When a product has a defect for which the seller is responsible, cancelling the contract is only the last form of redress. Consumers often mistakenly believe that a contract can automatically be cancelled if the product has even a minor defect.
Before cancelling the contract, the company can determine if the defect could be remedied by repairing the item, replacing it or reducing its price. The seller and the consumer are naturally free to settle on the form of redress that best suits the situation if they can arrive at an agreement.
The company has the right to repair the defect at its cost or replace the product with a faultless one if, after receiving the consumer complaint, it offers to do so without delay and the issue can be remedied within a reasonable time, without reducing the value of the item and without causing the buyer significant inconvenience.
- The company can usually choose if it prefers to repair the defect or replace the item. Repairing the item usually is the most appropriate method of redress.
- The company has the right to refuse to remedy the defect by repairing or replacing the item if this is not possible or would result in unreasonable costs.
If the product cannot be repaired or replaced, a price reduction that corresponds to the seriousness of the defect may be offered as redress. A price reduction could be given when, for example, the defect is minor and its significance may be small for the consumer regarding the whole, for example a surface defect.
A consumer may demand cancellation of the contract if a defect for which the seller is responsible is not minor and it cannot be remedied by other means. A defect is minor when, for example, the product can be repaired easily and without delay, or it has a surface defect that is of little significance for the customer when the contract is regarded as a whole.
When a contract is cancelled, the seller must refund the customer once the customer has returned the item. If the defect only comes to light a long time after the contract was concluded, the buyer must compensate the seller for having had the use of the product.
Additionally, the consumer is entitled to compensation for damages caused by the defect, including their costs and other financial losses. No compensation may be claimed for emotional distress.
More information on handling consumer relations
Familiarise yourself with the basics on the FCCA’s website:
Gain in-depth insight by reading the Consumer Ombudsman’s guidelines: