Section75 Claim - Case Law Help Please?‏

seguna

Hello
I'd be really really grateful for some assistance with a dispute I'm having with my Credit Card Provider. It involves a rejected Section 75 claim.

What I Bought?
An Educational course. Cost between £500-£1000.
When?
A few months ago.
Where from?
In person at a presentation. There was some email correspondence with the supplier after the purchase prior to attending the 2day course.
How I paid?
Credit Card, on a paper form direct to the Supplier.
What went wrong?
The course was incomplete and was mainly a feeder to a more expensive (and allegedly comprehensive) course. This constitutes misrepresentation by the supplier. After thinking about my options, I requested a refund.
Vendor’s Response?
That the course was 'good value' so refund request refused. They did not dispute the fact that the course was incomplete or that they misrepresented the content (they avoided discussing this).
Remedy Sought?
A full refund of the sums paid plus associated interest from my card supplier on the basis of S75. I think I have a much stronger claim here than to go after the supplier directly.
Creditor’s Response
Under Section 75 of the Consumer Credit Action 74, there is a debtor-supplier-creditor relationship created. The creditor is rejecting the S75 claim because they claim that PayPal is the supplier under S75. PayPal is not as far as I’m concerned. Why? Because I had NO knowledge of any involvement of PayPal being used by the supplier as a merchant or even as their payment service provider!
Further Info (1)
It’s been suggested that my exact situation has happened before where the creditor tried to hide behind a 3rd party/payment service provider. Apparently the case was ruled in favour of the debtor and I’d be most grateful if anyone can shed further light on this matter including the case law reference/guidance etc.
Further Info (2)
Please note that this is not a normal Paypal transaction where one would pay using their Paypal account linked to a credit/debit card or bank account e.g. When paying for something on Ebay. I am aware that paying using PayPal may/not be covered under S75 so I always avoid PayPal for transactions above £100.:D

This is a completely seperate offline transaction between myself and a vendor company (supplier) using my credit card as the means of payment. As far as I was concerned and as far as the paper work shows, this was me using my credit card to make a direct payment to the supplier.
Funny enough, the very reason I used my credit card to pay for this transaction was to cover me should there be issues with the course!!!

wouldbeqaulitymoneysaver

http://www.venables.co.uk/
If you have an Ipad you might be able to download paid maybe some Law apps with case laws in them as I have done.

Hintza

Something like this is subjective anyway and is only your opinion so I am not surprised they have refused S75.

I would have thought you would have to take this to the small claims court and argue your case.

unholyangel

From FOS website:

In some cases we see, the consumer has bought online, using a credit card on a website that uses a secure third-party payment system to process credit card payments.

Section 75 may not always apply to transactions made this way, because this payment mechanism can break the chain of arrangements that must be in place between the consumer, the lender and the supplier.

But there are many different types of payment mechanisms used on suppliers’ websites and not all of them prevent section 75 from applying. Where there is a dispute on this point, we look at the specific payment mechanism used and decide whether section 75 applies in the particular case.

Section 75 gives the consumer a right to claim against the lender in specific circumstances – where there was a misrepresentation or a breach of contract by the supplier. But there is no claim simply because, for example, you find you could have bought the same goods at a better price somewhere else – or if, on reflection, you feel the purchase was not worth the money.

How did he misrepresent the course? Did it conform to what was promised (ie coverage and any qualifications upon finishing/passing), if not.....can you please provide details of how it fell short?

wealdroam

All Section 75 of the Consumer Credit Act does is make the credit card company equally responsible with the seller for performance of the contract.

Once you have overcome the Paypal hurdle, you will need to convince the credit card company the contract has not been performed properly.
As has already been said, this appears to be very subjective.

You say...

I think I have a much stronger claim here than to go after the supplier directly.

Can you please explain why you think that?
The supplier and CC Co are equally responsible (once the paypal issue is out of the way).

wouldbeqaulitymoneysaver

The Which Ipad Iphone app has some pointers.
CAB.

Agricolae

seguna wrote: »

Hello
I'd be really really grateful for some assistance with a dispute I'm having with my Credit Card Provider. It involves a rejected Section 75 claim.

What I Bought?
An Educational course. Cost between £500-£1000.
When?
A few months ago.
Where from?
In person at a presentation. There was some email correspondence with the supplier after the purchase prior to attending the 2day course.
How I paid?
Credit Card, on a paper form direct to the Supplier.
What went wrong?
The course was incomplete and was mainly a feeder to a more expensive (and allegedly comprehensive) course. This constitutes misrepresentation by the supplier. After thinking about my options, I requested a refund.
Vendor’s Response?
That the course was 'good value' so refund request refused. They did not dispute the fact that the course was incomplete or that they misrepresented the content (they avoided discussing this).
Remedy Sought?
A full refund of the sums paid plus associated interest from my card supplier on the basis of S75. I think I have a much stronger claim here than to go after the supplier directly.
Creditor’s Response
Under Section 75 of the Consumer Credit Action 74, there is a debtor-supplier-creditor relationship created. The creditor is rejecting the S75 claim because they claim that PayPal is the supplier under S75. PayPal is not as far as I’m concerned. Why? Because I had NO knowledge of any involvement of PayPal being used by the supplier as a merchant or even as their payment service provider!
Further Info (1)
It’s been suggested that my exact situation has happened before where the creditor tried to hide behind a 3rd party/payment service provider. Apparently the case was ruled in favour of the debtor and I’d be most grateful if anyone can shed further light on this matter including the case law reference/guidance etc.
Further Info (2)
Please note that this is not a normal Paypal transaction where one would pay using their Paypal account linked to a credit/debit card or bank account e.g. When paying for something on Ebay. I am aware that paying using PayPal may/not be covered under S75 so I always avoid PayPal for transactions above £100.:D

This is a completely seperate offline transaction between myself and a vendor company (supplier) using my credit card as the means of payment. As far as I was concerned and as far as the paper work shows, this was me using my credit card to make a direct payment to the supplier.
Funny enough, the very reason I used my credit card to pay for this transaction was to cover me should there be issues with the course!!!

There are two issues here:

1. Was the course misrepresented or is there a breach of contract?

This is debatable. For there to be a breach of contract the supplier would have needed to have breached an explicit or implied term of the contract. For there to be a case for misrepresentation you would have to show that the supplier made a false statement of fact which caused you to enter into the contract.

The key questions here are:
a) What were you told you would get?
b) What did the contract say you would get?

To be honest, not knowing anything more than what you've told us, it sounds like it could just be a "bad deal" or poor value for money.

2. Does the transaction going through PayPal break the debtor-creditor-supplier relationship?

This is an interesting one and I don't think a court has ruled on this specific issue before. The Consumer Credit Act was written in 1974 at a time when credit cards were pretty new and this seems to have thrown a spanner in the works.

If you think about nearly all credit card transactions carried out today, there is at least a fourth party in the process. You begin with the debtor, who uses a credit card provided by a creditor to make a payment. The payment goes via Visa/Mastercard, and the transaction is picked up (acquired) by the supplier's bankers, who then pass the money on to the supplier, so...

1. Debtor
2. Creditor
3. Acquirer
4. Supplier

Technically I would say this breaks the relationship. However it appears to be accepted by the industry that it does not. For this reason I don't see how PayPal processing a credit card transaction and passing the money on to the supplier is any different.

Now in the old days when the act was written, the creditor and acquirer were normally one and the same. How it would work is a credit card company would supply cards to debtors, and would also provide facilities for suppliers to accept transactions on their specific card. Suppliers would have to apply to each issuer of cards for the right to accept its cards. If a card issuer didn't like the look of a supplier then they could refuse them facilities. In a way I guess section 75 may have been included to discourage card issuers from climbing into bed with dodgy suppliers, by making them liable for said dodgy supplier's dodgy activities.

I digress, but essentially I don't think PayPal should be an issue where it has performed the same function as the supplier's bankers. Still, there's no law on this as far as I'm aware, so good luck.

seguna

Hintza wrote: »

Something like this is subjective anyway and is only your opinion so I am not surprised they have refused S75.

I would have thought you would have to take this to the small claims court and argue your case.

Thanks.
They're not refusing the S75 on the basis of what the supplier "delivered or not", they're saying my supplier is PayPal when it's clearly not. I'm not sure how that's a subjective assessment?

seguna

Agricolae wrote: »

There are two issues here:
1. Was the course misrepresented or is there a breach of contract?

2. Does the transaction going through PayPal break the debtor-creditor-supplier relationship?

Thank you all so much for your posts! I've only today just come back here and seen them. Other forums I've used in the past always sent emails when threads were commented on so not sure if MSE Forum does that?
Anyway, this is all v.helpful.

Agricolae, thanks for crystalising the issues the way you have, nailing it spot on.

For me, the issue is definitely point 2. For privacy reasons, I'd rather not go into the key reasons why there was misrepresentation and breach of contract by the Supplier but there was and I have evidence in the form of various correspondence (copies of which were sent to the CC). The main issue though is that it was an upsell event (for a more comprehensive more expensive course) NOT the complete package as it was sold as.

That said, the CC company has not refused the S75 on that ground. They've done so on the 'PayPal is your Supplier' footing so that's why I'm contesting their action on that ground.:(

seguna

wealdroam wrote: »

Once you have overcome the Paypal hurdle, you will need to convince the credit card company the contract has not been performed properly.
As has already been said, this appears to be very subjective.

You say...

Can you please explain why you think that?
The supplier and CC Co are equally responsible (once the paypal issue is out of the way).

Well the CC has not commented on whether or not they think there was misrepresentation and or breach of contract. They've left that alone & just refused the S75 on the basis that 'under S75, PayPal is the Supplier' and NOT the training company.

I assume therefore that they think the evidence I sent them showing misrepresentation etc is sufficient to demonstrate that so they've gone down this non-Supplier route.

seguna

unholyangel wrote: »

From FOS website:
Quote:
In some cases we see, the consumer has bought online, using a credit card on a website that uses a secure third-party payment system to process credit card payments.

Section 75 may not always apply to transactions made this way, because this payment mechanism can break the chain of arrangements that must be in place between the consumer, the lender and the supplier.

But there are many different types of payment mechanisms used on suppliers’ websites and not all of them prevent section 75 from applying. Where there is a dispute on this point, we look at the specific payment mechanism used and decide whether section 75 applies in the particular case.

All I can say is that I doubt this applies. Firstly, I did NOT pay online. Secondly, I DIDN'T pay using PayPal or any other online payment site/processor. I paid by filling in & signing a card payment form on the supplier's premises. I've a copy of this form and there's no mention of PayPal on it. The company then went away and processed the card payment. I was not even there to enter a PIN or anything!

As far as I'm aware, I paid direct to the training company using my CC. That makes the CC the creditor and that company the supplier.