Delaware Automatic Renewal Cancellation Letter

Introduction

Key Things to Know

1. 1

   Delaware's consumer contracts subchapter lets you treat an improperly renewed contract as voidable, and this letter is your written notice ending, or voiding the extension of, a contract for merchandise that renews unless you act. Section 2731 defines merchandise broadly, as objects, wares, goods, commodities, intangibles, real estate or services, other than insurance, and a consumer as an individual buying or leasing primarily for personal, family or household purposes.

2. 2

   The renewal-notice rules use a narrow trigger. Section 2731(1) defines an automatic renewal provision as one renewing the contract for a specified period of more than 1 month where the renewal causes the contract to be in effect more than 12 months after the day it began, and where renewal is effective unless the consumer gives notice of the intention to terminate. A monthly plan that has run for years can still meet that test, because the 12 months are counted from initiation.

3. 3

   Section 2732(4) sets the cancellation duty more widely. With respect to a contract that automatically renews, and without regard to the duration of the renewal period, a person who knowingly or recklessly fails to provide a cost-effective, timely and easy to use mechanism for cancellation engages in a deceptive practice. The same paragraph says a consumer who enters into a contract online shall be permitted to cancel the contract online.

4. 4

   Under Section 2734(a), the seller shall disclose the terms of the automatic renewal provision clearly and conspicuously when the contract is entered into. Subsection (b) then requires notice of each upcoming extension no less than 30 and no more than 60 days before the cancellation deadline, stating that the contract renews unless cancelled, the cancel-by date, the cancellation procedures, with an online procedure if you joined online, and how to obtain details of the provision, such as a telephone number, address, copy or access to the contract.

5. 5

   If the contract was renewed in violation of Section 2734, Section 2735(c) makes it voidable by the consumer, using any method that would have been sufficient to cancel before the renewal. A consumer who voids it is not liable for costs, fees or expenses accruing after the voiding date. The statute lets the seller keep a prorated fraction of prepaid fees based on time elapsed, and says the seller shall return the remaining prepaid amount within 30 days.

6. 6

   Section 2737(a)(1) says that before bringing an action over a renewal made in violation of Section 2734, the consumer must give the seller notice of the violation and a request to cancel the extension, sent by email, by mail, or by any other method the seller offers. Under paragraph (2), no action may be started for a cured violation if, within 30 days of that notice, the seller cures it and gives a written statement, copied to the Director of Consumer Protection of the Department of Justice, that no further violations of that kind will occur.

7. 7

   Section 2734(d) excludes matters under the jurisdiction of the Public Service Commission, the Insurance Commission of this State or the Federal Communications Commission, and leases under the Residential Landlord-Tenant Code or the Manufactured Homes and Manufactured Home Communities Act. Section 2736 removes contracts whose total price or amount financed exceeds $50,000, contracts with banking organizations and building and loan associations under Title 5, and public utility tariffs filed with the Delaware Public Service Commission.

Delaware Requirements for Automatic Renewal Cancellation Letter

• Whether the Contract Meets the Section 2731 Renewal Definition

  Record the start date, each renewal period and its length. Section 2731(1) covers renewal for a specified period of more than 1 month that keeps the contract in effect more than 12 months after initiation. Note that you bought or leased the merchandise as an individual for personal, family or household purposes.

• Confirmation the Contract Is Not Excluded by Section 2734(d) or Section 2736

  Check for Public Service Commission, Insurance Commission of this State or Federal Communications Commission matters, residential landlord-tenant and manufactured home leases, a total price or amount financed over $50,000, banking organizations and building and loan associations, and filed public utility tariffs.

• How You Entered the Contract and the Cancellation Mechanism Offered

  Section 2732(4) requires a cost-effective, timely and easy to use mechanism for any automatically renewing contract, and online cancellation for anyone who entered into the contract online. Record how you joined, how you cancelled, and anything that made it slow or costly, with dates.

• The Sign-Up Disclosure Under Section 2734(a)

  The seller shall disclose the terms of the automatic renewal provision clearly and conspicuously when the contract is entered into. Keep the sign-up page, contract or receipt that shows how the renewal terms were presented.

• Whether the Section 2734(b) Extension Notice Arrived in the Window

  Notice of each upcoming extension is due no less than 30 and no more than 60 days before the cancellation deadline, stating renewal unless cancelled, the cancel-by date, the cancellation procedures, and how to obtain details of the provision. Record the date it arrived and what it said.

• Your Election to Void Under Section 2735(c)

  Where the contract renewed in violation of Section 2734, it is voidable by the consumer using any method that would have sufficed to cancel before renewal. State the voiding date; Section 2735(c)(2) ends liability for costs, fees or expenses accruing after it, with prorated handling of prepaid amounts.

• The Section 2737(a) Notice of Violation and Request to Cancel

  Before any action over a renewal that broke Section 2734, the consumer must send the seller notice of the violation and a request to cancel the extension by email, mail or another method the seller offers. Keep proof of the sending date; the seller's 30-day cure period runs from it.

• The Treble Damages Provision, Stated Without Predicting an Outcome

  Section 2735(a) makes a person engaging in a deceptive practice under the subchapter liable for treble actual damages proved plus reasonable attorneys' fees, and Section 2737(b) deems a violation an unlawful practice under Section 2513. Section 2734(c) offers the seller an error defense. Cite these factually. Attorney review is available as an option.