Statutory Cancellation Rights

California consumers have a legal right to immediately cancel contracts under a variety of contractual law theories. Contracts can be terminated for fraud, fraudulent executon (Jones v. Adams Financial Services (1999) 71 Cal.App.4th 831, 839), mistake, undue influence, breach, illegality,nonconformity, and unconscionability.  (Civ. Code §§ 1670.5(a), 1689(b), 1793.2(d), 1793.22(b)).
However, in a number of specific consumer transactions, the consumer has a statutorilly provided period of time for cancelling the contract.  In these situations, the consumer does not even owe the seller or other party a reason or demonstrate “legal cause.”  Typically, there is no penalty for cancelling under these statutes.

Below, please find a list of these transactions and the periods allowed for cancelling them, provided by the California Department of Consumer Affairs.  Note that some cancellation periods are measured in business days.

    • Automobile Sales and Leases — There is no statutory cancellation period for automobile sales or leases.
    • Credit Repair Services — five day cancellation period (Civ. Code § 1789.16).
    • Dance Studio Services — indefinite cancellation period (Civ. Code § 1812.54(b).
    • Dating Services — three business day cancellation period (Civ. Code § 1694.1).
    • Dental Services Contracts — three business day cancellation period (Civ. Code § 1689.3).
    • Discount Buying Services — three day cancellation period (Civ. Code § 1812.118).
    • Door-to-Door Sales — three business day cancellation period (Civ. Code § 1689.6(a)).
    • Electric Service Contract — three business day cancellation period (PUC 395).
    • Employment Counseling Services — three business day cancellation period (Civ. Code § 1812.511(a)(6)).
    • Endless Chain Scheme — indefinite cancellation period when scheme is unlawful under Pen. Code § 327 (Civ. Code § 1689.2)
    • Funeral Contracts (pre-need) — indefinite cancellation period (B&P 7737).
    • Health Studio Services — five business day cancellation period (Civ. Code § 1812.85(b)).
    • Home Equity Sale During Foreclosure — five business day cancellation period (Civ. Code § 1695.4(a)).
    • Home Improvements Contracts — three business day cancellation period if a security interest results or may result (12 CFR 226.23)
    • Home Loans — three business day cancellation period (12 CFR 226.23).
    • Home Repair or Restoration Contracts Following a Disaster — seven business day cancellation period (unless contract is automatically void) (Civ. Code § 1689.6(c)).
    • Home-Secured Transactions — three business day cancellation period (12 CFR 226.23).
    • Home Solicitation Sales — three business day cancellation period (Civ. Code § 1689.6).
    • Immigration Consultant Services — three day cancellation period (B&P 22442(f)).
    • Insurance (life under-$10,000) — between 10- and 30-day cancellation period as determined by insurer (Ins. Code § 10127.7).
    • Insurance (disability, seniors, life) — 30-day cancellation period (Ins. Code 786).
    • Insurance (property) — indefinite cancellation period (Ins. Code § 6010(a)).
    • Internet Sales (when order has not been filled) — 30 day cancellation period (B&P 17538(a)).
    • Job Listing Services — three business day cancellation period (Civ. Code § 1812.516(a)(6)).
    • Legal Document Assistant — 24 hour cancellation period (B&P 6410(e)).
    • Mail/Telephone Sales (when order has not been filled) — 30 day cancellation period (B&P 17538(a), 16 CFR Part 435).
    • Membership Camping Contracts
      • If buyer visits site — three business day cancellation period (Civ. Code § 1812.303(a)).
      • If buyer does not visit site — 10 business day cancellation period (Civ. Code § 1812.304(a)).
    • Mortgage Foreclosure Consultant Services — three business day cancellation period (Civ. Code § 2945.3(e)).
    • Personal Emergency Response Unit — seven business day cancellation period (Civ. Code § 1689.6(b)).
    • Private Child Support Collectors — 15 business day cancellation period (Fam. Code § 5613(a)).
    • Real Estate Transfer — delayed or materially amended Transfer Disclosure Statement — three day (statement delivered personally) or five day (statement delivered by mail) cancellation period (Civ. Code § 1102.3(b)).
    • Seller Assisted Marketing Plans — three business day cancellation period (Civ. Code § 1812.209(b)).
    • Seminar Sales — three business day cancellation period (Civ. Code § 1689.20).
    • Service Contracts
      • For used cars, home appliances, and home electronic products — 30 day cancellation period (Civ. Code § 1794.41(a)(4)(A)).
      • For new motor vehicles — 60 day cancellation period (Civ. Code § 1794.41(a)(4)(A)).
      • For any type of goods, pro-rata refund less cancellation fee — indefinite cancellation period (Civ. Code § 1794.41(a)(4)(B)).
    • Telephone Sales (when order has not been filled) — 30 day cancellation period (B&P 17538(a), 16 CFR Part 435).
    • Unlawful Detainer Assistants — 24 hour cancellation period (B&P 6410(e)).
    • Water Treatment Devices — three business day cancellation period (B&P 17577.3).
    • Weight-loss Services — three business day cancellation period (Civ. Code § 1694.6(a)).

 
In order to cancel, the buyer must send the seller written notice of cancellation within the period allowed by statute.  The notice must be signed, dated, and must state that the buyer is canceling the contract.  It need not provide any reason or justification for the cancellation – just notice provided within the requisite time periods.
The buyer should send the notice to the seller by certified mail, return receipt requested, at the address that the seller previously gave in the sale documents. Generally, the buyer’s notice of cancellation is effective when it is deposited in the mail with the proper address and postage.
The buyer should keep a copy of the notice for his or her own records, and to be able to prove that the notice was given and what was said.  This can be best achieved by providing oneself a copy and so indicating as a “carbon copy” (“CC:”) recipient in the notice.  The buyer should then note the exact date, time and place of mailing on the buyer’s own copy.