Section 75 - credit card reversing a refund

SynicalOptimist

Hello,

A car was purchased for £2500.oo from a large retailer. The car broke down on the way home from the retailer and was rejected over the phone that evening and in writing to the retailer and the credit card company the following day.

The credit card company requested all purchase and vehicle information and an inspection report on the vehicle, which was carried out by an independent inspector who, not only condemned it, but on the report also stated that it was not fit for purpose. All this was sent to the credit card company.



On the 7th of November 2011 shortly after recieving the information they requested, the credit card company confirmed in writing that they will be crediting the credit card with the full purchase price of the vehicle. However, after further investigation this could be reversed.

There was no contact form the credit card company until the 3rd February 2012, advising that after exhausting all venues, they have been unable to recover the money from the retailer and will be reversing their previous decision and applying a debit for the full purchases price to my card on or after the 7th February 2012 and taking back the refund.

Is this legal? Is this even correct?

As I understand it, the credit card company is equally liable with the retailer and by crediting/refunding the purchase price in full, accepted full liability, under section 75. If they cannot get the money back form the retailer, that is their issue, not the card holders. The credit card company also have rigid time scales and 45 days to deal with this, which was up around the 2nd of January, so I think they are somewhat out of time.

Can someone please clarify this as OFT, consumer direct and the FSA are unable to, ‘’they do not give advice on points of law’ they don’t even know in this case, ‘it was a new one on them’.

Thanks

aveylee

Sounds to me like the CC company processed your claim as a chargeback rather than a Sec 75 claim.
In which case their insistence that you obtain a mechanics report, 45 day timescale and reversals policy makes sense.
However a Sec 75 claim cannot be reversed in such a manner. They are jointly and severably liable for breaches of SOGA etc. That means if the supplier can't or won'y pay the CC company MUST.

Check whether you expressly mentioned a Sec.75 claim when you contacted them. If you did then;
Go back to the bank and state in writing via recorded delivery that you consider they are attemptiing to resile from their statutory obligations under S.75; any chargeback of your refund from your Credit Card will be considered illegal and result in legal action and FSA action etc. as appropriate.

If you did not mention S.75 then state you are making a claim under s.75 now (you have upto 6 years).

SynicalOptimist

Thank you for your prompt reply. But, When I got involved with this, the letter of rejcetion had already been sent and there was, from what I can remember, no mention of section 75 at that point just a request for the inspection. But I will double check.

meer53

You need to discuss this further with your card issuer. It does sound as though they have dealt with it as a chargeback rather than Section 75. The timescale for a chargeback to reject is 60 days so it ties in with your dates. You need to clarify exactly what action they've taken first. Then seek further advice about making a Section 75 claim. CAB or Trading Standards should be able to help you.

chanz4

Wheres the car now?

SynicalOptimist

Hello,

Sorry its been a while to reply. The credit card company had indeed done a chargeback, when I spoke wiht them I told them what I thought of them, tactfully of course and that they should have done a section 75 as requested and that I expected them to do just that now. The lady on hte phone was very appologetic and so nice, I felt a bit guilty at being so officious with her. Any way, they have now responded, but mnot how I expected. They have offered 1700 pounds of 2500 pounds and to keep the car. I have never come across this type of negotiating before, especially in section 75. I thought that, if the claim was just, then a full refund and expenses should be refunded and no haggling. Also, I see this as a possible acknowledgement that the calim is successfull, but they don't want the hastle of chasing the seller and limiting the cash pay out form the credit card company. So, my thoughts on this are; 1. they have admitted fault 2. I should push for a full refund 3. push for a refund of all out of pocket expenses.

Thoughts please.

meer53

Do you still have the car ? If not where is it now ? You can't really expect a full refund if you still have it.

SynicalOptimist

Yes we still have the car but the seller hasd refused to collect it since it was rejected within the first 24hrs of purchase as it was unroadworthy. the credit card company incorrectly did an incorrect chargeback, when they should have done a section 75 claim, hence it is still here. The location of the car is, as I understand it imaterial as it was rejected, but the seller refused to accept any liability or to collect it after several attempts to get them too. Both parties have been made abundantly aware that the car has always been avialable for either the credit card company or the seller to collect, but as yet they have not done so. So now that the credit card company, appears to be accepting a the fault under a section 75 claim, they are more than welcome to the car and we will have a full refund.

chanz4

Take the offer and sell it

meer53

Doesnt sound to me as though the CC issuer has actioned a Section 75 claim and they're just making you an offer to resolve it. You need to find out whether they have or not. It's probably more cost effective for them to pay you than continue with Section 75 as they made an error originally by actioning a chargeback. I'd do what Chanz4 suggests.

SynicalOptimist

But is it unroadworhty and pretty much worthless. Have I missed the point of section 75? and is this type of offer normal practice under such a claim. Not forgetting that the credit card company completely stuffed up the chargeback by not supplying the correct paperwork; ie independent detailed vehicle inspection report which condemned the car, hence the merchant bankers rejected the claim. Or am I missing something here.