hello and welcome to this webinar entitled Additional Content. The Key Provisions. My Name's keeps market. I may come in commercial lawyer with many years experience of dealing with consumer related matters. That's why I'm here to talk to you about today. These days I continue to do consultancy by also do training sessions as well. Hence the title today stopping and why I'm here to deliver it to you. Let's have a look at the agenda for this particular session where there's a look at the background to all of this. Some of the terminology we're going to also look at the statue writes on remedies that go with additional content and also has a look at some potential minor tweets that may be introduced into this area by the U new deal for consumers right out the annual session. Let's begin by looking at the background. Then the Consumer Rights Act 2015 actually introduces the context off additional content into our sale of Goods act type regime. Prior to that, the reality is that there was a great confusion on where additional content sat. Was it good? Was it services? Was it a combination? Now I actually have a separate definition that draws on one or two of the regulations as well in a distance selling context. And the key thing to notice that there is an important cuts off point with regard to all of this, which is the first of October 2015. And essentially, if you have a contract for the Supply oficial content that was made on or after that date, you're court by the rules that I'm about to discuss. If you do happen to have this is extremely unlikely a contract to do digital content from before that particular date and ultimately your back to the sort of sale. A good supply of services rules, which were always a little bit unclear with regard to that. But hopefully now, some years after the event, 3.5 years after the events, at least the reality is the vast majority of these contracts will be governed now by the rules. I'm about to explain to you, and essentially, if you do have additional content as defined in the way that we're about to talk about, essentially have a tight on entitlement as a consumer to certain rights and remedies, which a trader. Obviously that need to be aware off. Let's begin them with a little bit off terminology. So let's begin by looking at the basic distinction between consumer and trader. You know, let's just take a moment to read that to yourselves, and I'll make one observations about it. And then we want to talk about additional content on a few other matters with regard to. So the definition of consumer individual acting for purposes wholly or mainly outside of their trade, business, craft or profession is pretty much as it ever. WAAS trader is largely the same as it was before person waiting for purposes relating to that person's trade, business, craft or profession, or writing personally or through another person acting in their name or on their behalf marginally broader than the old definition of business we have. But frankly, it's not an issue we're going to get too worried about today. What we're more worried about is what you see on the next line, which is the definition off digital content. Have a look at that for me just for a moment. So data which are produced on supplying in digital form now that could be on a tangible medium I on a DVD or CD, or it could be downloaded more likely these days, we're moving more towards the download, but it's still possible for digital content to be caught up within what Michael Intangible medium environment. And we'll see a little bit more about that later on. However, the key thing, then to notice it's not just about the data being produced to survive in a digital form. There is a further caveat to this, which is that it must be paid for either directly or indirectly. If you look at the two bullet points underneath the initial definition, there you see what I mean. Contracts were traded to supply digital content to a consumer if it's supplied, or to be supply for a price place and direct payments, but it's the other one. That's important as well. Contracts were traded to supply digital content to a consumer. If a, it is supplied free with goods or services or other digital content for which the consumer pays a price and be not generally available without that price being paid, there's got to be some elements of payments. It's entirely free. It's outside for the time being the scope of these rules. Now, the next two slides, you got two case studies, which come from some of the guidance produced at the time the Consumer Rights Act 2015 came into force that allows to consider this issue of applicability the first case study that Can you have a read of that for a minute, please? And see what you think in both of these particular scenarios. It's about whether the rules apply. Okay, just take a moment to rebound. 1st 1 Thank you. So a consumer surprise subscribes to a magazine, which comes weekly with a free DVD at the end of the subscription that conceal. Have a box set off those DVDs. Although the DVDs are labeled as a free gift that consumers really paying to collect with DVDs now, right these days, I know like you have you're getting lots of DVDs, is very small. Little additional box sets, however, do the rights relation to digital content apply well. In theory, you have not paid directly for this DVD, but in practice you paid indirectly and therefore in the circumstances, the rules will apply on the various rights and remedies without to go on to talk about will be relevant. What about the second scenario? Have a look at base and see what you think. So a consumer downloads a free game, for example, a virtual world that builds up some virtual currency in the game through their normal gameplay. They then by and won't buy here we mean paid pounds sterling. It's an additional virtual currency in order to make an in APP purchase an item for their world of character or weapon or something like that. The item is faulty. It doesn't appear in the consumers will now doesn't return. I have to provide a remedy, but rather depends on whether this is caught by these rules or not. The big question is, if you have both virtual currency using your own money and then used it to buy this item, I think alternate the rules will apply. However, if you built up virtual currency in the game because of your success that have not actually had to pay for that, and in that particular context, these rules will not apply. So it's a question of analyzing quite closely whether you paid for it or not enough to say If you just build a virtual currency in the normal way by gameplay that is unlikely to fall within the scope of these routes, Right? Assuming the rules apply, then what are the statue rights and remedies that a consumer can benefit from? Well, let's have a look at this next slide. Could you see a list there of all of the key statue rights that apply in respect of digital content, they look remarkably similar to what you were expecting. Risp in respect of goods and supply of goods under the Consumer Rights Act. Sections 9 to 17. Look at those of you For a moment, digital contents were satisfied quality fit for a particular purpose, as described other pre contracts information included in the contract and traders right to supply. Now all of those are found in the good section here. However, we've got them, but with a twist. So let's go through each of these Intern with a brief overview, make once the observations about it and ultimately will come to a further series of case studies towards the end of this particular session. So that's factually quality. That is probably the one that a consumer would most commonly want to rely upon in order to reject a particular item. So you see there, Number one says every contract supply digital content has a term, but the quality is satisfactory. What is the bit in two accounts? The quality is satisfactory if it means to stand that a reasonable person leading the line. Those to ask It is absolutely essential that you understand that it's not what the individual themselves things is what a reasonable person looking at this in an objective fashion would think on. They can consider things like description, price and relevant circumstances and the relevant circumstances. Here are the same as you would expect in a sale of goods contract, but this the purpose is commonly supplied. I e doesn't do what it says on the tin appearance and finish. That's about the quality of the graphics, I would suggest with regard to some sort of video game, perhaps fruiting from minor defects. Again, glitches may appear, but has that small glitch got a profound impact. It prevents the next screen loading, for example, safety and durability. Well, durability obviously be perhaps slightly difficult to consider here, although I suppose it was a tangible medium scenario on, he used the DVD once and then exploded in your face or disintegrated clear. That wouldn't be sufficiently durable. Similarly, if it was flammable and it was a a tangible medium again, there's a breach of the rules on safety at that particular point. Now there are always been some exceptions to this. We're going to see those on the next slide, so this particular slide we see in front of us now talks about a series of exceptions to the requirement of satisfactory quality. But on this most important consumer context is the first of those anything which is specifically drawn to the consumer's attention before the contract is made. So, for example, again, if we are back to some form of tangible medium scenario, that in the circumstances, we would typically say if we told you in advance that the boxes slightly damaged or the DVD is not playing quite as well and we've actually reduced the price in the circumstances, then ultimately redrawn that to your attention, you cannot subsequently complain in terms off satisfactory quality. The last one was like to work, we told the consumer the consumer's aware of it and has continued now the second and the third point. I think I'm gonna be much more difficult to prove against the consumer. And they are. However, the consumer examines additional content before the contract is made on that examination ought to reveal it was defective or the consumer examines a trial version before the contract is made on. The defect was apparent at that time. Now, unless this consumers got a certain amount of knowledge about these things, I think those two are very unlikely toe work as a way of defending a claim for breach of satisfactory quality over the 1st 1 of its Drawn to their attention, I think, is a good way off defending such a claim. If it's applicable now, one final slide on Section 34 because this is part of our significance of all of them. If the trader or producer off the digital content has made various statements about its nature, either inserts and advertising or labelling, then this could be taken into consideration as to whether the item is fit for purpose is commonly supplied. So if you are a trader that's making these sorts of statements, you need to make sure that you can back that up. Of course, there are other rules about misleading advertising that we're not talking about today, but certainly, says a public statements. Be wary about it. You're acting for a consumer. You might have a look at any public statement and try and rely upon that to actually say this is part of the idea of satisfactory quality. There has been a breach on, therefore, in the circumstances we have a right to terminate. Now there are exceptions which you see on the right hand side. The first of all, the consumer was unaware of this public statement. Secondly, the public state with withdrawn or corrected and thirdly, the consumers no influence, so they knew it existed. But I have no impact on their mental state on desire to purchase the item whatsoever right, so fitness for purpose is commonly supplies satisfaction. Quality is the area that you would look to challenge on the most, just as you would for any sale of goods type scenario. But there are a couple of of this once briefly go through those before then proceed to talk about remedies. So Section 35 fitness for a particular purpose Section 34 is to do. It doesn't do what it says on the tin Venice occurs is commonly supplied what we normally expect. So here, Section 35. To get into an argument about this, the consumer must have made known into the cellar to the trader a particular purpose I know it does. These things will also do that and again the house. She quite a difficult, evidential burden from the consumer's perspective. In practice, however, if the consumer can show that they have made that known that ultimately the burden is and shifted onto the trader to show that the consumer did not rely upon or it was unreasonable for the consumer to rely on skill and judgment off the trader i e. It's unreasonable or they didn't rely on what the traders set. Now I have to say, I think that could be quite difficult from a trader's point of view, the realities where does the expertise rest is the rest of the consumer or the trader, and most of the time it will rest with the trader having said that, the evidential burden for the consumer is high, it's unlikely they have kept any form of record of off the record conversation they had. Therefore, it could be quite difficult for them to prove in practice. Okay, so another right we have is Section 36 for the I, the particular additional content to be as described. And again it says here, the digital content was much any description of it given by the traded to the consumer. Let's say, speaking a version of the game with a particular game play or a particular content. So or let's say, it's a description off so many particular DVDs to do the television program, and it turns out there is some defect in that you don't get all of it, hasn't got all of that content in it. It doesn't much up to the description and therefore could be rejected. Now here you will see that there are wanted to caveats that again, if the consumer examines a trial version before the contract is made and it's not sufficient that the it is not sufficient, the digital contact matches the trial version if it does not also match the description given voluntary to the consumer. So the age old argument on these occasions is I've told you what it is. I've given you a description, but you have also had a look at it. And therefore, the fact you had a look at it overrides my description. No, that's absolutely not what the court has said over the years. Ultimately, regardless as to whether you had a look at a trial version or not, it still has to comply with the original description. So that's not a way for the particular traded to wriggle out of this in this particular context. Furthermore, it is, of course, possible for changes to be made to a particular product before you buy it. But they are ineffective, unless that's expressly agreed. So what's the descriptions been provided? The item. The digital content must comply unless it specifically agreed that it won't between the two parts. Now again, we don't see that very often. But it's worth noting because sometimes that description could be quite influential could be quite important. And whether Sidney chooses to buy something or now the next one other pre contract information is not something I'm gonna get into today. There are two sessions that have been recorded for data law by myself to do with distance contracts and this is largely to do with distance contracts on the information is provided as part of that forming part of the contract. I'm not going through all that again. There's at least an hour's worth of comments on that somewhere else. So I'll leave that for today with them. We want to of the things. Finally, before we look at the issue off remedies so have subject to modification now, the length of the short of it is that all games may be modified or developmental content in modified and developed over the years again. The key thing to note is that any modifications must also comply with the three things we've got here about quality Venice, a particular purpose on description and again note. The general view is that additional content must continue to much the original description and conform to the original information on any modifications. Therefore, an intrusion on the back of that again claims relax. Conformity will be treated as a rising at the time the contract the content is supplied. So the key thing is, if we have got modifications made isn't for the better in which goes okay. If it's for the worst, it's highly likely there'll be a bridge off the original description. Finally, then, before we get onto remedies, the traders right to supply Section 41 in respect of digital content that's supplied or is to be supply, the trader must always have the right to supply it. And in fact, if they don't, Ritter are not licensed to provide. It will see there's some fairly significant consequences as a result of that. And that's coming on the next few slots. So those are stashed in rights as a consumer. The rights that traders need to be aware off what remedies were available to consumers. If those rights are abridged well, three in particular that we see here. We're going to go through each of these in turn and explain them in a bit more detail. So Section 42 actually lines up rights with remedies and at the end of this brief discussion, actually show you a short table that does not for you. But for now, the potential rights are Section 43 right to repair or replacement Section 44 right to price reduction in section 45 right to a refund. With that one you might like to make a note instantly but right to a re front. Section 45 is very narrow application, but only applies where there's a brief of Section 41. The traders right to supply. You might make a motive. How, unless we want to talk about repair or replacement. Such repair or replacement typically has to be offered by the trader within a reasonable time, without significant inconvenience on at the traders expect no great surprises toe that. However, the consumer cannot require a repair or replacement where doing so is in possible or where the cost of providing one over the other is disproportionate on a little bit more detail on that on the next slide that if the cost of a replacement is disproportionately large compared to repair that I consist is a trade or giving your repair similar. The converse is true. If the cost of repair is disproportionately large, is giving you a replacement. I can say I'm only going to give you a replacement, so please be aware of that. How do we determine this? Well, we've got to look at the value of the digital content, the significance of the lack of conformity on also the extent to which the other remedy can be affected without significant inconvenience. That's a common sense assessment. Nothing particularly remarkable about this in the circumstances, right? Must look then at right to price reduction. This is on the basis of either full or partial refunds and typically, what we need. Before we proceed to write to price reduction, there must be at least one failed repair or replacement. All the repair replacement has cannot be provided in a reasonable time without significant inconvenience. That's where that this right kicks in fact, is a default, right? If the other rights cannot be provided properly, how will the refund be payable as a set full or partial, depending on how much the infant the item has been used? But also is that we got a 14 day period from the date off rejection. Same method, no feet. So that is what you really need to know in terms of the key rights and the King Remedies is one of the remedy, though, which I mentioned, which I was going to talk about for a second, and it's the right to a refund. In this particular context, remember, it only applies where there's a breach of the right to supply. This time you're in town for a full refund because about that, not partial refunds. No matter how long you've had it, you should never have been sold in the first place. Therefore, essentially, we're looking at forage for more partial again. We've got 14 days with the same method, and we've got mo fee. And also we will look at the fact that sometimes the digital content may be varied and therefore the reforming to the extent attributable again, that's not a particularly major concern for us today. Instead, let's summarize with a particular table that you see in front of me now on the left hand side, you've got the various rights on the right hand side. You got the rebels. They need to be clear about lining up rights and remedies, satisfactory quality, repair or replacement. Failing which price reduction fitness a particular purpose again? Repair or replacement? Fighting? Which price reduction? How's describes? Guess we'll repair or replacement fading which price reduction now pretty contracts, informations purely price reduction and then the one at the end to watch out for right to provide digital content. A refund again. Make a note if you want to. It's a full refund in the circumstances. Now I've got a couple off case studies on the next two slides like to look out for a minute or so and then we'll go through them together, brushing. Let's have a look at each of those and I was going to go on explaining T. So a consumer buys a 69 p app based speaks invade again. Remember those? Any view of my sort of vintage this game is, as it was described. But the quality of the graphics is pulled. The 69 p poor graphics. A consumer buys a £30 space invaded type computer game games, as it was described. The quality of the graphics is poor. What remedies are available? Well, let's start with the rights that have been breached. Do we have a breach of satisfactory quality here? Well, I would argue respect to the 69 p game. If I may 16 90 I will have to live with poor graphics. I think the reasonable person would say it is of satisfactory quality. Therefore, discussion ends. However, if we do have a scenario where we paid £30 for a game on the graphic support quality. The reasonable person may well take the view that, in the circumstances, that is not a satisfactory quality. Therefore, what are we looking for? Repair or replacement? Failing? Which a refund Now? What about the second scenario? We have fear Consumer pace to download a TV series, which is described as containing all 13 episodes. When they downloaded, they find the final episode is missing. What remedies were available well comes out in a moment. What writes this is definitely to be, as described, the description WAAS. 13 episodes of this particular Siri's You've Only got 12. What remedies will again, it's repair or replacement replacement effectively. Here is the final episode on failing, which a price reduction. I think here replacement is likely to be a satisfactory way off dealing with this. Now there's one final rites that is over and above what we would expect in terms of the sale of goods type analysis. And it's the one you now see on here. It's called Damage to Device or Content Section 46. So here, local four of the bullet points that you see on this slide have to be satisfied before we proceed to the remedies. So training a supply additional content to a consumer under contracts. A trader to consumer the digital content was caused damage to a device or the additional content so it could be damage a laptop or it could be damage particular content on that laptop or smartphone or tablet. Whatever else you have to use for the the device or digital content must belong to the consumer. It mustn't be their work phone or their work device. And finally, the damages of a kind that would not have occurred if the trader of exercise, reasonable care and skill. Of course, we know that reasonable can skill tipping means the standard. We expect only reasonably competent designer in this particular case. Perhaps so there's plenty of things to potentially argue about their particularly the last one. But assuming that that satisfied, what do we then see to remedies? First of all, a right to demand a repair reasonable time? Most significant inconvenience traders expense echoes what we've talked about before, but as well is that the potential to sue for compensation which must be paid without undue delay during 14 days with no fate. So let's have a look. A little case study on this and see what we think about it. As we begin to wrap this session, let's take a look at that case study for me, please. And I will think about how this might work in practice. So a consumer buys an app for organizing their music photos. When they start to use it, they find it has a bug that courses the out to delete their music and photos. Now is an issue about description, possibly. But let's put that to one side. Clearly this comes back to Section 46 then, but we just talked about trains to consumer. It would appear so. I wish to other content it would appear so lost the consumer. It would appear so lob occurred. If they've used regional can skill, you would assume so. And therefore on the face of it, potentially, we're looking here at repair or compensation. Now you got a problem here. One thing is to fix the app, so that will do this again. But you then lost a whole load of stuff, so I'll keep it if you're a consume. A. You've been looking for compensation. A wish when you ask yourself, How can you value your music or your photos? First question. Second question, of course, is that we would always be looking to mitigate. Are lost. Is there not an argument? I think this has not been argued before a court. But is that not an argument that says you? The consumer should have made sure you backed up that content to the cloud and therefore also the. The fact that it's eating or left damaged in some way here is largely irrelevant because you should be able to obtain it from where you stole it. Now that potentially would be a very interesting argument to raise in respect of this section. But nobody has done it on to date. Another way of any case law, any of this is. Certainly if you are acting for a consumer who feel they've been wronged in this way, you may try it. You're actually for a trade, and you may well get these sorts off contacts from time to time, right? Where we going with all this stuff to do? A digital content? Well, your content had a good couple of years has been given his own persona, if you like, with various rights that attached to in a way that was never there before. With any great clarity, However, there are two further developments to make this even more interesting again elsewhere, I've talked about the EU new deal for consumers at length. So no great detail today, but just to slides as we begin to wrap this up today. First of all, we have determined that under the Consumer Rights Act 2015 Section 33 additional content requires price on. If you have that element of price, you got the rights and remedies. Note that ultimately there is a proposal to potentially extend some of this to three digital services now. It's not entirely clear at the minute whether that is the full scope of the U new deal for consumers or not, but potentially it could so watch this space. It may be that these various rights we've been talking about may well be extended into free digital content in the future. Alongside that and again, this is something I dealt with on two of the sessions and two other occasions. So no detail today also bear in mind that in terms of this free digital content or free digital services extension potentially also applies to the scenario of distance contracts where we have digital content caught by those particular rules. And as you will be aware, there are writes about information cancellation and reimbursement. Currently the general consensus for it to apply additional content it must have been paid for but also a in future that may will be extended to free digital services as well. Rana summarize all of this and then we'll finish this session. So it's in the definition additional content within the importance of it being paid for, directly or indirectly if it is paid for directly or indirectly. There's an access to a series of rights very similar to sale of goods Act rights. Historically so I'm not gonna go through those again. That particularly note with regard to satisfactory quality, the issue off what a reasonable person things, sounds of remedies. Note that repair or replacement typically must be offer first failing, which does the rights of price reduction. Also look that additional right with regard to damage to device or content, which is very much untested. But we wait to see keeper out on that. And finally note that this regime is like to be changed to some extent will be a time frame for the EU. New deal for consumers is 2019 to finalization 2021 for implementation. Right? Well, that's why Don't say my digital content. Watch this space. It will become more and more relevant as our lives become more and more digital. So that's all I have to say to you today, though. Thank you very much. You can't attention. I'm speech again since I'm in the future. Thank you. And good day to you.
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