Voluntary Termination Charges

[j4weeson]

Sorry to hijack the OP thread but i am in a similar situation and in need off help.

I have also recently VT my agreement which was accepted by the finance company and the car was dropped off at the auction and inspected for damages etc and the car was then sold on. Since then i have received a letter stating that i have to pay £58 + £22 for damage to the NSF and OSF front wheels which i am happy to pay as they had minor scuff marks. However, they are chasing for £543.42 for excess mileage charges which i am not happy to pay as i do not believe i have to as i exercised my right to VT. I have not signed anything from the company, however, the did sent a VT package for me to sign which i refused as i used the basic VT letter on one of the other threads here but they accepted it anyway. See the letter below

Dear [my name]

Following your request to VT we now have the vehicle in our possession and have had it independently inspected in accordance with the BVRLA Fair Wear and Tear Standard guide.

The Vehicle Appraisal Report has highlighted the following unacceptable damage. Based on the return mileage there is an excess mileage payable. This is detailed below:

OSF wheel - Scratched - Touch in Smart Repair - £22
NSF wheel - scratched - repair and refinish - £58
Excess mileage - allowed 17510 miles - excess 9057 miles at 6ppm - £543.42
TOTAL - £623.42

In order to complete your VT you must pay all liabilities due, these consist of:

Contractual Amounts Due: £0.00
Damage Recharges: £623.42
Total Liability: £623.42


Payment of this amount can be made by direct debit card by contacting us on the number below, by sending a cheque made payable to FCA Automotive Services UK LTD, or by transfer into our bank account.

Yours sincerely


I should point out that I am owed a partial refund as i made my monthly payment and the car was handed over half way through the month so i should get a refund in the region of £80 but the have failed to mention that!!

Any help would be greatly appreciated

Jason

[R0b]

Re: Voluntary Termination Charges

Sorry to hijack the OP thread but i am in a similar situation and in need off help.

I have also recently VT my agreement which was accepted by the finance company and the car was dropped off at the auction and inspected for damages etc and the car was then sold on. Since then i have received a letter stating that i have to pay £58 + £22 for damage to the NSF and OSF front wheels which i am happy to pay as they had minor scuff marks. However, they are chasing for £543.42 for excess mileage charges which i am not happy to pay as i do not believe i have to as i exercised my right to VT. I have not signed anything from the company, however, the did sent a VT package for me to sign which i refused as i used the basic VT letter on one of the other threads here but they accepted it anyway. See the letter below

Dear [my name]

Following your request to VT we now have the vehicle in our possession and have had it independently inspected in accordance with the BVRLA Fair Wear and Tear Standard guide.

The Vehicle Appraisal Report has highlighted the following unacceptable damage. Based on the return mileage there is an excess mileage payable. This is detailed below:

OSF wheel - Scratched - Touch in Smart Repair - £22
NSF wheel - scratched - repair and refinish - £58
Excess mileage - allowed 17510 miles - excess 9057 miles at 6ppm - £543.42
TOTAL - £623.42

In order to complete your VT you must pay all liabilities due, these consist of:

Contractual Amounts Due: £0.00
Damage Recharges: £623.42
Total Liability: £623.42


Payment of this amount can be made by direct debit card by contacting us on the number below, by sending a cheque made payable to FCA Automotive Services UK LTD, or by transfer into our bank account.

Yours sincerely


I should point out that I am owed a partial refund as i made my monthly payment and the car was handed over half way through the month so i should get a refund in the region of £80 but the have failed to mention that!!

Any help would be greatly appreciated

Jason

Hi Jason,

Who is the name of the lender on your agreement? is it FCA Automotive Services UK LTD or someone else?

When you VT you are not owed any refund if you pay more than the 50% mark, that is the total extent of your liability and the Consumer Credit Act makes it clear on this.

Minor scuff marks can be argued as fair wear and tear although if you are happy to pay for it then thats up to you. As for excess mileage, they cannot charge for this and if you haven't read my small guide on Voluntary Termination then it might be worth a read with a few sample letters and FAQs.

Guide to Voluntary Termination

[j4weeson]

Re: Voluntary Termination Charges

Hi Rob,

Yes the lender is FCA Automotive. I had a read through the fair wear and tear guide and i had the car thoroughly cleaned before handing the car over for inspection. The inspection report indicated that the car was good condition with minor scratches to the two front wheels. The car was well looked after and I am happy to pay the damage on the wheels as they were scuffed and the cost for repair is reasonable.

How should i respond to their letter?

Thanks for your help

Jason

[R0b]

Re: Voluntary Termination Charges

You can use the template letter in the guidance thread as a starting point for excessive mileage, and you could then incorporate into that you are happy to pay the costs of the scuffs.

Just as a point to note, I would say the BVRLA guidelines are irrelevant to your case. FCA Automotive is the lender of the agreement and they are not a member of BVRLA, but FCA Fleet Services are. Legally speaking, FCA Automotive and FCA Fleet Services are two separate legal persons and so anything they wish to rely on under the guidelines cannot be relied upon as they are not a member.

What to expect next:

Expect them to reject your argument something along the lines of that the excess mileage is accrued prior to the termination (not correct as it would have accrued after you handed the car back and they checked the mileage, plus your liability is restricted to the amount you have paid so far) or they will just say that it is in the terms and conditions you have accepted.

You can then raise their complaints procedure, which they are likely to uphold their initial response and then you can invoke a complaint to the Financial Ombudsman if you wish free of charge. Bear in mind that any acceptance of an Ombudsman's decision is binding on both parties. Be aware I've heard the Ombudsman has taken views in both favour of the lender and the consumer but I suspect that could be down to lack of knowledge of the consumer credit act more than anything, but you can reject their decision and FCA would have to take you to court.

In terms of going to court you may have read in another thread but this response about whether a lender would take you to court may be useful.

I would imagine that GMAC has a fixed cost contract with Shoosmiths for the collection of debt up to the point of issuing proceedings. Anything beyond this I would think would come at additional costs per hour or a further agreed fixed sum and this is where it will get expensive for GMAC.

It is a small claims issue, so legal fees are not recoverable with exception to around £100 as it is limited to this amount (unless you accept a part 36 you could be liable for all of their legal fees, so do not accept a part 36 offer). So, if GMAC were to instruct Shoosmiths to issue proceedings then I would guess the work involved for preparing, drafting and issuing the claim will probably be around £400-£600+ worth of solicitor costs.

They will then have to decide whether to instruct a barrister or Shoosmiths to act on their behalf in court, otherwise it would be GMAC and someone who probably doesn't have any legal experience. A barrister is likely to be junior so costs for something like this could be in the region of around £500-£1200 give or take a little either side. If Shoosmiths were to act I would imagine cost would be around the same possibly a couple hundred pounds less, although they may not have anyone who is experienced in consumer credit enough to act and may advise a barrister would be better.

Lets say this does go to court, you argue that the Vehicle Asset Protection cannot be claimed because it is wrapped up in the total amount payable and no separate contract/direct debit/provision in the agreement was made to state that the VAP is independent of the total amount payable. This would then bring the claim for damages down to circa £600, you then make further arguments on this and the judge agrees with you in full or partially and writes down some of the damages claimed best case scenario up to £200 for example. Note that claimants are usually expected to claim around 70% of the amount they are claiming for cases of these types.

So taking the above into account, best case for GMAC is they win but their costs for solicitors fees are higher than they are claiming for and so they are going to make a loss or a huge loss depending if the judge writes down some of the amount claimed. Worst case is that they lose altogether and they then owe the solicitors and/or barrister fees which puts them further out of pocket.

All in all, it would not be commercially viable for GMAC to pursue this in court as they would be making a loss whether they were successful or not.

That's my sort of rough view on this, Shoosmiths will need to go back to GMAC and take further instructions from them and they will then have to decide whether or not to proceed. Litigation is an expensive cost and sometimes that cost outweighs everything else.

[j4weeson]

Re: Voluntary Termination Charges

__________________________________________________ __________________________________________________ _________________________
Voluntary Termination Department 01st April 2016
PO Box 4465
Slough
Berkshire
SL1 0RW



Dear Sir/Madam
VOLUNTARY TERMINATION OF AGREEMENT
Account No:
Make / Model:
Registration:

I am writing further to your letter dated 29/03/2016

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

Under the Consumer Credit Act 1974, my liability in respect of the agreement is limited to half the total amount payable and any terms under the agreement which imposes additional liability directly or indirectly is strictly prohibited by the Act.

The vehicle was maintained in a reasonable condition throughout the period of the agreement and therefore such damage charges you are claiming would amount to fair wear and tear; the vehicle does not need to be returned to you in any better condition other than a reasonable one (see attached vehicle inspection report).

I am happy to pay the amounts of £22 and £58 only to repair the OSF and NSF wheels respectively.

Please confirm by return that this matter is settled and now closed.

Yours faithfully

__________________________________________________ ________________________________________________

Hi,

Would this response be ok to send to them?

Thanks

Jason

[R0b]

Re: Voluntary Termination Charges

looks fine to me

[j4weeson]

Re: Voluntary Termination Charges

Thanks for your help. I will post this tomorrow and see where it leaves me. Ill no doubt be back for more advice on their response.

uersmiley:

Jason