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Hi all,
I am after a little advise regarding the title of this thread. I recently VT'ed my car with only 3 months left on the agreement and never missed a payment, but like most that have a PCP I have found myself in a situation whereas I have exceeded the mileage.
I followed the guidelines and sent the letter in the template on this site back to Alphera and got the following response.....what do I do next?
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Dear XXXXXXXX
Thank you for your email in respect of the excess mileage invoice raised on your agreement. Having taken your comments into consideration and after a full review of your agreement, please allow me to explain our final position.
We regret that we do not agree with your position that you are not liable to pay the Excess Mileage Invoice rendered following the Voluntary Termination of your Agreement on the basis that your liability was limited to 50 percent of the total price ("Total Amount Payable") under the Agreement in accordance with Section 100(1) of the Consumer Credit Act 1974 ("the Act").
Section 99(2) of the Act
Section 99(2) of the Act provides that termination of an agreement by a customer by way of Voluntary Termination "does not affect any liability under the agreement which has accrued before the termination".
The "Excess Mileage Charges for Depreciation" and "Termination" sections of the Agreement clearly state that Excess Mileage Charges are sums that become payable under the Agreement prior to termination and as such it is clear that they are due and payable by you pursuant to Section 99(2).
The "Termination: Your Rights" section of the Agreement does not make specific reference to you having liability for charges incurred prior to termination upon Voluntary Termination of the Agreement, however, the Agreement should be read as a whole and also in the context of Section 99(2) of the Act.
You signed a Customer Acknowledgment form prior to entering into the Agreement which contains a section which states "please confirm your estimated mileage is correct on the agreement. Estimating too low may result in an excess mileage charge being payable when the agreement ends".
You ticked the box next to that section, thereby declaring not only that the mileage contained within the Agreement was suitable for your needs, but also acknowledging that an excess mileage charge may be applicable in the event that the mileage given was too low. You therefore have been in no doubt that you would have to pay Excess Mileage Charges in the event that you exceeded the agreed contractual mileage.
You then went on to sign the Agreement and by doing so was confirming that you had read and understood the Agreement and was willing to be bound by its Terms and Conditions, to include payment of an applicable Excess Mileage Charges in the event that you choose to Voluntary Terminate the Agreement.
Section 100 of the Act
Whilst Section 100(1) provides that a customer will be liable to pay a "creditor the amount (if any) by which one-half of the total price exceeds the aggregate of the sums paid and the sums due in respect of the total price immediately before the termination", Section 100(1) must be read in conjunction with Section 99(2). A customer’s liability to a creditor upon Voluntary Termination is pursuant to Section 99(2), i.e. payment of any pre-termination charges such as Excess Mileage, in addition to the limit of 50 percent of the Total Amount payable under the Act.
Further, Section 100(4) of the CCA provides that "if a debtor has contravened an obligation to take reasonable care of the goods" the amount due upon Voluntary Termination "shall be increased by the sum required to recompense the creditor for that contravention…..". This supports the "Termination" and "Termination: Your Rights" sections of the Agreement which provide your liability upon Voluntary Termination of the Agreement would be increased if reasonable care had not been taken of the Vehicle.
In this instance, mileage limitation is a fair measure of what would constitute "reasonable care" of the Vehicle given that it can affect its value upon resale. Exceeding the Maximum Total Mileage agreed upon commencement of the Agreement, is likely to have caused the Vehicle to have decreased in value more than it otherwise might have done had the agreed mileage been adhered to and you should therefore have to compensate us accordingly.
In light of this I am confident that Alphera Financial Services have not acted incorrectly by raising this invoice and consider our charge to be an accurate reflection of the additional mileage and will therefore remain payable in full.
In your letter you mention Mercedes-Benz, I must advise "The County Court Judgment between Mercedes-Benz Financial (UK) Ltd v Cahalane, does not set precedent to bind future decisions on Voluntary Termination Excess Mileage in the County Courts. Furthermore, the Court of Appeal decision is irrelevant as the charges levied against you are not a compensation charge. They are contractual charges that fall due immediately before you Voluntary Terminate".
Should you wish to discuss payment of the invoice, our Customer Accounts team can be contacted on 0370 5050 150 selecting option 4 and then 3. I must make you aware that as a regulated company we have a legal obligation to accurately report any amounts outstanding on your agreement for more than 28 days.
If you have any queries, please call us on 0370 5050 150 or email us at vehicle.logistics@bmwfs.co.uk. We are open from 9.00am to 5.00pm Monday to Friday.
Many Thanks
Kind regards
BMW Group
Financial Services
Kim Overton
Vehicle Logistics
Summit ONE, Summit Avenue
Farnborough
Hampshire GU14 0FB
I am after a little advise regarding the title of this thread. I recently VT'ed my car with only 3 months left on the agreement and never missed a payment, but like most that have a PCP I have found myself in a situation whereas I have exceeded the mileage.
I followed the guidelines and sent the letter in the template on this site back to Alphera and got the following response.....what do I do next?
-------------------------------------------------------------------------------------------------------------------------------------
Dear XXXXXXXX
Thank you for your email in respect of the excess mileage invoice raised on your agreement. Having taken your comments into consideration and after a full review of your agreement, please allow me to explain our final position.
We regret that we do not agree with your position that you are not liable to pay the Excess Mileage Invoice rendered following the Voluntary Termination of your Agreement on the basis that your liability was limited to 50 percent of the total price ("Total Amount Payable") under the Agreement in accordance with Section 100(1) of the Consumer Credit Act 1974 ("the Act").
Section 99(2) of the Act
Section 99(2) of the Act provides that termination of an agreement by a customer by way of Voluntary Termination "does not affect any liability under the agreement which has accrued before the termination".
The "Excess Mileage Charges for Depreciation" and "Termination" sections of the Agreement clearly state that Excess Mileage Charges are sums that become payable under the Agreement prior to termination and as such it is clear that they are due and payable by you pursuant to Section 99(2).
The "Termination: Your Rights" section of the Agreement does not make specific reference to you having liability for charges incurred prior to termination upon Voluntary Termination of the Agreement, however, the Agreement should be read as a whole and also in the context of Section 99(2) of the Act.
You signed a Customer Acknowledgment form prior to entering into the Agreement which contains a section which states "please confirm your estimated mileage is correct on the agreement. Estimating too low may result in an excess mileage charge being payable when the agreement ends".
You ticked the box next to that section, thereby declaring not only that the mileage contained within the Agreement was suitable for your needs, but also acknowledging that an excess mileage charge may be applicable in the event that the mileage given was too low. You therefore have been in no doubt that you would have to pay Excess Mileage Charges in the event that you exceeded the agreed contractual mileage.
You then went on to sign the Agreement and by doing so was confirming that you had read and understood the Agreement and was willing to be bound by its Terms and Conditions, to include payment of an applicable Excess Mileage Charges in the event that you choose to Voluntary Terminate the Agreement.
Section 100 of the Act
Whilst Section 100(1) provides that a customer will be liable to pay a "creditor the amount (if any) by which one-half of the total price exceeds the aggregate of the sums paid and the sums due in respect of the total price immediately before the termination", Section 100(1) must be read in conjunction with Section 99(2). A customer’s liability to a creditor upon Voluntary Termination is pursuant to Section 99(2), i.e. payment of any pre-termination charges such as Excess Mileage, in addition to the limit of 50 percent of the Total Amount payable under the Act.
Further, Section 100(4) of the CCA provides that "if a debtor has contravened an obligation to take reasonable care of the goods" the amount due upon Voluntary Termination "shall be increased by the sum required to recompense the creditor for that contravention…..". This supports the "Termination" and "Termination: Your Rights" sections of the Agreement which provide your liability upon Voluntary Termination of the Agreement would be increased if reasonable care had not been taken of the Vehicle.
In this instance, mileage limitation is a fair measure of what would constitute "reasonable care" of the Vehicle given that it can affect its value upon resale. Exceeding the Maximum Total Mileage agreed upon commencement of the Agreement, is likely to have caused the Vehicle to have decreased in value more than it otherwise might have done had the agreed mileage been adhered to and you should therefore have to compensate us accordingly.
In light of this I am confident that Alphera Financial Services have not acted incorrectly by raising this invoice and consider our charge to be an accurate reflection of the additional mileage and will therefore remain payable in full.
In your letter you mention Mercedes-Benz, I must advise "The County Court Judgment between Mercedes-Benz Financial (UK) Ltd v Cahalane, does not set precedent to bind future decisions on Voluntary Termination Excess Mileage in the County Courts. Furthermore, the Court of Appeal decision is irrelevant as the charges levied against you are not a compensation charge. They are contractual charges that fall due immediately before you Voluntary Terminate".
Should you wish to discuss payment of the invoice, our Customer Accounts team can be contacted on 0370 5050 150 selecting option 4 and then 3. I must make you aware that as a regulated company we have a legal obligation to accurately report any amounts outstanding on your agreement for more than 28 days.
If you have any queries, please call us on 0370 5050 150 or email us at vehicle.logistics@bmwfs.co.uk. We are open from 9.00am to 5.00pm Monday to Friday.
Many Thanks
Kind regards
BMW Group
Financial Services
Kim Overton
Vehicle Logistics
Summit ONE, Summit Avenue
Farnborough
Hampshire GU14 0FB
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