Section 75. Does it apply? Online retailer refund.

JamesParker12

Hi,

I'm trying to find out if a Section 75 rule applies to a purchase I made with AO.com.

I bought a washing machine from AO.com on finance through V12 Retail Finance [a trading name of Secure Trust Bank PLC]. The item was invoiced on 24 April 2015 and became faulty and irreparable (LG could not source the part to fix it and issued an "uplift" number to claim a refund or replacement] some time around the end of January 2017. Well within the manufacturers guarantee for parts and labour period, so there was no problem with that.

The item cost was £559.00; £671.52 including interest. Of which I have paid £587.58 to date. I have made all Direct Debit payments as required. And I have not yet cancelled the Direct Debit.

I called AO.com today [11 Feb 2017] and was told that because I bought the item on credit I was only eligible for a replacement item from them, not a cash refund: as the refund would just be a credit made back to the finance company [V12 Retail Finance]. But I have read that in certain circumstances Section 75 of the Consumer Credit Act 1974 rules that the company providing credit, if they have a pre-arrangement with the retailer, is equally liable for faults, misrepresentation or any other breach of contract depending on the circumstances. And in turn would be liable to offer a cash refund to the debtor/customer.

I plan on contacting the Financial Ombudsman when I'm a bit more confident about the rules.

I wonder if anyone out there has had any experience very similar to this? Any guidance would be great...

Many thanks!
James.

Bogalot

The retailer credits the lender and you would then be reimbursed by them for any overpayment. If the retailer credits back £559 then that will be forwarded to you and any ongoing payments cancelled.

JamesParker12

Thanks!

So you think I shouldn't have any trouble getting a full cash refund from V12 Finance if I instruct AO.com to make the credit back to them?

J

[Deleted User]

JamesParker12 wrote: »

. And I have not yet cancelled the Direct Debit.

Just to add that it's unwise for you to cancel the Direct Debit until this is fully resolved.

JamesParker12

Yeah I thought so.

Thanks.

unholyangel

JamesParker12 wrote: »

Thanks!

So you think I shouldn't have any trouble getting a full cash refund from V12 Finance if I instruct AO.com to make the credit back to them?

J

We can't say.

Section 75 makes the creditor (under regulated debtor > creditor > supplier agreements) jointly & severally liable with the supplier. Meaning if you have a claim against the supplier, you have the exact same claim against the creditor.


Now the issue with that is that technically, you don't have a claim for a full refund against the supplier. You have a claim for a repair/replacement - which they must do within reasonable time and without causing significant inconvenience, any replacement should be identical. If they're unable to do that, then you have a claim for a refund - but it doesn't need to be a full refund.

Also to note, it sounds like you purchased before the Consumer Rights Act came into force so it would be the Sale of Goods Act that would apply.

naedanger

JamesParker12 wrote: »

Hi,

I'm trying to find out if a Section 75 rule applies to a purchase I made with AO.com.

I bought a washing machine from AO.com on finance through V12 Retail Finance [a trading name of Secure Trust Bank PLC]. The item was invoiced on 24 April 2015 and became faulty and irreparable (LG could not source the part to fix it and issued an "uplift" number to claim a refund or replacement] some time around the end of January 2017. Well within the manufacturers guarantee for parts and labour period, so there was no problem with that.

The item cost was £559.00; £671.52 including interest. Of which I have paid £587.58 to date. I have made all Direct Debit payments as required. And I have not yet cancelled the Direct Debit.

I called AO.com today [11 Feb 2017] and was told that because I bought the item on credit I was only eligible for a replacement item from them, not a cash refund: as the refund would just be a credit made back to the finance company [V12 Retail Finance]. But I have read that in certain circumstances Section 75 of the Consumer Credit Act 1974 rules that the company providing credit, if they have a pre-arrangement with the retailer, is equally liable for faults, misrepresentation or any other breach of contract depending on the circumstances. And in turn would be liable to offer a cash refund to the debtor/customer.

I plan on contacting the Financial Ombudsman when I'm a bit more confident about the rules.

I wonder if anyone out there has had any experience very similar to this? Any guidance would be great...

Many thanks!
James.

Yes the credit provider is equally liable.

However if you are being offered a comparable, and not inferior, replacement then I think that is sufficient remedy (regardless of whether this is being provided by the retailer or the credit provider) and you are not able to demand instead a refund (or even a partial refund).

The credit provider will in my view be able to say you are being offered sufficient remedy by the retailer and so there is no remaining liability on them.

bris

At this point you are not entitled to a refund if they are providing a replacement.




If they do decide to refund it won't be a full refund as you have had nearly 2 years use out the machine. Expect around 50% and having finance it would go towards that and not directly to you.