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When uninvited traders sell goods or
services at your home or work they are door to door selling - eg,
when a salesperson calls at your home selling vacuum cleaners.
When a seller knocks on your door, remember:
- sometimes they will say they are doing a survey, giving
demonstrations, or giving away free offers. Before you let them
in, ask for identification - their name and who they work for
- you do not have to buy anything, even if you asked the seller
to call. You do not have to let the seller in. You can tell them
to leave at any time.
Sales under the Door to Door Sales Act
Seller approaches you
For a sale to come under the Act the seller must make the first
approach to you. The seller will have made the approach to you if:
- you did not ask the seller to call
- the seller phones and makes a time to call
- you win a prize in a competition and the seller tries to sell
you something when the prize is delivered
- you receive an advertising brochure in your mailbox and you
phone for demonstration.
The goods are bought on 'credit'
The Act applies in the following situations:
- goods bought on hire purchase costing more than $20
- goods paid for by instalments costing more than $40
- books costing more than $20 bought by instalment
- services costing more than $40.
Credit sales
If you pay cash, you are not covered by the Door to Door Sales
Act. Only credit sales are covered by the Act. A credit sale is one
where the payment is made after the goods are received.
A hire purchase agreement, deferred payment scheme or paying by
post-dated cheques over several months all meet the definition of a
'credit sale' for the purposes of this Act.
You are not covered by the Act if:
- you see a public advertisement in the paper and you ring and
ask the trader to call
- you buy goods (not books) and pay the full price when (or
before) you make the agreement
- the seller is selling insurance.
Buying goods or services at your door
For credit sales only:
You should sign an agreement which must be in writing, and signed
by you and the seller. The agreement must show the
- name and address of the trader
- cash price, and, if the sale includes credit, the finance rate
- total cost of credit
- amount of each payment, and
- how many, how often, and where payments are to be made.
The 'finance rate' is higher than the interest
rate. It shows the true cost of using credit because it adds the
interest and other costs together and shows them as a percentage (%)
of the amount financed - eg, $250 is 25% of $1,000.
'Total cost of credit' is the total cost of any
extra charges -eg, interest and associated costs. The seller adds
these costs of credit to the cash price of the goods and the cost of
any incidental services such as insurance - eg, $250 is the total
cost of credit.
Receiving a copy of agreement
When the agreement is made, you must be given a copy of the
agreement, which should contain
- a notice about your right to cancel the agreement
- a notice of cancellation form that you can use to cancel the
agreement.
Make sure you understand the agreement, especially the total
amount of money you must pay. Read it or ask someone to explain it
to you. Don't sign until you have had time to do this - no matter
how much the seller encourages you to sign then and there!
It's wise not to begin paying money until you have received the
goods and made sure they are satisfactory. If they are not, you may
have rights under the Consumer
Guarantees Act.
Seven day cooling off period
If you decide you don't want the goods or service, you have SEVEN
DAYS to cancel the agreement starting the day after the date the
credit agreement was made. This is called the 'cooling off' period.
You don't have to say why you want to cancel.
Cancelling the agreement
Write to the trader at the address shown on the agreement saying
that you are cancelling the agreement, or use the Notice of
Cancellation form.
Use registered mail so you can prove you
posted the cancellation within seven days of signing the agreement.
You might like to make a photocopy too.
The Act considers you have given the cancellation to the trader
on the day you post the form.
Rights on cancelling agreement
The trader must return any money you have paid, and you can hold
any goods you have received until you get the money back.
The trader must come and collect any goods you have received.
The trader must return, within ten days, any goods you traded in,
or pay you the value they placed on the trade-in.
If the trader has altered your property as the result of their
service, you can ask them to restore it to the way it was before
they began the work. (Don't pay for services already provided.)
You must look after the goods for twenty-one
days from the date you cancelled the agreement. If you break or lose
them, you may have to pay for them.
Cancelling after expiry of 7 day cooling off period
In some cases you can. You have one month
to
cancel the agreement starting the day after the date you agreed to
buy, if:
- it is not signed by either you or the seller, or
- important information about cost, credit, payments, or the
name and address of the trader is missing, or
- you did not receive a copy of the agreement, or
- you did not receive a Right to Cancel form, or
- you did not receive a Notice of Cancellation.
- You don't have to make payments until you receive a copy of
the agreement, a Right to Cancel Form and a Notice of
Cancellation.
When you receive them you have another seven days after the date
you are given the documents to cancel.
eg, the Right to Cancel Form is missing
from your agreement when you buy books. You ask the trader to send
you a copy. It arrives one month after you signed the agreement.
By then, you have decided the books are not very good and want
your money back. Even though one month is over, you have an extra
seven days from the day you received the Right to Cancel form to
cancel the books.
You must cancel in writing.
Other rights
Door to door sellers, like any other sellers, must be honest
about the goods and services they sell. When you buy at home you
have the same rights that you have when you buy at a shop as to the
information you receive and the quality of the goods . The
Fair Trading Act and the
Consumer Guarantees Act may apply.
That is
- you must be given true information about the goods or services
and the total cost if you buy on credit:
- goods must be of acceptable quality
- they must do what they are sold to do
- services must be reasonably well carried out.
If you have a complaint about the way a door to door sales
company has acted or has breached the Act you contact either the
Direct Selling Association of New Zealand (if the company is a
member) or file a complaint in the
Disputes Tribunal.
Write to the association at:
Private Bag 92-066
Auckland 1033
Tel: 09 367 0913
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