voluntary termination problems

[froddy]

Hello,
I have looked around the various threads in regard to the VT of my car. They are asking for £29 for a small dent and £1700 for excess mileage. I have therefore put together the following letter to send to them. Hopefully someone can help point me in the right direction with it.


Dear Sirs,
i am writing in relation to your letter dated .............

I do not believe that I am liable for any exces mileage charges.

When I purchased the vehicle the mileage selected was advised by the salesman as a method of keeping the monthly payments within my budget. I was not aware of how this would personally affect me.

As I have returned the vehicle in a more than reasonable condition, and have taken reasonable care of it, I believe I have adhered to Section 99 of the Consumer Credit Act, which says I have nothing more to pay.

My liability is restricted to 50% of the total amount payable of the agreement and I was not aware of any clause that contradicts this.

Section 189 and 173 of the CCA both confirm there is no provision in law that confirms a finance company can charge excess mileage on a voluntary termination of a car loan.

There is also no definitive reason that the excess mileage means that the vehicle is not in reasonable condition or decreased in value. This vehicle has completed more motorway mileage than city/town driving. This re is less wear and tear on brakes, tyres etc than a vehicle that had done less mileage due to city driving.

I look forward to your response.

[R0b]

Re: voluntary termination problems

Hello,

the sentence about section 189 and 173 could be misleading. You need to reword it to say something like, section 173 confirms that any contractual clauses which conflict with your rights under section 100 are void and unenforceable.

There should also be on the pre-contractual information about "Termination: Your Rights" you should refer to this as well and say you have terminated and already paid X, the car is in reasonable condition and I do not have to pay any more.

[froddy]

Re: voluntary termination problems

Hi Rob

Thank you very much for your help. I am a little confused with the last sentence in your post. Does this refer to the contract signed at purchase or the contract signed at termination.

I am in the process of redrafting my letter with your points.

Thanks

[R0b]

Re: voluntary termination problems

CCA agreements in relation to HP or conditional sale must have a pre-contracual nformation sheet and/or include information in your agreement. Usually on the front page of your agreement or pre-contractual sheet you will have a box or paragraph which is titled "Termination: Your Rights". This box contains statutory information which has to be included in your agreement. What it should say is you can terminate your agreement at any time and provided you have paid X (which X being 50% of the total amount payable) and taken reasonable care of the goods you do not have to pay any more.

That paragraph has the effect of section 100, which limits your liability to 50% of the total amount payable and is specifically intended to exclude any damages for breach of contract except for the monthly instalments outstanding.

[froddy]

Re: voluntary termination problems

Final draft:

Dear Sirs,

I am writing in relation to your letter dated ………….

I do not believe that I am liable for any excess mileage charges.

When I purchased the vehicle the mileage selected was advised by the salesman as a method of keeping the monthly payments within my budget. I was not aware of how this would personally affect me.

As I have returned the vehicle in a more than reasonable condition, and have taken reasonable care of it, I believe I have adhered to Section 99 of the Consumer Credit Act, which says I have nothing more to pay.

According to my contract in the section titled ‘Termination: Your Rights’ you state my liability is restricted to 50% of the total amount payable of the agreement and I was not aware of any clause that contradicts this. I have terminated and already paid over the required amount, the car is in reasonable condition and I do not have to pay any more

This position is further clarified under section 173 of the Act in that any contractual term which is inconsistent with any rights under the CCA and imposes additional liability, whether direct or indirect, shall be void and unenforceable.

There is also no definitive reason that the excess mileage means that the vehicle is not in reasonable condition or has decreased in value. This vehicle has completed more motorway mileage than city/town driving. This means there is less wear and tear on brakes, tyres etc. than a vehicle that had done less mileage due to city driving.

I have enclosed a cheque for £29.70 for the dent on the NS Quarter Panel as per your invoice.

Therefore, please confirm by return that this matter is now closed. I look forward to your response.

Yours faithfully

[R0b]

Re: voluntary termination problems

When I purchased the vehicle the mileage selected was advised by the salesman as a method of keeping the monthly payments within my budget. I was not aware of how this would personally affect me.

If the mileage was based on your usage and the salesman knew that then he may have misrepresented by indicating that the contract you signed was suitable. If that is the case its worth mentioning it

I have enclosed a cheque for £29.70 for the dent on the NS Quarter Panel as per your invoice.

Might be worth adding, something like: I do however acknowledge the damage regarding the dent on the NS Quarter Panel as per your invoice. Therefore, please find enclosed a cheque for £29.70 which represents my liability in full and final settlement of this matter.

Other than that, good to go

[froddy]

Re: voluntary termination problems

Hi,
This is the response I have had. the cover letter has my correct address but the actual letter,attached, has someone else's even though it has my name.

Thyr say it is effectively a gesture of goodwill offer of £350 writing off £1300+. However, the letter barely refers to excess mileage at all, just putting everything under the umbrella of damages.

I do do not want to accept the offer but don't know how to go about it.

[R0b]

Re: voluntary termination problems

How nice of them to wipe off such an amount.

All you need to do is respond to them politely and say that, the CCA says that the car need only be returned in a reasonable condition which in your opinion it was. You do not agree by the use of the BVRLA guidelines because the guidelines establish a code of practice in relation to commercial rental, leasing and fleet management charters. The terms on which the agreement was taken out was on the basis of a private consumer for private use, and therefore the standard in the BVRLA guidelines is a higher standard than what is set out under the CCA.

In relation to the excess mileage, you should refer to the statement in your agreement which says something like the following:

TERMINATION: YOUR RIGHTS
You have a right to end this agreement. To do so, you should write to the person you make your payments to. They will then be entitled to the return of the goods and to the cost of installing the goods plus half the rest of the total amount payable under this agreement, that is half the total amount payable under this agreement, that is £XXXX.XX. If you have already paid at least this amount plus any overdue instalments and have taken reasonable care of the goods, you will not have to pay any more.

Explain that this statement sets out your rights and liability when the agreement is terminated in accordance with section 99. Your liability is therefore restricted to the paid the amount specified and provided you have taken reasonable care of the goods, you owe nothing more.

I can also see that they claim the damage reflects the loss of the vehicle and not the cost of repair, so if thats the case then they have a general duty to mitigate any losses. If they have failed to take reasonable steps to minimise that loss by carrying out repairs, they are not entitled to the damages they allege because that loss could have been avoided.


IF you want to draft something up which covers all of the above, I am happy to take a look at it.

[froddy]

Re: voluntary termination problems

Thanks Rob. I will get onto it tonight when I return home.

[froddy]

Re: voluntary termination problems

Hi Rob,
How is this?

Dear Sirs,
I am writing in response to your letter dated……………..
After deliberation, I have decided to decline your offer topay £350. I have returned the vehicle in reasonable condition as per myagreement. I have also paid in excess of 50% of the outstanding balance as perthe paragraph below from the agreement as follows:
TERMINATION: YOUR RIGHTS.
You have a right to end this agreement. To do so, you should write to theperson you make your payments to. They will then be entitled to the return ofthe goods and to the cost of installing the goods plus half the rest of thetotal amount payable under this agreement, that is half the total amountpayable under this agreement, that is £XXXX.XX. If you have already paid atleast this amount plus any overdue instalments and have taken reasonable careof the goods, you will not have to pay any more.
This statementsets out my rights and liability in accordance with Section 99 when terminatingmy contract. I believe I have adhered to all the terms and have no more to pay.
In relation tothe BVRA guidelines you refer to, these refer to fleer, commercial renting andleasing. The terms of my agreement are on the basis of a private consumer usingthe vehicle for private use. It is therefore the Consumer Credit Act thatapplies to my situation.
I hope this putsan end to this distressing situation once and for all.
Yours faithfully,

[R0b]

Re: voluntary termination problems

Dear Sirs,

I am writing in response to your letter dated……………..

I have decided to decline your offer to pay £350. I have returned the vehicle in reasonable condition as per my agreement and I have also paid in excess of 50% of the outstanding balance. I refer you to the following paragraph contained in the agreement:

TERMINATION: YOUR RIGHTS.
You have a right to end this agreement. To do so, you should write to the person you make your payments to. They will then be entitled to the return ofthe goods and to the cost of installing the goods plus half the rest of thetotal amount payable under this agreement, that is half the total amountpayable under this agreement, that is £XXXX.XX. If you have already paid at least this amount plus any overdue instalments and have taken reasonable careof the goods, you will not have to pay any more.

As you can see, I have complied with the requirements set out in the paragraph above. If you believe that the car was not returned in a reasonable condition, please provide me with the relevant evidence which supports your claim, otherwise my liability is restricted to half the total amount payable in accordance with section 100 of the CCA.

Please confirm by return that the matter is now closed.

Yours faithfully,

[froddy]

Re: voluntary termination problems

Dear Sirs,

I am writing in response to your letter dated……………..

I have decided to decline your offer to pay £350. I have returned the vehicle in reasonable condition as per my agreement and I have also paid in excess of 50% of the outstanding balance. I refer you to the following paragraph contained in the agreement:

TERMINATION: YOUR RIGHTS.
You have a right to end this agreement. To do so, you should write to the person you make your payments to. They will then be entitled to the return ofthe goods and to the cost of installing the goods plus half the rest of thetotal amount payable under this agreement, that is half the total amountpayable under this agreement, that is £XXXX.XX. If you have already paid at least this amount plus any overdue instalments and have taken reasonable careof the goods, you will not have to pay any more.

As you can see, I have complied with the requirements set out in the paragraph above. If you believe that the car was not returned in a reasonable condition, please provide me with the relevant evidence which supports your claim, otherwise my liability is restricted to half the total amount payable in accordance with section 100 of the CCA.

Please confirm by return that the matter is now closed.

Yours faithfully,

Hi Rob

Thanks for that. I have posted it off and will keep you posted.

[froddy]

Re: voluntary termination problems

Well after two months of absolutely no contact, they have reared their ugly heads again. I am absolutely gutted and feel like telling them to just take me to court. Apparently this is the last they will hear of it and I have to go through BVRLA.

I have noticed that one again the address on the two attached letters is incorrect (I don't live in Plymouth) but the cover letter obviously is correct.

Any help will be greatly appreciated.

[R0b]

Re: voluntary termination problems

Up to you Froddy, with companies like these, it is like talking to a brick wall. They're not really going to take you to court because they know they will lose. BVRLA do have a ombudsman type service but I am not clued up on how it works and whether it may be binding on you if you accept their service - so I would suggest you avoid it because if it is binding, then you will lose any legal rights should they not find your favour.

The way these companies get you to pay up is by applying defaults on your credit report, which is misleading and inaccurate because but the ball then falls to you to take them to court. If you did go down that route, £50 for a claim and you could claim up to £300. Unfortunately nobody has had the balls to go down this route yet, so it's a little untested, though given the lack of court cases that have come to court over damage and excess mileage (0 to my knowledge) I think we can only conclude why.

[froddy]

Re: voluntary termination problems

Up to you Froddy, with companies like these, it is like talking to a brick wall. They're not really going to take you to court because they know they will lose. BVRLA do have a ombudsman type service but I am not clued up on how it works and whether it may be binding on you if you accept their service - so I would suggest you avoid it because if it is binding, then you will lose any legal rights should they not find your favour.

The way these companies get you to pay up is by applying defaults on your credit report, which is misleading and inaccurate because but the ball then falls to you to take them to court. If you did go down that route, £50 for a claim and you could claim up to £300. Unfortunately nobody has had the balls to go down this route yet, so it's a little untested, though given the lack of court cases that have come to court over damage and excess mileage (0 to my knowledge) I think we can only conclude why.

Thanks for getting back to me so quickly.

I didn't know they could apply a default to my credit rating whilst a dispute is still in progress.
I think i will write another letter confirming that i believe i have met my obligations and do not need the services of an ombudsman and stating firmly that should a default be applied i will pursue compensation vigorously.
Your thoughts appreciated.