A contractual relationship is formed when a consumer buys a product or service from a company. For example, paying for a product at a checkout or approving a renovation company’s offer both constitute the formation of a contract.
The contract is binding on both parties. Both parties must comply with the terms and conditions of contract, and usually neither party may unilaterally modify the contract without a justifiable reason. This implies, for example, that the vendor must supply the product ordered, the buyer must pay the agreed price by the agreed time, and the product or service must correspond to what was agreed.
Usually a sales contract is binding even if it is not made in writing. If it comes to a dispute, a verbal agreement may be difficult to verify, so we recommend always making a written agreement, especially in relation to larger purchases.
The consumer must be given the chance to read the main terms and conditions applicable to the contract and affecting the purchase decision when the product or service is being marketed, or, at the latest, when the contract is being made. In other words, it is not enough simply to refer to separate terms and conditions when making a sale.
The main content of the contract must be clearly indicated in the terms and conditions. This content includes (but is not limited to):
- the product or service being sold
- the price
- the duration of the contract (one-time purchase or fixed-term or ongoing contract)
- the delivery time and payment terms
- the consequences of breaches of contract
- ways of amending the terms and conditions
- ways of cancelling and terminating the contract
Unclear terms and conditions of contract
All the conditions that are significant for the consumer must be clearly expressed in the contract. Should a dispute arise, any unclear standard terms and conditions formulated by the vendor that are open to interpretation are usually interpreted in the consumer’s favour.