More favorable conditions for consumers after the introduction of the new Consumer Sales Act
It has now been a year and a half since the new Consumer Sales Act[1] (“CSA”) entered into force. The CSA applies to purchases made and agreements entered into after 1 May 2022, which means that we will most likely be able to enjoy developed case law within short. The revised law can be said to be more beneficial for consumers and more tightening for companies[2]. We have previously reported on the new rules regarding sales of defective products which also were updated in the new CSA (see our publication made on 1 June 2023). In this article we will report on the new regulation regarding the reversed burden of proof and the placement of the burden of proof in the event of cancellation.
The reversed burden of proof
The former CSA presumed that defects that occurred within six months of the delivery of the goods to the consumer would also be considered to have existed at the time of delivery (unless otherwise is shown or this is considered incompatible with the nature of the goods or the nature of the defect). This is often called the reversed burden of proof. In order to avoid claims, it is therefore up to the company to prove that the defect was not original. Chapter 4, 17 § CSA now states that defects that appear within two years after the goods were delivered are considered to be defects for which the company is responsible. The new regulation thus extends the reversed burden of proof from six months to two years, which must be seen as a significant increase. In connection with the drafting of the new law, it was discussed whether the reversed burden of proof should be either one or two years. As an argument for extending the time period to two years, it was argued, inter alia, that the sustainability of goods would be favored as this extension would force companies to produce higher quality goods to a certain extent in order to avoid defects arising only after a short period of use. Although, the Government's investigation could not show any evidence that a longer period of time for the reversed burden of proof would result in an increase in the lifetime of goods; the importance of ensuring a longer life span for goods and creating incentives for companies to manufacture and sell more sustainable goods were highlighted as important reasons for the expansion. Especially considering that many goods today are more technologically advanced. In general this may constitute a shorter life span, but it also makes it more difficult for the consumer to show the reason behind the defect and when the defect occurred. However, representatives of consumer electronics, among other things, stated in the examination of the Government’s proposal that the time period should only be extended to one year, mainly with regard to that the one-year guarantee offered by many actors in the consumer electronics industry is at risk of being removed when the reversed burden of proof is extended.
As already mentioned, we believe that this is a comprehensive extension. The extension can clearly be troublesome for companies because it can be problematic to prove circumstances relating to a product that you have not had the control over for a long time. It could also be argued that the extended period could be considered too burdensome to impose on all types of goods. It would not have been considered unreasonable to initially increase the burden of proof to one year, which is, after all, twice as long as before.
Reason for cancellation – not a minor defect
The previous CSA stated that the consumer had the right to cancel the purchase if the defect was substantial and the consumer could prove this. Chapter 5, 10 § CSA now stipulates that the consumer may not cancel the purchase if the company can show that the defect is minor. In this respect, it can be clarified that the same types of defects are intended to be the basis for cancellation as in the previous CSA, which means that older preparatory work and practice can still be indicative. On the other hand, a distinction has been introduced in the sense that the burden of proof is now placed on the company, which could become problematic in practice for companies. Again, it is complicated to prove circumstances relating to something you have no control over. It remains to be seen whether practice will provide some form of relief regarding the requirement of proof in view of the practical difficulties that may exist. Regardless, the main argument for shifting the burden of proof to the companies is that the companies have a knowledge advantage regarding the product leading to that the burden of proof may not be as burdensome for the companies as it may be for the consumer.
All in all, in the light of these two changes, it can be concluded that the rules of the burden of proof in the new CSA are favorable to consumers and that this will hopefully lead to more sustainable products being produced. It is from several aspects more burdensome for the companies but hopefully the inconvenience is motivated by the underlying purposes. Regardless, we are eager to see how practice develops and what requirements will be made by the courts, not least in the light of the Supreme Court’s decisions of February 2023[3] (regarding the assessment of evidence, which we believe also have an impact on the evidence requirements in civil cases (see our article published on 15 March 2023).
[1] Consumer Sales Act (SFS 2022:260)
[2] For example, Harding Rebecka, Ersson Anna, Tightened consumer rules, New law 2:22, p. 31.
[3] Supreme Court judgement of 2023-02-14 in case nr B 5952–21 and Supreme Court judgement of 2023-02-14 in case nr B 2354–22.