Many agents are unaware of an important change that kicks in this week – the doubling of the cooling-off period from seven to 14 days.
The change comes into effect on Friday but industry trainer Julian O’Dell says he has been shocked at the low level of awareness.
He also warns that the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (CICAR) are ambiguous and may result in test prosecutions of agents to clarify.
O’Dell said: “On my training travels around the country in recent months, I have come across a significant number of agents who were unaware of the imminent legislative changes affecting the point of instruction.
“These centre specifically on the cooling-off period that applies when a client signs to instruct an agent, and the agent’s responsibilities at that point.
“I have met agents who didn’t know this period was changing, or indeed when.
“In truth, there have even been some agents who didn’t know there was such a thing as a cooling-off period.”
The new regulations cover the provision of information to customers, both on and off trade premises.
They replace the existing rules regarding customers’ right to cancel contracts which are signed away from trade premises (distance selling).
O’Dell said that the key changes are both the doubling of the cancellation period,and the form of notice to be included in consumer contracts.
He warned: “There is a degree of ambiguity within the new regulations and agents will no doubt interpret their responsibilities in different ways, but ‘better safe than sorry’ would probably be a sensible mantra until test cases set precedents and clarify best practice.
“It seems likely that any test cases are likely to involve uninformed agents – clear proof that ignorance is NOT bliss.”
From Friday, both sales and letting agents will have to hand over certain information to anyone instructing them to market a property.
The new regulations do not apply to tenancy agreements or guarantors and also only apply to ‘consumer’ landlords, not companies.
Contracts signed in the agent’s offices do not carry with them a right to cancel – although even this seems open to challenge – but certain information must be provided to the consumer.
Where a contract is signed away from the agent’s premises, then there is a right to cancel and cancellation notice must be given to the consumer before the contract is signed.
This notice should read as follows:
To [here the trader’s name, geographical address and, where available, fax number and email address are to be inserted by the trader]:
I/We [*] hereby give notice that I/We [*] cancel my/our [*] contract of sale of the following goods [*]/for the supply of the following service [*],
Ordered on [*]/received on [*],
Name of consumer(s),
Address of consumer(s),
Signature of consumer(s) (only if this form is notified on paper)
[*] Delete as appropriate.
The biggest ambiguity is that cooling-off rules do apply to contracts signed away from the client’s home – eg, in the agent’s office.
In the opinion of lawyers, this is because, while the actual signing may be done at the agent’s office, all the information-giving and decision making will have been done away from the office, at the client’s home.
Another potential ambiguity arises in the situation where the agent leaves the contract with the consumer at their home, unsigned, but the consumer then later returns the signed contract to the agent’s office.
Does that count as an on- or off-premises contract, and if so, do cancellation rights apply?
The advice – from Warwick Trading Standards – is that generally, this would be regarded as an on-premises contract, with no cancellation rights.
However, if the consumer returns the signed contract ‘immediately’, then it would count as an off-premises contract and cancellation rights would apply.
Warwick Trading Standards does emphasise, however, that this advice is given in the absence of case law.
The Regulations, including the information which must be given to a consumer in the scenario of an on-premises contract, are at: