The Consumer Rights Act

If you have tried to resolve a customer's complaint but the situation is 'deadlocked', then what happens next will depend on whether:

• you have acted properly
• the customer decides to pursue the matter

If you accept that the customer's claim was valid under the Consumer Rights Act - but are confident that you have offered the necessary refund, repair or replacement - you may have met your legal obligations even if the customer refuses to accept that.

However, if you're uncertain that what you have offered is sufficient, you should seek advice from Consumerline.

Small claims

If a customer does decide to pursue a claim, they can use the small claims procedure for goods up to a maximum value of £5,000. You can choose either to defend the claim yourself or appoint someone to represent you. Larger claims can be made through civil actions in the County Court.

Always try to resolve complaints if possible. Time spent on defending a legal claim will probably outweigh the time you would have spent on resolving the matter amicably. Also remember that the inevitable outcome of an unresolved complaint is at least one lost customer and the potential for bad publicity.

Alternative Dispute Resolution

When there is a dispute between a business and a consumer, there are different options available to help resolve the issue. Alternative Dispute Resolution (ADR) is any process for the resolution of a dispute out of court.

Although traders do not have to agree to use ADR for a consumer dispute (unless it is compulsory for them by law, by scheme membership or by contract), traders are required to provide certain information about ADR to consumers.

When a trader is considering a consumer complaint and they have gone through their own complaint-handlings procedure, they must provide the consumer with:

• a statement that the trader cannot settle the complaint with the consumer
• the name and website address of an ADR provider that could deal with the complaint, if the consumer wishes to use ADR
• whether the trader is obliged or prepared to submit to an ADR procedure operated by that provider

The trader has to give the consumer details of an ADR provider but does not have to agree to use ADR.

The information must be provided in a 'durable medium' - for example, a letter or an email - and it will normally form part of the final 'deadlock' letter in response to a consumer complaint.

In addition, when a trader is subject to compulsory ADR, either by law or through the membership of a trade association, they must provide the name and website address of the ADR provider or scheme on their own website (if they have one) and as part of their general contract terms.