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

[enaid]

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

Will this include Insurance policies, as I said yesterday when you get insurance over a 10/12 month period you enter a credit agreement as I did with Premium Credit. If you cancel the insurance it does not automatically cancel the credit agreement and also many insurance companies have a clause where they can carry on with your next years policy unless you have a scrap with them as has also happened to me, (with Swinton insurance)

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

How about in a case where the goods are not rejected but the credit agreement is cancelled and payment by an alternative method is made?

This is an interesting point. One I was going to raise.

Currently if goods are bought on credit and the agreement cancelled the goods still have to be paid for by an alternative method. (see BIS guide).

This judgment says that there is an implied term which says when the sale agreement is cancelled then so must the credit agreement be, as you say shouldn't the arrangement work in the same way the other way around.

So if you cancel you agreement should you not be able to return the goods.

[Amethyst]

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

How about in a case where the goods are not rejected but the credit agreement is cancelled and payment by an alternative method is made?

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

There are a couple of points here.

The finding of the court regarding the implied terms in section 11 refers to the making of the agreement and the rescission of cantract, this would not apply once the agreement was up and running, you cannot have your goods for six months for instance and then, if they break stop paying the HP.

Also the new EU regulations introduced in 2011 enabled the debtor to withdraw from a credit agreement within 14 days of completion. This supplements the existing cancellation provisions of the CCA.

http://www.legislation.gov.uk/uksi/2...lation/13/made

So if goods were faulty it is a reasonably simple process to reject them under the sales of goods act provisions(fit for purpose) and then cancel the finance agreement, this problem really should not now occur.

[EXC]

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

''The rescission of the supply agreement excuses the innocent party from further performance of any obligations he has under it.'' - makes perfect sense.


It's the may also bit I'm struggling with EXC. Is it May as in - the debtor has the right at that point to cancel the credit agreement - or May as in - when the supply agreement is cancelled it has the affect of cancelling the credit agreement.

Probably way over complicating things, but that's the bit we need a definitive answer on.

This summary of the judgment from Compass Chambers and presumably written by Andrew Smith QC (Durkin's counsel) says it's automatic and also sheds a bit more light on a creditor's obligation to investigate and establish whether a debt is due prior to submitting a report to a credit reference agency.

''The Supreme Court held that once the contract of sale fell (for example because of the goods being faulty or not conform to contract) then the contract of credit automatically fell too, thus relieving the consumer from any obligation to make further payments under the contract of credit. Further, the court held that the creditor was under an obligation to investigate whether a debt existed prior to making any report to credit reference agencies. In the event of disputed debt, they must not make a report until the existence of the debt is adjudicated upon by a court if necessary, but whilst there is such dispute, they must make no report to the agencies.

This case will cause a major shift in the practices of creditors and debt collection agencies. Instead of using the threat to report bad debt to the agencies as a means of forcing payment from a consumer, the creditors are now prohibited from making a report until the debt is actually established. An example may assist.

A consumer purchases a computer and has credit provided for its purchase. It develops a fault and he takes it back to the shop. The shop refuses to accept it is faulty.

Usually the creditor would, if payments under the credit agreement are stopped by the consumer, threaten to report the consumer to a credit reference agency. This dramatic and effective threat would often result in the consumer paying for goods that were faulty.

In the light of the Durkin judgment, the creditor must investigate whether the debt is due – and that means investigating whether the goods were validly rejected by the consumer. If there is a dispute – other than a plainly ridiculous one – there can be no report unless and until the matter is determined by agreement of the parties or by court action. The court action envisaged by the Court is either an action for payment by the Creditor (where the Debtor can defend on the basis that the goods were validly rejected), or an action by the consumer (for example against the supplier for refund of sums already paid.

It is highly likely that there are many consumers who have been subjected to damage to their credit, or paid sums under threat that it now appears were not in fact validly extracted who now have claims for past losses.

The judgment is a major victory for consumers which restores power to the consumers which was intended when the 1974 Act was passed, but eroded by creditors using threats to extract sums without resorting to litigation.

Andrew Smith and Richard Pugh were asked to review the papers via the Free Legal Services Unit, and thereafter when accepting the instructions did so without charging any fee to Mr.Durkin''

http://www.compasschambers.com/news/...dgement_26_314

[mo786]

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

Will this change things or has this guy spent all these years fighting for something that should not have happened
As for the 8k I think that's an insult .

a default on a credit file is a powerful weapon in the fight for any creditor to get monies owed so when its wrong the debtor who is not in debt to them should get a large payout

This law clarified an anomaly in the law - which was that if you bought something on credit and then returned the item the credit agreement should cancel automatically.

If the law was written today then it most likely would have it like the laws on distance selling do.

The court said s75 was not relevant but there was an implied term that the credit agreement would cancel anyway - so it has created legal clarity in that respect.

As for the CRA - what the Court said was that HFC were taking the piss somewhat by registering a default, having done no checks, when the debtor was disputing the issue.

Without going back and reading it, I think they said if a creditor did do some checks they may be entitled to still register the default if they did not believe the debtor - but doing nothing was not acceptable. What this means is that creditor should ensure they do basic checks before registering defaults if a debtor is diputing something - if they don't then they will be liable to be sued for damages - which in this case was 8000 but will be assesed on a case by case basis on any other case.

As someone alluded to - the difficulty when you are saying you have lst out because of poor credit history is actually proving it. I didn't think they would allow Durkin to take home 200k+.

If he had gone for 50k he may have got away with it at the appeal but I don't think the appeal court fancied giving him 200k whatever the reason. I am not au fait with the Scottish legal system but it may have opened the floodgates. That said I am not sure what evidence Durkin had to show he suffered those losses because of this incident/case.

[jon1965]

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

my two cents worth

In this case they are using the same word but with completely different meanings

Even an agreement that is unenforceable under the CCA is still a valid or if you like enforceable agreement . I know it is down to interpretation but that is hardly unusual in the english language . Left and Left, Right and Right, Green and green, all same words different meanings

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

It really is not important. It is however important to understand that the creditor does not have to check that an agreement is enforceable under the act before he can register a default.

Because registering a default is not enforcement.

[Sparkie1723]

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

Rambling Sparkie again.....if you google.... void and rescinded.....you will find they are treated as being "different" ........even though they both acheive exactly the same result....now I'm not saying I really understand this at all .. cos I'm a do-do........just relaying what I found out.
This backs up Pt's take on this point IMO

Sparkie

[Ihaterbs]

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

[QUOTE=pt2537;420786]But it wasnt "void" thats the point. Rescission is to unravel the contract and place the parties back in the position they would have been in had the


the question is does it effect breaches of sec 65?

[pt2537]

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

Durkins contract was enforceable at inception, however the contract was then rescinded and therefore was devoid of legal effect.

But it wasnt "void" thats the point. Rescission is to unravel the contract and place the parties back in the position they would have been in had the contract not taken place

[Ihaterbs]

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

A "void" contract never has legal effect, it can never be enforced.

A void contract cant be rescinded cos it never has effect in the first place as i understand it ( and according to Chitty on Contract )

Durkins contract was enforceable at inception, however the contract was then rescinded and therefore was devoid of legal effect.

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

Indeed i agree, but im troubled by the fact that to place a Default on a credit file lasts for 6 years, yet a default can be placed when a default notice is issued.

If the Default is remedied, then the breach never occured according to 89, yet the credit file can still record the default.

It seems the supreme Court was suggesting that with defaults more care ought to be taken before recording them.

There have been a few judgments where the senior Courts have said creditors should not do X but instead should resort to testing their rights in Court, hopefully the Court of Appeal will give more guidance on this when we get a hearing

When section 89 refers to the breach not occurring it means in relation to the notice, it does not mean that the agreement returns to the condition it was in pre breach. The history regarding the repayments cannot change nor can the information recorded, it would be a breach of data protection principles as it would be a recording of an incorrect history.

The requirement to record data correctly is already encompassed in the DPA, hopefully courts may be more willing to enforce the provisions, but the case here brings nothing new to the table in this respect.

[wales01man]

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

Will this change things or has this guy spent all these years fighting for something that should not have happened
As for the 8k I think that's an insult .

a default on a credit file is a powerful weapon in the fight for any creditor to get monies owed so when its wrong the debtor who is not in debt to them should get a large payout

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

no, because that would need the agreement to be void from the beginning and plainly it isnt. Google void ab initio

It would be void from the beginning, if it was rescinded, in any case the point is that it would have no effect in law.