Can a company charge a cancellation fee, if there were no terms or conditions agreeing to this?
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Can a company charge a cancellation fee, if there were no terms or conditions agreeing to this?
Are there references to a law regarding this?
Asked on May 30, 2015 under Business Law, New York
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 9 years ago | Contributor
A specific cancellation fee can only be charged if there had been disclosure of the fee in advance (such as in the terms of sale or at the point of sale), so that by agreeing to the service or purchase, the customer can be considered to have consented to the disclosed fee.
That said, if there was a deposit and the customer cancelled without there being fault of the company, the company could keep the deposit. And if there was a contract to provide goods and services, unless the company defaulted or breached the contract's terms, if the customer cancelled and there was no early cancellation clause or provision, the company may be able to sue the customer for breach of contract and recover the profit it would have made on the transaction.
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