RCI Finance for excess mileage

[Kpros]

Hi guys,

First of all thank you for all of the time you have spent on these forums helping people like myself.

I don't want to bore you with information so I will try and keep it to the point but I am looking for a little bit of advice regarding a VT on a hire purchase around March of this year.

I had a Nissan Juke which I VT'ed towards the end of the agreement. They sent me a letter including a report in March 2018 detailing £0.00 in every single category apart from 'excess mileage' which was £522.61. Prior to realising that I didn't actually have to pay it I phoned them and spoke to a less than helpful gentleman who refused to put me through to anybody above him. It resulted in a promise of a call back from a manager/team leader which never came.

As I hadn't heard back I wrote them a letter complaining about not receiving a call back and stating that I would await the promised phone call and should I not receive it I would consider the matter closed. They failed to contact me via the phone, but then sent me a further bog-standard letter towards the end of May 2018. I ignored this letter as by now I had done some research (on here and on moneysavingexpert). It was clear that they had an 8 week window to respond to my complaint of which they failed to do, but ultimately they couldn't really enforce the excess mileage anyway.

That brings us to yesterday where I received the below letter from 'QDR Solicitors' chasing me for the money. By the way, the letter came via a text message to my phone with a link, which requested that I input my surname and postcode. I actually thought it was a scam so was going to delete it, but went along with it. I don't really accept that as a professional form of correspondence.

I am wondering whether I just ignore the letter, or should I reply using one of the templates you had put in (excess mileage 1) (but taking out the middle section as they have not cited any acts etc)

Here is the letter that I received yesterday. Any advice you can offer would be greatly appreciated

Private and Confidential Mr ***** ********
X XXXXXXXXX XXXX
XXXXXXX XXXXXX
XXXX XXX

09/10/2018

Dear Mr ****** ********
Our Reference: ***************
Our Client: RCI Financial Services Limited
Client Reference: 00000000000
Balance Outstanding: £522.61

We have been instructed to act for the above named client in connection with the recovery of the outstanding balance.

Our Client made several attempts in the past to contact you in order to resolve this matter directly and unfortunately was unsuccessful. Therefore, our Client has instructed us to collect the above balance.

Our Client requires you to make payment in full or alternatively submit your repayment proposals within the next 14 days. Failure to make payment may result in our Client instructing us to proceed with further action in order to recover the outstanding balance.

You can call us on 01926 758736 to pay by debit or credit card on our Automated Card Payment System; this is the simplest and quickest method of payment.

Our offices are open between the hours of 9.00am and 6.00pm Monday to Thursday and 9.00am and 5.30pm on Friday. Our alternative payment methods are below:

Cheque/ Postal Order: please post to QDR Solicitors, Olympus Avenue, Leamington Spa, CV34 6BF

Online: https://www.paymentsplace.com/qdr

We appreciate that managing your finances can be difficult, free independent advice and assistance can be obtained from the following organisations:

Money Advice Service National Debtline
0300 500 5000 0808 808 4000
http://www.moneyadviceservice.org.uk/en http://www.nationaldebtline.co.uk

Yours sincerely
QDR Solicitors

[R0b]

Morning,

I've only just picked this up but when you tag someone you have to tag them in the main body of your post and not use the tags at the bottom. If you don't I wont get a notification and I might miss your post.

Anyway, have you put a formal complaint to RCI and have they come back with their final response saying you are free to go to the Ombudsman? If so, when was this issued?

QDR solicitors are a branch of Wright Hassall solicitors run out of the same building and they predominantly deal with parking tickets and charges so it's a bit of a surprise to see them being instructed by RCI. Anyway, judging by their letter they are simply instructed by RCI as debt collectors but it's not entirely clear - you usually instruct solicitors to recover the debt by commencing legal proceedings so in a response it would be best to clarify in what capacity QDR are acting.

If you've not already complained to the Financial Ombudsman then I think that should be the first port of call. I now have a transcript of a judgment on excess mileage brought by Mercedes and they lost. That would be useful to refer to in your complaint and you have nothing to lose.

In the meantime you can respond to QDR but the contents of it will depend on whether you have the opportunity to take your complaint to the FOS or not.

I mightI have an example

[Kpros]

Hi R0b , thank you so much for your reply. Forgive me, I was unaware of that regarding tagging. Hopefully I have done it right this time.

I wouldn't say that it was a formal complaint, but I stated in my letter how disgraced I was by the way in which I had been treated and that I expected the phone call to deal with my complaint. So where I haven't labelled the letter as formal complaint, I have used that word and it was clear from my letter. I can attach a copy of my letter and their two letters to me if that is useful?

With the above in mind am I still able to complain to the FOS? Also, the fact that QDR had text me letter - should I accept this?

Thanks

[R0b]

Yes that one worked, your not the first person as it can be confusing.

If it wasnt a formal complaint then I would suggest that you get the ball rolling on that one with RCI. There is a template on here that I posted recently so I will try to hunt it down and you can use that as your starting point. It related to damages generally and not excess mileage but you can adapt it to suit your situation.

I will assume that RCI will eventuaevennot uphold your complaint and in which case you can pursue it to the FOS. In the meantime, FCA rules dictate that all debt recovery should be suspended pending the outcome of a complaint so QDR should back off. However it would be prudent to put them on notice about your complaint as communications do not always filter through.

If their correspondence came in the form of a text message and not a letter, you are well within your rights to tell them that the only method of communication you will accept is in writing, either by email if you give them one (which is what I prefer as its trackable) or by letter.

[R0b]

http://legalbeagles.info/forums/foru...ry-termination

Check out the above link it has a template letter. You can use the excess mileage letter example to weave in.

I would suggest you post up a draft first because there have been further developments that can be added into your letter since I did the excess mileage temaplte

[Kpros]

Hi R0b thanks for your replies.

Ok, thank you. I am working on the assumption that I have found the correct letter. If so, I have merged this one with the excess mileage template to the best of my ability. I wasn't sure whether or not I should mention the previous communication so I have not included this, if you feel I should please let me know. There are also segments of the letter in the template you provided that I have kept but am unsure if they are relevant. I have deleted what I deemed to be obviously unrelated to my claim, but kept the parts that I feel are, so if you can help that would be appreciated.

Although it may not have been a formal complaint, do you think it is worth me mentioning that I have previously complained and they failed to deal with it? Or am I treating this as a fresh letter entirely? I'm sure there are bits I need to change/bits that I can add so please find below:

Something to mention:

At appox. 15:30pm today I received a call from them (QDR). They asked for a Mr ****** ****** * ** (me), I asked who it was, and they said QDR Solicitors, I told them that I was unavailable to talk at that particular moment (I actually was) and to call back another time. If they call again, do you advise:

a) ignoring the phone call

b) stating that I refuse to discuss the matter over the phone and that any correspondence relating to the matter must come via the post and possibly cite the complaint?

Draft letter:

Customers Service Department
RCI Financial Services Ltd
Rivers Office Park,
Denham Way,
Rickmansworth,
WD3 9YS
By post and email: customerservices@rcibanque.com

08th October 2018

Dear Sir or Madam,

Re: Formal Complaint

Agreement Number: ***************

Vehicle Registration: **** ***

Please note that liability in relation to the alleged outstanding balance for excess mileage is denied.

You have suggested that I am liable to pay excess mileage under the terms of the agreement however this is not correct. Section 100(1) confirms that liability is restricted to one half of the total price payable. The CCA defines ‘total price’ as “total sum payable by the debtor under a hire-purchase agreement or a conditional sale agreement, including any sum payable on the exercise of an option to purchase, but excluding any sum payable as a penalty or as compensation or damages for a breach of the agreement”.

As you have already alluded to, the excess mileage is a contractual term of the agreement and therefore cannot be included as an amount which is owed. This position is further clarified under section 173 of the Act in that any contractual term which is inconsistent with any rights under the CCA and imposes additional liability, whether direct or indirect, shall be void and unenforceable.

Nonetheless, the excess mileage clause is based on the principle of ascertaining an estimated value of the car, taking into account its age and anticipated mileage at the end of the hire period. The hirer is then offered the option to purchase the vehicle at the suggested price. Mileage which exceeds the stipulated amount under the terms does not however, mean that the vehicle is not in a reasonable condition and you will note that this vehicle was returned in immaculate condition with absolutely no damage.

In any event, such sums you are alleging to be owed may only be recovered by a court order only and should you wish to pursue this matter in court, your application will be strongly defended.

The vehicle was maintained in a superb condition throughout the period of the agreement as documented in your report and therefore I do not accept liability for the sum of £522.61 that you are claiming to be owed. I am rather surprised that you have sought to recover this amount on the basis that there is no damage to the vehicle set out in the condition report. I should point out that as an authorised firm which is regulated by the Financial Conduct Authority, you are required to comply with certain rules. In particular, Rule 7.5.3 of the Consumer Credit Sourcebook requires you not to:

"ignore or disregard a customer's claim that a debt has been settled or is disputed and must not continue to make demands for payment without providing clear justification and/or evidence as to why the customer's claim is not valid."

As I mentioned earlier, I dispute the outstanding amount. In any event, there is case law on this matter and I would refer you to the Court of Appeal case, Brady v St. Margaret's Trust [1963] 3 W.L.R 1162 which was concerned with the extent of a hirer's duty to take reasonable care of the vehicle. On that point, Lord Denning stated that:

"There should be evidence by the hire-purchase company to show the condition of the goods at the time the agreement was made and to show how far the hirer has defaulted under it. As I read this clause, the hirer's duty is to keep the car in the condition in which it might reasonably be expected to be if he had looked after it properly. He need not put it in a better condition than it was when he hired it. He need only keep it in the condition in which a reasonably minded hirer would keep it. Thus he would repair it if there was an accident, and he would do the immediate repairs in the course of running the car, but no more. The hire-purchase company should give evidence of any default on his part in that duty."

In the circumstances, please treat this letter as a formal complaint in accordance with your complaints policy and the FCA Rules. I understand that you have up to 8 weeks to investigate my complaint and provide me with your final decision. If I am not satisfied with your response or you fail to reach a decision within 8 weeks of receiving my complaint, I shall be entitled to pursue my complaint to the Financial Ombudsman.

I would appreciate if you could acknowledge this letter within the next 14 days, as well as providing me with a copy of your complaints policy.

I look forward to hearing from you in due course.

Yours faithfully,

D***** ******

[R0b]

I'm not sure the section about damage to the vehicle is relevant if they are claiming the excess mileage charges. Take a look at the below example, you might need to adjust it if some things are not entirely accurate but should give you a flavour. You can omit the part about harassment if you wish to.

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

I am writing to you because I wish to make a formal complaint in accordance with your complaints policy and the Financial Conduct Authority ("FCA") Rules. My complaint is in relation to the termination of the hire-purchase agreement whereby you are claiming that I owe you £522.61 for excess mileage charges.

On [DATE], I terminated the hire-purchase agreement ("HP Agreement") and following the return of the vehicle, you wrote to me on [DATE] stating that the sum of £522.61 is due and payable for excess mileage charges. Although you did not explicitly refer to the HP Agreement, I have assumed that (based on the calculation of damages claimed) you are referring to clause [NUMBER] of the HP Agreement and therefore claiming breach of contract. Whilst I do not dispute the fact that the vehicle's mileage exceeded the agreed amount under the contract, I do not, however, accept that I am indebted to you because:-

1. The HP Agreement is regulated and subject to the Consumer Credit Act 1974 ("CCA 1974"). I exercised my right under Section 99(1) to terminate the HP Agreement voluntarily and in doing so, limited my liability to one half of the total price payable as per Section 100(1) of the CCA 1974. Furthermore, the CCA 1974 has a specific meaning for "total price" and it specifically excludes the recoverability of damages for breach of contract i.e. excess mileage or any other type of compensation and I am sure you will no doubt be aware that Acts of Parliament such as the CCA 1974 take precedence over common law contractual terms.

2. In a recent County Court Case (Mercedes-Benz Financial Services UK Limited v Cahalane) Deputy District Judge Ellington (as she was then) found that, among several other reasons, excess mileage charges were damages for breach of contract and the definition of "total price" under the CCA 1974 excluded those charges for the purposes of whether such charges could be recovered under a voluntary termination. Accordingly, Mercedes failed in their claim for excess mileage charges.

For the reasons mentioned above, I can see no basis for you claiming to be owed £522.61 relating excess mileage charges resulting from a breach of contract. I should also point out that as an authorised firm that is regulated by the FCA, you are required to comply with certain rules. In particular, Rule 7.5.3 of the Consumer Credit Sourcebook ("CONC") requires you not to:

"ignore or disregard a customer's claim that a debt has been settled or is disputed and must not continue to make demands for payment without providing clear justification and/or evidence as to why the customer's claim is not valid."

In my view, you have failed to provide any clear evidence or justification that the contractual terms under the HP Agreement take precedence over the provisions of the CCA 1974, and as such, you appear to be in breach of Rule 7.5.3 above.

Whilst writing, I note that you have instructed QDR solicitors to act on your behalf but it is not quite clear the capacity in which they are acting. Please can you confirm in what capacity you have instructed them to act. Nonetheless, I expect that all further correspondence from QDR be suspended pending investigation of this complaint and in accordance with Rule 7.14 of CONC. In the event that I continue to receive correspondence from QDR Solicitors during the investigation of my complaint, I shall hold you responsible for their actions and will consider legal proceedings against you for harassment and breach of the FCA Rules under CONC.

I understand that you have up to 8 weeks to investigate my complaint and provide me with your final decision. If I am not satisfied with your response or you fail to reach a decision within that allotted time, I shall be entitled to pursue my complaint to the Financial Ombudsman.

I would appreciate if you could acknowledge this letter within the next 14 days, as well as providing me with a copy of your complaints policy.

I look forward to hearing from you in due course.

Yours faithfully,

[YOUR NAME]

[Kpros]

Hi R0b thank you very much for your time putting that together for me. I had just replied but it seems to have disappeared.

I will find the clause number in my original agreement and add that in. The rest seems perfect, thank you. Do you think there is any mileage (pardon the pun!) In mentioning the report they sent me confirming there was no damage and thus the car was returned in immaculate condition?

Also, which letter-date should I cite? The first or second letter?

With regards to the phone call from QDR - should I ignore all future calls?

[R0b]

I've made a couple of changes to the above example so you might want to look at it again before you fire it off (few grammatical errors and forgot to insert definitions).

I don't think it matters but for clarity you could refer to the first letter that says you owe excess mileage charges. If they have referred to the clause number then you just adapt the wording to reflect that.

There's no point mentioning the vehicle damage charges unless they are claiming to recover damage charges from you. As far as I understand though, the charges claimed are linked to excess mileage charges.

Let's leave QDR for tonight, I have an example letter I can post up for that sort of response but need to find it.

[Kpros]

Hi R0b, I note the changes to the letter - thank you very much for this. I will get this sorted and posted tomorrow. I will refer to the first letter, and yes, it is only about the mileage; they have confirmed that there are absolutely no other charges (I have attached both letters received by them for clarity).

As you can see they do not cite a clause number/any acts of sections etc in either letter however I can potentially find this in my agreement documents with them if required.

Ok great (with regards to QDR). Should they phone me again beforehand, I will simply ignore it. I have saved their number so that I know it is them phoning.

Thanks once again for your support

[Kpros]

I have just dug out the original agreement and found this section of it which seems relevant based on the template. Shall I insert/cite clause number 11?

Thanks

[R0b]

You'll need to insert the clause number that says you'll be liable for excess mileage charges. I don't know which one that would be as I've not seen it.

[Kpros]

Forgive me R0b, the image did not attach for some reason but yes that was clause 11. Thank you so much, I will sort this today. You have been a really big help. I will ignore any calls from QDR

[Kpros]

Hi R0b - email sent with a scan of the letter and actual copy sent in the post via recorded delivery! Thanks again for your help. Shall I leave QDR where they are for the time being?

[James23abest]

Hi Kpros just a question about you bill, I too am going through a simular thing with RCI but they are trying to charge me damage and I'm guessing collection of the vehicle as it is listed in the box for other - £113. Did you have to pay a collection charge as it would be useful to know for building my case