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If you are a business selling products to consumers, then you may be aware of the Consumer Rights Act 2015. The Consumer Rights Act (or CRA) gives certain rights to consumers about the quality of the goods that they buy. The purpose of the legislation is to make it easier for consumers to know their rights against sellers. But it is also important that you know your obligations to your consumers under the Act, and that you comply with the consumer contracts regulations to avoid any potential claims in the future. This article will explain some key points about the CRA and some of the rights that it gives to consumers, and how you can best make sure that you are not accidentally in breach of your obligations.
What is the Consumer Rights Act 2015?
The purpose of the Consumer Rights Act, as mentioned, is to make it easier for consumers to know their rights. This is achieved through harmonising the rules on goods, services, and digital content in one single piece of legislation. Importantly, the CRA applies only in a business-consumer relationship. As a result, it will not apply if you are selling a good or providing a service to another business.
Who is a Consumer?
The difference between a consumer and a business is not always clear-cut, but the legislation has a definition for consumers.
Equally, you are not able to use the Consumer Rights Act against anyone yourself if you are a business owner – instead, you will have to rely on the Sale of Goods Act 1979.
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What Does the Act Do?
The Act, most importantly, imposes a series of obligations on sellers which they must comply with to avoid being liable to give a consumer a remedy.
First, a seller must have ‘good title’. Simply put, this means that you must have the right to sell the product or service to the consumer. For example, if you are selling items that you have in your possession through a financing scheme, then you will not have ‘good title’ and may not be able to sell it. Similarly, if you are selling stolen goods, the consumer will have a statutory right against you.
Second, any description that you provide about your goods or services must be accurate. This means that if you make a representation that your good will be of a certain dimension, colour, or quality, then it must conform to that. If your product fails to do so, you will be liable for your description not meeting the service actually offered.
Third, there is a general obligation that your goods must be of satisfactory quality. Above all, your goods must work and they must not be damaged.
When assessing whether goods are of ‘satisfactory quality’, a court will look at its:
- appearance;
- durability;
- suitability for purpose;
- safety; and
- freedom from minor defects.
In particular, the ‘suitability for purpose’ aspect is important. This means that your good must be suitable for the exact purpose for which you are selling it. For example, if a customer asks you for a drill that can drill into brick, you will be liable under the Act if you sell them a drill that is unable to drill into brick without telling them so.
What Remedies Would the Consumer Have?
If you find yourself in breach of the Consumer Rights Act, it is good to know what remedies may be imposed against you.
Usually, the customer will be able to:
- reject an item, and ask for a refund;
- claim a repair of faulty goods or ask for a replacement;
- claim a price reduction.
Importantly, a customer has a right to reject the goods completely within the first 30 days of their purchase. If this period has gone, then the customer will usually be entitled to a replacement. If the replacement comes back and it is still a faulty good, then the customer will then have a final right to reject the goods and get a refund.
Key Takeaways
If you are running a business that engages with consumers regularly, you should familiarise yourself with your obligations under the Consumer Rights Act. The CRA means that you have to have good title, sell products that match your description, make sure that your goods are suitable for the purpose that you sell them for, and provide remedies if you are in breach of your obligations.
As a result, it is a good idea to make sure that you are conscious of the Consumer Rights Act when you make any representations to your consumers. It is important to make sure that you take reasonable care in agreeing to consumer contracts to make sure that you have not misled the customer in any way, and that your goods are of satisfactory quality. Our experienced contract lawyers can assist you as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today at 0808 196 8584 or visit our membership page.
Frequently Asked Questions
Put simply, a consumer is anyone who is acting outside of business purposes.
A statutory right is a right that an individual has by virtue of the law. For example, the Consumer Rights Act 2015 gives statutory rights to customers, because it is a statute passed through government.
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