Three Mobile price-hike: customers may be able to cancel contracts without penalty

michaeljtbrooks

Many of you are affected by Three Mobile's recent price hike on Pay Monthly contracts taken out before March this year. The good news is that due to Three Mobile's contract wording, consumers affected should be able to cancel their contracts and by law keep their handsets without penalty.

[NB: I disclaim liability for any loss or damages incurred by acting or failing to act upon information within this post]

This post refers to the Three mobile Terms and Conditions [www (dot) three.co.uk/_standalone/Link_Document?content_aid=1220457052786]*, which are either identical or very similar to the Terms that Pay Monthly customers would have signed up to in the last few years.

Three have announced a 3.5% increase in monthly contract fees for contracts taken out before March 2012. Section 10.1(d) of the Terms states that any "detrimental", or "materially detrimental" notice given of changes to the service allows a customer to cancel their contract without Cancellation Fee.

Section 4.1 of the Terms states that Three can change the "fixed monthly fee", but must give affected customers a sufficient amount of notice. The amount of advance notice Three must give is more if the price increase is above the Retail Price Index. This section emphatically does not exclude the customer's right to cancel under 10.1(d) without penalty even if the price rise is below RPI.

Three mobile have been trying to claim that 4.1(b) allows them to raise prices, and provided that such a price rise is below RPI, the customer cannot cancel. However, a prominent lawyer (Andrew Dyson, Oxford University Fellow and Contract Lawyer) has argued in a publication that this section simply obliges Three when to notify customers and does not affect the customer's right to cancel. He argues that any price increase is always a "detrimental" change for the consumer, and nothing in the Three Mobile Terms exists to state otherwise.

Any such claim by Three that 4.1(b) excludes a customer from their rights under 10.1(d) is a misrepresentation of the Terms, and should be cause for complaint to Three and the Office of Fair Trading.

Three customers can speak with customer services about this for free by dialling 333 from their Three mobile.

The Independent has published a summary of this issue here:
[www (dot) independent.co.uk/news/uk/home-news/oxford-dons-legal-fight-over-price-rise-signals-trouble-for-phone-giant-7827719.html]*

The paper by Andrew Dyson can be found here:
[bit (dot) ly/M8H2jT]*

Having tried to cancel my contract and been told that my rights under 10.1(d) do not apply because the price increase is below RPI, I have lodged a complaint with Three about their misrepresentation of the Terms and unjust refusal of my rights. There is likely to be a small claims case about this issue which will serve as a strong legal precedent for affected customers.

In a world where 24-month contracts are being used by mobile carriers to lock people into their network for a long time, mid-contract price-hikes seem very unfair to me. The networks shouldn't have the luxury of guaranteeing you as a customer for 24 months while at the same time refusing you the right of having your monthly fee fixed for those same 24 months.

* apologies about this forum's moronic spam filter obfuscating the links

brightonman123

would this apply to other suppliers, too? (~cough~ tmobile? )

michaeljtbrooks

No, T-Mobile, Orange and Vodafone's Terms and Conditions were all worded "correctly" to exclude a customer's right to cancel if a price hike is less than RPI. If you're on those networks then a below RPI rise won't allow you to cancel without penalty.

Three Mobile's Terms and Conditions are worded very differently to the other networks with the effect that they have failed to exclude the customer's right to cancel in the case of below-RPI price rises. This is the crux of the whole argument.

What has happened is that Three have blindly followed T-Mobile, Orange and Vodafone but failed to realise that their Terms and Conditions don't allow for this unlike the other carriers.

I strongly encourage you to read the Ts and Cs if you are a Three customer and take the network to task over them.

digp

"Three Mobile's Terms and Conditions are worded very differently to the other networks with the effect that they have failed to exclude the customer's right to cancel in the case of below-RPI price rises. This is the crux of the whole argument."

You could - and I don't say you would win - challenge such as clause as unreasonable / unfair.

ossie

What I cannot understand is why Three have announced a 3.5% increase in monthly contract fees for existing contracts (Samsung Galaxy SII) as they are now offering exactly the same deal for less on a newer model phone (Samsung Galaxy SIII).

Guys_Dad

michaeljtbrooks wrote: »

Having tried to cancel my contract and been told that my rights under 10.1(d) do not apply because the price increase is below RPI, I have lodged a complaint with Three about their misrepresentation of the Terms and unjust refusal of my rights. There is likely to be a small claims case about this issue which will serve as a strong legal precedent for affected customers.

Would this SCC case be claiming the excess monthly costs or any cancellation charges that 3 would hit you with if you cancelled unilaterally?

In the latter event, you would also then have to contend with the appalling 3 Customer Services who would have hit your credit record with an indication on non-payment. I am not sure that the SCC could instruct 3 to remove any "bad debt" record histories. That could cause far more problems than the extra quid per month

When the hassle vastly exceeds the increased costs, then I tend to follow commercial practice and write off the costs to "bad debt provision", so to speak. I understand the matter of principle, though, and recognise that people have the right to challenge even the smallest matters on that basis.

Quentin

Guys_Dad wrote: »

Would this SCC case be claiming the excess monthly costs ......

Not a good idea to invest time and money sueing them over the extra monthly cost!

The minimum cost of a court hearing is £50, and this would just be for the court fees. You also need to consider the time and expense involved in submitting the claim and further court docs, as well as the risk of being made to pay the other sides expenses if you lose!

A_Flock_Of_Sheep

A simple answer is to never get involved with Mobile operator's "long contracts". If everyone began to boycott them and go for SIM free and PAYG (which arguably is just as good now if not better) they would have to do something.

I got wrapped up in the Vodafone one that happened a while back and did manage to "get out" penalty free but made a promise to myself to NEVER have a mobile "contract" again.

Guys_Dad

Quentin wrote: »

Not a good idea to invest time and money sueing them over the extra monthly cost!

The minimum cost of a court hearing is £50, and this would just be for the court fees. You also need to consider the time and expense involved in submitting the claim and further court docs, as well as the risk of being made to pay the other sides expenses if you lose!

Agreed. That then leaves taking them to court for the cancellation fee. By that time, they will have registered you as a debtor on the Credit Agencies's files and, as you know, this could take ages to correct, even if you won the court case.

Would you risk it?

Interesting to read the test case and aftermath.

matrix999

Guys,

I'm on the phone to Three just now.. Its like pulling teeth trying to get a PAC out of these jokers.

I'm wanting to cancel under sec 10.1 due to the price increase and challenge them in court over their terms and conditions. Three are coming out of some rubbish that i need to pay the ETC just now before they will issue the PAC??

Anyone heard of this?

Guys_Dad

Early Termination Charge ?