In November 2008, the English Law Commission and the Scottish Law Commission published a joint consultation paper on consumer remedies for faulty goods. Responses to the consultation, published on 13 May 2009, have revealed widespread support among both consumer and business groups for retaining the right to a refund. This right contrasts with the position under the EU Consumer Sales Directive (in which consumers’ first recourse is to repair or replacement) which has come under threat recently from the European Commission’s proposals for a new Consumer Rights Directive designed to harmonise consumer rights across EU Member States.

The general consensus is that the right to a refund is vital for consumer confidence in that it is a simple, well understood remedy that prevents consumers from becoming locked into a cycle of failed repairs. The majority of respondents nevertheless acknowledged that uncertainty over how long the remedy lasts is a problem and agreed with the Commission’s proposal that there should be a standard period of 30 days in which to receive a refund, with a limited amount of flexibility to extend or reduce this period in some circumstances.

COMMENT

There is little doubt that consumer remedies for faulty goods are an area in need of reform. Not only does UK law suffer from uncertainty, but the lack of synergy between traditional UK remedies and the Consumer Sales Directive has exacerbated the problem. Consumers and businesses alike have difficulty understanding and identifying appropriate remedies, giving rise to unnecessary disputes. The problem is acute particularly in relation to high value and technical goods. Within that debate, the right to a refund stands out as an element of certainty, to which the strength of support for its retention testifies.

The Law Commissions must now consider the consultation responses and provide a report and recommendations to the UK Government. Before that, the Department for Business Enterprise and Regulatory Reform (BERR) may, potentially, elicit similar sentiments in its consultation on the proposed Consumer Rights Directive, which may shape the United Kingdom’s side of negotiations on the Directive. However, allowing the United Kingdom to retain an automatic right to a refund is difficult to reconcile with the objective of maximum harmonisation at the heart of the proposed Directive as it is intended to address the problems caused by inconsistent national implementation of the current directives in the consumer acquis.