Terms & Conditions – your questions answered
Stacey Pocock – Head of Commerical & Civil Litigation answers your questions in The Business @CityRegionMag
Terms & Conditions
I am a small business owner and I have used the same terms and conditions on my invoices for the past 15 years. I’ve never had any problems so far, but should I continue to use them and if so, should I get them updated?
Yes! It’s good to hear that you are using terms and conditions but it is important to recognise that terms and conditions are not a static document and for them to be effective you must keep them under review.
It may be the case that you need more than one set of terms and conditions. If your customers are other businesses, you will need a different set of terms of conditions compared to if your customers are mainly consumers as the law for transactions between businesses is different to transactions between businesses and consumers. If your customers are consumers who are purchasing goods from you via the internet, you will need terms and conditions which cover the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013. In June 2014, these regulations came into force and gave consumers extended rights which now provide for a 14 day cooling off period instead of 7 days.
It’s easy to overlook the importance of terms and conditions and rely upon the fact that you’ve never had a problem in the past. If you have terms and conditions resolving disputes is simpler as you have written evidence as to what terms will apply to a given situation. Unfortunately, relying upon common law or statutory provisions alone can put a business owner in difficulty, especially when dealing with consumers as the main purpose of our laws is to give consumers protection. Whilst you can’t use terms and conditions to avoid consumer protection laws, you can use them to provide clarity so that customers will have a good understanding as to the level of service they can expect to receive and we all know that if your customer receives a good service, they are much more likely to return to you time and time again.
The benefit of written terms and conditions for business to business transactions should not be underestimated either. Unfortunately it is a reality that no matter how much trust you may have built up with your fellow business owner, a dispute can arise at any time and usually when you least expect. It is all too often the case that the parties won’t have a written document to refer to and resolving the dispute becomes trickier as the parties try to recall e-mails and telephone conversations which are rarely remembered in the same way by two opposing parties to a dispute.
Having a clear set of terms and conditions which are regularly reviewed and kept up to date is a must for any business owner. You shouldn’t be put off by the cost either because this can be a very cost effective exercise. A basic set of terms and conditions can be prepared for a few hundred pounds with regular reviews and updates costing much less. Of course, terms and conditions won’t cover every eventuality but they will be a starting point for resolving disputes before resorting to court action.