Could this be the biggest favour you can do your business?
Maybe as a slightly novel Christmas present for 2014, treat your business to the equivalent of a legal check up. The Standard Terms and Conditions of your business provide an important shield to minimise losses and claims against your business whilst at the same time providing a sound legal basis for securing money, goods or services owed to your business.
Outdated, outgrown or irrelevant Terms of Business will do more harm than good and by answering the following questions, you can get a good idea of whether the time has come for an update.
- Has your Business got Standard Terms and Conditions (STC)?
- Have the STCs have been reviewed in the last 18 months?
- If the Business trades with Consumers, have you updated the contract documentation, information and policies as well as the STCs in order to comply with the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (CCRs)which came into force on 13 June 2014?
- Have all outdated references to repealed legislation or bodies which no longer exist been removed e.g. the Property Misdescription Act 1991 (repealed 26 March 2013) or The Office of Fair Trading (closed down 31 March 2014)?
- Do the STCs and standard contracts continue to effectively manage the level of risk and revenue associated?
- Have the STCs and contracts been adjusted to suit any changes in your business e.g. timescales stipulated for the delivery of services/goods and terms for trading abroad?
- Are the STCs in tune with the insurance provisions of the business?
- Boring but there for a good reason – Do the STCs include Boilerplate Clauses, e.g. a clause limiting the liability of your business if it can not perform obligations under a contract due to ‘an event beyond the reasonable control of the business such as fire, flood, storm, strikes or failure of a utility network’?
If you have answered No to one or more of the questions above you ought to review and update the shield of protection offered by the STCs. If you supply consumers and have answered No to question 3, you will need to take urgent action.
You will either:
- need to satisfy yourself that your business is exempt from the scope of the CCRs (certain types of contract are excluded including ones for gambling, package travel and certain financial services) or,
- if not exempt, review and update all contract documentation, information and policies and to ensure they are compliant with the CCRs and manage new risks to the business.
Failure to comply with the CCRs may result in a conviction and possibly a fine (not exceeding standard level 5, currently £5000). Depending on the type of breach of the CCR, the contract between your business and the consumer may also be invalid. Need advice?
We can help you – call or e-mail for a no obligation chat.