Verbal contracts common at Starhub, SingTel

Verbal contracts common at Starhub, SingTel

SINGAPORE - The use of verbal contracts is a common practice at two telecoms companies, where they call existing customers to renew contracts for services such as mobile, broadband and pay TV.

This convenience for customers, however, can result in disputes such as disagreements over the terms and conditions of a contract.

The Consumers Association of Singapore (Case) said it received eight complaints regarding telcos' verbal contracts between January and November last year. That was an increase from the three complaints in the whole of of 2013 and six in 2012.

Both SingTel and StarHub have such a practice. SingTel gets its staff to make the phone calls, while StarHub outsources the work to third-party telemarketers. M1 does not do verbal contracts.

This came to light last month when a StarHub customer had his broadband contract renewed via a phone call to his wife.

Although the wife had told the telemarketer who made the call that she needed to check with her husband first, the telemarketer went ahead and renewed the contract for two years.

StarHub has since apologised for the "slip in communication" by its telemarketer, saying it was an isolated incident.

The company added that it settled the issue with the couple last month.

Such calls can be useful as they save customers time and the hassle of travelling to a telco's store to renew their contracts.

Said technical support engineer Lee Weng Hong, 60, a StarHub broadband subscriber: "It's good because I don't have to go down to the shop.

"Sometimes, the queue can be very long, (and the waiting time can be) like an hour."

Ms Cassie Fong, StarHub's senior manager of corporate communications, said: "If customers are not going to change their contract, then it makes sense to recontract over the phone."

She added that telemarketers making the calls would ask the customers security questions to verify their identity, and the phone conversations are recorded.

A SingTel spokesman said the company regularly audits its calls to ensure service quality.

Contracts made verbally are legally binding, said lawyer Tan Hee Joek.

"It's a valid contract if there's a meeting of minds and both parties know what they are agreeing to," he said.

"But if there were changes to the terms and conditions that were not explained, then the customer could say it wasn't a pro-per contract."

For peace of mind, consumers should record the phone call or ask for a follow-up written contract so that they can look through the terms and conditions before agreeing to it, he added.

Consumer watchdog Case, however, says that it is best not to make verbal contracts.

Otherwise, it may be difficult for consumers to prove any breach in contract, without any evidence of the terms and conditions mentioned verbally, said Case executive director Seah Seng Choon.

"Consumers should request that verbal promises are put down in writing and ensure that all communication is written and not merely a verbal consent," he added.

Mr Lee said that he goes through his monthly bill very carefully.

If he does not understand it, he will call the telco for an explanation, he said.

mellinjm@sph.com.sg


This article was first published on Jan 8, 2015.
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