Direct Sales, Future Performance, and Time Share Contracts (11:V)

Since the BPCPA has replaced the Consumer Protection Act, the BPCPA covers door-to-door sales, payday loans, credit cards, income tax refund services (although the federal Tax Rebating Discounting Act, RSC 1985, c T-3 regulates the actual amount which can be refunded), food plan contracts, unsolicited goods, and similar activities. The primary remedy for consumers in the BPCPA regarding these types of activities is the right to avoid or cease contracts for direct sale or for future services, after giving notice in the manner required by the statute. A single contract may fall under more than one category, and in that case, will attract the requirements and cancellation provisions of each applicable section.

NOTE: When exercising cancellation rights under the BPCPA consumers should be apprised of ss 27 and 28. In most cases, the contract is effectively rescinded by the cancellation; goods must be returned undamaged and payment must be refunded in full.

A. Direct Sales

When consumer is approached by a salesperson, instead of making a conscious decision to seek out a product or service, they may be taken unawares and can be vulnerable to being taken advantage of. The BPCPA recognizes this risk by imposing disclosure requirements and allowing a consumer to cancel the contract in ways the common law of contract does not permit.

A direct sales contract is defined in s. 17 as:

...a contract between a supplier and a consumer for the supply of goods or services that is entered into in person at a place other than the supplier's permanent place of business, but does not include any of the following:

• (a) a funeral contract, interment right contract or preneed cemetery or funeral services contract;
• (b) a contract for which the total price payable by the consumer, not including the total cost of credit, is less than an amount prescribed by regulation (an amount that has yet to be set at time of printing: cf. Business Practices and Consumer Protection Regulation, BC Reg. 294/2004);
• (c) a prepaid purchase card;

The BPCPA sets out a lengthy list of requirements under ss. 19 and 20 for the content of direct sales contracts, such as the name, address, and telephone number of the seller, the name (in a readable form) of the individual who signs the contract on behalf of the supplier, a detailed description of the goods or services to identify them with certainty, the price, and a detailed statement of the terms of payment. When credit is extended, there also needs to be a description of the subject matter of any security interest. This is not an exhaustive list; please consult the Act.

1. Right of Cancellation

Under s 21 of the BPCPA,

• (a) the purchaser may cancel the contract within 10 days after receiving a copy of the contract. The purchaser need not offer explanations for his or her decision. The vendor then has 15 days after the date of cancellation to refund all money without deduction.
• (b) if a delivery date is specified in the contract and not all of the goods/services are delivered/performed within 30 days of this date, the purchaser may cancel the contract within one year after the date a copy of the contract was received, provided that the purchaser has not accepted or used the goods/services;
• (c) if the contract does not contain information required under s. 19 and 20(1) of the Act, the buyer may cancel within one year of the date of the contract. A direct sale is unenforceable by the seller if the buyer is required to make a down payment in excess of a prescribed amount (BPCPA, s 20(3)(b)).

NOTE: Whether the purchaser has accepted goods is determined by the definition in the Sale of Goods Act (s. 39).

The BPCPA does not make oral executory contracts unenforceable. However, s 20 requires that the seller deliver a written copy to the buyer at the time of signing, or the contract is not binding on the buyer. Section 54 requires that the buyer provide notice of cancellation to the seller, and declares that it may be delivered by any method that permits the cancelling party to produce evidence that the contract was cancelled. Notice by registered mail, electronic mail, personal delivery, and fax is explicitly permitted. Nowhere does the BPCPA explicitly state that a notice of cancellation shall be in writing, but a buyer should be cautious and deliver written notice. The section explicitly permits that the notice can be given to the seller directly, or to the postal, fax, or electronic mail address of the seller shown in the contract. When a buyer rescinds a contract under s 21, that section also provides that the goods may be retained until all of the money paid is refunded. In Woodward v International Exteriors (British Columbia) Ltd (1991), 53 BCLR (2d) 397, 1 BLR 254 (CA), verbal notice of termination of an agreement was sufficient for the consumer to terminate this form of contract. Note that verbal notice may not be sufficient in all instances and written notice remains advisable. B.Future Performance Contracts A future performance contract is defined in s 17 as: ...a contract between a supplier and a consumer for the supply of goods or services for which the supply or payment in full of the total price payable is not made at the time the contract is made or partly executed, but does not include: (a)a contract for which the total price payable by the consumer, not including the total cost of credit, is less than a prescribed amount, (currently no amount has been so prescribed); (b)a contract for the supply of goods or services under a credit agreement, as defined in s. 57 (definitions), if the goods or services have been supplied; or, (c)a time share contract. Future services contracts are subject to some important statutory requirements under Part 4, Division 2 of the BPCPA. The BPCPA sets out a long list of requirements under ss. 19 and 23 for the content of future services contracts, such as the name, address, and telephone number of the seller, a detailed description of the goods or services to identify them with certainty, the price, supply date, and a detailed statement of

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