Order Cancelled After Despatch But Before Receipt

[minskin]

Hi folks,


After 10 years trading online I'm pretty familiar with the DSRs but there has been one question that I've never quite found the definitive answer to.

A customer places an order for goods with an estimated despatch time of, say, 1 week.
At 10:20pm on the evening of day 4, the customer sends an email stating that they are cancelling the order.
On the morning of day 5 the goods are despatched before the email is viewed or the cancellation request actioned.

Whilst I accept that the customer has a right to cancel under the DSRs, who pays for the return? We include a clause stating that the customer must pay the return costs of cancelled items. We also request in our terms that attempts to cancel before despatch must only be done by person-to-person phone call to ascertain whether the goods have already been sent or if they can be stopped. But! Where a customer asserts that they cancelled the order according to the DSRs and before despatch, where do we stand?

In one recent incident, a customer refused the goods at the door which incurred a cost, almost double our outbound costs and what she would have paid had she taken receipt of the goods and then returned them herself, another way. We were invoiced by our carrier for the return costs.

Whilst it does say in the DSRs that customers have a right to refuse goods at the door it doesn't specifically relate to goods that have been cancelled between despatch and delivery. In fact, there is no mention of this scenario at all. there is, however, mention that normal Right To Cancel rules apply which suggests that if the 'customer pays return costs' clause has been included in the T&Cs then the customer should pay or be deducted from the refund.

I would appreciate any comments or thoughts on this.

Many thanks, Minskin

 

[akirk]

If you look at Amazon - always a good model for how to run a mail order business - there is a stage in their process beyond which you can not cancel - it becomes a return - that change is still while the product is at Amazon - but once it is within the automated process...

not everyone can afford a system like Amazon - but it is worth studying it and following their logic - so for example, your system could send out an email before dispatch stating that the product is now in the dispatch system and can no longer be cancelled - that if there are any issues it now must be returned through your returns process...

i.e. structure the processes and control it - at the moment you are allowing the customer to do as they wish - you can comply with teh DSR / make it easy for the customer / make it structured for you - it is just about re-vamping the processes...

Alasdair

 

[minskin]

Hi Alasdair,

Thanks for your reply.

I certainly wish we could afford a system like Amazon's but even though we can't, it's certainly something we could look at implementing in some way.

We already inform the customer by email when the goods have been despatched and now I think about it, I can't recall ever having a cancellation request for any of those orders. It's that crucial time when we are packing and despatching an order when we are at risk so your advice is good and I'll certainly have a look at getting something in place.

In the "recent incident" I mentioned previously, we have received back the goods via our carrier after the customer refused it but we have not yet refunded her. We're waiting for the invoice from our carrier to find out the exact return costs, then we were planning to deduct that cost from her refund. Am I asking for trouble?

Ta, Minskin

 

[akirk]

if a customer has refused it - I would soak up the carrier costs.
as far as they are concerned (and legally I would guess) it has not been delivered to them, so they have no need to pay your return costs - may be a tricky one - probably cost you more in time / bad reputation / etc. than absorbing it...

ref. Amazon - no, they will have spent millions on their site - but you can use similar logic

Alasdair

 

[TotallySport]

It depends on what you can get the customer to do, DSR states the customer doesn't have to pay for return on any purchase, regardless of curcumstance, they only have to make it available for collection.

State the parcel has been sent, and ask them to return it for a refund, if they dispute it, offer to collect it using a courier or send a pre paid envolope stating this is sent at their own risk.

 

[minskin]

I will most probably suck up the cost of this one as I think, like you say, a clearer cancellation policy/structure would have left the customer much less able to cancel at the point she did.

However! And please bear with me, I'm just being the Devils advocate....

if a customer has refused it - I would soak up the carrier costs.
as far as they are concerned (and legally I would guess) it has not been delivered to them, so they have no need to pay your return costs

This suggests that a customer can refuse any delivery for any reason and not have to pay the return cost no matter what cancellation policy might be in place, simply on the basis that it hasn't actually been delivered.

Whilst I accept that had our cancellation policy been much clearer like Amazons, the customer would have felt much less able to cancel the order and had they done so it would certainly not look good for them in any legal wranglings. But this would only be on a moral standing as strictly speaking, such a cancellation policy would not be lawful. As far as the DSRs go a customers' right to cancel is 'unconditional' from the moment they place the order until 7 days from the day after they receive it. At no point do the DSRs state that there is a point where a customer cannot cancel an order within their cancellation period.

Rather, it suggests that the same Right To Cancellation rules apply consistently throughout the Right To Cancel period. As part of that Right To Cancel rule I am allowed to insist that the customer pays for the return of a cancelled order.

Hi TotallySport;

Yes, I understand that a customer isn't actually obliged to physically return the order but, as long as it is included as such in our returns policy, we can insist that they pay the costs of it no matter who actually performs it.

With regard to your other point, in this instance, the parcel never actually got delivered as the customer refused it at her door. We tend not to have any problems with customers returning items they have taken delivery of and we have good solutions in place.

My issue is who pays the return costs should a customer refuse a delivery when their cancellation was received between despatch and delivery.

Many thanks, Minskin

 

[MH1]

On this occassion I would take the hit, and then add too your terms and conditions that once a dispatch email has been issued any yone cancelling their order is responsible for the return courier charge.

Unfortunately the only way for you too avoid this is to check your emails on the morning of dispatch, and maybe issue a seperate email address soley for the use of cancelling an order, but even then clients would argue they did not realise they had to use it.

Hopefully this is a rare occurance for yourself.

 

[Setfire]

We take the view that its our responsibility until its in the customer's hands. If the customer chose to cancel when its on the way, we would tell them to refuse. That way, their interaction ends - no more hassle for them.

The price of the odd return is a cost worth bearing to keep the customers happy imho.

 

[TotallySport]

Hi TotallySport;

Yes, I understand that a customer isn't actually obliged to physically return the order but, as long as it is included as such in our returns policy, we can insist that they pay the costs of it no matter who actually performs it.

With regard to your other point, in this instance, the parcel never actually got delivered as the customer refused it at her door. We tend not to have any problems with customers returning items they have taken delivery of and we have good solutions in place.

My issue is who pays the return costs should a customer refuse a delivery when their cancellation was received between despatch and delivery.

Many thanks, Minskin

Actually your wrong, DSR overrights your terms and conditions, or returns policy and if the customer doesn't want to pay to return it to you no matter what reason they give, including cancelling they don't have to return it (as long as within certain time scales which are in your terms and conditions or/and returns policy), they only have to make it available for collection so you can get someone to collect it. They also not need to take it to the post office if they don't want.

So even if they don't refuse and they want to split hairs they can make you pay for the return, so ineffect your responsible for the returns postage regardless.

Luckly most customers are happy to resolve matters quickly and general would pay returns costs, but if they don't want to they don't have to.

 

[akirk]

the key though as with so much of business is clarity / structure / simplicity for the customer...

make it clear and simple how to cancel - give them your process to do it and then you have structured it to suit you...

all you can do is minimise hassle but directing the customer to do it your way...

Alasdair

 

[davek17]

Hi There

There's a similiar post on here somewhere as I have been looking into this recently. I have found that if its B2C then the DSR applies, don';t forget that B2B and iot doesn't. However your Terms can apparently absolve you of the DSR delivery costs and processes use to get products back to you.

Obviously you need to weigh up each situation on its own merit but if you are selling low margin products then paying for returns under the DSA this can put you out of business.

We have to have this clause in our terms because people will buy our products, test software on them to certify their software and then return them back in 7 days as a return. You also can't reasonably sell a lot of products as new when you get them back either.

I have been told you can include a restocking fee in your own DSA terms too.

Hope this helps.

 

[deniser]

We do this:
1. if they are in the UK and the item has already been despatched we tell them it has been posted and that they should refuse it when delivered.
2. We tell them that we will refund them upon receipt of the refused parcel but as the post office will not give a refused parcel priority it will take some time (got one yesterday which took 3 weeks) - don't forget after all we are entitled to wait 28 days before actioning a refund for a cancellation.
3. We also tell them that if they want their refund more quickly then they should accept the parcel and send it back to us - this means they have to pay the postage (which under our T&C the customer has to pay) but they then have some control over the speed it is delivered at plus proof of sending etc. which some people prefer for peace of mind.
That way the customer has the choice which limits the annoyance factor.
4 if they are overseas we ask them to return it to us once delivered - they usually don't bother
5. we always check emails in the morning before actioning any deliveries as there are always emails about changes, wrong sizes, cancellations, different delivery addresses etc. and we keep checking emails throughout the packing process rights up to the point where the post gets collected.

 

[TotallySport]

Hi There

There's a similiar post on here somewhere as I have been looking into this recently. I have found that if its B2C then the DSR applies, don';t forget that B2B and iot doesn't. However your Terms can apparently absolve you of the DSR delivery costs and processes use to get products back to you.

Obviously you need to weigh up each situation on its own merit but if you are selling low margin products then paying for returns under the DSA this can put you out of business.

We have to have this clause in our terms because people will buy our products, test software on them to certify their software and then return them back in 7 days as a return. You also can't reasonably sell a lot of products as new when you get them back either.

I have been told you can include a restocking fee in your own DSA terms too.

Hope this helps.

Although your right abot DSR only aplies to B2C, but your terms and conditions cannot overwrite DSR, you can make them better but not worse, eg you can allow a 30 day returns period, but not a 5 day, as DSR states 7 days.

If the customer returns goods, you have to refund all the original amount including postage, and if the person doesn't want to repay postage according to DSR its the sellers responsibility to pay returns costs.

You also cannot charge a restocking fee for returns inside the time to allow for returns under DSR.

There are some exceptions like software and items for hygience reasons.

 

[TotallySport]

Should also point out DSR only applies to UK purchases, if you sending overseas DSR does not apply.

 

[deniser]

Should also point out DSR only applies to UK purchases, if you sending overseas DSR does not apply.

I don't think that's true as it arises out of an EU regulation - I remember reading some court case recently about an Italian transaction where the EU regulation overrode the Italian doemstic legislation on distance selling - it is an EU thing but enforceability though is a different matter!

 

[muskoka]

I have read this thread with interest as I have just had a return which I collected at my own cost. I would be interested in comments regarding returns where the goods were delivered part-assembled but finished by the customer using glue and screws. The product is then not able to be dis-assembled but is much bulkier to move and virtually impossible to pack. Would I be in order charging for the return collection cost? Hopefully I won't get another but I may need to amend my T&Cs just in case.

 

[kulture]

Actually your wrong, DSR overrights your terms and conditions, or returns policy and if the customer doesn't want to pay to return it to you no matter what reason they give, including cancelling they don't have to return it (as long as within certain time scales which are in your terms and conditions or/and returns policy), they only have to make it available for collection so you can get someone to collect it. They also not need to take it to the post office if they don't want.

So even if they don't refuse and they want to split hairs they can make you pay for the return, so ineffect your responsible for the returns postage regardless.

Luckly most customers are happy to resolve matters quickly and general would pay returns costs, but if they don't want to they don't have to.

Actually Total you are not quite right. If the customer just makes it available for collection, then the DSRs allow you to deduct a reasonable cost for this collection from the refund amount.

 

[TotallySport]

Actually Total you are not quite right. If the customer just makes it available for collection, then the DSRs allow you to deduct a reasonable cost for this collection from the refund amount.

Not it doesn't, the customer doesn't have to pay for the collection and you have to refund the entire purchase amount.

 

[TotallySport]

I don't think that's true as it arises out of an EU regulation - I remember reading some court case recently about an Italian transaction where the EU regulation overrode the Italian doemstic legislation on distance selling - it is an EU thing but enforceability though is a different matter!

All the documentation I have read only states the DSR is for the UK, I have never seen anything that states its for Europe.

Never had this issue so never really had to look into it as much as the UK.

 

[kulture]

Not it doesn't, the customer doesn't have to pay for the collection and you have to refund the entire purchase amount.

No you are wrong. Please look at 14 para 5 of the DSR. Where it states

(5) Subject to paragraphs (6) and (7), the supplier may make a charge, not exceeding the direct costs of recovering any goods supplied under the contract, where a term of the contract provides that the consumer must return any goods supplied if he cancels the contract under regulation 10 but the consumer does not comply with this provision or returns the goods at the expense of the supplier.

 

[minskin]

Oh crikey, now I'm really confused!

As I understood it, although the customer was not obliged to actually physically return the item, they would be liable for the cost of that return (as long as included in T&Cs). The DSR seem to be very clear on this in sections 17 and 14;

17. Restoration of goods by consumer after cancellation
17.—(1) This regulation applies where a contract is cancelled under regulation 10 after the consumer has acquired possession of any goods under the contract other than any goods mentioned in regulation 13(1)(b) to (e).

(2) The consumer shall be treated as having been under a duty throughout the period prior to cancellation—

(a)to retain possession of the goods, and

(b)to take reasonable care of them.

(3) On cancellation, the consumer shall be under a duty to restore the goods to the supplier in accordance with this regulation, and in the meanwhile to retain possession of the goods and take reasonable care of them.

(4) The consumer shall not be under any duty to deliver the goods except at his own premises and in pursuance of a request in writing, or in another durable medium available and accessible to the consumer, from the supplier and given to the consumer either before, or at the time when, the goods are collected from those premises.

(5) If the consumer—

(a)delivers the goods (whether at his own premises or elsewhere) to any person to whom, under regulation 10(1), a notice of cancellation could have been given; or

(b)sends the goods at his own expense to such a person,

he shall be discharged from any duty to retain possession of the goods or restore them to the supplier.

(6) Where the consumer delivers the goods in accordance with paragraph (5)(a), his obligation to take care of the goods shall cease; and if he sends the goods in accordance with paragraph (5)(b), he shall be under a duty to take reasonable care to see that they are received by the supplier and not damaged in transit, but in other respects his duty to take care of the goods shall cease when he sends them.

(7) Where, at any time during the period of 21 days beginning with the day notice of cancellation was given, the consumer receives such a request as is mentioned in paragraph (4), and unreasonably refuses or unreasonably fails to comply with it, his duty to retain possession and take reasonable care of the goods shall continue until he delivers or sends the goods as mentioned in paragraph (5), but if within that period he does not receive such a request his duty to take reasonable care of the goods shall cease at the end of that period.

(8) Where—

(a)a term of the contract provides that if the consumer cancels the contract, he must return the goods to the supplier, and

(b)the consumer is not otherwise entitled to reject the goods under the terms of the contract or by virtue of any enactment,

paragraph (7) shall apply as if for the period of 21 days there were substituted the period of 6 months.

(9) Where any security has been provided in relation to the cancelled contract, the duty to restore goods imposed on the consumer by this regulation shall not be enforceable before the supplier has discharged any duty imposed on him by regulation 14(4) to return any property lodged with him as security on cancellation.

(10) Breach of a duty imposed by this regulation on a consumer is actionable as a breach of statutory duty.

14. Recovery of sums paid by or on behalf of the consumer on cancellation, and return of security
14.—(1) On the cancellation of a contract under regulation 10, the supplier shall reimburse any sum paid by or on behalf of the consumer under or in relation to the contract to the person by whom it was made free of any charge, less any charge made in accordance with paragraph (5).
(2) The reference in paragraph (1) to any sum paid on behalf of the consumer includes any sum paid by a creditor who is not the same person as the supplier under a personal credit agreement with the consumer.
(3) The supplier shall make the reimbursement referred to in paragraph (1) as soon as possible and in any case within a period not exceeding 30 days beginning with the day on which the notice of cancellation was given.
(4) Where any security has been provided in relation to the contract, the security (so far as it is so provided) shall, on cancellation under regulation 10, be treated as never having had effect and any property lodged with the supplier solely for the purposes of the security as so provided shall be returned by him forthwith.
(5) Subject to paragraphs (6) and (7), the supplier may make a charge, not exceeding the direct costs of recovering any goods supplied under the contract, where a term of the contract provides that the consumer must return any goods supplied if he cancels the contract under regulation 10 but the consumer does not comply with this provision or returns the goods at the expense of the supplier.
(6) Paragraph (5) shall not apply where—
(a)the consumer cancels in circumstances where he has the right to reject the goods under a term of the contract, including a term implied by virtue of any enactment, or
(b)the term requiring the consumer to return any goods supplied if he cancels the contract is an “unfair term” within the meaning of the Unfair Terms in Consumer Contracts Regulations 1999(1).
(7) Paragraph (5) shall not apply to the cost of recovering any goods which were supplied as substitutes for the goods ordered by the consumer.
(8) For the purposes of these Regulations, a personal credit agreement is an agreement between the consumer and any other person (“the creditor”) by which the creditor provides the consumer with credit of any amount.

 

[deniser]

All the documentation I have read only states the DSR is for the UK, I have never seen anything that states its for Europe.

Never had this issue so never really had to look into it as much as the UK.

The DSRs implement European Council Directive (97/7/EC)7 and for
most goods and services provide additional rights to consumers
buying at a distance to encourage confidence in this method of
buying. The protection the DSRs offer is important because
consumers cannot inspect goods or services before they buy when
they shop at a distance. All member states of the European Union
(EU) must implement the Directive in their national legislation. The
DSRs came into force on 31 October 2000 and were amended by
SI 689/2005 effective from 6 April 2005. This made changes to the
requirements to provide information when supplying services and to
cancellation periods for the supply of services.

Where do the DSRs apply? (Jurisdiction)
2.6 One aim of the Directive is to ensure that consumers enjoy the same
minimum level of protection no matter where a supplier is based in
the EU. If you are making distance sales to consumers in other
member states you should be aware that the Directive may have
been implemented differently elsewhere in the EU. You may
therefore have to take advice to ensure that you meet your legal
obligations in other member states. The Private International Law
(Miscellaneous Provisions) Act 1995 is also relevant to cross-border
transactions and disputes relating to e-commerce, for example, issues
of jurisdiction and identifying the law of which State applies to a
particular dispute. The full text of the act can be downloaded from
www.opsi.gov.uk

 

[davek17]

Hi There

I believe that DSA derives from European community and covers the EC, i'm not sure but we act here like that if that helps.

However a word of warning. If you sell out of the EU or UK or whatever the DSA doesn't cover then you can get into a load more trouble if you do not understand what you do need to be abiding by in that country.

In terms of making the kit etc, surely that would come under one of the areas the DSA states that it does not cover? I would also say there is argument to say its not in new condition.

Also I have been told there is a clause in the DSA for sealed or cellophaned box also constitues not new if the seal is broken.

 

[TotallySport]

I stand corrected, I guess I need to download it again and go through it. Thanks

 

[minskin]

Muskoka, what was the reason for the return?

 

[kulture]

I stand corrected, I guess I need to download it again and go through it. Thanks

The DSRs are confusing. It gets worse when you realise that there are amendments which are in separate documents. Thus there is no single accurate regulation document.

I never go by "guideline" leaflets as they are just someone else's interpretation.

 

[minskin]

I never go by "guideline" leaflets as they are just someone else's interpretation.

I couldn't agree more, I've found some real contradictions and just downright wrong information on some consumer sites.