County court judge could clear way for PPI reclaims

Its a good start!

The firm probably used this case as an example for free press releases etc!

petermb wrote: »

It just bears out what I have been saying all along. If you just go after the PPI premium alone you are losing out. Imagine the effects this is going to have on all those loans with single premium PPI.

Dont forget this was a credit card with monthly payments. PPI on a loan is going to have a greater effect. Especially where the loan is a regulated contract.

I know this could open doors for some but this was mainly cause of not having the credit agreement. Take that away from the claim and complainant is left with either the PPI and interest OR the commissions received so not much different to a normal PPI complaint... oh and a bill from Cartel


It seems the main reason why the judge ruled the debt unenforceable was that MBNA could not provide an agreement. He also ruled that they pay back the PPI with interest or the commissions received. I thought it was just cause of the PPI but seems different reading it now.




The main ground on which Judge Smart said Mrs Thorius's credit card debt was unrecoverable was because MBNA could not provide a copy of the original signed loan agreement, which is also a requirement by the Consumer Credit Act.

Judge Smart agreed with the argument of Mrs Thorius's barrister, Paul Brant, that this "secret" commission meant the credit card deal was unfair and therefore in breach of the Consumer Credit Act.

The Judge ordered the company either to repay Mrs Thorius's PPI premiums and interest, or the value of the commissions it had received which so far has been undisclosed.
The PPI premiums, which rose each month as the credit card debts increased, amounted to £2,500 over the time the card had been in use.


MBNA applied for leave to appeal, which was rejected, but it may now apply directly to a higher court for permission to appeal.
Or it may be able to appeal if it can find the original loan documentation.
Only when higher courts have decided the issue will the legal ramifications, and the effects on lender and borrowers, be clear.

If they can "find" the agreement then what happens????

It is however going to be argued by the looks of things.

woodymeg wrote: »

please could you explain the above in abit more detail dont really understand what you are saying, sorry if i sound abit thick;)

There is more mileage in this yet and more issues to come to the surface.
Karen is quite correct in that in this case the reason for unenforceability is that the lender could not provide a copy of the agreement. Therefore the lender lose the right to claim back the balance of the loan.

In this instance the ppi was monthly and does not form part of the credit. However the judge ruled that the lender ( MBNA) had received commissions from the insurance company that had not been disclosed. This is breach of agency law and breach of fiduciary duty by the lender.

This is going to have a greater effect on loans rather than credit cards.
The amount of PPI often forms part of the credit on regulated agreements. The judge has now identified that the lender is acting as an agent and therefore must disclose their commissions. Should they fail to do and the commission is deemed to be a secret then the ppi arangement is voidable. Should part of a credit agreement be deemed voidable then this will have potentially fatal implications for the loan agreement itself.

So we go round and round and come back to the same point. You are not going to win these arguments doing it yourself or indeed going through the FOS. You need to find a good legal Eagle.

The upshot to this of course is that it is all very well winning shuch a case but I feel certain that the claims company would have been working on a contingency ( charging a percentage of the win) which will wipe out the entire amount the client will be due back in this instance so look for a company or law firm that are working on access to justice. It shouldnt cost you anything using this route. I say shouldnt because there will always be lawyers and claims companies that want to play with the system through greed.