Voluntary Termination section 99 50%

[James Cannan]

I entered into a 48 month HP agreement on the 7th February 2015 for the purchase of a car with the total amount payable under the agreement £7,239.52.

After paying £3,819.76 - 52.75% of the amount payable under the agreement I notified the finance company of my intention to terminate the agreement re the letter below.

Close Brothers Motor Finance,
Fairbairn House,
Fairbairn Place,
Livingston.
EH54 6TN


27^th February 2017


Dear Sir / Madam,


TERMINATION OF AGREEMENT PURSUANT TO S.99
OF THE CONSUMER CREDIT ACT 1974

Agreement number:29-669807
Registration: FL09 WWU

I am writing to notify you that I wish to invoke my statutory right under section 99 of the Consumer Credit Act 1974 and hereby give you notice that the agreement is terminated effective immediately from the date of this letter. Please confirm by return acknowledgement of this letter and to make arrangements for collection of the vehicle.

The condition of the car is noted as being in a reasonable condition for its age and photographic evidence has been taken in the event of any future dispute as to the condition of the vehicle.

You will be aware that the Consumer Credit Act limits my liability to half of the total amount payable under the agreement but excludes any sum payable as a penalty, compensation or damages for a breach of the terms of the agreement. Such terms imposed are inconsistent with my rights under the Act and are therefore deemed void and unenforceable.

The vehicle is now available for collection and I would be grateful if you could contact me on 07519 961 428 to arrange a suitable time within the next 14 days.


The finance company did not respond to my letter after which I sent them an email asking them to contact me and advise when they would be picking up the vehicle.


They then phoned me to advise the car required to have an MOT which under section 99 I understand it does not it only requires to be in reasonable condition. I did however get the vehicle MOT'd to avoid claims later on in the process.

I then sent them the following email

I initially wrote to you on the 27th February and followed this up with the email below invoking my right to voluntary terminate my hp agreement with your company.

You requested I MOT the vehicle which I have since had carried out.

Your colleague however has advised that I am liable for a missed payment which under the agreement is not true.

Under the Consumer Credit Act 1974 I can terminate the agreement at any time before the final payment under the agreement is due and my liability under the agreement is restricted to 50% of the total amount payable.

The consumer credit act further states that once I have invoked my right to terminate under section 99 the lender cannot impose any further liability.

The car will be available for collection from 16th March onwards and would request you advise of your arrangements for collection within the next 7 days.

In the meantime I will store the vehicle on your behalf until collection.



Since then I have agreed with them on the phone that they will come and pick up the vehicle next week.

I have however now received a default notice from them advising I owe £167.49 which amounts to 1 months payment plus a £25 fee.


In the default notice they advise that the total amount payable under the agreement is £7,239.76 and I have paid £3,819.76 which as detailed above is 52.75% of the amount payable.

Under section 99 all my liability has been extinguished.

Any ideas how I should progress this

[R0b]

Re: Voluntary Termination section 99 50%

Hi James,

Section 99 is in relation to giving notice, it has nothing to do with requiring the car to have an MOT, nor does it say that. I suspect they are saying the car needs an MOT for the purposes of it being in a reasonable condition for which they can obtain compensation. A car without an MOT does not necessarily mean that its in an unreasonable condition since an MOT can only prove that the car is roadworthy on the day the test is carried out, but having a valid MOT does help to prove that it is in a reasonable condition.

Obtaining the MOT certificate after you gave notice does not negate the termination of the agreement, and once notice is given to terminate, it cannot be revoked, that's contract law 101.

How you progress this issue depends on what steps you want to take. I would certainly be keeping an eye on your credit report over the next few weeks following the expiry of the period stated on the default notice.

You could also preserve your position and put them on notice that the default notice they have issued is invalid and not enforceable since you gave notice to terminate on X (do you have proof of postage?) and therefore the contract is deemed terminated from the date of the letter. If at some future date you become aware that there is any adverse entry on your credit file as a result you will consider taking legal action against them for breach of data protection (Principle 4 in particular).

Whether you choose to take legal action is up to you but if your not going to go down that route in the event that they do apply a default, don't mention it.

[James Cannan]

Re: Voluntary Termination section 99 50%

Hi Rob,

Thanks for that.

I didn't send the letter recorded delivery though followed it up with an email to which I attached the letter.

I understand the situation with the MOT though thought it might mitigate claims later on.

I have timelines of phone calls & texts from them on my mobile which proves they got the letter or at least the email, how else would they know to contact me.

I think I will do as you suggest and preserve my position and keep a check on my credit file and put them on notice that there default notice is invalid and unenforceable.

Thanks for your help.