Cellphones: Warranties and Cancellation

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The law protects you with several warranties if your cellphone doesn’t work. There are also rules to follow if you want to cancel your phone contract.

Your phone doesn’t work? The law can help

When you buy a phone, it comes with warranties.

A warranty guarantees that the product will work the way it’s supposed to and for a reasonable amount of time.

There are three kinds of warranties:

A legal warranty is free. It means that the merchant must give you a phone that works properly for a reasonable length of time.

A manufacturer’s warranty – or merchant’s warranty – is often included in the cost of the phone. It protects you (in part) if the phone doesn’t work properly.

There are also warranties offered by merchants for a fee. These warranties are always optional. You can decide whether you want to purchase one.

How warranties protect you

Merchants must repair a new phone that doesn’t work properly. In some cases, they must even give you a new phone or a refund.

You might have to pay for some repairs, but only if this is clearly written in the contract describing the warranty.

Merchants can’t make you pay for services you couldn’t use while the phone was being repaired. For example, you don’t have to pay for data services if you can’t access the internet with the phone the merchant lends you while yours is being repaired.

Important! Most warranties don’t cover problems that you caused. For example, if you drop your phone in the water, you will probably have to pay to replace it.

Want to cancel your contract? Watch out for cancellation fees

You must generally pay a fee to cancel a contract before the date stated in the contract.

The cancellation fee depends on the phone discount you got when you signed the contract. The higher the discount, the higher the fee. The closer you are to the end of your contract, the lower the fee.

What if you didn’t get a phone discount?

The general rule is that the cancellation fee is 10% of the amount left to pay on the contract, but it can’t be more than $50.

Suppose you have a two-year contract. If you pay $50 a month and you cancel five months before the two years are up, the amount left to pay on the contract is $250 (5 X $50). In this case, you’ll have to pay $25 (10% of $250) because this is less than $50.

If you didn’t get a phone discount and the contract doesn’t end on a fixed date, there is no cancellation fee.

You can find out more about cancelling cellphone contracts on the websites of the CRTC (Canadian Radio-television and Telecommunications Commission) and the Office de la protection du consommateur (consumer protection bureau).

Can a teenager have a cellphone?
Teenagers can sign their own phone contract. However, the carrier may ask for a parent or other adult to co-sign with the teenager. The person who co-signs the contract would be responsible for paying if the teenager fails to.

In some cases, a teenager can cancel a contract that is too difficult to pay. For example, a pricy plan when the teenager has no revenue. Parents can always pay in their place.