Due to current events, we would like to point out once again that special rules apply to contracts with consumers. Particular attention should be paid to the right of withdrawal, which allows consumers to cancel a contract without giving reasons. Craft businesses that do not adapt to the requirements of consumer law risk financial losses and warnings.
A right of withdrawal exists, for example, when a craftsman conducts contract negotiations and concludes contracts outside his business premises, e.g. in the private home of his customer or on his customer’s construction site, by telephone or by e-mail/internet. Consumers may revoke this contract within 14 days without giving any reason. If the consumer has not been properly informed of his right of withdrawal, the period is extended to one year. Properly means that a tradesman must hand out a model withdrawal form to his customer in addition to the model instruction.
The decisive factor for the right of withdrawal is therefore how and where the contract is concluded. For craftsmen, this results in certain information obligations towards their customers.
In a recent ruling of 17 May 2023 (Ref: C-97/22), the European Court of Justice (ECJ) even ruled that consumers can revoke the contract even after the work has been completed and are released from any obligation to pay. In the case at hand, a homeowner had contracted an off-premises tradesman to renew the electrical installation. After completion of the work, he did not pay the bill but revoked the contract because the company had not informed him of his right of revocation. The tradesman must bear all the costs he incurred in fulfilling the contract during the revocation period.
Crafts businesses should therefore inform consumers about their right of withdrawal at an early stage (with model instructions and model withdrawal form) and, if possible, only start work once the 14-day withdrawal period has expired.
On the subject of “right of withdrawal”, you will find attached various information from the German Confederation of Skilled Crafts (Zentralverband des Deutschen Handwerks, ZDH) including model instructions that meet the requirements of the various contractual situations in business practice.