£12k Bill!

CharlieWannaWin

Hi, I'm really hoping someone can offer some advice.

My sister persued a PPI claim through one of these no win no fee people. They did some investigating on her behalf and she then received a letter from the legal department of the people who provided the PPI cover saying that if she pursued her claim they would bill her for the time they spent dealing with it. She got scared and did not pursue her claim. She's now been sent a bill for £12k and is understandably terrified.

Can anyone offer any advice on what her position is legally? I've suggested she go to CAB.

Thanks,

Charlotte

Voyager2002

First of all, I suggest that she has a good laugh. Then she might explore whether the bill is soft enough to use as toilet paper, or would be any use for lighting fires.

Did she in fact take out PPI cover, and is it likely that it was mis-sold? And once she decided not to pursue her claim , did she instruct the company acting for her to withdraw the case?

On second thoughts, perhaps she should simply forward the bill to the Claims Management Company and ask them to settle it, while telling the PPI people to send bills to them.

CharlieWannaWin

Thanks. So you think they're just trying to scare her off? As far as I'm aware she instructed the company acting for her to withdraw the case.

jamesd

First thing to do in this case seems to be to phone the Financial Ombudsman Service and ask for their comments on threatening people with prohibitive charges if they don't drop PPI claims. They may agree to take this case as a result of the call because it's a blatantly unethical practice.

dunstonh

My sister persued a PPI claim through one of these no win no fee people. They did some investigating on her behalf and she then received a letter from the legal department of the people who provided the PPI cover saying that if she pursued her claim they would bill her for the time they spent dealing with it. She got scared and did not pursue her claim. She's now been sent a bill for £12k and is understandably terrified.

Who sent that letter? The claims company or the company she had PPI with? I know you said the company with the PPI but that does not make any sense as the complaints process is regulated and you cannot bill people for making a complaint (there is the potential if the complaint is frivolous and you continue to generate ongoing work).

CharlieWannaWin

Right, I have more info. It's not PPI. She was approached by one of these PPI recovery firms, and gave them all her details to see if she was entitled to any money back. They looked into her finances and suggested that her mortgage was mis-sold by the broker that they used. They referred her to a different company 'who could better deal with that sort of claim'. She was assured at all times that it was a no win no fee arrangement and there would be nothing for them to pay. Two years down the line she was informed that her claim wasn't worth pursuing so she withdrew it. The company dealing with the claim asked her to sign a form freeing them of any comeback in relation to the claim and also received a letter from the broker's solicitors threatening her with a bill if she persued the claim. Because of that letter, she didn't sign the form as she wasn't sure what ramifications of that would be.

And now she has a £12k bill.

dunstonh

They looked into her finances and suggested that her mortgage was mis-sold by the broker that they used.

This is not good. There are a number of scam companies telling people that their mortgages were mis-sold using fake reasons. They usually hit with no initial fee but then later come back asking for money for it to proceed.

Two years down the line she was informed that her claim wasn't worth pursuing so she withdrew it. The company dealing with the claim asked her to sign a form freeing them of any comeback in relation to the claim and also received a letter from the broker's solicitors threatening her with a bill if she persued the claim.

I can understand the broker solicitor issuing a letter as these are frivolous complaints typically made by the CMC using made up reasons and it sounds like its gone beyond the normal reject stage.

And now she has a £12k bill.

Who has issue the bill?
What is the bill for?

jamesd

CharlieWannaWin wrote: »

She was assured at all times that it was a no win no fee arrangement and there would be nothing for them to pay. Two years down the line she was informed that her claim wasn't worth pursuing so she withdrew it. The company dealing with the claim asked her to sign a form freeing them of any comeback in relation to the claim and also received a letter from the broker's solicitors threatening her with a bill if she persued the claim.

What claims did she make via the claims company about the mortgage being unsuitable? She presumably signed letters making claims of some sort about the mortgage.

It is not a surprise that the claims management company would drop a case a soon as there was a chance that it might have to payout serious money. Nor is it a surprise that they would attempt to get her to take all liability from them for their actions during the claim by signing that form, apparently after they already knew that there was a problem.

magpiecottage

I think we need to know whose solicitors sent the letter.

If she still has it, this should be referred to the Financial Ombudsman Service but a copy should also be sent to Consumer.Queries@fca.org.uk.

addedvaluebob

As mentioned by others she should definitely take this to the FCA and FOS for their opinion on this 'solicitors letter' as this sounds like the company breaking the rules on complaint handling as they are prohibited from charging consumers for dealing with a complaint even if it is eventually rejected.

Hopefully the OP will post the name of the company and solicitor as a warning to others as this is nothing more than legal bullying

magpiecottage

addedvaluebob wrote: »

As mentioned by others she should definitely take this to the FCA and FOS for their opinion on this 'solicitors letter' as this sounds like the company breaking the rules on complaint handling as they are prohibited from charging consumers for dealing with a complaint even if it is eventually rejected.

Not entirely correct, in limited circumstances, a firm can take action against a consumer making a complaint in bad faith. However, with my clients, if the complaint involves a CMC and is clearly untrue we contact the consumer directly to see if what the CMC says is really true. Then, if necessary, we will draft a complaint for them to send to the CMC. We do this at no charge to the consumer.

Obviously, we only have one side of the story - and a second hand version of it. However, on the basis of what has been said, there is a very serious breach of FCA rules - to the extent that I would expect enforcement.

Hopefully the OP will post the name of the company and solicitor as a warning to others as this is nothing more than legal bullying

Yes - but the CMC holds itself out as expert in these matters. So it should have realised that the financial services firm was bullying and referred it direct to FOS and the FCA as soon as it learned of the problem rather than simply aborting the complaint. It might not have been able to go to FOS if the complainant was too frightened to sign but it absolutely could have complained to the FCA.