VT - RCI Finance excess mileage charge and damage claim

[ashrider88]

Hi R0b ,

Thank you in advance for any help with my current dispute with RCI Financial Services.

to keep it brief:

- Bought a Clio on a 4 year PCP deal with 10k annual mileage.
- 2 month after buying the car i was promoted at my employment to a regional role which included much more travel. I called RCI to up the mileage and was told this was not possible but i should save some money if i estimate i will exceed the allowance.
- I recently returned the vehicle via VT after 3.5 years with 65,552 mile on the clock
- I have been charged £2575 for excess mileage and £485 fo some minor scratches on the car.

Would you be kind enough to share what you would do in this situation, what my rights are, and any advice on how to respond?

I am happy to share the vehicle inspection report from Manheim if that helps?

Regards

Ashley

[R0b]

Hello

The limitation of liability should still apply here, but really you should have documented in writing your request to increase the mileage. If RCI took you to court and deny you ever calling them up, what evidence do you have to support that was discussed?

You could perhaps argue it was unfair for them to reject your request for an increase in the annual mileage without good reason and that might be an unfair relationship, though that would be your fallback position. The main argument is that Section 100 limits your liability regardless of exceeding the mileage. Given the amount in question, they may try and take their chances at issuing a claim in court against you but that something you will have to wait and see

[ashrider88]

R0b thank you very much for your guidance.

i could always ask for their recorded call and ask my network provider for evidence of a call made I guess.

i will chance a court hearing... worst case I have to pay it with fee’s added

[ashrider88]

Hi R0b

Further development of from my above post...

I sent this as an email...



I am writing to you in response to your email dated X and your pre-action protocol for debt claims letter dated X.

I am disputing both the damage claim and the excess mileage.



Re: Condition of vehicle following voluntary termination



Please note that liability in relation to the alleged outstanding balance for excessive damage to the vehicle is denied.

The vehicle was maintained in a reasonable condition throughout the period of the agreement and therefore such damage charges you are claiming would amount to fair wear and tear; the vehicle does not need to be returned to you in any better condition other than a reasonable one. Photographic evidence was taken prior to the vehicle being transferred to you which clearly shows that the vehicle was in a reasonable condition. The onus is on you to prove that the alleged damage caused was more than reasonable fair wear and tear.



I will be contacting the ombudsman to verify my position here.



Re: Claim for Excess Mileage



The right to recover excess mileage charges is a contractual one and, as a result of exercising my voluntary termination right, limited my liability to one half of the total price payable. The Consumer Credit Act 1974 is explicit as regards to the definition of "total price" in that it excludes sums related to compensation, damages for breach of contract or penalty charges. The excess mileage charges are a contractual term and therefore considered to be compensation for exceeding the agreed mileage and/or damages for breach of contract. Accordingly, those charges are irrecoverable.

I would further add that this issue has arisen in a recent County Court case at Willesden (Mercedes-Benz Financial Services UK Limited v Cahalane). It was held that:

1. excess mileage charges were excluded under the definition of "total price" and that the section titled "TERMINATION: YOUR RIGHTS" also detailed the total amount payable under the agreement, which did not include excess mileage charges. The Judge further stated that she was further bound by the Court of Appeal decision in Julian Hodge Bank Limited v Malcolm Hall [1997] WL 1103662; and

2. the excess mileage was not a failure to take reasonable care of the goods on the basis that there was no correlation showing there to be a causal link between the excess mileage and a failure to take reasonable care of the vehicle beyond fair wear and tear.

Therefore, as far as I am concerned, the charges claimed by RCI are not recoverable and for the reasons set out above, i shall not be paying those sums. I trust this makes my position clear and I do not think it necessary for there to be any further correspondence on the matter, save that legal proceedings are issued in which case it is my intention to defend any claim brought by RCI.



The reply received was....



Good Morning,



Thank you for your email.



The excess mileage is a contractual charge stated on page 2 of your agreement documents. This confirms that mileage will be charged on the ending or earlier ending of the agreement, section 11 of your Terms and Conditions states that the mileage will be proportionately reduced to the reduced term. The excess mileage charge would stand.



Regarding the damages we understood when working the report you had disagreed with these charges so we did attempt a courtesy call to go through this. Looking at the images these are deemed outside fair wear and tear. I can however see some charges for poor repair, did you have any work carried out on the vehicle prior to collection?




Section 11 in my contract states.....

11.3 For the purpose of calculating whether any excess mileage charges are payable where this agreement ends for any reason prior to the end of the term, the maximum contractual mileage shown on page 2 shall be reduced proportionally to the reduced term.


Do i have a leg to stand on?

Any help much appreciated.

Regards

Ashley

[R0b]

An act of Parliament is the highest form of law and so a contractual term cannot overrule it where there is a conflict. You could go back to RCI and tell them this and invite them to explain why they believe that clause 11.3 overrides and supersedes the Consumer Credit Act. You'll probably get the same response because the people you are speaking to have no clue and simply follow instructions from those more senior; likely to be wasting your time and effort.

You might be better off sitting back and see what RCI does, which is likely nothing but that's not to say they won't at some point in the future. They have 6 years to pursue you and so you will need to keep all paperwork for that amount of time.

[jonevns1990]

R0b Hi, thanks for all your posts across this forum - they are a huge help in an ongoing VT process.

I returned VT'd a car back in January 2018 and immediately disputed the excess mileage charges - however BMW didn't correspond with me since and I assumed the account have been closed.
Recently I checked my credit report and noticed that BMW had been applying late payment charges to my account for the last 12 months - I have since been in contact with BMW and they have spouted the usual and stand by the excess mileage charge that is owed.

Where do I stand in regard to these defaults on my account? I noticed on one thread you mention a breach of data protection but I can't find any more information on the subject?

Again, thanks for all your information, you really are the font of all knowledge on these VT related topics!

[R0b]

R0b Hi, thanks for all your posts across this forum - they are a huge help in an ongoing VT process.

I returned VT'd a car back in January 2018 and immediately disputed the excess mileage charges - however BMW didn't correspond with me since and I assumed the account have been closed.
Recently I checked my credit report and noticed that BMW had been applying late payment charges to my account for the last 12 months - I have since been in contact with BMW and they have spouted the usual and stand by the excess mileage charge that is owed.

Where do I stand in regard to these defaults on my account? I noticed on one thread you mention a breach of data protection but I can't find any more information on the subject?

Again, thanks for all your information, you really are the font of all knowledge on these VT related topics!

So I think breach of data protection is ultimately the route to go down and commence legal proceedings because I don't think that BMW will shift their position regardless.

I haven't really done much on this recently because it does take a lot of time and research but I have been thinking that it is best to gather as much evidence as possible to enable you to take to court and then attack BMW.

I have been mulling over whether it might be worthwhile contacting Experian for example, and getting them to confirm whether BMW are using the correct status codes. If you can get them to confirm that BMW are using a status code not intended for the purpose it is being used, then the next step could be to issue a request for rectification to BMW in accordance with the GDPR. BMW then have an obligation to respond either accepting or rejecting your request and, if the latter, giving sufficient explanation.

Assuming both of those attempts fail, your last resort is then to take the matter to court and persuade a judge to find in your favour. I have been (slowly) trying to refine some arguments to put forward as part of a claim and at the moment, Just FYI there is someone who posted not too long ago who is based in Scotland and decided to issue a claim, and BMW have defended suggesting they have a contractual right under the agreement to report the charges.

If that is the gist of their defence then I would view that as a bit of a flimsy argument because the right to report would only be available in so far as the contract remains alive. That's because it is illogical to think that someone can continue reporting the fact that you have missed payments under a contract that has been terminated; the view taken by BMW would imply that they have an indefinite right to report any form of payments under the agreement as missing, regardless of whether or not they are disputed. When you look at the context of how Credit Reference Agencies operate, their duty is to enable lenders to carry out a statistical analysis of an individual as to the likelihood of them being able to meet their credit repayments.

For example, take a look at the information provided by Experian





Seems to me to be quite clear that the purpose of a CRA is to provide credit information to lenders; emphasis on the word credit. Sadly, I've never had a BMW financial agreement, largely down to me not liking their cars but certainly someone at some point will have to challenge their position. I am of the opinion that they have abused their powers of reporting, it's misleading if not inaccurate and contrary to the principles of credit reporting, as approved by the ICO.

As I said, there's a number of arguments I have been compiling but since there is no case law and requires perhaps some complex explanations together with references to the law, it's not a cut and dry claim. Really comes down to how well you would do in court.

[jonevns1990]

R0b thanks very much for this information!

I have just opened an account with Experian and shall contact this in regards to the above as a first port of call.
I'll let you know how this process pans out!

Thanks again,

Jon

[Star345]

Hi I am after some advice if possible please. I have VT my car early. I had a 6000 miles allowance on a 3 year PCP. My car has currently done just over 17000 miles which I thought would be fine as I havent gone over the total 18,000 miles of my milage total. But they have said I have excess milage?
My car has also just been inspected all was fine apart from dents which have put a charge to. These 'dents' are potentially from other cars opening there car doors into mine in car parks! Would this not come under wear and tear? I have disagreed with the inspection and I am wondering what happens now? As I dont feel it's fair I should pay for dents in the car that I have not personally done. Thank you

[FredFerret]

Hi I am after some advice if possible please. I have VT my car early. I had a 6000 miles allowance on a 3 year PCP. My car has currently done just over 17000 miles which I thought would be fine as I havent gone over the total 18,000 miles of my milage total. But they have said I have excess milage?
My car has also just been inspected all was fine apart from dents which have put a charge to. These 'dents' are potentially from other cars opening there car doors into mine in car parks! Would this not come under wear and tear? I have disagreed with the inspection and I am wondering what happens now? As I dont feel it's fair I should pay for dents in the car that I have not personally done. Thank you

This will not fall under BVRLA Fair wear an tear if they are bigger than 15mm or there is any paint damage. How did you get on?