- Generally, a future performance agreement is a consumer agreement where delivery of the goods, performance of the services, or full payment does not happen at the time the agreement is…
- A business offering a future performance agreement is generally expected to clearly set out, before the consumer commits: - A fair description of the goods or services - The itemized…
Not every sale is complete the moment money changes hands. A gym membership, a pre-ordered product, a prepaid service package — all of these involve a consumer paying now for something the business will deliver, in whole or in part, later. Ontario’s Consumer Protection Act, 2002 has a specific category for this: the future performance agreement, and it comes with disclosure and documentation rules on top of the ordinary rules for a consumer sale.
If your business takes payment before it fully delivers, this category almost certainly applies to at least part of what you sell. Missing its requirements is a common, avoidable way for an otherwise solid contract to unravel.
What Is a "Future Performance Agreement"?
Generally, a future performance agreement is a consumer agreement where delivery of the goods, performance of the services, or full payment does not happen at the time the agreement is made — there is a meaningful gap between signing and completion. The internet agreements and direct sales agreements covered elsewhere in Ontario consumer protection law are, in effect, specific types of arrangement that often overlap with this broader category.
Common Examples
| Type of arrangement | Why it counts |
|---|---|
| Gym or studio membership | Ongoing service delivered over the membership term, paid upfront or on a schedule |
| Product pre-order | Payment taken before the product exists or ships |
| Prepaid service package (e.g., a block of sessions or visits) | Services delivered gradually after payment |
| Home renovation or contracting deposit | Work performed well after the deposit is paid |
| Continuing retainer or subscription service | Service delivered over time under a single agreement |
Not every one of these arrangements will always meet the legal definition — the details of timing and structure matter — but each is the kind of deal that should prompt a business to check.
Required Disclosures Before Signing
A business offering a future performance agreement is generally expected to clearly set out, before the consumer commits:
- A fair description of the goods or services
- The itemized total price, including any additional charges
- The timing of delivery or performance
- Cancellation, return, or refund terms
- Any other material terms of the arrangement
This mirrors the disclosure themes that run through Ontario consumer protection law generally: nothing important should surface for the first time after the consumer has paid.
Getting the Written Contract Right
After the agreement is made, the business is generally expected to provide the consumer with a written copy recording what was actually agreed. This is not just good practice — it is what protects the business if a dispute later arises about what was promised, and its absence is what tends to trigger extended cancellation rights for the consumer.
Cancellation Rights When Something’s Missing
Where the required disclosures were not made, or the written copy was not provided, the consumer may gain an extended right to cancel the agreement that goes beyond what a simple change of mind would allow. Because the specific windows and thresholds involved can be technical and can change, a business should not guess at them. Confirm the current rules and get legal advice before treating any future performance agreement as locked in.
Drafting Checklist for Businesses
- Identify every product or service line where payment happens before full delivery
- Confirm your standard contract or membership form includes all the required disclosures
- Build a process to deliver a written copy of the agreement to every consumer, every time
- Review your cancellation and refund language against current requirements, not an old template
- Train front-line staff not to promise verbal terms that contradict the written agreement
- Revisit your templates periodically, especially after any change to your pricing or delivery model
Frequently asked questions
Does this apply to a simple gift card purchase?
Generally not on its own. A gift card is treated under its own set of rules. But a membership or subscription funded partly through gift card balances can still be a future performance agreement in its own right.
What if the consumer only pays a deposit, not the full price?
That is a common structure for a future performance agreement, not an exception to it. The gap between payment and full delivery is exactly what brings the category into play.
Can we require the consumer to waive these disclosure protections in exchange for a discount?
No. These are baseline consumer protections that a business generally cannot contract around, regardless of any discount offered in exchange.
Does a business-to-business service retainer fall under these rules?
Generally not. These consumer protection rules are aimed at agreements with individual consumers buying for personal, family, or household purposes, not commercial arrangements between businesses.
This is a corporate question
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