Tim O’Callaghan is a partner in Druces LLP, specialising in advice to the fashion and luxury goods business. In this month’s column, he outlines a new Act that will affect all retailers from October.
This intimate apparel solicitor is well aware that his readership is – like the Boy Scouts of old – used to ‘being prepared’. With the first daffodils and the mellifluous song of the cuckoo heralding spring, your minds are already on the collection for the next Autumn/Winter.
Your marketing campaigns for Christmas and Valentine’s Day are prepared well in advance of these occasions, and so I hope you will consider transferring such exemplary forethought into the dry, but important arena of consumer legislation.
The most significant piece of legislation affecting all retailers for many years will be coming into effect this October. The Consumer Rights Act 2015.
But why do you need to know about this now? Before the summer holidays start, you’ll need to get your solicitor beavering away on your terms and conditions and policies to ensure that they are compliant.
Have you ever wondered which laws apply to you as a seller to the general public? If you have, you might have considered any of the eight separate pieces of legislation that are likely to apply.
If you had secluded yourself in a cave for a year with the sole purpose of digesting and understanding these turgid documents you may very well have emerged none the wiser and a little less sane.
Even lawyers assisting retailers have found the legal landscape of consumer protection confusing, fragmented and at times seemingly contradictory.
Think your new collection is an eclectic jumble? It is no doubt considerably more coherent than the consumer protection legislation we have had to date. From relatively arcane, yet crucial, acts such as the Sale of Goods Act 1979 to the Unfair Contract Terms Act 1977, the statute books groan under the weight of consumer protection legislation.
An overarching review and consolidation and simplification have been long overdue. Thankfully, just before Parliament dissolved ahead of this year’s General Election, a new Act was introduced with the express intention of simplifying and putting in one place all of the relevant legislation affecting sales to consumers.
So, how will this affect you?
The New Act
The first thing to note is that the Act comes into force on 1 October 2015. This gives you time to ensure that your terms, conditions and procedures are compliant.
Any business that faces the public and sells directly to the public will need to review the following documents:-
1. Sales contracts including a standard website and app terms and conditions;
2. Limitation of liability clauses;
3. Cancellation and returns and refund policies;
4. Any pre-contractual information provided to the public.
As a growing amount of business is done online, there is a specific sector of the Act that deals with digital content and services. The main part of the Act sets out the following:-
1. Time period of 30 days in which customers may reject sub-standard goods and be entitled to a full refund.
2. For those involved in the luxury end of the market, there are particular provisions that apply, which raise the possibility that customers may be able to bring a claim long after any “guarantee period” has expired if the customer can satisfy the court that it could have reasonably been expected that the product at the luxury price paid, would last for a number of years.
3. All garments and accessories must meet a concept of satisfactory quality to take into account the price and stated purpose of the garments.
4. Whereas before you may have stated that you would replace a sub-standard item of clothing or repair it, prior to offering a full money back refund, those instances have now been limited by the Act;
5. The remedies available to customers have, historically, been of byzantine complexity. They have now been simplified and are set out quite clearly in the Act;
6. Finally, there is a provision stating that retailers cannot contract out or exclude the provisions of this very important statutory provision.
Those dealing with customers directly are best advised to review their terms and conditions of business and their online terms without delay. Once the extent of the Act has been appreciated, sales staff should be briefed on the new provisions and retailers should contact their insurers to discuss with them the extent of cover available.
With consumer rights being such a hot issue in the press and on online media, it is unlikely that any lingerie businesses selling direct to customers will be able to turn a blind eye to this new law by relying on customer ignorance. Be prepared!