Part 1 – Direct agreements

Under the Ontario Consumer Protection Act, purchasers of products or services, bought through a “direct agreement”, are given certain rights to cancel the agreement. Under the Act, direct agreements are those which are negotiated and entered into in person, at a place other than the supplier’s place of business, such as at the purchaser’s home (also known as door-to-door sales agreements). The agreement can be for such products or services as water heaters, water softeners, lawn care, snow removal and home renovations, or any product or service purchased at home from a door-to-door salesperson.

Right to cancel within 10 days – cooling-off period

You can generally cancel a direct agreement without any reason, by giving notice of cancellation to the seller within 10 days of receiving a copy of the signed contract. Also known as a “cooling-off” period, this 10-day cancellation period is only available if the item purchased was worth over $50, there is a written agreement or contract, and you either did not pay for the item in full, or did not receive all the goods and services when you signed.

The notice to cancel must be provided in writing by email, registered letter or by hand delivering it. Be sure to keep a copy of your letter. The company has 15 days to return your money and is responsible for picking up the product or paying for its return if they want it back.

Right to cancel because of missing information

If the 10-day cancellation period has expired, you still may be able to cancel the agreement within one year of signing it, if you did not receive a copy of the agreement, or it does not contain the necessary information. In addition to the name and address of the buyer and seller, the agreement must clearly describe the item or services purchased, a detailed description of the payment terms and any guarantees, delivery dates, delivery charges and the date on which services are to be performed and completed. If it doesn’t, you can cancel the agreement, and the company must provide a full refund.

The company may be exempt from having to refund the full amount of the agreement price if the buyer requested the services to be performed within the 10-day period. In this case, the supplier is entitled to deduct reasonable compensation from the refund amount. The exception was intended to give some protection to the supplier of emergency services, such as emergency home repairs.

Right to cancel because of unfair business practices

You may also be able to cancel the agreement, in writing, within one year from the date you signed it, if an “unfair practice” led you to purchase the product or service. Under the law, an unfair practice can include a number of behaviours including, a seller making false or misleading statements, such as stating that something you own requires servicing or replacing if it does not, saying goods are new when they are not, or stating that the product or service is better than it really is.

Unfair practices can also include situations where a seller takes advantage of a buyer’s reading problems, language difficulties, or mental or physical disabilities. This also includes excessive sales pressure and charging an excessively high price.

In addition, with direct agreement purchases, the final price cannot be more than 10% above the estimate, unless you agree. Also, there is a minimum warranty about the quality of services. If they are not reasonably acceptable, you can file a complaint with the Ministry of Government and Consumer Services.