MSE News: O2 to hike its prices by 2.7% - can you leave your contract penalty-free?

MataNui

This issue is really about 2 basic principles of contract law. Firstly that a contract should be beneficial to both sides and should not be written to favor one party. The OFT specifically mentions contracts should not favor the business to the detriment of the consumer and secondly that the terms should be known and understood at the time the contract is agreed. The problem with mobile phone contracts is that there are clearly 'unfair' terms (some are specifically described by the OFT as being unfair and shouldnt be used). One of them is regarding being able to change the cost by any variable amount without the customer being able to cancel without penalty (or conditions are placed on when they can cancel) and the other is that they ALL say the company can change the terms and conditions at any time (again the customer cant cancel without penalty). These are examples that you can find in almost all mobile contracts that the OFT has specifically ruled as 'unfair' standard terms and would be easily challenged in court if you wanted to do that. The way O2 have done it now (with regard to the price rises) wont be classed as unfair though since it states that prices WILL increase and by how much and when they will increase. So the consumer knows (or could work out) exactly how much the contract will cost them when they sign.

DUTR: You mention that nobody takes these issues to court and you may be right. It wont be 'because they would be laughed out' though. Its because the mobile companies know that there are terms in the contracts that they wouldnt be able to enforce so its easier to let the user leave.

DUTR

MataNui wrote: »

This issue is really about 2 basic principles of contract law. Firstly that a contract should be beneficial to both sides and should not be written to favor one party. The OFT specifically mentions contracts should not favor the business to the detriment of the consumer and secondly that the terms should be known and understood at the time the contract is agreed. The problem with mobile phone contracts is that there are clearly 'unfair' terms (some are specifically described by the OFT as being unfair and shouldnt be used). One of them is regarding being able to change the cost by any variable amount without the customer being able to cancel without penalty (or conditions are placed on when they can cancel) and the other is that they ALL say the company can change the terms and conditions at any time (again the customer cant cancel without penalty). These are examples that you can find in almost all mobile contracts that the OFT has specifically ruled as 'unfair' standard terms and would be easily challenged in court if you wanted to do that. The way O2 have done it now (with regard to the price rises) wont be classed as unfair though since it states that prices WILL increase and by how much and when they will increase. So the consumer knows (or could work out) exactly how much the contract will cost them when they sign.

DUTR: You mention that nobody takes these issues to court and you may be right. It wont be 'because they would be laughed out' though. Its because the mobile companies know that there are terms in the contracts that they wouldnt be able to enforce so its easier to let the user leave.

See the reply #2306 in this thread, the person did take time and challenge a price increase.
I don't know exactly how much my monthly bill will be as I may not be able to forsee inexpected out of bundle charges, however this month and next I will be paying £21.07 and in March it will be £21.64 assuming no out of bundle useage, the provider has already given me plenty of notice and in any instance just 30 days notice is required. I suppose because I don't buy handsets on credit, that is why I am a lot less fussed about a small price rise .

I suppose the network could allow the termination of the contract and dark list the handset imei or request the handset is returned swiftly?

NittyGritty

DUTR wrote: »

See the reply #2306 in this thread, the person did take time and challenge a price increase.
I don't know exactly how much my monthly bill will be as I may not be able to forsee inexpected out of bundle charges, however this month and next I will be paying £21.07 and in March it will be £21.64 assuming no out of bundle useage, the provider has already given me plenty of notice and in any instance just 30 days notice is required. I suppose because I don't buy handsets on credit, that is why I am a lot less fussed about a small price rise .

I suppose the network could allow the termination of the contract and dark list the handset imei or request the handset is returned swiftly?

tmobile did the exact same thing last year with RPI, the only trouble was they botched the figures up, and some complained to CISAS including myself, and won along with compensation. 02 haven't made the same mistake,so for those who use this an excuse (RPI) you wont get anywhere this time around.


however they are increasing calls and texts outside of allowances, so for those who go outside the allowances by 10% will have no trouble in leaving free of charge. even if its not 10% its still worth going to CISAS if you feel that strongly about it. just make sure you make it worthwhile and add some form of compensation for the trouble your taking. they can only say no, in which case you've lost nothing, if you win then you have everything to gain, cancelled contract, plus compensation plus u get to keep the phone


(ive done this three times in mid contract, once with tmobile,02 and what was orange) and not once did they ask for it back. if they do (unlikely unless you've just started like a month or 2 in)


as for being "3 months or so" DUTR, theres no or so about it, its 1 month only/previous month

MataNui

DUTR: Like you i dont get handsets as part of a contract (not anymore and not for a long time) and i wouldnt moan about a few pence increase either. In a way i am quite pleased O2 have done this as at least users will now know exactly how much the contract will cost them. TBH i think the entire industry needs to change and i guess the root of it all is the idea that 'upgrading' to a nice new phone all the time is now the norm.

Of course if they subsidise an expensive handset they want to 'protect' that investment but the way they do business (particularly by using the unfair and unenforceable contract terms) needs to stop. Perhaps what you suggest regarding returning the handset (or a payment to the value of it) might not be such a bad idea. It would make people think twice about unaffordable contacts for nice new phones.

NittyGritty

MataNui wrote: »

i wouldnt moan about a few pence increase either.

its exactly why these companys have no issues with hiking the costs of call and texts, because they know out of the millions only a few complain and take it further with the ombudsmen. I was like you once, until I thought...... hang on a min, I,m not going to sit around and do nothing anymore.


if I feel they are doing wrong, and they are breaching my contract in anyway, I will have no issues in complaining and taking it to ombudsman, win or lose the case at least I tried, rather than sit back and agree to the hikes

DUTR

MataNui wrote: »

DUTR: Like you i dont get handsets as part of a contract (not anymore and not for a long time) and i wouldnt moan about a few pence increase either. In a way i am quite pleased O2 have done this as at least users will now know exactly how much the contract will cost them. TBH i think the entire industry needs to change and i guess the root of it all is the idea that 'upgrading' to a nice new phone all the time is now the norm.

Of course if they subsidise an expensive handset they want to 'protect' that investment but the way they do business (particularly by using the unfair and unenforceable contract terms) needs to stop. Perhaps what you suggest regarding returning the handset (or a payment to the value of it) might not be such a bad idea. It would make people think twice about unaffordable contacts for nice new phones.

If it wasn't enforceable then the companies would be retracting the decision, that is never going to happen. Sometimes companies and the Goverment have to make ugly descisions, rhis is reletively minor in the grand scheme of things and is only of great effect to the sub prime subscribers who will not accept there is no people power.

NittyGritty

DUTR wrote: »

If it wasn't enforceable then the companies would be retracting the decision, that is never going to happen

T-Mobile did this last year with the RPI, they got the figures WRONG, it wasn't Enforcebale hence why some took it to CISAS and won and left for free, and even a couple of months ago I think it was on MSE, T-Mobile were Forced to refund those affected when it finally came to light to the public.

parrysite

AndyBSG wrote: »

I was on an 18 month handset contract with 4 months still to run.

Phoned them up and said I wanted to cancel my contract without penalty due to the price increase.

They then told me I would have penalties as an RPI increase is specified in my contract.

I then said that I know RPI increases are covered but the unrelated Call, Text and MMS price increases are not covered and under CISAS regulations if I incur additional charges not covered in my monthly tariff due to extras then I can cancel on this basis.

Did you have to quote a specific part of the CISAS guidelines? And did they admit defeat straight away or did you need a manager? I'm calling soon but just want to be well equipped.

G1D

Hi, don't know whether this is the right thread, but like all o2 customers I've been hit with the RPI price rise (again).
Does anyone know if there are any mobile networks that don't have this RPI clause in their small print on their standard contracts? (So you only pay for what you agreed to when you sign the contract).
This would be good to know when my contract does expire.
Thanks.

DUTR

G1D wrote: »

Hi, don't know whether this is the right thread, but like all o2 customers I've been hit with the RPI price rise (again).
Does anyone know if there are any mobile networks that don't have this RPI clause in their small print on their standard contracts? (So you only pay for what you agreed to when you sign the contract).
This would be good to know when my contract does expire.
Thanks.

When it does expire the other networks may do the same (if they don't already).