Question from Jennie Rater:
A salesman solicited me at my home to buy a generator after the hurricane. Having no electricity, I agreed to buy the generator. A couple of days later, I found out that I could have bought the same item for a much cheaper price at a local home improvement store.  I have two questions: Firstly, can I change my mind and get out of this contract; and secondly, am I a victim of price gouging?

Answer:
Many consumers assume that they have a right to cancel a contract or to ask a retailer to take back an item and refund the consumer’s money. Generally, consumers do not have a right to cancel a sale of goods or services, unless they have a statutory right, or the goods are defective, damaged, or undelivered. In those cases, consumers may be able to demand their money back. And when a merchant offers consumers a “money-back guarantee,” the merchant must honor that promise.

In this case, we’re dealing with a home solicitation sale. Under the Federal Trade Commission's Cooling Off Rule and Florida Home Solicitations Sales Act, consumers are allowed three days to cancel a contract involving the sale, lease, or rental of consumer goods or services when:

• The seller visits the consumer at his or her home in a door-to-door sale for more than $25; or
• The contract is for more than $25 made anywhere other than the seller's normal place of business-for instance, at a sales presentation at a hotel or restaurant, outdoor exhibit, computer show or trade show (other than public car auctions and craft fairs).

In these cases, consumers must receive a contract which specifically provides for a “Buyer’s Right To Cancel,” statement indicating: 

“This is a home solicitation sale, and if you do not want the goods or services, you may cancel this agreement by providing written notice to the seller in person, by telegram, or by mail. This notice must indicate that you do not want the goods or services and must be delivered or postmarked before midnight of the third business day after you sign this agreement. If you cancel this agreement, the seller may not keep all or part of any cash down payment.”

If the seller does not give the consumer proper notice of his or her right to cancel, the consumer may cancel the door-to-door sale at any time until the consumer is provided with the proper notice. It is also a good idea to make a copy of the cancellation for your records and to mail the original by certified mail.

If a consumer cancels a home solicitation purchase within the three-day period, the seller must return to the consumer any payments made and any notes or other evidence of indebtedness within ten days from the cancellation. The seller is also entitled to receive any merchandise in the consumer's possession, but if the seller fails to ask for the merchandise within 40 days of cancellation, the merchandise becomes the consumer's. The merchandise must also be in the same condition as when it was delivered.

If the consumer called the salesman, and the goods or services are needed to meet a bona fide immediate personal emergency, then the seller could ask the consumer to waive his or her buyer’s right to cancel. The buyer must sign a separate dated and signed personal statement in the buyer’s handwriting describing the situation requiring immediate remedy and must expressly acknowledge and waive the right to cancel the sale within three business days.

Legitimate sales solicitors who sell door to door are required to have a permit. Florida Statute 501.022 requires anyone intending to engage in “home solicitation” to file a sworn application for a permit in writing with the Clerk of Circuit Court for the county in which they intend to conduct home solicitation sales.

Because these laws can be a little tricky, the Consumer Services Department advises consumers who think their situation may be covered to read their contracts thoroughly – before your cancellation period expires.

Miami-Dade County’s price gouging law protects consumers from salesman who charge unconscionable prices after a state of emergency has been declared. It is unlawful during a state of emergency to sell, lease, offer to sell, or offer for lease commodities, dwelling units, or self-storage facilities for an amount that grossly exceeds the average price for the commodity the 30 days before the declaration of the state of emergency or the seller’s price for the commodity during the 30 days before the declaration of the state of emergency, unless the seller can show how increases in its prices or market trends justify the price increase. The rule of thumb is that gouging occurs when a good or service costs at least 10 percent to 25 percent more than the norm prior to the emergency.

The Consumer Services Department enforces the Miami Dade County’s Price Gouging Ordinance.  For more information, call the Consumer Hotline at 305-375-3677.