VT Dispute HELP!

[sk2018]

We VT our Fiat 500 back in Feb - we were informed that any charges would be sent to us within 6 weeks of collection. We did not receive anything within this time period, but then received a letter 10 weeks later stating we owed £1,073.58 for unacceptable damage, excess mileage and collection fee.

We had issues with the car being collected. It was arranged to be collected on 19/02 but they didn’t show, which meant they then collected on 20/02. This meant I had to take two days off work, which meant I lost money.

Several letters have been sent, stating we were not prepared to pay using CCA in our favour. The finance agreement was under my partner's name. We have now received a letter stating we owe £602.58 for the excess mileage. They have removed the damage and collection charges “out of good will”.

They claim that exceeding the agreed mileage allowance can be seen to be the customer contravening the agreement to take care of the goods as agreed therefore able to charge customers if they have not adhered to their mileage allowance, stating under CCA 1974 section 100 (4) and the T&C’s of the finance agreement they can reclaim for damages to the goods.

I’ve also worked out they’re charging an additional £100 to what the excess mileage charge should actually be. Despite this, I still refuse to pay this.

When we took out the finance, the salesman told us to go for the lowest mileage to keep monthly charges down.

I’m also not prepared to pay for anything related to the vehicle 8 months later!

Can you provide any advice in how to respond to this?

Thanks in advance!

[Kati]

R0b ... one for you please xx

[R0b]

Hello

First of all, if you've not read it already I would suggest you read my guide on Voluntary Termination. I am in the process of updating it but the content is largely unchanged and still applicable.

You then need to decide whether you choose to dispute their charges and put them to proof or wait and for them to take you to court and have your say, or simply pay up and come to a repayment plan.

A word of caution, some lenders (BMW, Barclays) have now resorted to issuing late payment markers or other adverse entries on people's credit file. Whilst I am of the belief that is unlawful and contrary to the Data Protection Act with regards to reporting accurate data, they have nonetheless continued to do this because people are not prepared to challenge them in Court but also they know people will simply succumb to their demands as it hurts in obtaining further credit. I am not aware of Fiat doing this, but that's not to say they won't.

[sk2018]

R0b

Firstly, thank you for getting back to me!

I have been reading over your guide on VT - I'm just getting confused on the information provided under Section 100. Fiat are using section 100(4) so do I have a leg to stand on? I'm unsure how to argue against this - can you offer any help?

I have attached the letter we sent following our initial letter informing our decision to VT. As you can see we used your template to help. I've also attached a copy of the email received from Fiat in response to our letter. We've now received a letter asking us to pay £602.58 for the excess mileage. The letter itself does not state any reasons/information, just details on how to pay.


In your experience, how likely do these companies take to court?


Thanks in advance

[R0b]

Ahh FCA that old chestnut with their standard letter full of crap. They're clutching at straws with regards to their claim for misrepresentation and I think would have no hope in being successful under that argument.

As to the damages claim under Sedtion100(4), the correct reading is that you have to take reasonable care of the goods i.e. not to cause deliberate damage or misuse as FCA point out. However, where is their evidence regarding the damage to the vehicle as a result of the excess mileage bearing in mind you are not liable for wear and tear? Their claim is purely economic at that and there is already decided court cases that the law of England and Wales does not impose a duty of care generally to avoid financial loss.

Theres another thread on here somewhere ww I provided a draft response and then FCA decided to fold after that. I'll try digging it out

[sk2018]

R0b - that would be really helpful - thank you!

I have attached a draft - do you mind having a look?

I am aware of the last paragraph and unsure whether I would actually be able to report for harassment? In terms of the charge I know thats ridiculous but my partner insists!

Any thoughts/advice would be greatly appreciated.

Again thank you in advance!

[R0b]

I think at this present time you might struggle to claim harassment, as this is a disputed debt rather than a debt that is simply not owed in any circumstances, I think they would at least be given the benefit of the doubt.

Anyway, I've found the link to the thread (click here) and my example response is at post #11 however I think you'll need to adapt it because your issue is also about other fees to.

I think we can build on that example for a number of reasons:

1. You can reference their goodwill to write off the damages and collection fees but I would question why they were willing to discount this amount so readily. Makes you wonder whether they knew themselves that those charges couldn't be recovered or pinned on you.

2. Expand on the point regarding Section 100(4). It is true that you have a duty to take reasonable care of the goods which means not to do, or refrain from doing, any act which causes physical damage whilst it is in your possession however, they haven't provided any evidence proving the actual damage caused by the excess mileage - the burden of proof is on them, not you and at best their claim is purely economic (financial) not physical. In any event, the court case I mentioned in my last post is White v Jones 1995 decided by the House of Lords (now renamed as the Supreme Court which is the highest court in England and Wales) which said that:

"The law of England does not impose any general duty of care to avoid negligent misstatements or to avoid causing pure economic loss even if economic damage to the plaintiff was foreseeable."(my emphasis)

3. Can you confirm whether the car was brand new when purchased or second hand? If the latter, what was the mileage when you took possession and how old is it?

Have a go at providing a draft version based on the above and adapted to suit your circumstances and then post it up, I'll have another look and provide feedback.

[sk2018]

R0b

Thank you again! That thread was really helpful. The car was brand new when we got it. I've put together a draft - would be great to see what you think and whether it would be worth sending.

Dear XXXXXX,

Thank you for your email of XXXXX

I acknowledge your goodwill to write off the damages and collection fees. However, it does make me wonder whether you knew that those charges couldn’t be recovered or pinned on me.

I also note that in your email, you referred to Section 100(4) of the Consumer Credit Act 1974 as the reason why you believe that the excess mileage charges are recoverable following termination of the agreement. In particular, you stated that exceeding the mileage could be seen as contravening to take “reasonable care”. It is true that I have a duty to take reasonable care of the goods, which means not to do, or refrain from doing, any act that causes physical damage whilst it is in my possession. However, there is no evidence to suggest that the excess mileage caused any actual damage. The burden of proof is on you, and at best, your claim is purely their claim is purely economic (financial) not physical. In any event, there are already decided court cases, such as the White v Jones 1995 decided by the House of Lords (now renamed the Supreme Courts), which said:

"The law of England does not impose any general duty of care to avoid negligent misstatements or to avoid causing pure economic loss even if economic damage to the plaintiff was foreseeable."

You also confirmed that you are not seeking to recover the mileage charges through a breach of contract but instead you are relying on the common law of misrepresentation.

Your interpretation that misrepresentation "allows the business to recover costs associated with unexpected depreciation in the event that the customer has exceeded the mileage allowance at any point in the contract” is not correct. A claim for misrepresentation requires there to be a pre-contractual statement of fact by the statement maker which is relied upon and to induce the recipient of the statement to enter into the contract and, but for that statement, the recipient would not have entered into the contract at all. I do not accept that the mileage I said I would cover over the term of the agreement was a misrepresentation and my reasons are threefold:

1. At the time of speaking to your sales agent, I was asked to estimate the number of miles that I would expect to be driving. I therefore gave an honest opinion of the number miles I might cover on an annual basis; the mileage stated was both a statement of opinion and an estimate of a future intention. It is well established in law that neither statements of opinion nor estimated future intentions are considered to be a statement of fact.

2. The stated mileage was not in fact a representation rather it was a statement which was intended by both sides to be incorporated into the contract as a contractual term. Indeed, this is further verified by the fact that annual mileage has been clearly stated on the first page of the contract. The Courts have, on several occasions, confirmed that a statement that is incorporated into the contract is unlikely to be considered a representation.

3. Notwithstanding the above, the stated mileage was not something which would have induced FCA to enter into the contract nor was it material. On the contrary, the decision to enter into the contract was largely the result of a credit check carried out by FCA to determine whether or not I would be capable of meeting the monthly repayments.

In the circumstances, I do not believe that your claim for excess mileage charges under the common law of misrepresentation has any force and my position remains the same, namely that the charges are not recoverable by FCA. If, however, should you choose to pursue this matter, then that is entirely your own prerogative but I am fully prepared to defend any claim brought against me.

I trust that this response clarifies where I stand and I do not expect there to be any need for further correspondence except where legal proceedings have commenced.

Yours faithfully,

XXXXXX