Conservatory contract

beternal

Hi

We are having a conservatory built and we paid a deposit (~£4000). They then said they were sending it off to manufacturer. Several weeks later (after the cancellation period) the company notify us that they would be increasing the cost of the build by 20%. We said we wanted to pull out... you can't increase the cost of a product after the contract has been signed without negotiation (can you?).

They then call us back a few days later saying they have looked into it and will be giving the original price (wow, that was easy) and I said no, we still want the refund. We told him the second the price went up that we wanted the refund. He then said we would incur a 40% 'fine' according to the contract as manufacture has already begun.

A - Am I within my rights to pull out the second the price changed?
B - What is to stop them saying "prices have increased to a million pounds" after the cancellation has passed, and then say to cancel now you will incur a 40% 'fine' because (after arbitrary time) manufacture has started?
C - What would we be entitled to receive if he is not telling us the truth?
D - Why would it take five weeks to realise that the cost of manufacture had gone up by 20% unless they had JUST started looking into it... and IF the cost had increased, why would anyone start manufacture before the cost was agreed with the client? (logic question)

Any advice/comments appreciated

Aylesbury_Duck

beternal said:

Hi

We are having a conservatory built and we paid a deposit (~£4000). They then said they were sending it off to manufacturer. Several weeks later (after the cancellation period) the company notify us that they would be increasing the cost of the build by 20%. We said we wanted to pull out... you can't increase the cost of a product after the contract has been signed without negotiation (can you?).

They then call us back a few days later saying they have looked into it and will be giving the original price (wow, that was easy) and I said no, we still want the refund. We told him the second the price went up that we wanted the refund. He then said we would incur a 40% 'fine' according to the contract as manufacture has already begun.

A - Am I within my rights to pull out the second the price changed?
B - What is to stop them saying "prices have increased to a million pounds" after the cancellation has passed, and then say to cancel now you will incur a 40% 'fine' because (after arbitrary time) manufacture has started?
C - What would we be entitled to receive if he is not telling us the truth?
D - Why would it take five weeks to realise that the cost of manufacture had gone up by 20% unless they had JUST started looking into it... and IF the cost had increased, why would anyone start manufacture before the cost was agreed with the client? (logic question)

Any advice/comments appreciated

Why did you pull out, seeing as they reverted to the agreed price?  Anyway, to answer your questions:

A - yes, if you have a dated trail of them increasing the price and then you formally withdrawing from the contract.
B - contract law.
C - your conservatory, or if you have what I said in (A), a refund.
D - no idea, but it's not really relevant.

What seems critical here is the exact sequence of events.  If you formally withdrew from the contract when the revised price came in, you are entitled to a refund of your deposit.  If you didn't withdraw at that point, and the original contract is still in place, then what you're entitled to depends upon a) what your contract says about costs you must incur upon cancellation, and b) what actual costs they've incurred to that point.

TELLIT01

I would be surprised if you can pull out of the contract without penalty if the company has agreed to supply at the original price.  It sounds more like buyers remorse than anything else.  Given the costs involved I would certainly speak to a solicitor as you will only get guesses, some more educated than others, here.

They certainly can't just increase their price and expect the customer to accept that, unless there is anything in the contract stating the price may increase.  We are about to have work done in our garden involving a lot of timber and the quote does state that the final figure may change due to fluctuating timber prices.  We had agreed to that from the outset.

Sandtree

A - you need to look at the contract terms, an attempt to renegotiate doesnt automatically trigger a cancellation right

B - Unfair Contract Terms legislation, it is possible for prices to vary after a contract is executed but it'd expect it to be proportional with exit clauses if excessive... look at any 2 year+ mobile contract and see how they deal with price increases 

C - Question is unclear, if there is a breach of contract then reasonable losses the breach causes to the other side must be covered. If the contract states fixed costs its possible these can be challenged as unfair if they are disproportate to the losses (though courts are more comfortable with fixed costs now than they used to be)

D - Depends on how quickly the manufacturer does their calculations etc and comes back. Prices are normally including markup so if their manufacturer charges them £10,000 they charge you £20,000... manufacturer now says itll cost £12,000 its up to them if they stick to billing you £20,000 or move to £22,000 or £24,000. They can tell the manufacturer to start if they are willing to stick to the original price or its within the tollerance of movement allowed by the cosntract. 

macman

You had a valid contract. They asked to vary the terms (by way of a price increase). You refused to accept an increase. They withdrew their request. Unless there is something you haven't told us, your original contract remains; for you to pay the original price.
What you have not told us is why you now want to withdraw from the contract you agreed on the original terms? Other than being hacked off at their temerity in asking for an increase post-contract?

cx6

no you can't pull out - the contract is being performed

equally, if you do pull out they cannot charge an arbitrary 40% unless it was in the contract and even then it has to represent their actual losses.