Beware of the Consumer Sales Practices Act
and the Home Solicitation Sales Act
As a contractor, you probably fall within the Consumer Sales Practices Act and the Home Solicitation Sales Act. Together, these laws may apply to transactions you have with consumers who purchase your services. These laws do not apply to businesses who purchase your services. Under these laws, you must accurately represent your products or services, honor guarantees and warranties, and disclose important exclusions and limitations in your advertisements. You must not make any false claims about your business, your products or services, your prices or your terms. Additionally, you must not take advantage of a customer’s illiteracy, mental disability, physical disability, or inability to understand the terms of a sale. Finally, you must not sell a product or service knowing the customer cannot afford or substantially benefit from it, or sell used items as new, or use bait-and-switch tactics to trick customers into paying higher prices. These are all violations of the Consumer Sales Practices Act.
The Home Solicitation Sales Act is essentially a subset of the Consumer Sales Practices Act, and as a contractor you should pay particular attention to its requirements. Ohio’s Home Solicitation Sales Act applies where you sell you products or services to a customer in their home or outside your regular place of business (such as a fair booth, trade show, etc.), and this law gives customers a 4-day “cooling off†period during which they can cancel the contact they signed with you.
Ohio’s Home Solicitation Sales Act requires you to provide the customer with a copy of the signed contract (which must include the date, your name, address and essentially the same language used in your sales presentation), and 2 completed copies of the Home Solicitation Sales Act cancellation form (available with Lawfox). You must not start any work until the 3-day cooling-off period has expired, and if you must accept the customer’s cancellation of the sale (for any reason or no reason at all) if the customer sends the cancellation notice by midnight of the third business day after signing the contract (this means that if they mail the cancellation and it is post-marked prior to midnight on the third business day, the cancellation is valid, even if you receive it after the 3-day period expires. Be sure to check with your customers before you start work to confirm they did not send the cancellation notice.
If a customer cancels you contract under the Home Solicitation Sales Act, you must provide a refund to the customer within 10 days of receiving the cancellation notice. If any goods were left at the customer’s home, the customer must make those goods available to you, and you must arrange to pick them up. Finally, beware that some cities and municipalities may require you to be registered with them if you sell your products or services door-to-door.
Be sure to check with the appropriate city or municipality in which you intend to sell. Violating Consumer Sales Practices Act and the Home Solicitation Sales Act will expose you to significant financial penalties – in some situations a buyer may recover up to three times the amount of their damages plus their attorney fees, or the buyer may have the right to terminate the contract (which poses a problem if you have already started the work). The lesson here is to comply with both laws using Lawfox’s contractor documents and avoid losing money and time.
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