The Scenario
A consumer orders a sofa online for $2,800 and pays by credit card. The initial delivery estimate is four weeks. At week eight, the retailer pushes the delivery date to week twelve. At week twelve, no further update is provided. After repeated emails, the retailer stops responding. Six months later, the sofa has still not been delivered.
Rights Analysis
The agreement is an internet agreement under the Consumer Protection Act, 2002. Under s. 40, the consumer may cancel an internet agreement within 30 days if goods are not delivered within 30 days of the agreed delivery date, or at any time where the supplier fails to disclose material terms. The consumer may cancel in writing; the supplier is then required to refund within 15 days.
Where the supplier does not refund, CPA s. 99 creates a statutory chargeback right: the consumer may request the credit card issuer reverse the charge. Separately, the Visa and Mastercard network rules allow a chargeback for non-delivery, typically within 120 days of the expected delivery date.
Possible Options for the Consumer
A written cancellation notice to the supplier is the first step, invoking the CPA s. 40 right. If the refund is not processed within 15 days, the consumer may immediately request a chargeback from the card issuer under CPA s. 99 or the network rules, whichever is more favourable.
Supporting documentation for the chargeback includes the order confirmation, emails to the supplier, and the cancellation notice. Where the chargeback is denied, a Small Claims Court action against the supplier is the next available remedy.