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New Zealand law explained for everyone

Consumer Guarantees Act 1993

Supply of services - Provisions relating to cancellation

38: Effects of cancellation

You could also call this:

“What happens when you cancel a service contract”

If you cancel a contract for services under this Act, you can usually get a refund of any money or other things you gave for the services. However, a court or the Disputes Tribunal might say the supplier can keep some or all of what you paid.

If part of the contract was already done when you cancelled, nobody has to give back the money or property that was already exchanged, except for your refund as mentioned before. For the part of the contract that wasn’t done yet, nobody has to do it or can ask for it to be done.

These rules don’t stop you from getting money back if someone lied, broke the contract, or didn’t do what they promised. You can still claim damages under section 32(b)(ii) or 32(c) if the supplier didn’t meet a guarantee. You can also still return goods that came with the service if they’re not good enough.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM312852.

Topics:
Money and consumer rights > Consumer protection
Business > Fair trading
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“How to properly cancel a service contract”

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39: Ancillary power of court or Disputes Tribunal to grant relief, or

“Courts and Tribunals can help make things fair when you cancel a service”

Part 4 Supply of services
Provisions relating to cancellation

38Effects of cancellation

  1. Where a consumer cancels a contract for the supply of services under this Act,—

  2. the consumer shall be entitled to recover from the supplier a refund of any money paid or other consideration provided in respect of the services unless a court or the Disputes Tribunal orders that the supplier may retain the whole or part of the money paid or other consideration provided by the consumer:
    1. so far as the contract has been performed at the time of the cancellation, no party shall, by reason of the cancellation, be divested of any property transferred or money paid pursuant to the contract, except as otherwise provided in paragraph (a):
      1. so far as the contract remains unperformed at the time of the cancellation, no party shall be obliged or entitled to perform it further.

        1. Nothing in subsection (1) shall affect—

        2. the right of a party to recover damages in respect of a misrepresentation or the repudiation or breach of the contract by another party; or
          1. the right of the consumer to recover damages under section 32(b)(ii) or 32(c) for failure to comply with a guarantee; or
            1. the right of the consumer under this Act to reject goods supplied in connection with the service.

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              Notes
              • Section 38(1)(a): amended, on , by section 261 of the District Court Act 2016 (2016 No 49).