Voluntary Termination - refusing to take back the car unless excess mileage is paid

[Aenides]

I have tried to send back my car by exercising VT rights but the car company is refusing to take back the car unless I make a card payment of £2500 for excess mileage. Any advice would be welcome.

[R0b]

Are they refusing to accept your VT letter or are they simply refusing to collect the car following notice of your VT?

[Aenides]

They're refusing to start the process of the VT unless i pay the money. I'd written to them and emailed the letter to start the process of VT but had to contact them since i heard nothing. I called them today and they said I'd have to pay the excess mileage charge before they could start the process of VT and coming to collect the car. I've got another monthly payment coming up soon and am wondering if I should just cancel the DD.

[R0b]

Who's the finance company, and do you have that in writing or was this over the phone?

[Aenides]

It's Northridge finance and it was over the phone. She said they don't invoice but only take payments over the phone and that the charge had to be settled before they'd start the process and come and collect the car. As I have given notification of my intention to VT, can I cancel the DD?

[R0b]

Exercising your VT rights is implied into the contract under S.99(1) the Consumer Credit Act 1974 and unless the contract has already terminated, lenders cannot refuse to accept this.

It's a common misconception amongst lenders and if they refuse to accept a valid VT notice, then their refusal would constitute a repudiation of the agreement - that's because S.99(1) would be considered a condition in that it is a fundamental right of protection to the consumer that allows you to end the contract and limit your liability to 50% of the total price payable. Therefore, refusing to accept your right to terminate without lawful justification deprives you of the benefit to limit your liability and cease all further instalments.

Nothing in the CCA says that your right to VT is subject to any other conditions, in fact it explicitly says you can terminate at any time. Again, something overlooked by many lenders who get themselves into a pickle and one day will pay the price when someone (maybe like me) challenges them on this.

I'm curious, how did they know that you owe £2,500 in excess mileage charges? Did you make the error of telling them the mileage before giving them your VT notice?

That may affect how you approach this.

[Aenides]

They asked the mileage on the vehicle when i called them to come and get the car. Said they needed the mileage before they could proceed with VT. I wrote to them, then called them because they hadn't called me to come and collect the car, then they said they needed the mileage before they could proceed, then said they couldn't proceed unless i paid the excess mileage charge there and then.

[R0b]

With a repudiation of the contract, you are entitled to accept their refusal as a breach and seek damages which is probably going to be the the balloon price because that's what you would have been entitled to had the contract been fully performed - at the very least, it would be the outstanding rental payments left on the contract.

Terminating a contract for repudiation does not affect any accrued rights and it could be argued that by giving them the mileage and Northridge the mileage on the car prior to accepting the repudiation of the contract, means that the right to those damages have accrued.

So I would suggest your best position would be to insist that the right to VT was a unilateral one which was not subject to acceptance by Northridge, but instead only written notice was needed.

Assuming you gave notice to terminate with immediate effect, then it is up to Northridge to come and collect the car. You can force their hand in one of two ways by telling Northridge to collect the car within the next 14 days otherwise:

1. You will (if not done so already) transfer the V5C in their name by notifying the DVLA and cancel all road tax and insurance. If the car is on a public highway then you should make reference to that and give them the street name and postcode and explain that all responsibility after that date falls to them. If the car is on your land i.e. a driveway, you could also state that you no longer give permission for it to remain and so you will take steps to remove it and put it on a public highway.

2. You could serve notice under the Torts (Interference with Goods) Act 1977 give them 14 days and if no response then treat the car as abandoned and you will proceed to selling it less any costs incurred by you - you can find an example letter here (notice of intention to sell goods).

Whatever your options, make sure you take thorough photos and/or videos if possible just in case they claim that the car is damaged. Or you can simply play ping pong correspondence and do not but argue back and forth to collect the car.

[Aenides]

Thank you, I'll send them a letter and email it to them also insisting on the VT and telling them to come and collect the car... or would you suggest another phone call to convey this message? I'm also cancelling the DD to stop any further payments being taken.

[Aukey]

Do everything in writing, they can't say it wasn't said then....

[Aenides]

Thank you

[Aenides]

I have today received an email asking me to call the collections department which I will do this afternoon, once I figure out what the collections department does. Guessing they either want to arrange t ocollect the car or they're trying to collect another months payments since i cancelled the dd.

[Aenides]

as thought, they have gone through the checklist but are refusing to instruct the auction house to come and collect the vehicle until i pay the excess miles plus another months payment because I've cancelled the DD. I told them i'd be writing another letter to them about this so.... not sure how to word it or what to put in it. Excess mileage is £2500 which isn't a small sum. I'm transferring the vehicle into their name now and guess i'll just take it from there? Any advice welcome.

[R0b]

That's up to them, why don't you engage their complaints procedure and make a formal complaint whilst at the same time telling them one of the two options I mentioned above.

If they don't uphold your complaint, then you can go to the FOS and also ask for compensation based on the fact they are asking for more instalments knowing the contract was terminated as well as a complaint about the excess mileage.

I'm sure at some point they will give in and arrange collection.

[Aenides]

Just emailed the letter to them telling them I've assigned the vehicle to them, cancelled the insurance and road tax and that it was parked on the street. They called me immediately and still kept banging on about paying excess miles as per my PCP agreement plus 3/4 of the June instalment. So i just said "you've clearly not read my letter or are choosing to ignore the issue so we are going round in circles. Thanks for your call, good bye".