In what situation can traders justify cancellation fees?

Cancellation fees can be justified when they are stated clearly in the contract. This is because consumer law in New Zealand emphasizes transparency and fairness in agreements between traders and consumers. If a cancellation fee is explicitly included in the terms of the contract and the consumer has had the opportunity to review these terms before agreeing, it supports the trader's right to implement such fees.

This situation adheres to principles of contract law, where parties are bound by the terms they have agreed upon, provided those terms are not unfair or misleading to the consumer. Therefore, having a clearly defined cancellation fee that the consumer is aware of at the time of entering the contract allows traders to enforce such fees without falling foul of consumer protection regulations.

In comparison, factors such as a customer's refusal to follow instructions or the trader's subjective determination of necessity for the fee do not provide a strong basis for justifying cancellation charges under consumer law. While the unavailability of a service is a legitimate consideration, it does not directly correlate to the enforcement of cancellation fees unless specifically outlined in the contract.