The myth that all contracts may be cancelled within three days of signing

QUESTION: The salesman pressured me into signing a contract right away, but now that I've thought about it, I'm not so sure I can afford the purchase. Don't I have three days before the contact becomes binding?

One of the most frustrating experiences for an attorney is when a client comes in for advise on a contract and I see that they've already signed it. It is a myth that all contracts may be cancelled within three days of signing without any loss or liability. While there are laws which do mandate a three day right of recission, these laws only apply to specific types of contracts such as home solicitation sales"(1), certain contracts for home improvement where the seller also provides financing (2), or contracts to join a gym or for dance lessons (3).

Certainly if the contract itself does not state on its face that the consumer has a right to cancel the agreement within three business days or some other period of time, you should never assume that such a right exists. Absent a right of cancellation spelled out in the contract or provided by law, once the contract has been signed by both sides, it is most likely binding and enforceable.

One such example of a contract which is binding once signed, is a contract for the sale and purchase of a home. The purchase of a home is usually the largest single commitment that most of us will ever undertake. The amount of money that the purchaser commits to pay is often for tens of thousands and even hundreds of thousands of dollars. Payments extend over fifteen, twenty and even thirty years. In light of the financial obligations and risks involved, it is surprising that many people are willing to sign these contracts without consulting an attorney and frequently without even reading or understanding the obligations they're committing to undertake.

In spite of this fact, and thanks to the use of some very well written, standard form contracts, most home purchases proceed without difficulty. However, given the number of home sales which occur each year, if even a fraction of one percent of each sale goes bad because one of the parties didn't understand the terms of their contract, or worse, because of intentional fraud, a huge amount of money is at risk and the harm to consumers can be enormous.

Many contracts do not involve large expenditures of money and therefore would not justify the cost of consulting with an attorney. Where this is the case, a few simple rules should be followed.

First, read the contract in its entirety. Then if you note that promises or representations made to you by the salesman are not contained within the written contract or worse, are contradicted by the terms of the written agreement, insist that the promise be put in writing and including within the contract itself.

If you don't understand certain portions of the contract, as the salesperson to explain it to you, and when in doubt, you may even ask that his explanation be included in the contract. Never accept the answer of "that's just language the bosses make us put in but you don't have to worry about it". Truly honest people who intend to keep their word should not object to putting their promises in writing.

Make sure you receive a complete copy of the fully signed contract and any addendums to it for your own file.

Try to avoid snap decisions on impulse or major purchases without sufficient thought and consideration to whether or not you really want to buy the product, can you truly afford it, have you done your research to make sure you're getting the best product at the best price and terms, and are you certain you're dealing with a reputable salesman or business.(4) Ask if you're entitled to a refund or return if your dissatisfied with the product and if you're told you can cancel the contract without penalty or obligation, get the promise in writing. Finally, remember if you're paying a deposit, even the best laws and the best contracts won't enable you to get your money back if the seller skips town.

Where substantial sums of money or other obligations are involved, never sign a contract before reading and understanding it, and in almost every such case, its best to consult with a qualified attorney. A small sum spent to make sure you understand and agree to the terms of a proposed contract can save untold amounts of money and heartache in the event of a dispute.

The discussion provided herein is intended as a general description of the law in order to educate the public so consumers can more readily avoid common legal pitfalls that result from their failure to read and understand legally binding contracts before signing them and consulting with an attorney. This article is not intended as a substitute for obtaining specific legal advise. You should not rely upon the information contained in this article as containing an exhaustive discussion of the law governing contracts and you should be aware that the statutes cited herein are always subject to change or recission. There is no substitute for consulting with your own attorney who has read your specific contract and is familiar with your unique questions and concerns and the law that applies under your particular circumstances at the time of your intended contract.


1. See Florida Statute 501.025
2. See Florida Statute Chapter 520
3. See Florida Statute Sections 501.107 and 501.143
4. One place you can check is with the better business bureau found either in the telephone directory or conveniently on-line. Remember, the best con men are likely to also have the best sales pitch and will probably seem like honest and reliable people.