First Alert contract - 3 Day Cooling Off?

[RogerC]

What is the name of your state (only U.S. law)? Arizona

My 84 year old mother agreed to a First Alert contract over the phone 2 days ago. She expects the equipment to arrive tomorrow and is supposed to call when it arrives to schedule a technician to install it.

She provided her credit card for the equipment and will be charge $90/mo for the service on auto-pay. The contract is a 3 year term and the only allowable cancellation is if she has to enter a care facility or requires live-in care. She cannot afford this service. In my opinion this is unscrupulous on the part of First Alert.

My question is, does the FTC cooling-off rule or any Arizona law allow her to back out of this deal within 3 business days?

I read the 'Federal Trade Commission 16 CFR Part 429' and it states "the Rule does not apply if a transaction is conducted and consummated entirely by mail or telephone". However, given she will most likely be asked to sign the contract when the technician installs the equipment (which I've no intention of allowing to happen), I'm not clear if the phone conversation she had with the salesperson constitutes 'conducted and consummated entirely' by phone.

Any suggestions are appreciated.

 

[PayrollHRGuy]

From 16 CFR 429.0 - Definitions.

The term door-to-door sale does not include a transaction:

(4) Conducted and consummated entirely by mail or telephone; and without any other contact between the buyer and the seller or its representative prior to delivery of the goods or performance of the services; or

(5) In which the buyer has initiated the contact and specifically requested the seller to visit the buyer's home for the purpose of repairing or performing maintenance upon the buyer's personal property. If, in the course of such a visit, the seller sells the buyer the right to receive additional services or goods other than replacement parts necessarily used in performing the maintenance or in making the repairs, the sale of those additional goods or services would not fall within this exclusion;'


Arizona Law

https://www.azleg.gov/viewdocument/?docName=http://www.azleg.gov/ars/44/01276.htm

It may matter in AZ if she initiated the call or the seller did.

 

[quincy]

What is the name of your state (only U.S. law)? Arizona

My 84 year old mother agreed to a First Alert contract over the phone 2 days ago. She expects the equipment to arrive tomorrow and is supposed to call when it arrives to schedule a technician to install it.

She provided her credit card for the equipment and will be charge $90/mo for the service on auto-pay. The contract is a 3 year term and the only allowable cancellation is if she has to enter a care facility or requires live-in care. She cannot afford this service. In my opinion this is unscrupulous on the part of First Alert.

My question is, does the FTC cooling-off rule or any Arizona law allow her to back out of this deal within 3 business days?

I read the 'Federal Trade Commission 16 CFR Part 429' and it states "the Rule does not apply if a transaction is conducted and consummated entirely by mail or telephone". However, given she will most likely be asked to sign the contract when the technician installs the equipment (which I've no intention of allowing to happen), I'm not clear if the phone conversation she had with the salesperson constitutes 'conducted and consummated entirely' by phone.

Any suggestions are appreciated.

Here is a link to the laws that apply in Arizona, Roger.

https://www.azag.gov/consumer/threeday

You should impress upon your mom the potential financial dangers of providing credit card information over the phone.

 

[RogerC]

From 16 CFR 429.0 - Definitions.

The term door-to-door sale does not include a transaction:

(4) Conducted and consummated entirely by mail or telephone; and without any other contact between the buyer and the seller or its representative prior to delivery of the goods or performance of the services; or

It may matter in AZ if she initiated the call or the seller did.

Thank you, PayrollHRGuy.

Unfortunately, she did in fact pick up the phone and call them. It's looking like the 3 Day Cooling Off rule probably won't help her with this.

 

[RogerC]

Here is a link to the laws that apply in Arizona, Roger.

https://www.azag.gov/consumer/threeday

You should impress upon your mom the potential financial dangers of providing credit card information over the phone.

Thank you quincy. The link seems to indicate the Rule only applies to solicitations expressly initiated by the seller, so the rule is probably not something I can turn to.

That being said, I'm still wondering about whether or not she is actually bound by the contract given she hasn't actually been presented with any documentation yet. Also, doesn't a person have the right to turn the product down if they don't like it when it arrives?

Yes, I definitely need to start managing the use of her credit card.

 

[Zigner]

From 16 CFR 429.0 - Definitions.

The term door-to-door sale does not include a transaction:

(4) Conducted and consummated entirely by mail or telephone; and without any other contact between the buyer and the seller or its representative prior to delivery of the goods or performance of the services; or

Since the transaction was conducted entirely by telephone prior to the delivery of the goods or the performance of the service, it also does not apply to the OP's mom.

 

[quincy]

Your mom might want to call her insurer to see if it covers First Alert (Medicare won't). Odds are her insurance won't but it is worth a call.

There are a lot of (probably unnecessary) add ons to the basic system that will ratchet up the costs considerably. Someone should be with your mom to prevent her from signing up for these extras, this if she cannot get out of the contract entirely. And I see the possibility of her getting out of the contract.

 

[Mass_Shyster]

I suggest contacting an attorney who specializes in consumer protection. The three year oral contract may not be enforceable under the statute of frauds.

Specifically, ask the attorney what happens if your mother refuses delivery of the product.

BTW, I could did not find a company called First Alert that sells "I've fallen and I can't get up" systems. Are you sure that's the name?

https://www.azleg.gov/ars/44/00101.htm
No action shall be brought in any court in the following cases unless the promise or agreement upon which the action is brought, or some memorandum thereof, is in writing and signed by the party to be charged, or by some person by him thereunto lawfully authorized:

1. To charge an executor or administrator upon any promise to answer for any debt or damages due from his testator or intestate out of his own estate.

2. To charge a person upon a promise to answer for the debt, default or miscarriage of another.

3. To charge a person upon any agreement made upon consideration of marriage, except a mutual promise to marry.

4. Upon a contract to sell or a sale of goods or choses in action of the value of five hundred dollars or more, unless the buyer accepts part of the goods or choses in action, and actually receives them or gives something in earnest to bind the contract, or in part payment, but when a sale is made at auction, an entry by the auctioneer in his sale book, made at the time of the sale, of the kind of property sold, the terms of the sale, the price, and the name of the purchaser and person on whose account the sale is made is a sufficient memorandum.

5. Upon an agreement which is not to be performed within one year from the making thereof.

6. Upon an agreement for leasing for a longer period than one year, or for the sale of real property or an interest therein. Such agreement, if made by an agent of the party sought to be charged, is invalid unless the authority of the agent is in writing, subscribed by the party sought to be charged.

7. Upon an agreement authorizing or employing an agent or broker to purchase or sell real property, or mines, for compensation or a commission.

8. Upon an agreement which by its terms is not to be performed during the lifetime of the promisor, or an agreement to devise or bequeath any property, or to make provision for any person by will.

9. Upon a contract, promise, undertaking or commitment to loan money or to grant or extend credit, or a contract, promise, undertaking or commitment to extend, renew or modify a loan or other extension of credit involving both an amount greater than two hundred fifty thousand dollars and not made or extended primarily for personal, family or household purposes.

 

[Zigner]

I suggest contacting an attorney who specializes in consumer protection. The three year oral contract may not be enforceable under the statute of frauds.

Specifically, ask the attorney what happens if your mother refuses delivery of the product.

BTW, I could did not find a company called First Alert that sells "I've fallen and I can't get up" systems. Are you sure that's the name?

You don't think they'll get a signature?

 

[quincy]

I suggest contacting an attorney who specializes in consumer protection. The three year oral contract may not be enforceable under the statute of frauds.

Specifically, ask the attorney what happens if your mother refuses delivery of the product.

BTW, I could did not find a company called First Alert that sells "I've fallen and I can't get up" systems. Are you sure that's the name?

Honeywell is the company with rights to First Alert. It is a security system that can include a variety of safety/security features.

 

[RogerC]

Your mom might want to call her insurer to see if it covers First Alert (Medicare won't).

There are a lot of (probably unnecessary) add ons to the basic system that will ratchet up the costs considerably. Someone should be with your mom to prevent her from signing up for these extras, this if she cannot get out of the contract entirely. And I see the possibility of her getting out of the contract.

Thank you quincy.

She's on Medicare, so it doesn't look like she'll get help there. Yes, she pretty much blindly accepted everything the salesperson told her she needed. She'll be paying the maximum.

What is it you see as a possible way out?

 

[RogerC]

I suggest contacting an attorney who specializes in consumer protection. The three year oral contract may not be enforceable under the statute of frauds.

Specifically, ask the attorney what happens if your mother refuses delivery of the product.

BTW, I could did not find a company called First Alert that sells "I've fallen and I can't get up" systems. Are you sure that's the name?

Thank you SteveF.

I've already instructed mom to refuse the delivery... Although I'm not sure if that is the right thing to do.

I'll look for an attorney, but probably won't be able to answer that question before the delivery comes tomorrow.

In my haste to research this, I inadvertently said First Alert, the company is actually Life Alert.

 

[RogerC]

You don't think they'll get a signature?

If it matters, I've told her to just refuse it and not sign anything when the delivery comes.

Hope I'm not digging a deeper hole.

 

[RogerC]

Honeywell is the company with rights to First Alert. It is a security system that can include a variety of safety/security features.

I don't want to give Honeywell a bad rap. I erred earlier... the company is actually Life Alert. Not a Honeywell product.

 

[quincy]

Thank you quincy.

She's on Medicare, so it doesn't look like she'll get help there. Yes, she pretty much blindly accepted everything the salesperson told her she needed. She'll be paying the maximum.

What is it you see as a possible way out?

Stevef mentioned the statute of frauds, which requires that contracts that take over one year for completion must be in writing and signed. Your mother could refuse to sign a 3 year agreement. And your mother always has an option of refusing delivery and installation entirely - although this could potentially come with a penalty, depending on facts.

I am not sure an attorney is necessary unless/until the system is refused and the security system company kicks up a fuss - but it might be smart to contact a consumer protection clinic in Arizona anyway.

Do you live near your mom, Roger? Someone trustworthy should be with your mom when the Life Alert installer arrives.