Mobile Phone Contract - Price Rise Refunds

ulaggy

Glad that MSE are aware. Fingers crossed they'll join us!

Ofcom email sent (and everyone CC'd in)

ShowMeTheMoola

Hi All.

RC thank you for the revised response to defence - especially having just left hospital! Hope you are feeling better. I have been allocated Claire Williams as my adjudicator. I can see she awarded one person on her their full claim earlier this month so lets see how things pan out given EE's new approach...

Martinmal1

Just had my confirmation from cisas EE have until 22nd of July and them I'm free of there clutches

muse213

RC, just had my confirmation of my acceptance of the decision, EE have until the 22nd July to give me PAC code, comp and backdated bills etc, how will they do all of this? Do they send a letter? Or by phone because I am going to France later on today for a week and a bit!

Advice would be greatly appreciated, and hope you are feeling better!

Mikmonken

Anyone had a response back yet from OFCOM re the complaint?

Mikmonken

just got mine

Ofcom reference: 1-257859495

24 June 2014

Dear Mr G

Following on from our email dated 20 June 2014 regarding EE, we are continuing to consider these matters carefully and now expect to have a reply in full for you on 25 June 2014.

I apologise for the delay and any inconvenience this may cause.

Yours sincerely

Jessica Eyles
Consumer Contact Team

bobbyh1982

ABSOLUTELY BUZZING!

CLAIM SUCCEEDS!

The company shall cancel the customer’s contract without penalty backdated to his notice of 24 April 2014, provide a PAC and unlock code, and compensation of £100.00!!!!

Over the moon with this - Top work RC!

Can somebody please help with what to do next - I'm off to Spain on Saturday, I'm guessing my usage will be free then I accept the decision when I get back?
What happens then - do I simply wait for CISAS to get in touch and the details with a cheque from EE?

My bill is also due on Monday - should I cancel my DD?

Thanks!

ulaggy

I wouldn't cancel the direct debit until the account has been closed. Otherwise, you'd probably be at risk of them trying to take money from your account still (as they have a timeframe to sort it all by, and will probably try and take money till that point). You'd end up with a bad mark on your credit record. You'd be able to get it removed, but that's more faffing for you!

Maccadinho25

RandomCurve wrote: »

Another 2 emails have been sent o Ofcom - please everyone send that email as it will make a differnce (and will only take a few seconds of your time).


Also please stop PM'ing Helen at MSE - she has contacted me and we are discussing possibilities.


Thanks

Had a response from Ed Richards office 11 hours after sending the email as requested. Just an acknowledgment but will keep you updated

Irreverent

Had a response from CISAS. Claim does not succeed - adjudicator AM - I'm really displeased given the total lack of consistency across CISAS adjudicators. I'm bitter, but to me the response is a load of waffle that translates as "big company = always right, tiny, insignificant customer = always wrong"

I have no idea how the simple notion that a price rise above inflation doesn't count as material detriment. Any idea as to the best next step? Is there any opening for a new claim from another angle and another £300 out of EE's pockets?

Decision
1. The claim does not succeed.



2Company’s address for correspondence: Trident Place, Mosquito Way, Hatfield, Hertfordshire, AL10
9BW. 2

Main issues
2. I consider that the main issues in this adjudication are:

a. Whether the company has broken a term of the contract between it and the customer or
failed in its duty of care.

b. Whether the reasons given by the customer are sufficient to justify an apology, penalty
free termination, and £50 compensation.

Background information
3. In order to succeed in a claim against the company the customer must prove on a balance of
probabilities that the company has broken some term express or implied of the agreement
which existed between them, or failed in the duty of care which the company owed to the
customer and that as a result of this breach the customer has suffered loss. (A duty of care is a
responsibility or a legal obligation of the company to avoid acts or omissions which can be
reasonably foreseen to be likely to cause harm to others). If no such breach or loss is proved
the company will not be liable to pay compensation however disappointed or upset the
customer is.

4. The customer and the company are aware of the facts of this case. I do not propose to recount
all the facts in the same manner and order as the parties have done in their documents except
where it is necessary for the purposes of this decision. I have carefully considered all of the
documents submitted by the parties in support of their submissions and presented to me. The
parties should also be reassured that if I have not referred to a particular document or matter
specifically, this should not be taken to mean that I have not considered it in reaching my
decision.

Customer’s and company’s positions
5. The customer states that the company has notified him of a price increase. This increase is of
material detriment and gives rise to a right to terminate the agreement without penalty in line
with General Condition 9.6. The customer requests compensation for the company failing to
inform him of his right to cancel the agreement without penalty, and for failing to address all
points raised in his original e-mail. The customer submits that the increase is in excess of
accepted measures of inflation such as the CPI and is therefore a real terms increase. Ofcom
has issued guidance stating that any mid-term price increase will be considered to be material
detriment; the company has varied its terms and conditions after the guidance came into effect
and the customer submits that the guidance is therefore applicable to his agreement. The
guidance also merely clarifies General Condition 9.6; it does not amend it.
3

6. The company submits that the claim falls outside the remit of the CISAS Scheme as it does not
directly relate to bills or communication services. The company gave notice between 29
January 2014 and 14 February 2014 that it would be amending its terms and conditions,
effective from 26 March 2014. In line with Clause 4.3 and its sub-clauses, the company gave
notice between 5 and 15 April 2014 of a price increase of 2.7%. This is no more than the RPI
figure published most recently before notice was given, that of February 2014 published on 25
March 2014. The company denies that the increase entitles the customer to terminate without
paying an early termination charge or that it is material detriment. The company submits that it
is not obligated to use any other method to calculate the price increase; the terms specifically
refer to the RPI. The company denies that it mis-sold the agreement to the customer as it did
not have plans to increase its prices at that time. The agreement was not a ‘fixed term contract’
and the company could increase its charges as provided for by the agreement. The company
submits that determining if the increase is of material detriment is a complicated issue of law.
The company denies any breach of the agreement or its duty of care or that the customer is
entitled to the remedies requested. It denies it was required to issue a deadlock letter as it
maintains the issue is outside the scope of the CISAS Scheme.

7. The customer has responded to the company’s defence stating that the company has not
explained why the new terms and conditions should not be subject to the Ofcom guidance on
material detriment effective from 23 January 2014, why a price rise above the CPI is not a real
terms increase and therefore material detriment, and how the clarification of the actual wording
of General Condition 9.6 should not apply to the contract. The customer submits that the
company is attempting to frustrate his claim by suggesting that the case is a complex matter.
The terms provide the RPI as the figure that any increase must not exceed; this is not the same
as a figure that the company is required to use. Such an interpretation would amount to a
clause that requires the company to breach General Condition 9.6 by applying a real terms
increase. The customer states that he has been caused stress by the company not responding
fully to all points raised in his correspondence. The customer reiterates that a real terms
increase cannot be considered neutral and is therefore of material detriment. The customer
highlights the fact that the company did provide him with a deadlock letter as an example of its
lack of care.

Adjudicator’s findings and reasons
8. I find that:

a. The company has submitted that the dispute falls outside the scope of the Scheme as it
does not fall within Rule 2(g) stating that the dispute must be about bills, communication
services, or the customer service provided. I do not accept this. First the dispute relates
to the customer’s future bills, specifically the price of the basic price plan. Secondly,
determining material detriment in relation to this bill will also fit within the category of 4

billing. I am also not persuaded that the issue of material detriment is a complicated
issue of law. I shall therefore proceed to determine the dispute in full.

b. The company has updated its terms and conditions, effective 26 March 2014. Due notice
of the change was provided between 29 January and 14 February 2014. I note that the
customer did not request termination of the agreement at this point. Accordingly, I must
find that, as the customer has not requested termination in line with the terms of the
agreement (i.e. before the change takes effect) he has therefore accepted the change to
the terms and conditions. I am therefore satisfied that the terms and conditions
applicable to the customer’s agreement is version LEG300v15A.

c. The customer submits that if the terms and conditions have been changed, then the
Ofcom guidance relating to material detriment, effective to all agreements entered into
after 23 January 2014, should apply to him. I do not accept this.

d. The change to the terms and conditions amounted to an amendment to an ancillary term,
as opposed to a core term of the agreement. The amendment was made in line with the
terms themselves that allow for such changes. I find that the customer has accepted the
updated terms and conditions but that as no other change has occurred to his
agreement, in particular to the end date of the minimum term, the amendment cannot be
seen to amount to a new agreement. I therefore find that the customer’s agreement is
not automatically subject to the Ofcom guidance on material detriment applicable to new
contracts.

e. The company has increased its prices in line with Clause 4.3 of the agreement. The price
increase is one of 2.7%. I note that Clause 4.3.1 provides that a price increase will not
give rise to the right to terminate without charge unless the increase is in excess of the
RPI figure most recently published before notification of the price rise was given. As
notice was given between 5 and 15 April 2014, the relevant RPI is that of February 2014,
published on 25 March 2014.

f. In order to terminate the agreement without charge, the customer must show that the
price increase is of material detriment. As I have found above, the guidance published by
Ofcom is specifically not retrospective and does not apply to the customer’s agreement. I
must therefore determine if the increase is of material detriment with regard to the
evidence as a whole.

g. I am mindful that the terms and conditions have always had a price variation clause and
have made reference to the RPI as the limit to any such increase. The clause has the
effect of putting the customer on notice that the price may increase during the minimum 5

term of the agreement, and that if this increase is in excess of the RPI, it will give rise to
a right to penalty-free termination.

h. The customer makes reference to the CPI being the accepted measure of inflation, and
that an increase in excess of this will amount to a ‘real terms’ increase and will therefore
be of material detriment. I am not persuaded by this. The terms have provided for an
increase that is no greater than the RPI and any such real terms increase in price must
be viewed within this context.

i. I find that the terms and conditions provide the company with the right to implement a
price increase up to the RPI. As the terms have always provided this right and the
amended terms clarified rather than implemented this right, I find that any increase that is
less than the RPI cannot be considered to be of material detriment unless the customer
has individual, extenuating circumstances showing the effect of the increase would be
materially detrimental to him. No such evidence has been provided.

j. Nevertheless, I do not accept that a real terms increase amounts to material detriment
within the context of the terms of the agreement and the contract was entered into before
the Ofcom guidance came into force. The customer was aware at the commencement of
the agreement that the price could increase by no more than the RPI, and I find that this
context is sufficient that any such increase cannot be considered to be of material
detriment.

k. The customer’s claim is for an apology and to have the agreement terminated without
charge. He also seeks £69.34 in compensation for the company’s failure to notify him of
his right to cancel the agreement without charge should he consider the increase to be
detrimental, and for not addressing all of his points when responding to him. He also
requested further compensation should the company make certain arguments in its
defence submission.

l. In its defence submission the company maintains that in its view the decision to increase
its prices by 2.7% did not breach either the agreement or its duty of care to the customer.
I accept this to be the case. Having reviewed the company’s response to the customer’s
issue I find that, although it did not respond to each and every one of his points, it made
its position clear to him. The company’s position has been consistent throughout and
once it had made its final position clear to the customer it provided him with the details of
its dispute resolution provider, namely CISAS, so he could progress it further if he
wished. I do not find this represents a breach of its duty of care towards the customer. I
dismiss the submissions that the company should be denied its right to make certain 6

arguments in its favour or that the mistake over the deadlock letter is indicative of its
general lack of care.

m. For these reasons, I find that the customer is not entitled to terminate his agreement
without an early termination charge applying. The customer’s claim is therefore unable to
succeed.

Conclusion
9. My conclusion on the main issues is that:

a. The company has not failed in its duty of care to the customer.

b. The reasons given by the customer are not sufficient to justify an apology, penalty free
termination, and £50 compensation.

10. Therefore, my decision is that the claim does not succeed.