25% of contract price for restocking fee?

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Posted by: from Toronto
6/3/2015 at 12:46:51 AM

I am thinking of cancelling a contract but the agreement states that if cancelled after 10 days, I have to pay for restocking fee. So does that mean other than my $2000 deposit, I need to pay restocking of 25% of contract cost?

The project has not commenced yet since they just initially came to do design review and found additional work that was not included in the estimate.

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Date/Time6/3/2015 at 8:18:10 AM

There is no restoking fee at Rona, Home Depot, Lowes. The only time there is a stoking fee is if it was a special order and its ususlly the cost of the product ordered not the contract.

Hope this helps.

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Date/Time6/3/2015 at 8:22:42 AM


Usually that means for any items that were ourchased and returned. Say you bought a carpet and didn't use it, they could charge a re-stocking fee, which simply covers the cost for someone getting it in the first place, packaging it, shipping it and doing it all again, in reverse.

I would suggest that you ask your contractor to be specific about the fee and ask that the details be in writting.

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Diana from End Designs Inc. in Pickering
Date/Time6/3/2015 at 8:28:58 AM

Hi Felda

Normally a restocking fee does not apply in a serviced based contract, however if the contractor had to buy material for your job and now return it that is a different story. I would need more details about what the job is to help you further.

In regards to the $2000, it is normal practice to keep the initial deposit (some or all of it) when a job is canceled after a certain deadline, But normally the client never has to pay more on top of that initial deposit.

Keep in mind this is just a general guide line, and any contract can demand any number of different things. If you can post more details about your contract then I can further help you.

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Elda in Toronto
Date/Time6/3/2015 at 10:54:53 AM

Thanks to all replies.

This is a renovation contract. We have not authorized any construction related materials purchase yet. We are still in the process of resolving the Contract Cost issues. Initially, during the cooling off period, we decided not to pursue the contract due to more expensive green building material thing (which in our case around 15-20% more than a dry wall) but we're convinced by them to stay after discussing credits upon us the clients, taking some trades. Even the quote details support my claim but somehow they have an explanation around it. But this discussion of credits was not in writing only by shaking of hands.

Now prior to fully continuing with the construction, they said that a design review has to be made, thus found an additional cost of over 10% to the contract price. Although we haven't agreed to that addition yet, that was not even the one triggered the idea of breaking the contract. It was more about the credits previously discussed now after the cooling off period is done, somehow is being short changed. The version of what he remembers we agreed against what we believed we agreed.

And this is the background of where my dilemma comes from.

I don't even care about the $2000 deposit now. I'm just concerned about the clause in the contract that says 25% of contract cost restocking fee if we cancel after the cooling off period. Is this condition of the agreement legally binding?

Any insight will help. Thanks.

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Date/Time6/3/2015 at 6:19:04 PM

How can you have a restocking charge (for what product?) at whatever rate, on a handshake and on only a quote basis? Verbal agreements are binding, but a written contract trumps oral. If you are willing anyway, to part with a $2000. deposit (for what?) then what is the problem anyway? Either get more specific for us to compare our experiences for you, or get a lawyer!

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Mark from CMJ Renovations in Oakville
Date/Time6/6/2015 at 3:06:57 PM

How can there be a restocking fee if no material has been purchased?

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