Unfair cut to heat pump refund

On 4 June 2021, Which? member John Etherington from Shrewsbury paid Rural & Country Energy a deposit of £7,336 for the supply and installation of a ground-source heat pump. However, John had concerns over a lack of communication from the business. He contacted the firm within the 14-day cooling-off period to cancel, but he was convinced to stay. Further poor communication led to John deciding to cancel the contract on 26 July – seven weeks after signing up. John assumed he would be repaid in full, but later he was told that costs totalling £1,085 had been deducted from the refund, which included the initial visit and an ‘assessor bonus’. After unsuccessfully challenging this cost deduction, John contacted Which? for advice.

The Law

The Consumer Rights Act 2015 states that contractual terms which require consumers to pay compensation when they cancel a contract must be proportionate to the service that has actually been provided.

Our advice

As the initial visit and assessment were completed prior to the contract being signed, these costs should not have been charged as they had not arisen as a result of the contract. After challenging the business, John received a cheque in the post for the full refund of the deposit. Rural & Country Energy said: ‘Refunds and costs are considered case by case. Our T&Cs make provision for costs retention in certain circumstances. To avoid bad feeling a full refund was ultimately authorised.’