Getting Out of a Cell Phone Contract
When recently trying to cancel my cell phone contract, I was advised that I would have to pay $20 per month left on my contract – which came to about $460.00 – plus the monthly fee for the next 30 days, even though I would not be using the phone line.
While researching the various ways I could avoid paying this hefty fee, I came across a 2007 Washington Post article which reported that a man faked his own death to get out of paying a $175 cancellation fee to get out of his cell phone contract early.
Indeed, most Canadian telecommunications companies will not charge a cancellation fee if the contract holder has passed away. The Estate Trustee would have to send in the death certificate along with the relevant account information to the company and ask that the contract be cancelled. This step should be taken as quickly as possible, as any outstanding monthly charges will be a liability of the estate.
Since faking my own death seemed a little extreme (not to mention fraudulent), my only other option was to find someone to take over the contract.
I placed an ad on Craig’s List seeking an individual willing to take over my contract. In exchange, I offered my old BlackBerry Torch free of charge, along with some cash. I actually had little trouble finding a willing taker – but it may not be that easy for those who don’t have a relatively new device in good condition to offer. It also took a bit of time and effort to arrange for the transfer and to meet the person and give them the phone. Many people may not feel comfortable making these sorts of arrangements with strangers.
A recent Bill introduced by the Ontario government may help limit such cancellation fees and prevent the need for consumers to go through such hassles simply to cancel a cell phone contract.
In May, the Ontario Minister of Consumer Services introduced the Wireless Services Agreements Act, 2012. It is fashioned upon legislation in Quebec and seeks to increase protection for consumers. Part of the Bill includes limits on cancellation fees based on prorating the economic incentives (such as the discount on devices or handsets) over the term of the contract. Currently, the standard practice is to charge $20 for every month left on the contract – regardless of the value of the phone you got in the bargain. To read more about the Bill, check out this article. The Bill applies to contracts with consumers only, and will not apply to contracts entered into prior to the date the legislation comes into force.
Those people with existing contracts will continue to be limited to either paying the standard cancellation fee or finding someone willing to take over their account.
Thanks for reading!