A contract is an agreement between parties for the performance tasks or services or the sale of goods or services. The parties may be represented by an individual, a group of people, a company or an organization. The contract may be written or verbal.
Among other things, the contract includes:
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A short title: a summary of the contents of the contract
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Identification of the parties: who are the parties involved (name, address and other relevant information)
- The purpose of the contract: the reason why the parties are making an agreement
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The obligations: the details of what is agreed upon between the parties as well as the rights and responsibilities of each party
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Payment: the amounts and terms of payment, if applicable
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Date and place: the time and place where the contract is signed
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Signatures: of the parties or their representatives
When you sign a contract, you commit to respecting its contents. You need to be familiar with all the clauses, meaning everything implied in the contract, before signing it. Make sure that all parties have signed the contract or it may not be valid. Make sure you keep a copy of the contracts you sign for reference, just in case.
Did you know that a contract does not have to be in writing to be legally binding? But it is much easier to rely on a written and signed contract than a verbal one.
Find out more on the Éducaloi website for more details on contracts.
In the province of Quebec, all contracts between a consumer and a merchant for goods or services are governed by the Consumer Protection Act. Sales, service and rental contracts must comply with a set of rules. Among other things, all these contracts must clearly indicate the total amount you will have to pay to benefit from the goods or services. There must be no hidden costs: the price indicated on the contract must reflect the actual price you will have to pay.
The details contained in the contract may vary from one contract to another. The purchase of a used car does not require the same information as a contract with a plumber to repair the plumbing in a bathroom. A lease contract shows the length of time the property will be rented and the terms under which it will be returned to the owner at the end of that period. A service contract is used to hire a self-employed worker and provides details of the tasks that will be performed by the person hired. A sales contract gives specifications on the good(s) included in the contract.
There are special rules covering contracts for credit cards, lines of credit and personal loans as well as contracts associated with credit, such as installment plans. The plans allow you to take possession of a good but you do not own it until all of the monthly payments have been sent to the merchant. The content of these contracts is determined by the Consumer Protection Act.
For more information about this topic, consult the concept sheet on Credit Contracts.
How can you be sure that the item you are buying is in good condition, that it will function for a reasonable time under normal use and that it has no hidden defects?
Warranties exist to attest to the proper functioning of a product. In Quebec, warranties are governed by the Consumer Protection Act. There are three types of warranties:
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the legal warranty
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the manufacturer’s (or merchant’s) warranty
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additional coverage (extended warranty)
The law provides specific conditions for applying these warranties to certain goods, including used vehicles.
A legal warranty assures the consumer that goods purchased or services received are of good quality, comply with the law, are safe, with no hidden defects, and have a reasonable lifespan. It applies automatically and free of charge when you purchase goods or services. It also applies to rented goods.
Under this warranty, goods should be suitable to use as intended. For example, a lawnmower should be able to mow a lawn.
The length of this warranty depends on the reasonable amount of time the product should be expected to work, the price paid and the conditions of use. A computer with a sticker price of $3,000 should work longer than a computer that cost $700.
The Office de la protection du consommateur website provides some examples of rulings concerning the application of the legal warranty.
It is the responsibility of merchants or manufacturers to apply the legal warranty. They can repair the goods themselves or have them repaired at their own expense. They can also exchange the product or reimburse you for it. Remember, it is your responsibility to provide proof of purchase, such as the sales receipt.
If the merchant or manufacturer refuses to apply the legal warranty, you need to make sure your rights are respected. The concept sheet on recourse outlines the different steps for this.
An appeal is a procedure undertaken in order to obtain recognition of a right that has not been respected.
Some manufacturers offer a warranty when you buy one of their goods or services. This warranty is additional to the legal warranty. Manufacturers or merchants can inform you of this warranty, but feel free to ask questions and research it if you are unsure.
This warranty automatically comes with the good or service. You do not have to pay extra, because it is already included in the purchase price.
Manufacturers choose what will be covered by their warranty and for how long. For example, the manufacturer might offer a two-year warranty covering parts and labour. If the item is defective within that two-year period, the manufacturer will pay for the entire cost of the repair and for the parts needed. You may have to pay the shipping cost to send the product, such as a computer, back to the manufacturer’s location where the problem will be handled.
Manufacturers must respect the period and the terms of the warranties they offer. Remember, you must provide proof of purchase.
Also known as the extended warranty, additional coverage is neither free nor included in the price and has a set timeframe. This is a warranty that many merchants offer to cover the products they sell. It is offered in addition to the legal warranty and the manufacturer’s warranty, if one exists.
It may seem like a good idea, but consider the cost of these extended warranties. Does the legal warranty or the manufacturer’s warranty already cover the goods they sell? Is the product likely to break within two or three years of purchase? How much would it cost to repair the product if it broke? Is the repair cost a lot higher than the cost of the additional coverage?
You need to decide if buying additional coverage is really worth it.
Be aware that the merchant is obliged to explain the legal warranty, which automatically protects every purchase, and the manufacturer’s warranty, if any, before bringing up any additional coverage.
Business practices include any element (action, advertising or other) related to the promotion, sale or execution of a good or service by a merchant’s representative or professional.
In Quebec, a set of laws governs what merchants are—and are not—allowed to do. Essentially, they have set of rules of conduct they must follow. For example, goods or services received must match what was described in the contract and must be consistent with advertising and what merchants or their representatives told you.
Business practices also regulate how prices for goods are displayed and how the Price Accuracy Code is applied. For more information about this topic, consult the concept sheet on Consumer Rights and Responsibilities.
Some of the benefits of online shopping include having a wide variety of merchants available at your fingertips whenever you want and from wherever you are.
The Consumer Protection Act applies to these online purchases, as it does to the purchases you make directly in a store, with some exceptions. It can be more difficult to enforce your rights as a consumer with a company outside Canada since it is not directly subject to Canadian law.
Here are some basic rules for safer online shopping:
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Use anti-virus software on your computer, phone or tablet to keep it secure.
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Review the website before making a transaction. Does it seem reliable? Has the merchant had any complaints filed with the Office de la protection du consommateur?
- Make sure the website is secure for a transaction by looking at the URL. It should say https. The s means that the site is secure
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Make sure you have all of the required information on what exactly you are buying. Does it have a detailed description of the product with its dimensions? Are there any good quality, large photographs to show the details of the product and its general appearance?
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Ask about the merchant’s return policy, warranties and terms of sale, which should be readily available to you.
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Make sure you understand all of the fees so you know exactly how much you will need to pay before you complete the transaction, including delivery charges, customs clearance fees (if the product is coming from outside Canada) and the exchange rate, if applicable. The merchant is not required to include the amount of GST and QST in the posted price. However, the taxes must be shown and added to the price of the product when it is time to complete the transaction.
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Provide only information that is strictly necessary to complete the transaction: only your contact and payment information, such as your credit card number, are needed.
Always be alert for signs that a website may be fraudulent, especially when something looks too good to be true for the price.
Being alert when buying goods or services online can prevent many unpleasant surprises.
Find out more about this topic on the Office de la protection du consommateur website, which has a section on online shopping.
Itinerant trade refers to merchants making sales or soliciting customers at a location other than a store, via door-to-door sales or at stalls during an event, for example.
The practices and sales of itinerant merchants are subject to the Consumer Protection Act. This law states that you can cancel any contract made with the merchant within 10 days without penalty.
For example, you could cancel a ski package purchased at a stall during a winter sports show. You have 10 days from the date you signed the contract to cancel the purchase with the merchant, and you do not need to give a specific reason.
Collectif, Mes dossiers. Manuel de l’élève, pp.32, 37-39
Collectif, Finances en jeu. Manuel de l’élève, p. 86-86, p.96-99, pp.102-106