Pennsylvania Commonwealth Court: Contractors Must Honor Oral Cancellation Requests Under HICPA

Contractors operating in Pennsylvania must honor customer cancellation requests, whether those requests are made verbally or otherwise. Failure to honor such a request exposes a contractor to significant potential liability, as treble damages and attorneys’ fees may be assessed in addition to actual damages.

On July 3, 2024, the Commonwealth Court of Pennsylvania ruled that contractors are required to “respect requests to cancel made orally or by any other means” under the Home Improvement Consumer Protection Act (“HICPA”). Commonwealth of Pennsylvania, Office of the Attorney General v. Gillece Services, LP— A.3d —-, 2024 WL 3282546 (Pa. Cmwlth. 2024), a three-judge panel of the court adopted the trial court’s view that HICPA Section 517-7(b) “prima facie requires contractors to cancel home improvement contracts ‘regardless of the means by which the customer provides actual notice of cancellation.'”

This case arose from allegations that several home improvement contractors “were receiving telephone calls from customers seeking to cancel home improvement contracts and, despite such notice, were sending crews to the customers’ properties and attempting to begin work, refusing to honor the attempted cancellation unless a signed notice was given. . . .” The Attorney General filed a complaint seeking to enjoin what he considered to be prohibited business practices. The trial court granted the Attorney General’s motion for summary judgment and entered a permanent injunction, requiring the contractors to allow customers to cancel their home improvement contracts within three business days of signing.

The contractors argued that Section 201-7 of the Unfair Trade Practices and Consumer Protection Act (“UTPCPL”) specifically requires written notice of contract cancellation. However, the trial court noted that a similar provision of HICPA, Section 517-7(b), “makes no mention of formal requirements for providing notice” and therefore does not require written notice. Despite the similarities between Section 201-7 and Section 517-7(b), the trial court observed that HICPA applied to the home improvement contracts at issue, which could therefore be terminated orally. “HICPA functions somewhat like an extension of the (UTP)CPL,” the trial court noted. “Violations of HICPA are treated as violations of the (UTP)CPL, and nothing in HICPA precludes any right a consumer may have under the (UTP)CPL.”