PCP Termination due to epilepsy

[Clarke24]

Hi
I’m looking for some help regarding a PCP agreement.
My daughters boyfriend took out a Motonovo PCP agreement in December 2016 for 4 years. 9 months ago he started suffering with epilepsy, initially he wasn’t allowed to drive for 6 months and got his licence back in January 2018. He has since suffered another epilepsy episode and is not allowed to therefore drive until he has been a year free from epilepsy. Here lies the problem. He has phoned motonovo finance and they have said he has 2 options - either give the car back and pay over £4000 to meet the half way point of the agreement or sell the car and pay the outstanding amount of around £11,400.
As he is not able to drive he has cancelled his insurance and registered the car as SORN along with informing DVLA that he has epilepsy and when his last episode was. He is now on medication for his epilepsy and as long as he doesn’t have an episode for a year will then be allowed to drive after this.
Can you tell me if what the finance company are saying are his only options? Looking through the paperwork he has I cannot find anything that relates to this sort of situation so any help would be greatly appreciated.
Thanking you in advance.

[des8]

Hi and welcome.
Sorry to hear about this problem but as far as I know there are no grounds to terminate a finance agreement on medical grounds.
The finance company may not be particularly helpful but legally they don’t have to do anything.

Tagging R0b for confirmation or otherwise

[R0b]

Morning,

As Des has suggested, the starting point is that once entering into the agreement, then it's difficult to get out of. However, there may be a way around this and that is by arguing something called frustration of contract.

Frustration of contract is a long established principle that a contract may be discharged without further liability where certain events happen that make performance of the contract impossible or something radically different when the contract was first entered into.

You cannot rely on frustration of contract if there is a term within the contract that makes provision for situations like this e.g. unable to drive on medical grounds or other illness so the starting point is to read the contract and find out if there is anything in there about medical issues or illness.

Frustration of contract on the grounds of medical issues or other illness has been applied regularly in employment related contracts, I'm not sure I've seen something apply in the context of goods and services contract though if there are, then there must be little case law out there.

In short, the only real grounds I can see are (subject to what the contract says) that the contract has been frustrated due to his epilepsy which was without fault by either side. The purpose of the contract is the enjoyment and use of the vehicle which he agreed to hire from MotoNovo at the time. The effect of the epilepsy means that he is no longer deemed fit to drive by the DVLA and that has therefore performance has become radically different to what was envisaged when entering into the contract initially.

I should point out that frustration of contract cannot be relied on simply because performance of the contract becomes more difficult or onerous, so it would be a question of whether or not the epilepsy is considered to be an event which was unforeseen by both parties and significant enough to be radically different than what was expected.

A starting point should be to make a formal complaint to MotoNovo and kickstart that process. I would expect them to say that he is still going to be held to the contract and they won't do anything about it. The next step after that is the Financial Ombudsman who has a pretty poor record of making fair decisions and is further enhanced by the recent Channel 4 Dispatches show. If the FO refuses to side with him, then the last option would be court and it could be risky to bring a claim based on frustration of contract only. I would say that if it comes to that point, he will probably need to speak to a lawyer.

[des8]

Krell v Henry [1903] 2 KB 740 might be worth a look