BT Taken To Court By Customer Over Direct Debit Contract

[EXC]

Re: BT Taken To Court By Customer Over Direct Debit Contract

''EXC I didn't say she was clogging up the court system; I said it was a spurious case. And now she's lost.''

Did I say you said that? Or am I missing something here? It was, after all. part of a quote that you ''loved''. Remember?

''There clearly are cost implications with accepting payment in cash or cheque rather than DD''

There are cost implications for advertising. Does that justify a separate charge?

''As I stated before, BT are not a monopoly and there is a choice of telephony providers. Similarly there is a competitive market for other utility services (e.g. gas and electricity) and people can choose the supplier with the terms they like.''

Again, does this justify the charge?

[ed.]

Re: BT Taken To Court By Customer Over Direct Debit Contract

Where I live I have no choice BUT to use BT, we have no cable, I can't afford £3000 plus for a satellite service - we have no cable feeds. Anything I wish to do with a telephone or broadband means I HAVE to have an account with BT for the line.

I would love to see her arguments though.

The argument about chasing late payers doesn't wash - the costs for that are 'apparently covered' in the late payment fees aren't they, so unless we are talking about double recovery - afterall, BT admit the charge is because cash payers are more likely to miss/pay late and the argument seems to be the same for this charge aswell.

[argentarius]

Re: BT Taken To Court By Customer Over Direct Debit Contract

I have at least 15 direct debits leaving my account every month. None has ever been debited early. - None have ever bounced then, leaving you in the situation where others have bounced as a result of charges inposed in the previous months by the bank? Do you understand the never ending spiral of charges that accumulate on accounts and get people in deeper and deeper? I run a very tight ship and cannot budget for charges on my account, I get one charge, it throws everything out!

As I said, I've never had a DD debit early. There is no earthly reason why any supplier will intentionally, or even accidentally, do this. And if they do, you can get an immediate refund from the bank as it's an unauthorised DD. And you will get the associated charges refunded. There is no reason for an early DD to lead to an accumulation or spiral of charges.

Amethyst Anyone who is merely "poor" can get a basic bank account with DD facilities. The idea that the poorest are excluded from banking is not true. As I understand it the only people who may not be able to get basic bank accounts very easily are those with criminal convictions for fraud and the like, not the "poor" people this case is supposedly to protect.

Not anyone with a basic bank account can have d/d facilities, some basic accounts DO NOT provide this facility. It is not only people with fraud convictions that struggle to get basic bank accounts, I know of one person that couldn't get a bank account at all, full stop. She had to get her wages paid in a cheque and get it cashed by her mother. You don't appear to have had any kind of struggle financially and you really dont appear to understand the struggle that people have once the start getting these charges or to know that every single pound in your bank account is very important and a slight overspend can cause so much trouble!

It doesn't matter than "not every basic bank account has DD facilities". Some do. So choose one of them. The case isn't IMHO primarily about the 1 in 1,000 people who can't get a bank account. It's about the 999 in 1,000 who can, or who have one, but just have an irrational problem with DDs.

Cetelco So what if it's a revenue stream? BT are in business to make money for their shareholders. It doesn't matter if they charge £10 for line rental and £1 for cash payment, per month, or £11 for line rental. The total price is what matters. As the judge said, the cash payment charge is a core term and an element of the price for the service. you have missed Cetelcos point completely. If the consumer is being told that the charge is the cost of processing their form of payment then it should be exactly that, the TRUE cost, not a cloak and dagger way of squeezing yet more profit out of the consumer.

I haven't missed anything at all. They don't say (in the contract) that it's the cost of processing their form of payment; they say that people paying via that method have to pay an additional fee which is part of the cost of providing their telephony service. Obviously you don't understand the judge when he said it was a core term and part of the price.

It's scarcely "cloak and dagger" - it's obviously spelled out in the conditions when anyone signs up, or when the fee has increased for those who have been with BT forever.

''EXC I didn't say she was clogging up the court system; I said it was a spurious case. And now she's lost.''

Did I say you said that? Or am I missing something here? It was, after all. part of a quote that you ''loved''. Remember?

You quoted my post, so I expected your comments to refer to my post not something someone else actually said. Apologies for misinterpreting your comments.

''There clearly are cost implications with accepting payment in cash or cheque rather than DD''

There are cost implications for advertising. Does that justify a separate charge?

Those costs are the same whichever payment method is used. Your point is a red herring. In any case, they are not intended to be a "passing on the exact costs" charge. They are part of the cost of the service and BT are quite entitled to make a profit on that element of the service if they choose to do so.

''As I stated before, BT are not a monopoly and there is a choice of telephony providers. Similarly there is a competitive market for other utility services (e.g. gas and electricity) and people can choose the supplier with the terms they like.''

Again, does this justify the charge?

It doesn't need to. "Justifying the charge" is irrelevant for something which is a core term and part of the price. Companies can charge what they like.

Re: BT Taken To Court By Customer Over Direct Debit Contract
Where I live I have no choice BUT to use BT, we have no cable, I can't afford £3000 plus for a satellite service - we have no cable feeds. Anything I wish to do with a telephone or broadband means I HAVE to have an account with BT for the line.

I would love to see her arguments though.

The argument about chasing late payers doesn't wash - the costs for that are 'apparently covered' in the late payment fees aren't they, so unless we are talking about double recovery - afterall, BT admit the charge is because cash payers are more likely to miss/pay late and the argument seems to be the same for this charge aswell.

You don't need to use cable as an alternative to BT; you can use Talk Talk or other companies. I don't know whether they cover your area or not, but they cover a far wider area than cable does.

I can only imagine that her arguments are based on the charge NOT being a core term, as then UTCCR would become relevant and the charge might be deemed unfair. The reason I attacked the case as spurious is that I couldn't see that argument working.

I've said in my other responses that the costs don't matter if it's a core term. So double recovery wouldn't apply either.

This is another shocking misjudgement by an incompent, anti-consumer judge.

Missed this one the first time through. I think it's unfair and wrong to criticise a member of the judiciary for applying the law correctly. I think he's probably more competent than someone who can't type incompetent properly.

Judges are not allowed to be pro-consumer or anti-consumer. They are required to apply the law correctly.

[EXC]

Re: BT Taken To Court By Customer Over Direct Debit Contract

''It doesn't need to.''

You have misread my question which was ''does this justify the charge?''. You have answered a different question which is ''does it need to justify the charge'' that I didn't ask.



For fear of repeating myself....

These kind of payment proccessing charges never existed until a few years ago so what's changed?

[Amy]

Re: BT Taken To Court By Customer Over Direct Debit Contract

As I said, I've never had a DD debit early. There is no earthly reason why any supplier will intentionally, or even accidentally, do this.

These companies do not take the money from an account the banks do and they always apply the debits before the credits, don't they?

The case isn't IMHO primarily about the 1 in 1,000 people who can't get a bank account. It's about the 999 in 1,000 who can, or who have one, but just have an irrational problem with DDs.

I have a bank account with DDs available, but I do not wish to pay that way. I also do not consider myself to have an "irrational problem" with DDs.

They don't say (in the contract) that it's the cost of processing their form of payment; they say that people paying via that method have to pay an additional fee which is part of the cost of providing their telephony service. Obviously you don't understand the judge when he said it was a core term and part of the price.

Perhaps you could explain how it costs this much or indeed anything at all, to pay in cash or via the internet?

It's scarcely "cloak and dagger" - it's obviously spelled out in the conditions when anyone signs up, or when the fee has increased for those who have been with BT forever.

Does this make it right by adding it into the contract? How do you explain that the existing customers did not incur a fee originally presumably because it does not cost BT a lot, if anything, but all of a sudden does now cost BT?

[Nattie]

Re: BT Taken To Court By Customer Over Direct Debit Contract

Amy, I think we are playing with semantics here. The banks do not take the direct debits, the supplier requests payment to which the bank then process. It could be suggested from your post that the bank are deciding the date when the company can have the money.
There is a cost for cash payment for a BT bill? Ask any business account holder outside their interest free business banking terms.

[ed.]

Re: BT Taken To Court By Customer Over Direct Debit Contract

Originally Posted by ed.

Re: BT Taken To Court By Customer Over Direct Debit Contract
Where I live I have no choice BUT to use BT, we have no cable, I can't afford £3000 plus for a satellite service - we have no cable feeds. Anything I wish to do with a telephone or broadband means I HAVE to have an account with BT for the line.

I would love to see her arguments though.

The argument about chasing late payers doesn't wash - the costs for that are 'apparently covered' in the late payment fees aren't they, so unless we are talking about double recovery - afterall, BT admit the charge is because cash payers are more likely to miss/pay late and the argument seems to be the same for this charge aswell.

You don't need to use cable as an alternative to BT; you can use Talk Talk or other companies. I don't know whether they cover your area or not, but they cover a far wider area than cable does.

Still means I'm required to use BT for the line though - I have no other 'provider' option, as either way I'm forced into using BT to one degree or another. Where I am we have nothing but BT as an option, admittedly in the main cities etc this isn't applicable as there are other 'line' choices, but for lot of people this isn't the case so BT still does have a monopoly of sorts across the Country.

I can only imagine that her arguments are based on the charge NOT being a core term, as then UTCCR would become relevant and the charge might be deemed unfair. The reason I attacked the case as spurious is that I couldn't see that argument working.

But the core term of 'service' is the product, these 'new' charges only really came into play 'contractually' this February. These charges in no way formed the original bargain so the UTCCR's do apply. Additionally, having held two BT accounts now in my life at no point have I ever been sent T&C's or anything along those lines. The first contractual arrangement that I was advised of was their recent change to T&C's saying that by making a payment I was agreeing to enter into a contract with BTPS or whatever the acronym is.

The line of advised and could change is pointless and irrelevant, until Feb it wasn't contractual anyway - but for me, failure to pay it would see me cut off and as I'd still pay the line rental only by cash I'd still suffer the charge regardless.

Let alone the fact that BT love their 12-18 month contracts so if I broke it now and failed to pay their charge I'd actually 'contractually' be penalised into paying for how ever many months are left. So where is the freedom there? Yes, admittedly that's, I imagine, a marked difference from her argument on the basis for UTCCR introduction though.

But TS, OFT, OFcom do not consider such charges part of the core bargain - makes you wonder, although I suspect she did, reference those in her skellie.


I've said in my other responses that the costs don't matter if it's a core term. So double recovery wouldn't apply either.

But we've already established they aren't core terms, they are new charges in no way related to what is any bargain with a company such as this. Provision of telephoney, or mobile, or broadband access. Those are the core terms, nowhere does the service provided change or alter depending on means of payment for those services.

Does it cost more to process cash or CHQ, yeah of course it does. compared to say DD or standing order, or online payment.

They blow their own argument firstly by not including other means of automated payment like online payment.

Secondly if, as Nattie alluded to, the Banks themselves deem a rough cost for a cash or CHQ transaction to be between 50-100 pennies per time then surely 50-100 pennies PER payment is more indicative of any real cost. Not a cost per month, which is what it is in effect, despite the fact that for two months you don't make payment anyway?

£4.50 a quarter so that's almost £5 admin cost tp handle one payment??

No chance - so I think double recovery is a decent side argument. Afterall, BT's own website describe these charges as based on the fact cash payers are more likely to pay late etc.

Now they are covering that risk, twice in effect.

If it's that much of a business problem for them, then surely the service cost itself reflects their costs and overheads - not spurious additional payments that do catch those predominantly on lower incomes etc.

[Kafka]

Re: BT Taken To Court By Customer Over Direct Debit Contract

Oh dear, it didn't go the way you wanted.

Kafka[/B] It's not a penalty charge and it's lazy wording to call it one.

[B]

Are you seriously telling me that it costs BT nothing at all to process a collection by automated DD, yet £4.50 to take my payment by automatic transfer from a debit card (which is how I always pay)?

If it really costs £4.50 for a non-DD payment, then presumably they have been weathering these costs magnanimously for the last 20 years or more have they? Or why have they suddenly discovered it and decided they need to cover the costs now?

Unless someone can answer these questions very convinvingly then these are opportunist penalties levied to raise a profit beyond the cost of processing, for people who won't be forced into paying the way they want them to. There is no service fee argument here like the banks try to use, because there is no service involved.

Such profits are not permitted in law, regardless of what one County Court judge says about them being core terms. I would be very interested to see what arguments BT used to justify these new charges. They have totally refused to provide any justification to me in my complaints so far. All they will say is that it is "not a penalty charge but a separate fee for methods of payment which cost us more to process." They will not answer any of the points above.

[argentarius]

Re: BT Taken To Court By Customer Over Direct Debit Contract

You have misread my question which was ''does this justify the charge?''. You have answered a different question which is ''does it need to justify the charge'' that I didn't ask.

For fear of repeating myself....

These kind of payment proccessing charges never existed until a few years ago so what's changed?

"Does this justify the charge" is a meaningless question in that case. Charges that don't need to be justified, don't need to be justified. Companies can charge whatever they like, to make a profit, as a core term of a contract.

These companies do not take the money from an account the banks do and they always apply the debits before the credits, don't they?

Banks don't take debits before credits. That's rubbish. Banks require you to have the funds in your account by the close of business the previous working day, to make a DD payment the following working day. The order of transactions on a working day is irrelevant.

I have a bank account with DDs available, but I do not wish to pay that way. I also do not consider myself to have an "irrational problem" with DDs.

Then, if you choose to pay by another method, you are contractually accepting the higher rate for paying by that method. It's your choice.

Perhaps you could explain how it costs this much or indeed anything at all, to pay in cash or via the internet?

No, because the paragraph you are responding to states that BT don't say (in their contract) that the additional fee is to cover specified additional costs. They don't need to make that link, and they don't make it. The costs are irrelevant to their ability to make this charge.

Does this make it right by adding it into the contract? How do you explain that the existing customers did not incur a fee originally presumably because it does not cost BT a lot, if anything, but all of a sudden does now cost BT?

It's not about "right" or "wrong". It's about what's legal. And it is legal to amend the terms of an ongoing contract, by notifying the customer who accepts those revised terms by continuing to use the service. Once again, the costs are irrelevant. BT have identified an additional income stream as they are quite entitled to do.

On another forum, by the way, someone has pointed out that BT used to give a DD discount but then changed to charging a non-DD supplement. It's all semantics. There was a DD discount for a long, long, time, so the idea that customers having to pay more for non-DD payment is a new concept is incorrect.

But we've already established they aren't core terms, they are new charges in no way related to what is any bargain with a company such as this. Provision of telephoney, or mobile, or broadband access. Those are the core terms, nowhere does the service provided change or alter depending on means of payment for those services.

No, we haven't established that they are not core terms. The judge in this case stated that they were core terms.

The price for a service is almost inevitably a core term. BT are essentially offering two different services:

- phone service paid for by DD - price £x
- phone service paid for by another means - price £y

In both of those service contracts, the price is specified as a core term and it's agreed between BT and the customer.

Does it cost more to process cash or CHQ, yeah of course it does. compared to say DD or standing order, or online payment.

They blow their own argument firstly by not including other means of automated payment like online payment.

Secondly if, as Nattie alluded to, the Banks themselves deem a rough cost for a cash or CHQ transaction to be between 50-100 pennies per time then surely 50-100 pennies PER payment is more indicative of any real cost. Not a cost per month, which is what it is in effect, despite the fact that for two months you don't make payment anyway?

£4.50 a quarter so that's almost £5 admin cost tp handle one payment??

No chance - so I think double recovery is a decent side argument. Afterall, BT's own website describe these charges as based on the fact cash payers are more likely to pay late etc.

Now they are covering that risk, twice in effect.

If it's that much of a business problem for them, then surely the service cost itself reflects their costs and overheads - not spurious additional payments that do catch those predominantly on lower incomes etc.

The service cost itself is different depending on the method of payment.

The costs incurred by BT are irrelevant - they are allowed to make a profit and that means that they can set the price for their service (including any element notionally related to payment method) how they please.

Are you seriously telling me that it costs BT nothing at all to process a collection by automated DD, yet £4.50 to take my payment by automatic transfer from a debit card (which is how I always pay)?

If it really costs £4.50 for a non-DD payment, then presumably they have been weathering these costs magnanimously for the last 20 years or more have they? Or why have they suddenly discovered it and decided they need to cover the costs now?

Unless someone can answer these questions very convinvingly then these are opportunist penalties levied to raise a profit beyond the cost of processing, for people who won't be forced into paying the way they want them to. There is no service fee argument here like the banks try to use, because there is no service involved.

Such profits are not permitted in law, regardless of what one County Court judge says about them being core terms. I would be very interested to see what arguments BT used to justify these new charges. They have totally refused to provide any justification to me in my complaints so far. All they will say is that it is "not a penalty charge but a separate fee for methods of payment which cost us more to process." They will not answer any of the points above.

They are not, legally, penalties. If they were, then such profits wouldn't be permitted in law. But they aren't, so the "can't profit" argument falls.

[Amy]

Re: BT Taken To Court By Customer Over Direct Debit Contract

I'm not sure how we could all have got it so terribly wrong.

Tell me, is it you in the adverts?

[Xena]

Re: BT Taken To Court By Customer Over Direct Debit Contract

Banks require you to have the funds in your account by the close of business the previous working day, to make a DD payment the following working day. The order of transactions on a working day is irrelevant.


Sorry can't be arsed to quote and delete so much.

Not true, you are wrong, not all banks require monies the day before the DD is due to go out. Barclays don't..they pay it, providing I check my accounts online, the machine in the wall what have you and make sure the money is in there to cover it on the day and not the DAY BEFORE like you are saying.

[argentarius]

Re: BT Taken To Court By Customer Over Direct Debit Contract

90% of banks do have such a rule.

But BACS credits are usually credited first, meaning that the rule isn't applied a lot of the time.

So, in fact, credits are applied before debits in this instance and the original assertion (that banks systematically apply debits before credits which was (somewhat irrelevantly) raised in an earlier post) is most definitely wrong.

[EXC]

Re: BT Taken To Court By Customer Over Direct Debit Contract

"Does this justify the charge" is a meaningless question in that case. Charges that don't need to be justified, don't need to be justified. Companies can charge whatever they like, to make a profit, as a core term of a contract.

'Core terms' are irrelevant to the legitimacy of a charge. It is the main subject matter as UTCCR makes clear:

Assessment of unfair terms
6. - (1) Without prejudice to regulation 12, the unfairness of a contractual term shall be assessed, taking into account the nature of the goods or services for which the contract was concluded and by referring, at the time of conclusion of the contract, to all the circumstances attending the conclusion of the contract and to all the other terms of the contract or of another contract on which it is dependent.

(2) In so far as it is in plain intelligible language, the assessment of fairness of a term shall not relate-

• (a) to the definition of the main subject matter of the contract, or
• (b) to the adequacy of the price or remuneration, as against the goods or services supplied in exchange.

By any stretch of the imagination the proccessing of your payment does not go anywhere near being the main subject matter, or as Justice Smith put it, ''the purpose'', of the contract.

Your ''service'' argument is eroneous. Once you have paid the bill for goods or services rendered your obligations end there and so do the services provided.

But the biggest hole in your argument is the question you cannot seem to answer:

These kind of payment proccessing charges never existed until a few years ago so what's changed?

[Nattie]

Re: BT Taken To Court By Customer Over Direct Debit Contract

http://www.opsi.gov.uk/SI/si1991/Uksi_19910199_en_1.htm

Argue all you want on penalty charge or not but you are relying on the case that the person relied on and not the law that governs the charge that is made. The DD charge while not necessary IMHO being fair to those on low income and to those who do not like Direct Debits, is, unfortunately, LEGAL.
The information was on the forum for everyone to read but everyone else have read the article from the claimants' perspective and are not applying the law that allows them to do so. see above link to law. I am guilty as charged of getting involved in this thread without connecting the brain to the actual subject matter. Are we arguing contract law and UTTCR or are we arguing The Price Indications(method of payment) Regulations(1991)?

[EXC]

Re: BT Taken To Court By Customer Over Direct Debit Contract

Although I think it is challegable under UTCCR, I'm principlly arguing with argentarius that naked profiteering of by a regulated utility is not something one should condone.

To 'proccess' one cheque, one of tens of thousands received every day by BT can barely be described as a material cost. It must be a few pence at most and to charge £4.50 is a mark up of many thousands of per cent. By any standards this is naked profiteering and not something a civilised society should accept.