Cancellation conundrums: distance sales of goods and services

03 Mar 2013
Alasdair Taylor

The Consumer Protection (Distance Selling) Regulations 2000 (the DSRs) contain an intricate set of rules concerning the cancellation, by consumers, of distance contracts for the supply of goods. A different set of rules concerns the cancellation of distance contracts for the supply of services. But nowhere in the Regulations is there any guidance on the cancellation of distance contracts for the supply of both goods and services.

For example, supposing you offer a lightbulb supply and fitting services. Customers pay a single fee via your website for both the bulb and the fitting. When does the right to cancel expire? Assuming all the necessary information has been supplied to the customer, then:

  • under the rules on the cancellation of contracts for the supply of goods, the cancellation period will expire 7 working days beginning on the day after the day on which the consumer receives the lightbulbs;
  • under the rules on the cancellation of contracts for services, the cancellation period will expire 7 working days beginning with the day after the day on which the contract is concluded, unless the fitting of the lightbulbs begins with the consumer’s agreement before the end of that period, in which case the right to cancel expires when fitting service begins.

The OFT guidance on distance selling recognises this problem, but provides a rather incomplete solution:

You need to assess whether there are two separate contracts or not, for example, one for goods (a mobile phone or modem) and the other for a service (such as the airtime or internet connection). If so, the contracts are treated separately. The relevant provisions of the DSRs should be applied to each of them.

In both cases, the cancellation period starts when the contract is made. It is possible to have cancellation periods running at different times, for example, the service contract may remain cancellable after the goods have been provided.

In this case, the customer may be entitled to cancel one element but not another.

Yes, in some cases there will be two contracts, but in other cases there will not. What then?

It seems to me that there are three main options.

First, you can artificially split the contract into two, and follow the OFT’s guidance.

Second, you can select the later of the two dates as the last date of the cancellation period, and either postpone service provision until the goods period has ended, or risk cancellation after you have provided services.

Third, you can select the earlier of the two dates as the last date of the cancellation period, and risk a customer compliant that you are not complying with the DSRs.

To my mind, none of these options are very attractive.

You might not want to spend to much time pondering the options, however, as the relevant law will change when the UK implements the Consumer Rights Directive. The new law should be in force on or before 13 June 2014.


I found a van on a company website that I was prepared to buy, and was going to use the van I had at the time as a px. Said garage offered 13100 for my van. They needed a holding deposit to hold the vehicle. I gave a deposit over the phone after being pressured as they said they had other people interested. I kept telling the salesman I would want to test the vehicle before the exchange he said “fine, your love it”. He then sent paper work for me to sign via email. Their terms and conditions are green lettering on green paper and it doesn’t print well. I signed where they said sign but not in the boxes as there where allot of mistakes on the form. I cancelled and they will not give me my deposit back. They said i broke the contract no deposit will be returned, but reading your posts they haven’t followed the procedures as they didn’t sign their own paperwork or give me a time scale for delivery – their terms and conditions are one sided to their advantage!

Thanks in advance what would you do ?

Regards Greg

You should make an appointment with your solicitor to go through this – it’s not really possible to give any useful advice without reviewing the documents and knowing all the circumstances.


Usually, the whole point of a deposit is that it’s lost upon cancellation. Unless the cancellation right in the DSRs applies, or a contractual deposit refund policy offered by the provider applies, you’re unlikely to have a straightforward legal remedy. I doubt whether the the DSR cancellation right would apply to a yachtmaster course, which if it is not a B2B transaction may well fall within the partial exception in Section 6(2)(b) relating to “leisure services”.

Your best bet may well be an argument under the Unfair Terms in Consumer Contracts Regs. You should read these regulations, and in particular Schedule 2, paragraph 1, which states that terms may be unfair if they have the object or effect of permitting the seller or supplier to retain sums paid by the consumer where the latter decides not to conclude or perform the contract, without providing for the consumer to receive compensation of an equivalent amount from the seller or supplier where the latter is the party cancelling the contract. Whether such an argument would be effective will depend upon all the circumstances.

See pages 38 and 39 of this:

It seems neither of us can prove our position. They deny anyone would say “all our caravan windows open”, but I phoned specifically because I was unsure of what I was doing. It seems as I already have the windows and they already have the money, it’s tough luck me.

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