Civil Recovery - Retailer Terminated Credit Agreement

[PercyNorfie]

Hi All,

I have an interesting one here, I bought over the phone a product that I financed with a 0% interest free consumer credit agreement.

Retailer is also a FCA Credit Broker. Agreement is between myself and Creditor, agreement was arranged by retailer and validly executed/post the 14 days cooling off period. Deposit paid etc.

6 months later, the retailer messaged the creditor to cancel/terminate the agreement, I received a notice from the creditor that the agreement between myself and the creditor is cancelled and no debt was outstanding. Please note that I was not in default etc.

I then receive a phone call from the store, saying that the agreement is cancelled and I need to sign a new agreement. Creditor explains that retailer canceled the agreement, and I have no contract with retailer directly. I explain this to the retailer and they threaten me.

Retailer has then instructed Civil Recovery with the usual 1977 Torts Act. As I never set foot in the store, is there anything that can happen here?

I have confirmation from the Creditor through a SAR that the Retailer told the Creditor to terminate the agreement. Creditor as part of the FOS investigation says that they did nothing wrong, but loan is cancelled and retailer is pursuing me directly.

Retailer is coming after me, despite the consumer credit agreement saying that payment will be made by the Creditor (assume they have a separate B2B agreement).

I believe the retailer has made a mistake, and is targeting the consumer rather than going for the B2B relationship here.

Civil Recovery is also claiming £250 admin costs despite this not being a shoplifting case.

Many thanks for any advice or assistance.

[atticus]

What do you mean by "the usual 1977 Torts Act"? (Yes, I am familiar with the Torts (Interference with Goods) Act 1977)

What exactly has Civil Recovery said in its letter to you?

I am wondering if there is anything we have yet to be told.

[PercyNorfie]

Thank you Atticus, I have seen you respond helpfully to other people.

The Civil Recovery Firm said that their client is considering bring a claim against you under the Torts (Interference with Goods) Act 1977 to recover compensation for loss and consequential damages. I ignored these letters based on advice from this forum and on the basis that I have not taken any action. I bought the product from a distance, never set foot in store etc and had paid the CCA until the Creditor cancelled it.

The retailer are claiming that after the retailer requested the termination of the original consumer credit act agreement that by not entering into a new agreement that I have committed the tort of conversion.

I have received a letter before action, claiming that I had bought this in store, but have the supporting emails that shows that this would have been impossible since the product was not in store until 3 weeks after the agreement. I wasn't even in the same country.

I feel that this is an example of aggressive and misleading actions and I also suspect that the retailer as a credit broker is not following CONC 13.1.6 in these actions.

Please note that the original agreement could not be affirmed, as the Creditor would not reinstate the original agreement that was terminated.

[atticus]

The retailer are claiming that after the retailer requested the termination of the original consumer credit act agreement that by not entering into a new agreement that I have committed the tort of conversion.

I am struggling to see how, in the circumstances you have described, you became subject to a legal obligation to enter into a new agreement. Does the letter attempt to explain that?

[Pezza54]

OP stated the FOS is investigating. The Ombudsman's Final Decision will be binding on the creditor
OP should reply to LBA pointing this out and that court action should be put on hold until the ombudsman makes his decision

[atticus]

None of which prevents us from trying to understand the grounds on which a claim is threatened.

[Manxman]

I'd like to know what was purchased, its value, and what led the retailer to tell the creditor to cancel the agreement. (Is that even something the retailer can get the creditor to do?)

A lot is not being told...

[PercyNorfie]

Manxman - Engagement Ring, 10k and retailer/credit broker claims that the finance agreement was terminated unknowingly by a glitch or human error.

Pezza54 - Thank you for the tip here.

[atticus]

Have you stopped paying? I guess that as the agreement has been cancelled or whatever, you are not paying.

If so, are you being sensible and putting aside the money you would otherwise have paid?

[PercyNorfie]

Creditor hasn't requested any further payments, they have confirmed separately nothing is outstanding. Only issue is the retailer.

[atticus]

Another issue is your benefitting from what you know to be an error somewhere.

Again: are you being sensible and putting aside the money you would otherwise have paid?

[PercyNorfie]

Yes, payment is not an issue. The creditor does not see it as an error and has terminated the contract. I have a response from them claiming that the retailer cancelled the contract and I have no debt outstanding as a result.

[atticus]

We do not know what happened between the retailer and the finance company, and quite how the retailer could cancel a contract between the finance company and yourself is not clear. But somewhere in all this you have a £10K ring for which you have not paid in full.

Once all the facts are known, I have little doubt that a cause of action against you can be found.

Sorry, but I doubt that in the end you will be able to keep the ring and not pay the balance. There is something to be said for you writing a letter that gives the facts as you see them, states that you have no idea why the retailer interfered with the loan agreement, and finishes that when they can sort that out you will of course continue with the loan payments. Or maybe you could offer to make the remaining repayments to the retailer, by the same instalments, if it will indemnify you fully against any claim by the finance company.