Upon concluding a purchase, traders sometimes ask consumers to sign a sales agreement. While both written and verbal sales contracts are legally binding, written agreements offer the advantage of clear documentation, providing tangible proof of the terms agreed upon between the buyer and the seller.
These agreements outline the rights and obligations of both parties, detailing essential aspects such as the agreed price, the delivery date and the product specifications. If either party breaches the terms, the contract may be considered invalid, potentially leading to financial consequence. For consumers, this could mean losing the right to claim a refund of money paid, or remedies, while sellers may be held liable for extra costs incurred by consumers due to the breach of contract.
Since a sales contract is proof of what was verbally agreed between the two parties, consumers should thoroughly read and understand what is written in it before signing. This to ensure that the contract includes what was verbally agreed, such as the price, the method of payment, a clear description of the goods or service purchased, the delivery date, or in the case of services, the date when the service will be provided, and also the seller’s contact information.
For instance, if a consumer is buying a home appliance, they should ensure that the contract clearly states the exact model, the price agreed and when it will be delivered. Any special arrangements related to delivery should also be clearly outlined in the sales contract.
Many contract terms are not set in stone, and both parties have the opportunity to discuss and agree on adjustments
Consumers should be aware that once they sign a contract, they cannot simply change their mind without facing potential financial consequences. For instance, in long-term contracts like gym memberships, phone plans or subscriptions, early termination might require paying the remainder of the contract or a cancellation fee. So it is crucial for consumers to thoroughly review and understand the contract terms before signing, especially in relation to cancellation policies and potential penalties, to avoid unexpected costs later on.
On the other hand, sellers have a legal obligation to draft contracts in clear and easily understandable language.
Consumer protection laws are designed to ensure transparency, and if any term in the contract is vague or ambiguous, it will be interpreted in favour of the consumer. This means that sellers must avoid using confusing or misleading terms that could disadvantage consumers.
Additionally, contracts cannot include unfair terms that limit or restrict consumer rights. For example, a contract that absolves the seller from responsibility for delivery delays or defective goods is considered unfair and cannot be legally enforced, even if the consumer signed the contract and agreed to such terms.
Although the law provides this layer of protection, consumers should still remain vigilant when reviewing sales contracts. If consumers are uneasy or uncomfortable with specific terms in a contract, they should consider negotiating those terms before signing. It is important to remember that many contract terms are not set in stone, and both parties have the opportunity to discuss and agree on adjustments.
Once a contract has been amended, it is essential that the revised version is properly documented and signed by both the consumer and the seller. This ensures that the agreed-upon changes are legally binding and that both parties are accountable to the new terms. Without both signatures, there is no legal proof of the modification, which could lead to disputes later, especially if issues arise in the future.
If a dispute arises regarding the terms and execution of a contract, consumers have the option to seek assistance from the Office for Consumer Affairs at the Malta Competition and Consumer Affairs Authority (MCCAA). By submitting a formal complaint along with a copy of the sales contract, consumers can receive guidance on the validity of their claim and whether they have a legal basis for action.
The MCCAA can assist in resolving the dispute through its conciliation process, which aims to mediate between the consumer and the seller to reach an amicable solution. If the dispute remains unresolved, the MCCAA can advise consumers on how to escalate the matter through the Consumer Claims Tribunal. This process provides consumers with cost-effective alternative to lengthy legal proceedings.
Odette Vella is director, Information and Research Directorate, MCCAA.