could not enforce the contract. However, the appellant had not been entitled to cancel the contract because he had not been given the required notice of his right to cancel. Therefore, the contract had remained alive and he could not recover his deposit.

The Supreme Court allowed the appellant’s appeal against the dismissal of his counterclaim for the deposit. The aim of the Regulations was to protect consumers against the risks involved in contracts entered into outside of business premises. Under the Regulations, sellers must give consumers, at the point the contract is concluded, written notice of their right to cancel. Member States are also required to ensure that, where this is not given, appropriate measures are put in place to protect the consumer.

The CA had been incorrect to find that the appellant was not entitled to cancel the contract until he had been given appropriate notice of his right to cancel. The right to cancel was central to the purpose of the Regulations and not dependent upon the requirement to give notice of such a right. The right to cancel under the Regulations could be interpreted as: ‘the period commencing from when the trader is required to give the consumer a written notice of his right to cancel pursuant to regulation 7(2) and expiring 7 days after receipt by the consumer of a notice of the right to cancel’. Therefore, the appellant was within his rights to cancel the contract at that time and was entitled to recover his deposit.

For judgment, please download: [2014] UKSC 50
For Court’s press summary, please download: Court’s Press Summary
For a non-PDF version of the judgment, please visit: BAILII