WON !! Richard Durkin v HFC / PC World supreme court judgment 26/03/14

[EXC]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

From press release:

HFC did not contest the award of £8,000 for damage to credit if breach of duty were established. However, the Supreme Court rejects Mr Durkin’s attempt to restore the sheriff’s award of damages for the extra interest he paid and for the loss of the capital gain on the Spanish property. Appeals like the present may only be made on matters of law, meaning the Supreme Court cannot go behind the First Division’s findings of fact on these alleged heads of loss

[Dougal16T]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

Morning all,

Now THAT is what I call a result!

A great pity about the Sheriffs Award.
Best wishes,

Dougal.

[Guest]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

I think we need to look at what has actually been said.

I understand that whilst the general damages have been awarded the main bulk have not.

Also the section 75 point seems to have failed, the court relying on the "implied consent" to enter into the agreement.

[EXC]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

No, only the 8k, however an important principle there that the banks have a duty of care to take reasonable steps to ensure that the agreement is enforceable before they issue a default on a credit file. If they breach that duty of care then they are liable in damages.

Absolutely and that's what counts in the grand scheme of things.

[Amethyst]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

PRESS SUMMARY

Lord Hodge finds that Mr Durkin was entitled to rescind the credit agreement and validly did so by giving notice to HFC in about February 1999 [27]. He sets out the legal framework, explaining that the agreement was a regulated consumer credit agreement and a ‘debtor-creditor-supplier’ agreement under the 1974 Act [13-17]. The key provision is section 75(1), which provides that “if the debtor under a debtor-creditor-supplier agreement… has, in relation to a transaction financed by the agreement, any claim against the supplier in respect of a misrepresentation or breach of contract, he shall have a like claim against the creditor, who, with the supplier, shall accordingly be jointly and severally liable to the debtor” [18].

Lord Hodge explains that the purpose of the restricted-use credit agreement is to finance a transaction between the consumer and the supplier. Where, as here, the contract is tied to a particular transaction, it has no other purpose [22-23]. The rescission of the supply agreement excuses the innocent party from further performance of any obligations he has under it [24].

It is inherent in a debtor-creditor-supplier agreement under the 1974 Act, which is also tied into a specific supply transaction, that if the supply transaction it financed is brought to an end by the supplier’s repudiatory breach of contract, the debtor must repay the borrowed funds recovered from the supplier. In order to reflect that reality, the law implies a term into such a credit agreement that it is conditional upon the survival of the supply agreement. The debtor on rejecting the goods and thereby rescinding the supply agreement for breach of contract may also rescind the credit agreement by invoking this condition [26].

Knowing of Mr Durkin’s assertion that the credit agreement had been rescinded, HFC was under a delictual duty to investigate that assertion in order reasonably to satisfy itself that the credit agreement remained enforceable before reporting to the credit reference agencies that he was in default. HFC made no such enquiries, accepting without question DSG’s position that Mr Durkin had not been entitled to rescind the contract of sale [29-33].

HFC did not contest the award of £8,000 for damage to credit if breach of duty were established. However, the Supreme Court rejects Mr Durkin’s attempt to restore the sheriff’s award of damages for the extra interest he paid and for the loss of the capital gain on the Spanish property. Appeals like the present may only be made on matters of law, meaning the Supreme Court cannot go behind the First Division’s findings of fact on these alleged heads of loss [36-39].

[Amethyst]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

Judgments not working The resource you are looking for has been removed, had its name changed, or is temporarily unavailable. http://supremecourt.uk/decided-cases...5_Judgment.pdf

[EXC]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

PDF of judgment.

[ncf355]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

PT

Confused -

Does this not seem to give an auto right to a minimum of £8k for injury to credit via a wrongful default?

(possibly even more allowing, as you say, for interest?)

[Amethyst]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

Ta xx

[Amethyst]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

Am I right in thinking the judgment means if you return goods the finance agreement is still not automatically cancelled, unless you put it in writing ? (para 30/31)

[EXC]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

I wonder what the interest on the £8k will be? Could be a few bob.

Damages resulting from HFC’s breach of its duty of care are confined to injury to Mr Durkin’s credit in the sum of £8,000. I would give the parties an opportunity to agree the date from which interest should run and the rate or rates of interest to be applied.

[Amethyst]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

Should be from the date the default was applied to his credit file.

[EXC]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

Am I right in thinking the judgment means if you return goods the finance agreement is still not automatically cancelled, unless you put it in writing ? (para 30/31)

It's not clear is it? They seem to be drawing a distinction between it being verbally 'intimated' and 'asserted'.

[ncf355]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

Hmm

Having read the judgment and EXC quote above, seems pretty clear that 8K has been accepted as a reasonable amount for 'general injury to credit' (plus interest of course)

[Amethyst]

Re: Richard Durkin v HFC / PC World supreme court hearing 28th January 2014

26. It is inherent in a debtor-creditor-supplier agreement under section 12(b) of the 1974 Act, which is also tied into a specific supply transaction, that if the supply transaction which it financed is in effect brought to an end by the debtor’s acceptance of the supplier’s repudiatory breach of contract, the debtor must repay the borrowed funds which he recovers from the supplier. In my view, in order to reflect that reality, the law implies a term into such a credit agreement that it is conditional upon the survival of the supply agreement. The debtor on rejecting the goods and thereby rescinding the supply agreement for breach of contract may also rescind the credit agreement by invoking this condition. As the debtor has no right to retain or use for other purposes funds lent for the specific transaction, the creditor also may rescind the credit agreement. It appears to me that similar reasoning would apply to a section 12(c) agreement where the credit agreement tied the loan to a particular transaction.

27. I am satisfied therefore that Mr Durkin was entitled to rescind the credit agreement.

So does that say a consumer is entitled to rescind the credit agreement when he cancels supply agreement but not that it is automatically rescinded at the point the consumer cancels the supply agreement (ie returns the goods or pays by another method etc).... so the consumer must inform, by telephone or in writing the creditor that they rescind the credit agreement ??