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Scotland v British Credit Trust [2014] EWCA Civ 790. ( 10th June 2014 ) PPI / UR

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  • Scotland v British Credit Trust [2014] EWCA Civ 790. ( 10th June 2014 ) PPI / UR


    Lord Justice Kitchin:

    This is an appeal against the judgment of Her Honour Judge Hampton given on 19 November 2012 whereby she held the respondent claimants, Mr Mark Scotland and Miss Emma Reast, were entitled to compensation from the appellant defendant, British Credit Trust Limited ("BCT"), having found that the relationship between them was unfair within the meaning of s.140A of the Consumer Credit Act 1974 ("the Act").

    BCT is a finance company. It has no sales team of its own but obtains its business through brokers to whom it pays a commission. In March 2005 it lent the claimants 8,563.08 comprising 7,430.00 to allow them to purchase double-glazed windows and doors, and a further 1,133.08 to allow them to purchase payment protection insurance ("PPI"). The term of the loan was 10 years.

    In November 2011, over six years later, the claimants began these proceedings alleging that the loan was improperly executed; that BCT was liable for misrepresentations made by the salesmen about the PPI; and that the relationship between the claimants and BCT was unfair. The first allegation was withdrawn early in the proceedings and it was accepted at trial that the second was time barred. Accordingly the only allegation with which the judge had to deal was the third, that is to say whether the relationship was unfair.

    The judge held that the relationship was indeed unfair by reason of the conduct of the salesmen and she made a consequential order varying the terms of the loan and directing BCT to repay to the claimants the sum of 2,165.52 being the insurance premium and the interest paid in respect of it.

    The judge refused permission to appeal. On 27 March 2013 Bean J granted permission and directed that the appeal be transferred to this court pursuant to CPR 52.14 on the basis that it raised an important point of principle. He took that course primarily in the light of observations made by Tomlinson LJ in Harrison v Black Horse [2011] EWCA Civ 1128 at [31] that a misrepresentation was likely ordinarily to be irrelevant to the question whether a relationship was unfair. I must return to this decision and its relevance to the present case later in this judgment but for present purposes simply note that Bean J considered that it raised an issue which could only authoritatively be decided by this court and so merited the exercise of his discretion and the taking of what he recognised to be an unusual course. The appeal was accepted by this court on 23 April 2013.


    For all the reasons I have given I would dismiss the appeal.

    Lord Justice Underhill
    I agree.

    Lord Justice Moore-Bick
    I also agree.
    Common Sense .... if in doubt, use it !

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