How can sole traders legally circumvent 'no business use' restrictions in domestic contracts?

Question

I would like to get some advice regarding using consumer services for business purposes, where the contracts for the services have terms that when taken in isolation, forbid the use of the services for such things.

The services range from things like electricity and gas, to internet, telephone, and car insurance. Such no-business-use restrictions are very awkward for sole traders that want to share their personal space/utilities with their business.

Often the contracts stipulate that if any term is found illegal, invalid, and/or unenforceable, then it is struck off from the contract. The contracts also often stipulate things like that the contract is to be construed in accordance with the laws of some geographical area (such as England and Wales). These things lead me to ask whether such prohibitive terms might be considered struck off from the contract, or reduced in scope, through any such reasoning.

Answer 1

You need to ask what constitutes "business use".

For example, to take an extreme case, if I regularly bring home files from work, and sit in the living room doing them before supper, and now and then text my employer to ask the email address to send it to, does that mean I'm using my living room for "business use"? Or if I'm a teacher and I do lesson plans and mark papers in the evening?

No. Business use generally means actually using it as business premises, where a business is happening. Not just business matters incidental to/part of your home domestic life.

The main exception is, as already stated elsewhere, motor insurance, because that requires by law that each individual journey and car use is insured, and a specific journey can be business or personal.

Answer 2

How can sole traders legally circumvent 'no business use' restrictions in domestic contracts?

By getting a business-use contract with the provider, if one is actually required.

Every providers' contracts are different, but as far as I'm aware the utilities (gas, electric and water) do not have such restrictions - I've just checked mine and they don't.

According to U Switch domestic broadband is an option for running a business from home, and makes no references to not having one would invalidate a contract. I've checked my contract with one of the "big" firms and it doesn't say so either, but if yours does then you need a new business-use contract if you want to operate legitimately. Ditto for the phone.

The only thing you must have is business-use on your car insurance - not having it WILL invalidate your insurance if you use your car for business (and your car may be seized and crushed if stopped by the police on a business journey without valid insurance)

Answer 3

I'll give you some examples: You buy a coffee machine, or a waffle iron. They say "not for business use". Now if you are a sole trader who occassionaly drinks a coffee, that's one thing. But if you make a living selling coffee to the public, that cheap coffee machine you bought isn't built for that use. So you will be refused warranty repairs or replacements, you will be told that the overheating coffee machine is your problem, etc., if your business use exceeds what normal private citizens would use it for. Instead of a £100 coffee machine, you'll have to buy a £2,000 one.

I use my internet connection for business (well, employed and working from home, but no difference really). It's the exact same service as with a business contract, except 1. I pay a lot less for exactly the same service. 2. If my internet breaks down for a week I will be refunded a quarter of my monthly payment. With the business contract they would send someone out to fix my problem ASAP.

Someone uses their car to drive for Uber, and only pays insurance for non-commercial use: They can be in for a very, very bad surprise. If there is an accident, and the insurance company finds out it was during an Uber job, they will most likely try to get all their money back from you, which can bankrupt you forever. If the police catches you, they will accuse you of driving without proper insurance. All kinds of possible extreme legal trouble.