PCP voluntary termination excess mileage charges court claim

[cjm128]

Issue Date: 02/06/2017
Amount approx: 7k
Claimant: Mercedes Benz FinancialServices
Solicitor: Mortimer Clarke
Original Creditor: MercedesBenz Financial Services (MBFS)
Particulars of Claim:
Itook out a PCP agreement in 2012 with Mercedes on 10k annual miles. Despite requiring 20k the dealer encouragedme to take an agreement with lesser miles on the basis I would just trade it inat the end of the agreement (as per my previous agreement with them). Sadly after divorce I was lumbered with a carwith 90k+ miles on it after 3 just over years, so looked into VoluntaryTermination (VT) under the ConsumerCredit Act (CCA) and found this forum, pretty much followed the advice.
Iterminated my PCP agreement under the Voluntary Termination right outlined inthe consumer credit act with Mercedes Benz Financial services in February lastyear. I refused to sign the "termination pack" that asked me toaccept liability for excess mileage charges and eventually Mercedes agreed tocollect the car.
Thecar was collected by BCA. The conditionreport "Within standards No Charge".
Mercedessend me a bill for the excess mileage amounting to 5.5k plus VAT.
Iset a letter using the Template letter sent from the forum's VT guide denyingthe charges. MBFS responded using theargument that the vehicle wasn't in reasonable condition due to the excessmileage and claiming that the mileage charges are accrued before termination.
Aftera further exchange along these lines I engaged with a solicitor to write aletter on my behalf. Mercedes dealtwith the issues as a complaint and insisted the charges were valid. I then resent the solicitors letter each timeI was contacted by them or DLC, their debt collection agency.
Ireceived a letter from MBFS appointed solicitor Mortimer Clarke in April. I sent a variation of my solicitors previousletter outline why the charges were unlawful and offered them a reduce sum of£2250 (which was rejected).
MortimerClarke responded citing the following two sections of the CCA -
With respect to section 99(2) of the act - "Termination of an agreement under section (1) doesnot affect any liability under the agreement which has accrued before thetermination"
And
With respect to section 100(4) - "If the debtor has contravened an obligation to take reasonable care ofthe goods or land, the amount arrived at under subsection (1) shall beincreased by the su required to recompense the creditor for that contravention,and subsection (2) shall have no effect accordingly".

ThusI assume these are the key points they will use. The Claim Form simply stated after somepre-able "...under the terms of theAgreement the defendant agreed to pay any costs or charges associates withvehicle damage, excess mileage and or rental. These sums are now due andpayable"

Ihave pulled together a number of points from this forum's excellent VoluntaryTermination points but I'm not sure really how to structure the defence.

Iwould very much welcome any advise on the defence, any experience this scenarioand, something I'm struggling to find any reference to online, whether or notan excess mileage claim for VT has ever gone to court.

[R0b]

Re: PCP voluntary termination excess mileage charges court claim

Hello,

First of all you should acknowledge the claim with an intention to defend, assuming the claim was made online you would then have 33 days from the date of issue to file a defence. I will give you some breathing space, though you may wish to consider writing to Mortimer Clarke and request a further extension of 28 days to file your defence. This right enshrined under CPR 3.8, if you want to do this you would need to put it in writing.

Now for your evidence, it would help if you can answer the following questions:

1. Was the car brand new or used? If used, how old was it?
2. Did you take photos of the car inside and out?
3. Was the car regularly serviced? did you take copies or photos of servicing or receipts for any repairs? If not, is there evidence of you making payment e.g. card transaction?
4. Do you still have a copy of the damage report from BCA that says within standards, no charge? I assume theres no information on there that says excessive mileage, other than the recorded mileage?
5. Just to confirm for clarity, you never signed any documentation that you agreed to pay for excess mileage, damage etc that MBFS sent to you?

Once we have the above information, it will help to prepare a draft defence around this. The particulars of claim seem to be lacking in clarity, the claim for £7k suggests it results from costs or charges for damage and excess mileage and rental charges but fails to properly particularise whether or not the £7k is attributed to all three or not. I assume that it solely relates to the excess mileage given what you've said but they should have been clearer so you know what case you have to meet - again this could be put in the defence.

[cjm128]

Re: PCP voluntary termination excess mileage charges court claim

Hi R0b,

Many thanks for the reply. I have acknowledged the claim online.

In response to your questions:
1. Was the car brand new or used? If used, how old was it? - Yes, brand new
2. Did you take photos of the car inside and out? - Yes I have photo's
3. Was the car regularly serviced? did you take copies or photos of servicing or receipts for any repairs? If not, is there evidence of you making payment e.g. card transaction? - Yes the car was serviced inline with the Mercedes maintenance schedule. The service record was digital but I may have the copies they issued still, I'll check.
4. Do you still have a copy of the damage report from BCA that says within standards, no charge? I assume there's no information on there that says excessive mileage, other than the recorded mileage? - Yes, I do have the BCA report which does just state the mileage.
5. Just to confirm for clarity, you never signed any documentation that you agreed to pay for excess mileage, damage etc that MBFS sent to you? - No, I didn't sign the documentation that MBFS sent out to me.

Yes, the detail in the claim is very vague and not specific although the charges in question are solely related to excess mileage.

[R0b]

Re: PCP voluntary termination excess mileage charges court claim

Thanks for the info. My view is that assuming your correct about the two points Mortimer Clarke seek to rely on they should be easy to overcome. The bit about section 99(2) is typical and they haven't taken into account what section 100 says. If they argue about the excess mileage causing damage, you could rely on the damage report which not only says within reasonable standards there is no evidence on there to suggest the car is mechanically unsound, therefore there is a presumption that the car was returned in a reasonable condition.

Does the excess mileage charges marry up with the amount being claimed e.g. Calculating the pence per mile by the number of miles gone over?

I also have to ask about the excess mileage clause itself, does it say if you go over you will pay X pence per mile or does it say X pence per mile plus VAT?

I have a draft defence lying about somewhere when I was preparing for something like this (though the lender never actually issued a claim) I'll try and dig it out so you can use it as a starting point. Might have to wait until the weekend as I'm a bit busy til then.

[cjm128]

Re: PCP voluntary termination excess mileage charges court claim

Thanks Rob. Really appreciate your response, puts me at ease! Despite everything I've read I haven;t found any reference to it going to court yet so good to get your view.

Yes, the claim marry's up with the charges; its quoted as 9ppm plus VAT in the contract.

I very much appreciate the offer of the draft defense, that would be a great great help.

[R0b]

Re: PCP voluntary termination excess mileage charges court claim

I'll get looking, you have to remember the onus is on them to prove otherwise that the car was in an unreasonable condition - no evidence = no damages.

I'm also slightly concerned about the excess mileage charges. Generally liquidated damages I.e. Purely Compensatory damages for do not attract VAT charges whereas if the damages are also part of the goods or services supplied then VAT is applicable. I'd need to read further into it but perhaps an argument that they've over inflated their claim to include VAT charges when they should not have, though it can be a fine line.

I'll let you know when I have further info

[R0b]

Re: PCP voluntary termination excess mileage charges court claim

FYI, I found the a link to HMRC regarding VAT on liquidated damages. As you can see when you read it, VAT is not applicable under liquidated damages.

https://www.gov.uk/hmrc-internal-man...ion/vatsc35600

[cjm128]

Re: PCP voluntary termination excess mileage charges court claim

Thanks Rob.

Quick question, as the claim is so vague, basically saying end of contract charges are now due and payable, is it a CPR request to get more information on the claim? I have a fairly good idea of the points they will use from all the previous correspondence but can I request more detail and are they likely to supply it?

Many thanks

[R0b]

Re: PCP voluntary termination excess mileage charges court claim

Yes you could make a request for further documents under CPR 31.14 and also a Part 18 request for further information. I would expect those requests to be resisted on the basis that the claim is likely to fall into the small claims track for which those parts of the CPR do not apply. Strictly speaking, yes the claim will no doubt be allocated to the small claims track but you could argue that the claim has yet to be allocated and until such allocation, the full rules of the CPR applies.

In addition to the above, I would suggest that you also make reference to it in your defence along the lines of something that the Claimant's pleadings are inadequate and deficient ... and the defendant invites the Claimant to provide sufficient particulars by way of reply or alternatively, invite the court to make an unless order for detailed particulars with a failure to comply resulting in the claim being struck out.

As I said in a previous post, you could also request an extension of time as agreed between the parties under CPR 3.8(4) generally (or CPR 15.5 for Defence) provided it does not affect any court hearing and that it is in writing. As this is early stages no court date is going to be put at risk, so if you would like (again they may ignore you but should you win at trial, you could refer the court to the letter in relation to their unreasonable conduct) to do this then you can use the letter below as an example.

I should have some free time tomorrow I will try to find out that Defence I drafted, if I can't i'll provide you with a starting point so you can at least attempt something in the meantime.

--------------------------

Dear Sir or Madam,

Claimant v Defendant - [CASE NUMBER]

I write with reference to the above matter.

You may be aware that I have recently acknowledged the claim against me for which I am now required to file a defence. Unfortunately, the Particulars of Claim does not provide a concise statement of facts nor does it identify with any detail, the damages under each head of loss claimed. In the circumstances, the claim does not provide sufficient information in order for me to understand the case I have to meet and I therefore suggest that it would be appropriate to agree an extension of time to enable sufficient information to be exchanged.

I would like to draw your attention to paragraph 42 of the judgment of the Court of Appeal in Denton v TH White Limited [2014] EWCA 906 which states that the parties should be ready to agree limited but reasonable extensions of time, and to paragraph 43, which warns that courts should be ready to penalise opportunism and that agreement to extensions of time should not be unreasonably refused.

This position is covered by Rule 15.5 of the CPR, with the maximum permitted extension being 28 days and the extension must not put at risk any hearing date. Given that this claim is in the early stages of proceedings and no hearing date has been fixed, I therefore propose an extension of [insert number of days] to [insert date].

If you are prepared to agree to the proposed extension, I would ask you to confirm your agreement in writing within the next [7] days. Should you unreasonably refuse or ignore my request, I reserve the right to refer to the court to this letter on the question of costs and conduct.

Sincerely,

[NAME]

[cjm128]

Re: PCP voluntary termination excess mileage charges court claim

Many thanks R0b, much appreciated

[R0b]

Re: PCP voluntary termination excess mileage charges court claim

Many thanks R0b, much appreciated

Good afternoon, I have been trying to look for the draft defence I made but I must have misplaced it someone. Anyway I've attached something quick as a starting point which you can use to assist you in your defence.

You will see at paragraphs 1 & 2 I have sort of stated that the Claimant's particulars are poor and what should happen to rectify the issue. Ordinarily, money claims online done online are almost always poor as are the ones issued by debt collector;s solicitors presumably for speed reasons. Those with sufficient money would look to strike out the claim as early as possible but I think courts are more willing to offer a chance for it to be rectified before ordering something quite draconian. Hence paragraphs 1 & 2 which invites the Claimant (or the court) to provide further particulars on their claim and, if they don't then you might have grounds to strike out if you wished to do so, though not 100% guaranteed. It can be worded a lot better so maybe look at that further down the line once you've got your core defence locked down.

I would suggest you take a look at the guide I made plus some research at other threads made on here to help you formulate you the rest of your defence. If you get stuck let me know and I'll try and give you some pointers but in the meantime you should consider the following:

1. Read this for help if you haven't already http://www.legalbeagles.info/forums/...on-Your-rights
2. Also read this thread which might help too http://www.legalbeagles.info/forums/...CP-CCA-S99-(2)
3. You should also refer to the fact that the Claimant had the car appraised in terms of the vehicles condition. The result was that it was returned within acceptable standards - no mention of the car being mechanically unsound due to excess mileage.

Also, have you checked your credit report to see if MBFS has recorded a default on your credit report? Noddle is free to use and Experian is free trial. If they have then you could consider making a counterclaim for breach of data protection i.e. inaccurate data plus also breach of the ICO guidance on reporting defaults to credit reference agencies.

On final point to note about the document itself - at paragraph 2 I have put in brackets definitons for the Defendant and Claimant, this is a matter of preference but I prefer to identify the parties personally as it helps especially if an appeal is made but there is no harm making reference to Defendant/Claimant but just make sure it is consistent throughout.

I have also quickly created some styles for the document to make it easier for you and ensuring the document stays in paragraphs. Not sure how good you are with word but if you look at the image below you can see I have set three levels (1, 2 and 3).



Level 1 is the primary one you should use to create the paragraphs e.g. 6, level 2 is the sub-level of the paragraph in question e.g. 6.1 and level 3 is a further sub-level of the same paragraph e.g. 6.2 (a). There is also the 'Normal' style which I would use for the headings. Hope that makes sense!

[cjm128]

Re: PCP voluntary termination excess mileage charges court claim

Thank you so much R0b. Will work through this later today. Much appreciated.

[R0b]

Re: PCP voluntary termination excess mileage charges court claim

No worries, happy to look anything over before you send off if you post it up

[cjm128]

Re: PCP voluntary termination excess mileage charges court claim

[MENTION=71570]R0b[/MENTION],

MBFS are claiming court charges and solicitor fees in their claim. Are they able to do this for a small claim?

Many thanks

[R0b]

Re: PCP voluntary termination excess mileage charges court claim

Application fees yes, Solicitors fees are capped at £100 but usually the court awards around £50 which covers the cost of issuing the claim.

Are they trying to claim more than that? The only way I can think they are claiming is if there is a clause in the contract which says so but is specific to the wording.

Again, if you check your credit report you may wish to counterclaim for breach of data protection but that is up to you.