Reviewing a deposit and cancellation policy you have been sent

A deposit and cancellation policy is a supplier's statement of what it keeps when the customer cancels, and it is written by the supplier. Whether it is enforceable depends on when the customer received it, whether the customer is a consumer or a business, whether the deposit is a deposit or a part payment, and whether the cancellation charge reflects the supplier's loss or punishes the customer. I review the policy from the customer's side and return it annotated, with a written explanation of what the supplier can enforce, what it cannot, and how to challenge a charge, for a fixed fee of £495 in three working days.

Who this is for

Businesses and individuals in England and Wales who have paid or been asked to pay a deposit to a contractor, a venue, a caterer, a supplier, a training provider, a clinic or a hire company, and have been sent a cancellation policy or a cancellation charge they want to understand or dispute. A business customer is bound by the policy as a contract term; a consumer has additional protection.

What to look for in a deposit and cancellation policy

Whether the policy is part of the contract at all

A policy binds the customer only if it was incorporated into the contract before or when the contract was made: on the quotation, the booking form or the website the customer agreed to, not on an invoice or an email sent afterwards. The review checks when the customer first saw the policy, what the customer agreed to and how, and whether the policy has been changed since, because a policy the customer never agreed to is not a term, whatever it says.

Deposit or part payment, and whether it is refundable

The word 'deposit' is used for two different things: a sum paid as security for performance that the supplier keeps if the customer cancels, and a part payment of the price that must be returned, less the supplier's actual loss, if the contract ends. The review reads the policy and the booking documents to say which the sum is, whether it is described as non-refundable and whether that description is enforceable, and what the supplier has to give credit for if it keeps the deposit.

The cancellation scale and the rule against penalties

Cancellation scales charge an increasing percentage of the price as the date approaches, to the full price in the final period. A cancellation charge is enforceable if it protects a legitimate interest of the supplier and is not out of all proportion to it, applying Cavendish Square Holding BV v Makdessi [2015] UKSC 67; a charge that bears no relation to the supplier's loss, or that ignores the supplier's ability to resell the date or the goods, is a penalty and unenforceable. The review measures the scale against the supplier's real loss and sets out the challenge.

If you are a consumer: unfair terms and the cancellation right

Where the customer is a consumer, the policy is a consumer contract term that must be fair under section 62 of the Consumer Rights Act 2015, and a term that lets the supplier keep the whole prepayment on cancellation without a matching obligation on the supplier, or that requires a disproportionately high sum for cancelling, is on the grey list in Schedule 2. A consumer who agreed the contract at a distance or off premises also has a 14-day right to cancel under regulation 29 of the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, with a refund within 14 days under regulation 34, unless the contract is one excluded by regulation 28, such as accommodation, catering or leisure services for a specific date. The review applies those rules to the customer's booking.

If you are a business: the policy as a contract term

A business customer is bound by the policy as a term of the contract, subject only to incorporation, to the rule against penalties, and, where the policy is the supplier's standard form, to the reasonableness test in section 3 of the Unfair Contract Terms Act 1977 for terms that let the supplier render a performance substantially different from what was expected or none at all. The review sets out the business customer's position, the arguments available on the charge, and the interest the supplier may claim on a cancellation charge under the Late Payment of Commercial Debts (Interest) Act 1998 if it is due.

The supplier's own cancellation and the customer's remedies

Policies say little about the supplier cancelling, postponing or changing what was booked, and the customer's remedy then comes from the contract and the general law: a refund of sums paid, and damages for the customer's wasted costs and the difference in price of a replacement. The review checks the policy for the supplier's cancellation, force majeure and substitution terms, and advises the customer on what it can recover if the supplier does not perform.

What it costs

Standard review, £495. Marked-up document and a written explanation of the changes. Three working days.

Buying online forms the engagement on payment. The scope is what the contract review page describes, you accept the Terms of Service at checkout, and I email you within four working hours to get started. If you would rather ask something first, email me.

What you get

• Your own contract returned with my amendments as tracked changes, plus a clean version with every change accepted, ready to send to the other side
• Comments in the document where a point needs explaining
• A written explanation of what I have changed and why, by email or as an attachment if it is lengthy, marking the points I would hold firm on and the ones that are negotiable
• A view on what is normal market practice and what is the other side pushing their luck
• One round of follow-up questions by email, included

What is not included

• Negotiating directly with the other side, which I quote separately once I know who is on the other side. Where the other side is willing to share a live document, I can work in that document directly
• Drafting a replacement contract from scratch
• Advice on the law of any jurisdiction other than England and Wales
• Tax, accounting or regulatory advice
• Disputes about a contract that is already signed

Questions I am often asked

We paid a deposit and the supplier says it is non-refundable. Is that right?

Only if the deposit was agreed as a true deposit, security for your performance, before the contract was made, and if you are a consumer only if the term is fair. The review reads the booking documents and says whether the supplier can keep it and what it must give credit for.

The cancellation charge is the full price even though we cancelled months ahead. Can they charge that?

Only if the charge reflects the supplier's legitimate interest and is not out of all proportion to it. A full-price charge months ahead, ignoring the supplier's ability to resell the date, is open to challenge as a penalty. The review measures the charge against the supplier's real loss and sets out the argument.

The policy was on the invoice, not the quote. Are we bound by it?

Not by anything you first saw after the contract was made. A term has to be brought to your attention before or when you agreed, and an invoice comes after. The review checks what you agreed to and when, and whether the policy formed part of it.

Related guidance and services

• Contract review, £495, the service this page describes
• Terms and conditions drafting, £995
• Reviewing a venue hire contract for an event
• Reviewing a hotel group booking or conference contract

This page is general guidance for businesses in England and Wales, not advice on your own circumstances. Last reviewed: September 2026. Email geoffrey@caesar.co.uk.