Q: Through my business, I deal with several schools. A couple have signed finance agreements for office equipment for a set period, such as 36 months. But in the fine print - which they often haven't noticed - it says that they have to give the company 90 days' notice
if they want to end the contract on the set expiry date. Otherwise it renews automatically for another 90 days. Is this allowed? - Geoff, Whangarei
A: I took your question to the Ministry of Business, Innovation and Employment, which says this is out of its consumer affairs jurisdiction because the goods aren't for personal, domestic or household purposes. "The person/their company will need to obtain legal advice on their rights and liabilities under the lease contract."
Solicitor Vanassa McGoldrick says people should make sure they read all the terms of any agreement. "Ignorance is no excuse ... as long as it's in the agreement, when you sign that, you sign up to what's in it."
She said legislation allowed people to question contract terms that were unreasonable, but three months did not seem excessive. "If you think of it from the other side, the person doing the leasing needs to know what they should do when the term is up. Do they go in the next day and reclaim the stuff? It's so everyone knows where they stand."
She said people were frequently caught out by "fine print". Many finance companies have agreements that allow them to take out a caveat on property even when loan repayments are being met.
