Taking BMW to court - Paid excess mileage after VT.

[R0b]

Re: Taking BMW to court - Paid excess mileage after VT.

You could email her direct instead, ann.lloyd@LA-law.com

Saves on post at least and waiting for a wresponse

[Malt_Vinegar]

Re: Taking BMW to court - Paid excess mileage after VT.

Good idea, I just did that. I though perhaps letter was better, as it can be sent signed, but I guess its simple enough to email

[R0b]

Re: Taking BMW to court - Paid excess mileage after VT.

Email is alot easier when it is possible to do so, I would advise that than letter. Just toc clarify have you actually issued a claim yet or is this still the pre-action stage?

Given her status as a partner, I can't see how she can possibly advise BMW that they have a strong case against you if you have drawn her attention to the relevant provisions of the CCA. You have reasonable grounds to argue and BMW can't whinge if they want to pay a lawyer's fees to defend something in the small claims, that is their choice and should not be used as a tactic to scare you from making a claim, which of course is what they are doing.

I guess we shall wait and see what the response will be

[Malt_Vinegar]

Re: Taking BMW to court - Paid excess mileage after VT.

I have not yet raised action, but will shortly, depending on her response.
My guess it that a lot of people just fold and pay, and perhaps such she is not au-fait wit the actual legislation, or at least chooses to ignore it to her benefit?

[R0b]

Re: Taking BMW to court - Paid excess mileage after VT.

I see, well when you do start your claim you will need to be precise and include all the allegations on there to be successful - let me know at that point and I can assist.

I think alot of companies just look at the relevant sections e.g. 99 & 100 but either ignore or actually don't know the underlying definitions, for example what the Act defines as total price, and that's what stumps them but they will more likely dig their heels in. Hopefully, since it has been passed to their lawyer she should have some common sense and know that if it went to court, there is a chance that they could lose and the cost will outweigh the benefit.

Presuming this matter is not on a fixed fee, I suspect her fees for work will be in the region of £200-£300 per hour.. and increase substantially when a claim is issued. Makes sense to settle it!

[Malt_Vinegar]

Re: Taking BMW to court - Paid excess mileage after VT.

No reply yet from Ann and she is still not answering her phone. I'm guessing she must be on leave.
I will call the practice and ask for her. I assume they will let me know what's going on!

[R0b]

Re: Taking BMW to court - Paid excess mileage after VT.

I would personally leave it, you've emailed her and given them 14 days. Calling continuously would probably just get her back up and the ball is now in their court since you have made your position clear when you sent the email. Give it the 14 days and if she fails to respond in that time, then your next step will be to make a claim providing you still wish to continue at that point.

[Malt_Vinegar]

Re: Taking BMW to court - Paid excess mileage after VT.

No Response from the solicitors. I guess that means I am go for legal action? I believe we have given them adequate time to respond.So, I presume I have to detail my whole case in the application? Furthermore, do I raise it against BMW, or the appointed solicitors? I assume my complaint is with BMW, so I raise it to against them directly..Lots of questions!

[R0b]

Re: Taking BMW to court - Paid excess mileage after VT.

Hi Malt,

If you are certain you want to go through with this then I can assist you if you like but it won't be something that could be knocked up pretty quickly. As the claim relates to HP there are some provisions in the Civil Procedure Rules on HP claims and might need to comply with those.

Equally, I don't think its just duress you might be able to argue but also restitution, both of which probably require a bit of extensive reading and it's more likely that you will need to set out detailed Particulars of Claim separately.

In the meantime, you could follow up with an email to the solicitor informing her that you've not heard a response from her within the time specified. You are prepared to give another 7 days, otherwise you will submit a claim without further notice.

The claim will be against BMW not the solicitors.

[Malt_Vinegar]

Re: Taking BMW to court - Paid excess mileage after VT.

I spoke to Ann today, and she has informed me that she had intended to respond, but is awaiting instructions from BMW. She has promised to come back to me by "close of play Monday 25th" at the latest.

I will follow this up with an email with what was agreed on the phone.

Lets see what they say by then! This is the first time they have actually agreed to a deadline or rubbish my claim...

[R0b]

Re: Taking BMW to court - Paid excess mileage after VT.

It will be interesting to see what she has to say, but at the end of the day this hasn't really been tested in court and will be determined on the construction and meaning of s.99 of the CCA on the word "accrued". So if this does proceed to court then will need to come up with solid arguments as to why it is not owed but in any event, they still should have not threatened to apply a default as it has nothing to do with the credit or monthly instalments so there could be some kind of success there.

Let's await and see her reply, it's either going to be an offer to settle or its going to say see you in court.

[Malt_Vinegar]

Re: Taking BMW to court - Paid excess mileage after VT.

Got this today:

Dear Malt

Thank you for your e-mail.
You refer to The Law of Consumer Credit and Hire (Philpott et al 2009 at 387-379). Please provide us with a copy of the extract.
Section 100(2) the Consumer Credit Act 1974 (as amended) (the Act)
You refer to section 100(2) of the Act which states:
“(2) Where under a hire-purchase or conditional sale agreement the creditor is required to carry out any installation and the agreement specifies, as part of the total price, the amount to be paid in respect of the installation (the “installation charge”) the reference in subsection (1) to one-half of the total price shall be construed as a reference to the aggregate of the installation charge and one-half of the remainder of the total price.”
Section 189 CCA says that “installation” means “(a) the installing of any electric line or any gas or water pipe, (b) the fixing of goods to the premises where they are to be used, and the alteration of premises to enable goods to be used on them, (c) where it is reasonably necessary that goods should be constructed or erected on the premises where they are to be used, any work carried out for the purpose of constructing or erecting them on those premises.”
There was no ‘installation’ here. Your Agreement was for the hire of a vehicle and so section 100(2) does not apply.
Section 173 of the Act
This section relates to contracting out. Please can you explain how this is relevant there?
Section 189 of the Act
We agree that section 189 states that “total price” means “the 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”. Total sum here includes the excess mileage charge which you agreed to pay at the outset of the Agreement.
Section 100 (4) of the Act
We draw your attention to this section which states that “If the debtor has contravened an obligation to take reasonable care of the goods or land, the amount arrived at under subsection (1) shall be increased by the sum required to recompense the creditor for that contravention, and subsection (2) shall have effect accordingly.” Reasonable care includes paying for any excess mileage (as stipulated in your Agreement). Excess mileage affects the value of the vehicle and therefore increases our client’s loss. You were fully aware of that at the time you entered into the Agreement and agreed to that condition. You cannot use section 99 of the Act as a means to absolve yourself from that liability. The Excess Mileage Charges section of the Agreement could not be clearer:
“Excess Mileage Charges are payable at the end of the agreement if you return the Vehicle at 4.09 pence for each mile covered in excess of the Maximum Total Mileage of 68307 miles. Maximum Annual Mileage is 12000 miles. Mileage on delivery of 19307 miles is included in the Maximum Total Mileage. See Clause 8(3)(d). if you end this agreement early (see Termination): the Maximum Total Mileage will apply pro-rata to the reduced period of hire and your obligation to pay the Excess Mileage Charge will accrue accordingly immediately prior to termination. If the Vehicle’s mileage exceeds the Maximum Total Mileage calculated pro rata, you will therefore have to pay the Excess Mileage Charge for each mile covered in excess of the relevant Maximum Total Mileage.”
Your alleged claim is misguided and we urge you not to issue court proceedings. If you do, BMW will defend those proceedings and will seek an order that you pay its costs of doing so. We will refer to this e-mail on the question of costs because you had opportunity not to litigate where your claim was without merit but proceeded in any event. If despite this e-mail you decide to issue a claim, we request that in the spirit of the civil Procedure Rules, you give us 14 days’ notice.

Yours sincerely

[R0b]

Re: Taking BMW to court - Paid excess mileage after VT.

So I'm just digesting what she is saying here.

S100(2) is the wrong section obviously so my bad on that one, I did of course mean s100(4) which she has referenced already.

Section 173 of the Act
This section relates to contracting out. Please can you explain how this is relevant there?

s.173 applies in so far as any contract term within the agreement is void and unenforceable if it seeks to override any provision set out in the CCA.

We agree that section 189 states that “total price” means “the 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”. Total sum here includes the excess mileage charge which you agreed to pay at the outset of the Agreement.

Excess mileage does not include the total price, as it cannot be determined at the time of entering into the agreement. This would fall into the exclusion part of the definition of 'total price' e.g. it is an amount for compensation as a result of the breach of the agreement. Total price here means the total amount payable of credit under the agreement and not any additional contractual liabilities.

We draw your attention to this section which states that “If the debtor has contravened an obligation to take reasonable care of the goods or land, the amount arrived at under subsection (1) shall be increased by the sum required to recompense the creditor for that contravention, and subsection (2) shall have effect accordingly.” Reasonable care includes paying for any excess mileage (as stipulated in your Agreement). Excess mileage affects the value of the vehicle and therefore increases our client’s loss.

Where's the proof? that is her or her client's opinion and does not necessarily ring true, if she or BMW want to make that claim then they would need an expert to have inspected the vehicle overall to determine whether or not the car was in a reasonable condition. As the car is likely sold on now, that is impossible and so no proof = no claim. An argument against this is that the mileage is not the sole factor in understanding whether or not a car is in reasonable condition, but you could argue that the way in which the car has achieved the miles could affect it. For example, a car who has done those miles city driving is likely to have put more wear and tear than someone who is driving along the motorway all the time. Equally someone who has maintained the car, services at the right intervals is likely to have kept the car in a reasonable condition. So simply stating that the excess mileage has caused loss is not determinable and that value of the car does not mean that it is in an unreasonable condition as explained.

“Excess Mileage Charges are payable at the end of the agreement if you return the Vehicle at 4.09 pence for each mile covered in excess of the Maximum Total Mileage of 68307 miles. Maximum Annual Mileage is 12000 miles. Mileage on delivery of 19307 miles is included in the Maximum Total Mileage. See Clause 8(3)(d). if you end this agreement early (see Termination): the Maximum Total Mileage will apply pro-rata to the reduced period of hire and your obligation to pay the Excess Mileage Charge will accrue accordingly immediately prior to termination. If the Vehicle’s mileage exceeds the Maximum Total Mileage calculated pro rata, you will therefore have to pay the Excess Mileage Charge for each mile covered in excess of the relevant Maximum Total Mileage.”

Does your contract state this? Even if it does, the clause is trying to circumvent the whole purpose of voluntary termination and the protection of the debtor in that a debtors liability is limited to a maximum of 50% of the total price payable. The Excess mileage clause is seeking to override the statutory liability which is restricted to 50% of the total price payable and therefore is unenforceable as per s.173. It is inconsistent with the maximum liability of the debtor which purports to impose additional liability on the debtor where s.100 restricts that liability to half the total price payable. The whole purpose of s.99 is to protect the debtor and provide for a maximum liability that is owed to the creditor and to therefore afford the creditor to impose further liability by way of a contractual term goes against the nature of that protection.

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

At the end of the day this is a moot point and as there is zero case law on the matter they can request costs but you have a valid claim to make and the normal small claims costs should apply as there is a genuine point of law that is disputed and requires a determination of the court. Litigants should not be deterred from bringing a claim where it raises a serious question of law only to be hit with costs for raising that question.

The ball is in your court malt

[Malt_Vinegar]

Re: Taking BMW to court - Paid excess mileage after VT.

Thanks for the breakdown R0B. I will be speaking to a solicitor. Then decide what route to take.

I am committed to take this to the court to try and set a point of law if it is sensible to do so!

Oh and the vehicle was as near to immaculate as possible when returned! Main dealer serviced and I have the photos and report to prove it. I dare say I keep my cars better than most and this car was no exception.

[R0b]

Re: Taking BMW to court - Paid excess mileage after VT.

Well from what I have read so far it would indicate that there is a definite cap when someone terminates under s.99. Here's an extract taken from another authorative book The Encyclopedia of Consumer Credit Law

it has been suggested that ss. 99, 100 of the present Act indirectly limit the damages recoverable by the creditor from the debtor for breach and repudiation of the agreement, since it cannot be assumed that the agreement would have run its full course and damages must be assessed on the basis that the debtor would have exercised his right to terminate, i.e. would have performed the agreement in a way most beneficial to himself and not in that most beneficial to the creditor (see, e.g. Financings Ltd v Baldock [1963] 2 Q.B. 104, 113; Cockburn v Alexander (1848) 6 C.B. 791, 814; Withers v General Theatres Corp Ltd [1933] 2 K.B. 536, 549; Beach v Reed Corrugated Cases [1956] 1 W.L.R. 807, 816–817; The Mihalis Angelos [1971] 1 Q.B. 164; Golden Strait Corp v Nippon Yusen Kubishika Kaisha [2007] UKHL 12). It would seem to follow that s.100 in effect acts as a “cap” on damages recoverable for breach of the agreement.

There is scope for argument either way, however the CCA was the successor of the Hire Purchase Act 1965 and that limited liability at 50%. The provisions of the HP Act in that respect have effectively been lifted and inserted into the CCA without any change.

Essentially, as I read that, the damages is based on what would favour the debtor and in that sense, you could have terminated the agreement at some point further down the line being under the mileage limit and terminated the agreement then, which would mean you would owe no excess charges.