PPI Reclaiming discussion Part III

di3004

Found this bit of write up here:
Marshallka didn't you add something like this before as well ?

What is the law entitling me to my PPI back?
[FONT=Arial,Helvetica,sans-serif]If you were mis sold a policy you were probably negligently misrepresented to - which is covered by the Misrepresentation Act 1967.[/FONT]
Or, if you didn't receive a fair rebate upon cancellation or repaying the loan early then this is and unfair contract term.
The Unfair Terms in Consumer Contracts Regulations 1999 states:

• (1) A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer.

marshallka

di3004 wrote: »

Found this bit of write up here:
Marshallka didn't you add something like this before as well ?

What is the law entitling me to my PPI back?
[FONT=Arial,Helvetica,sans-serif]If you were mis sold a policy you were probably negligently misrepresented to - which is covered by the Misrepresentation Act 1967.[/FONT]
Or, if you didn't receive a fair rebate upon cancellation or repaying the loan early then this is and unfair contract term.
The Unfair Terms in Consumer Contracts Regulations 1999 states:

• (1) A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer.

If you look up "A contractual term" it is a term in a contract...


Unfair terms—If terms are made unfair by legislation they will not be enforced by the courts. They could be interpreted against the person who included them into the contract. Legislation mainly protects consumers, but also applies in a business-to-business if one party is significantly more powerful than the other.

marshallka

Unfair Terms
5. - (1) A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer.

(2) A term shall always be regarded as not having been individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence the substance of the term.

(3) Notwithstanding that a specific term or certain aspects of it in a contract has been individually negotiated, these Regulations shall apply to the rest of a contract if an overall assessment of it indicates that it is a pre-formulated standard contract.

(4) It shall be for any seller or supplier who claims that a term was individually negotiated to show that it was.

(5) Schedule 2 to these Regulations contains an indicative and non-exhaustive list of the terms which may be regarded as unfair.

Assessment of unfair terms
<A name=6>6. - (1) Without prejudice to regulation 12, the unfairness of a contractual term shall be assessed, taking into account the nature of the goods or services for which the contract was concluded and by referring, at the time of conclusion of the contract, to all the circumstances attending the conclusion of the contract and to all the other terms of the contract or of another contract on which it is dependent.

(2) In so far as it is in plain intelligible language, the assessment of fairness of a term shall not relate-

(a) to the definition of the main subject matter of the contract, or (b) to the adequacy of the price or remuneration, as against the goods or services supplied in exchange.

Written contracts
<A name=7>7. - (1) A seller or supplier shall ensure that any written term of a contract is expressed in plain, intelligible language.

(2) If there is doubt about the meaning of a written term, the interpretation which is most favourable to the consumer shall prevail but this rule shall not apply in proceedings brought under regulation 12.

Effect of unfair term
<A name=8>8. - (1) An unfair term in a contract concluded with a consumer by a seller or supplier shall not be binding on the consumer.

(2) The contract shall continue to bind the parties if it is capable of continuing in existence without the unfair term.

di3004

http://www.reckon.co.uk/open/Unfair_Terms_in_Consumer_Contracts_Regulations_1999

Unfair Terms in Consumer Contracts Regulations 1999

The Unfair Terms in Consumer Contracts Regulations 1999 (Statutory Instrument 1999 No 2083 made under the European Communities Act 1972) implement an EC consumer protection directive aimed at defeating unfair or oppressive small print in consumer contracts.
Full text from OPSI/HMSO:

http://www.opsi.gov.uk/si/si1999/19992083.htm

Related Reckon news items:

• http://www.reckon.co.uk/item/bab122c4Ofcom review of potentially unfair charges] (February 2008)
• Announcement of OFT test case (July 2007)
  (some further activity has taken place on this case but nothing conclusive as of early March 2008)
• Berwick v Lloyds TSB Bank Plc (court judgment) (May 2007)
• OFT market study into GB personal current bank accounts (April 2007)
• OFT guidance on fair credit card default charges (April 2006)
• OFT investigation into default charges on credit cards (July 2005)

Related Reckon quick guide:

• When are bank charges unfair

di3004

http://www.berr.gov.uk/whatwedo/consumers/fact-sheets/page38609.html

Unfair Terms in Contracts With Consumers Quick Facts

Relevant or Related Legislation:
Unfair Terms in Consumer Contracts Regulations 1999
Key Facts:
• A consumer is an individual not acting in the course of his or her business or profession.
• A consumer is not bound by a standard term in a contract with a seller or supplier if that term is unfair.
• Standard terms are those devised by a business in advance and not individually negotiated with the consumer. They do not have to be in writing but typically are found in the ‘small print’ on the back of order forms etc.
• A standard term is unfair if it creates a significant imbalance in the parties’ rights under the contract, to the detriment of the consumer, contrary to the requirement of good faith.
•The Regulations do not cover price-setting terms or terms defining the product (known as core terms).
• All terms (including core terms) must be in plain intelligible language otherwise they are open to challenge as unfair.
• The Office of Fair Trading (OFT) and certain other named authorities have powers under the Regulations to stop businesses using unfair standard terms and anyone from recommending the use of such terms. The OFT has a duty to consider any complaint sent to it that a contract term drawn up for general use is unfair. Other named bodies are not obliged to accept complaints for consideration.

Frequently Asked Questions (FAQs)

Q1. What exactly does the definition of an unfair term mean?

Q2. Apart from individually negotiated and core terms are there any other standard terms not covered by the Regulations?

Q3. What does a consumer do if a firm refuses to accept that a term is unfair?

Q4. Who are the other qualifying bodies that can take action against unfair Terms?

Q5. Standard terms are often in small print that is difficult to read. Is this covered?

Q6. If a term of the contract is unfair does this invalidate the rest of the contract?

Q7. How does the OFT assess whether a standard contract term is unfair?

Q8. What action can OFT and the other enforcement authorities take to prevent the continued use of unfair terms?

Q9. Where can I get advice about unfair contract terms?

---

Q1. What exactly does the definition of an unfair term mean?

An unfair term is one that creates a significant imbalance in the parties’ rights under the contract, to the detriment of the consumer, contrary to the requirement of good faith.

A term is most likely to cause an imbalance if it has the effect of reducing the consumer’s rights under the ordinary rules of contract or the general law. For example they either stop consumers from making certain sorts of legal claim against the business which they could otherwise have made, or give the business rights against the consumer that it would not otherwise have had.

But a term causing an imbalance must be capable of causing detriment to consumers. taken together with the other terms in the contract.

The requirement of good faith embodies a general ‘principle of fair and open dealing’. It does not simply mean that a term should not be used in a deceitful way. Suppliers are expected to respect consumers’ legitimate interests in drafting contracts, as well as negotiating and carrying them out.

Q2. Apart from individually negotiated and core terms are there any other standard terms not covered by the Regulations?
Yes. Terms reflecting the law, i.e. terms which must be included in the contract by law, or which the law explicitly says are allowed, are not covered. For instance, international treaties sets limits on the compensation airlines have to pay for loss or injury caused to passengers, and these limits are incorporated into UK law. But these terms must reflect the law adequately, not in a misleading way, and can be unfair if they give an advantage to the business beyond the minimum that the law allows.

Q3. What does a consumer do if a firm refuses to accept that a term isunfair?
For the individual consumer, the Regulations mean that if a business refuses to accept that a term is unfair, the consumer can ask the help of the court. If the court agrees with the consumer, the business will not be allowed to rely on that term. But, it is essential for the consumer to seek legal advice before becoming involved in a dispute that could lead to court proceedings.

Q4. Standard terms are often in small print that is difficult to read. Is this covered?
The Regulations require that plain and intelligible language is used in consumer contracts. The plain language rule is part of a wider requirement that consumers should be able to read and understand terms before becoming bound by them. So, contract terms which are hard to understand because of obscure wording or unreadable small print can be found to be unfair.

Q5. If a term of the contract is unfair does this invalidate the rest of the contract?
The fact that an unfair term is unenforceable does not mean that the rest of the contract is void, unless it is unworkable without the unfair term.

Q6. Who are the other qualifying bodies that can take action
against unfair terms?
They include local trading standards authorities, utility regulators, and the Consumers’ Association. A full list appears In Schedule 1 to the Regulations.

Q7. How does the OFT assess whether a standard contract term is
unfair?
The OFT’s starting point in assessing the fairness of a term is normally to ask what would be the position for the consumer if it did not appear in the contract. Where a term changes the normal position seen by the law as striking a fair balance it is regarded with suspicion.

Q8. What action can OFT and the other enforcement authorities take toprevent the continued use of unfair terms?
The Regulations permit enforcement authorities to consider appropriate undertakings by businesses about the use of contract terms with consumers. If necessary an application for an injunction (in Scotland, an interdict) can be made through the courts against anyone who is using or recommending the use of an unfair term.

Q9. Where can I get advice about unfair contract terms?
The Department for Business, Enterprise and Regulatory Reform (BERR) does not deal with individual consumer enquiries or complaints. If you have an enquiry please contact Consumer Direct at: www.consumerdirect.gov.uk (Tel: 08454 04 05 06). Consumers in Northern Ireland should contact Consumer Line on 0845 600 6262.

di3004

http://www.berr.gov.uk/whatwedo/consumers/buying-selling/sale-supply/unfair-contracts/index.html

Unfair Terms in Contracts

Unfair Terms in consumer contracts are regulated by the Unfair Contract Terms Act and The Unfair Contract Regulations.


The Unfair Contract Terms Act 1977 limits the use of exclusion clauses in contracts.

The Unfair Terms in Consumer Contracts Regulations 1999 (SI 1999 No 2083) provide that a term which has not been individually negotiated in a consumer contract is unfair (and hence non-binding on the consumer) if, contrary to the requirement of good faith, it causes a significant imbalance in the rights and obligations of the parties to the detriment of the consumer.
We have seperate pages for each of the above subjects. Please click on the links in the menu on the left.

In February 2005 the Law Commission and the Scottish Law Commission published a joint Report and draft bill on unfair terms in contracts. The Report recommended rewriting the existing law on unfair contract terms into a single, unified piece of legislation, which preserves the existing level of consumer protection. It also recommended improved protections for the smallest and most vulnerable of businesses (see link on the right to the Report on the Law Commission website).

The Government responded to the Chairmen of the English and Scottish Law Commissions on 24 July 2006. The letters to the Chairmen may be downloaded on the right.

di3004

http://www.berr.gov.uk/whatwedo/consumers/consumer-finance/credit-act-1974/index.html

Consumer Credit Act 1974

The Consumer Credit Act 1974 (as amended by the Consumer Credit Act 2006) regulates consumer credit and consumer hire agreements. Its protections apply to agreements between traders and individuals, sole traders, partnerships and unincorporated associations, but not agreements made between traders and corporate bodies such as limited companies.



The Act lays down rules covering:

• the form and content of agreements;

• credit advertising;

• the method of calculating the Annual Percentage Rate (APR) of the Total Charge for Credit;

• the procedures to be adopted in the event of default, termination, or early settlement; and
• the unfair relationships test.

The Act also requires that all traders who make regulated agreements or exercise rights under a regulated agreement obtain a consumer credit licence from the Office of Fair Trading (OFT). Credit brokers, credit repair businesses, debt advisors, debt management businesses and others, may also require licences.

Appeals against OFT licensing decisions should be made to the Consumer Credit Appeals Tribunal (part of the Tribunals Service).

Local trading standards departments and the OFT enforce the Act. The OFT also produces guidance about the Act and its regulations. For further information contact local trading standards departments or the Office of Fair Trading.

........................................................................................................................
http://www.berr.gov.uk/whatwedo/consumers/consumer-finance/credit-act-2006/index.html

Consumer Credit Act 2006

The Consumer Credit Act 2006 (which was fully implemented on 1 October 2008) establishes a fairer, clearer and more competitive market for consumer credit, updating consumer credit legislation that had been in place since the 1970s, and making it more relevant to today’s consumers.


The Act was implemented in 3 phases:

6 April 2007: the remit of the Financial Ombudsman Service (FOS) was extended to cover consumer credit and the Unfair Relationships Test was introduced for new agreements.


6 April 2008: the Office of Fair Trading’s (OFT’s) new strengthened licensing regime was introduced, the Consumer Credit Appeals Tribunal (for appeals against the OFT’s licensing decisions) was established, the financial limit (of £25,000) was removed so all new credit agreements (unless specifically exempt) are regulated, and the Unfair Relationships Test was extended to all existing credit agreements.


1 October 2008: a requirement for lenders to provide borrowers with much more information about their accounts on a regular basis, such as an annual statement and notices when consumers fall into arrears or incur a default sum was introduced, the OFT’s regulation was extended to credit information and debt administration services which means debt administration and credit information (repair) service providers need a consumer credit licence, and consumers can go to the courts asking for longer to pay back their loan (a time order) when they receive an arrears notice (prior to October, consumers could only seek a time order when they received a default notice)

marshallka

http://www.financial-ombudsman.org.uk/NEWS/speech/chantrey-vellacott-dfk.htm
Walter Merricks, Chief Ombudsman

Financial Regulation Industry Group, Chantrey Vellacott DFK Annual Reception 6 June 2001
who are we?

The Financial Ombudsman Service is an unusual creature. A creation of statute but founded on a voluntary initiative. An alternative dispute resolution forum optional for applicants, but with a compulsory jurisdiction over bodies complained about. A consumer service yet providing impartial adjudication. An officially created organisation but not dependent on taxpayer's money. An independent body not accountable to ministers. A jurisdiction required by law to be based not on legal rights. An adjunct to financial regulation, yet independent of it. A free service to consumers whose legal rights remain unaffected if they choose, while decisions against financial firms are legally enforceable. A jurisdiction self funding by compulsory levies and fees on the firms complained against. A mission to prevent disputes in addition to merely adjudicating on those that have arisen. A "one-sided" scheme offering an unlevel playing field broadly supported by those playing up hill.




Our "fair and reasonable" jurisdiction has attracted a fair amount of attention. It allows us to look beyond the law, beyond wording of the small print, to take into account the large print in the promotional materials, good industry practice, and, if necessary, adopt a modern and fairer approach where it is clear that the law has lagged behind. This is not dissimilar to the approach of the regulations governing Unfair Terms in Consumer Contracts,

marshallka

di3004 wrote: »

Not seen the postie go by yet, my neighbour says she has not seen postie today yet either, and she is waiting for something very important and was told she would get it by this morning, then like I said before there are only 17 houses in my street and if there are not much mail to deliver I know for a fact they will not post in this streeet until Monday, wrong I know but found this out because my sister used to work for them.......:rolleyes:
My neighbour rang the head office to tell them, they said there's still time....

I received the other streets post again the other day, and done the decent thing by giving them their post and ask if they had any of our's just in case, we have the same door number, and the first part of the address is very similar !!

Di, what do you think of these unfair rebate complaints now after reading all this....

marshallka

Just found this statement here about unfair rebates etc

In some policies the cancellation clause states that if the firm decides to cancel a policy at any point during the period of insurance, it will refund some of the premiums already paid – on a pro rata basis. However, if the policyholder cancels, then the firm retains all the premiums already paid, or refunds a smaller proportion than if it had itself cancelled the policy.


The FSA statement specifically refers to terms that charge policyholders a disproportionately large sum if they do not fulfil their obligations under a contract, or if they cancel it. We share the view that giving consumers the right to cancel – and then penalising them financially for exercising that right – is likely to be unenforceable in law, as well as unfair and unreasonable.

In some circumstances, regulatory rules require ‘cooling-off’ periods for contracts. We would expect firms to make particular provision for these periods, as it is important that cancellation rights are not restricted by unfair charging practices. For example, the Insurance Conduct of Business rules require insurers to allow a cooling-off period of 30 days for pure protection contracts. If a customer decides to cancel the contract during this period, insurers are not entitled to charge anything.

Complaints about refunds under payment protection policies – and under other policies that are not renewable – require us to consider some additional factors. We hope to comment further on this in a future edition of ombudsman news.



This is from the ombudsman

http://www.financial-ombudsman.org.uk/publications/ombudsman-news/54/insurance.htm


A good read here to help us to learn about what an unfair rebate is