Currency exchange rate difference if refunded for faulty goods

lissa_23

We bought a well known, and supposedly reputable, brand of watch in lanzarote from a local jeweller, using 2 different credit cards (there wasn't enough limit to buy outright on either).

The watch is faulty, which has been confirmed by the manufacturer, but they say we have to get a refund from the shop we bought it from in lanzarote.

However, the currency exchange rate has changed against us in the interim, so a refund of the amount we paid in euros would leave us with a substantial loss in sterling.

So, can we claim the full sterling amount from our credit card companies under section 75? Or get the refund then claim the difference under section 75?

grumbler

Theoretically, yes, s75 does cover consequential losses.

chattychappy

Interesting question. As Grumbler says, S75 does cover consequential losses - this is because S75 makes the CC jointly liable for breach of contract and it is a general rule of contract law that you can get "damages".

But a couple of points here. Damages can be limited because of "remoteness". I always remember the example used when I was at law school. I crash into somebody's car whilst their passenger is on the phone and it's my fault. Am I liable for personal injury to the occupants? Yes. Am I liable for damage to the car? Yes. Am I liable for damage to the phone? Yes. Am I liable for the loss of £1M because that was the value of the deal the bloke was doing on the phone at the time and following the interruption, he lost out to a rival. No, probably not! The loss is too remote.

In this case, the contract was formed in Euros, you paid in Euros, you get refunded in Euros. Now Euros aren't worth what they were. But is that really a loss that flows from the purchase contract? I think not. The fact that your card is denominated in sterling isn't really relevant. S75 means that the CC is wearing two hats here. They are still your card issuer and a party to your CC agreement and this operates in sterling. But you are claiming from them wearing their other hat - as a party to the purchase contract. Would you expect to claim from the manufacturer/shop for your currency loss? Nope. By the same token, I don't think you can claim from the CC. The losses are just too remote.

So I wouldn't rate your chances any higher than "theoretical" as Grumbler puts it. And probably a lot lower.

bris

Personally no I don't think you will be able to claim it as a personal loss because there will be no breach of contract so S75 will not be an issue.


You would only be able to start a S75 claim if the retailer refused the refund only then would it be a breach.

grumbler

chattychappy wrote: »

In this case, the contract was formed in Euros, you paid in Euros, you get refunded in Euros. Now Euros aren't worth what they were. But is that really a loss that flows from the purchase contract? I think not.

On second thought I tend to agree.

InsideInsurance

Do you think they should be able to make a claim against you if the currency movement was in your favour?

As has been said, you paid €2,000 and you got back €2,000 so there is no breach of contract and so no claim against the retailer and as such no claim under S75

Penelopa.Pitstop

When BA cancelled my flight and refunded me money I lost £10 due to currency exchange rate. I wrote complain to them and when they didn't reply, I also wrote complaint to credit card. After a month, both paid missing £10.

So I would contact credit card and ask to cover the difference if the shop refuses to pay you extra to cover the difference. Worst case scenario you won't get anything but you will know you tried.