Section 75

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  • born_againborn_again Forumite
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    I totally understand card companies not wanting to payout, but they should follow the CCA 1974
    A  person can file a Secton75 without even going to the  retailer or travel agent,
     " credit card company is jointly and severally liable for any breach of contract "
    The only reason credit card companies  aren't obeying the Act, is they have never liked it and it costs them.

    There will  be fines issued out at the end of all this, and expect card companies who have refused to follow the Act will be some of them.
    S75 was never designed or intended for the way we use credit cards now.
    It was set up when credit was provided by providers for certain products. So say car HP etc. The companies providing the credit, only dealt with that market.
    Not as now where it in effect covers anything someone buys via credit (within the limits)

    S75 really requires a total overhaul to bring it into line with the new way credit is used.

    Problem with fines is it could be the one thing that tips many companies over the edge and into administration. That's if they survive that long. 
    I thought 2019 was a bad year for company failures. 2020/21 could well be far worse.
    You could even see some players in the credit card market pull out.

    The best option is for ALL players to work together and find a way round the refunds. But i fear that it will require Government level funding.
    Or to put it another way. Taxpayers will be picking up the tab for far longer than ever imagined.

    >>Think I will print off a voucher (it's just an IOU) and pay my statement with it  and say a it can turned into cash next year.<<

    As many people say. Do you want a holiday next year? If you do, then that voucher maybe the only way you get one. As, if everyone got a refund. There would be no holiday companies left.
    Far too many companies are living on credit and expected income for the next holidays.
    Life in the slow lane
  • Life__Goes__OnLife__Goes__On Forumite
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    I agree S75 needs a overhaul, if/when there is, the card companies will wish there hadn't been.

    Personally I feel vouchers will make little difference in the short term, its just kicking the can down the road.
    It might keep them afloat this year, but next year once the are paying out it will be mostly outgoings.
    For vouchers to be truly effective, then they needed to be 3 years plus, with  Government  support.

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  • wizzywig27wizzywig27 Forumite
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    Ok so after three pages of comments I still don’t have an answer 😬 

    One other point to make is that someone stated that vouchers are being offered therefore S75 won’t work, my problem being is I either go on holiday this year, or not at all due to personal circumstances. I don’t want to wait a year for my voucher to run out THEN get a cash refund.

    It seems that there is already a breach of contract which means I could cancel (as they changed departure airport), however due to reasons above I’d rather just go (obviously casting aside all the dilemmas of 14 day quarantines are both ends, etc).
  • eskbankereskbanker Forumite
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    eskbanker said:
    I do get that the purpose of the act was to harmonise consumer protection between bespoke and off-the-shelf packages (by including both within ATOL, etc), but it's still not clear to me that its provisions extend as far as actually redefining service supplier for s75 purposes, where the role of intermediaries has always had legal significance, not just in the context of travel but in other scenarios too.

    The FOS case I cited earlier makes a clear distinction between the roles of organiser and supplier in agreeing that s75 didn't apply, so where these are two separate organisations it doesn't seem as straightforward as you're suggesting - are you able to highlight the specific provisions that support your statements above, or do you have a view why that FOS case went the way it did?
    The PTLTAR 2018 only applies to holidays booked after July 2018

    There is no dates in the FOS except the decision 11th Aug 2019

    The person would have a had to book a  holiday,  go on that holiday, return for holiday, complain to the tour operator,  get a reply from the tour operator, file a Section 75,  get a response from the bank, and then file a complaint to the Ombudsman, and get the decision from the Ombudsman in just over a year,  for it to be under PTLTAR 2018

    I don't think that is very likely on the rulings I have read,  but impossible to prove on way or another unless more info.

    So I don't want to comment on that case as,  as if under the old law for package holidays, I wouldn't have an opinion one way or another, I don't know the old rules.
    Fair point about the dates, there is no evidence that that case related to a booking made under the new regulations.  I haven't found any more recent s75 cases one way or the other that examine multi-party arrangements under the 2018 regulations, but presumably they'll start to filter through eventually - I believe that the comments in some of the other posts above are an accurate reflection of the fact that card companies will be reluctant to honour s75 claims if they believe that they have the option to reject them, so it must only be a matter of time before FOS is asked to adjudicate!

    Life__Goes__On said:
    I have looked at PTLTAR 2018 and my view, is the  organiser  (Travel Agent) is responsible  not the operator  (TUI)
     https://www.legislation.gov.uk/ukdsi/2018/9780111168479/regulation/15

    2) The organiser is liable to the traveller for the performance of the travel services included in the package travel contract, irrespective of whether those services are to be performed by the organiser or by other travel service providers.

    To me it clearly states the "organiser" (TA) is responsible under the contract, not the other service provider (TUI)
    So any failure in that contract results in a breach by the TA, and that is covered by Section 75
    I understand that line of argument but am still unconvinced that it actually compels card companies to treat the organiser as the supplier when evaluating s75 claims.  Going back to the FOS case referred to above, if that claim was under the old rules, that would obviously signify that the s75 status of agent-booked tour operator packages has been changed under the new regulations, which would clearly be a major benefit to consumers.  However, I can find no triumphant mention of this in the coverage of the new regs by MSE, Which, etc, and on the contrary, MSE's piece on the Thomas Cook collapse last year clearly saw the continuing distinction between agent and supplier when considering the applicability of s75 in such situations:

    If you paid by credit card for a holiday or a flight costing £100+, you should have Section 75 protection if you paid Thomas Cook – but if you paid a travel agent you may not. Section 75 of the Consumer Credit Act means if you pay for something costing £100-£30,000 on a credit card, the card company's equally liable if something goes wrong – so you may be able to claim your money back from it. For more info on how this works, see our Section 75 guide.

    However, if you booked via a travel agent it's more complicated. Technically for Section 75 to work, there must be a direct link between the debtor (that's you, the customer), the creditor (the credit card company) and the supplier (in this case, Thomas Cook). If you booked via a travel agent, it's likely that relationship could be deemed to be broken, which would mean you wouldn't be able to claim, though the Financial Ombudsman Service told us it would come down to the exact nature of your contract with the travel agent.

    Granted there is some ambivalence in that wording but there's no doubt in my mind that if all agent-booked packages now benefit from s75 coverage then it would be stated here.  That's not to say that MSE is the ultimate definitive authority, and they do make mistakes, but I don't recall seeing any coverage of the new regulations effectively resulting in an extension of s75 scope, and can't find any now, whereas something of such benefit to consumers would generally be trumpeted prominently on here and elsewhere!

    wizzywig27 said:
    Ok so after three pages of comments I still don’t have an answer 😬 

    One other point to make is that someone stated that vouchers are being offered therefore S75 won’t work, my problem being is I either go on holiday this year, or not at all due to personal circumstances. I don’t want to wait a year for my voucher to run out THEN get a cash refund.

    It seems that there is already a breach of contract which means I could cancel (as they changed departure airport), however due to reasons above I’d rather just go (obviously casting aside all the dilemmas of 14 day quarantines are both ends, etc).

    As mentioned above, I believe that there is plenty of scope for interpretation, but to pick up on the MSE comment quoted above, the exact nature of the booking is likely to have an impact, so perhaps if you clarify exactly which parties are involved and their roles under the terms of the contract(s) you signed, who you paid, and so on, it may be a bit clearer (spot the optimist!).  As stated in the MSE coronavirus article linked earlier, the 2018 regulations do oblige whoever you paid to refund you, in cash not vouchers, so there's no obligation to accept vouchers - where have you seen that vouchers effectively override s75?
  • edited 31 May 2020 at 12:35PM
    Life__Goes__OnLife__Goes__On Forumite
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    edited 31 May 2020 at 12:35PM
    eskbanker
    I do see your point of view and it is a valid one, I just don't agree with it, as I strongly believe the contract encompass the  PTLTAR 2018, so any breach will relate to that.

    I think we will both be looking at future Ombudsman's rulings, and also keep an eye on this forum (and the COVID-19 one) for S75 claims.

    On a different note I expect some TA to fail because of PTLTAR 2018.
    Some TA will have booked non-refundable rooms overseas ( that remain open) and also the flight. If the flight is cancelled the TA should get a refund for that,   but not the room as it's still available.
    But under  PTLTAR 2018  they owed the customer a full refund within 14 days.



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  • wizzywig27wizzywig27 Forumite
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    eskbanker said:
    eskbanker said:
    I do get that the purpose of the act was to harmonise consumer protection between bespoke and off-the-shelf packages (by including both within ATOL, etc), but it's still not clear to me that its provisions extend as far as actually redefining service supplier for s75 purposes, where the role of intermediaries has always had legal significance, not just in the context of travel but in other scenarios too.

    The FOS case I cited earlier makes a clear distinction between the roles of organiser and supplier in agreeing that s75 didn't apply, so where these are two separate organisations it doesn't seem as straightforward as you're suggesting - are you able to highlight the specific provisions that support your statements above, or do you have a view why that FOS case went the way it did?
    The PTLTAR 2018 only applies to holidays booked after July 2018

    There is no dates in the FOS except the decision 11th Aug 2019

    The person would have a had to book a  holiday,  go on that holiday, return for holiday, complain to the tour operator,  get a reply from the tour operator, file a Section 75,  get a response from the bank, and then file a complaint to the Ombudsman, and get the decision from the Ombudsman in just over a year,  for it to be under PTLTAR 2018

    I don't think that is very likely on the rulings I have read,  but impossible to prove on way or another unless more info.

    So I don't want to comment on that case as,  as if under the old law for package holidays, I wouldn't have an opinion one way or another, I don't know the old rules.
    Fair point about the dates, there is no evidence that that case related to a booking made under the new regulations.  I haven't found any more recent s75 cases one way or the other that examine multi-party arrangements under the 2018 regulations, but presumably they'll start to filter through eventually - I believe that the comments in some of the other posts above are an accurate reflection of the fact that card companies will be reluctant to honour s75 claims if they believe that they have the option to reject them, so it must only be a matter of time before FOS is asked to adjudicate!

    Life__Goes__On said:
    I have looked at PTLTAR 2018 and my view, is the  organiser  (Travel Agent) is responsible  not the operator  (TUI)
     https://www.legislation.gov.uk/ukdsi/2018/9780111168479/regulation/15

    2) The organiser is liable to the traveller for the performance of the travel services included in the package travel contract, irrespective of whether those services are to be performed by the organiser or by other travel service providers.

    To me it clearly states the "organiser" (TA) is responsible under the contract, not the other service provider (TUI)
    So any failure in that contract results in a breach by the TA, and that is covered by Section 75
    I understand that line of argument but am still unconvinced that it actually compels card companies to treat the organiser as the supplier when evaluating s75 claims.  Going back to the FOS case referred to above, if that claim was under the old rules, that would obviously signify that the s75 status of agent-booked tour operator packages has been changed under the new regulations, which would clearly be a major benefit to consumers.  However, I can find no triumphant mention of this in the coverage of the new regs by MSE, Which, etc, and on the contrary, MSE's piece on the Thomas Cook collapse last year clearly saw the continuing distinction between agent and supplier when considering the applicability of s75 in such situations:

    If you paid by credit card for a holiday or a flight costing £100+, you should have Section 75 protection if you paid Thomas Cook – but if you paid a travel agent you may not. Section 75 of the Consumer Credit Act means if you pay for something costing £100-£30,000 on a credit card, the card company's equally liable if something goes wrong – so you may be able to claim your money back from it. For more info on how this works, see our Section 75 guide.

    However, if you booked via a travel agent it's more complicated. Technically for Section 75 to work, there must be a direct link between the debtor (that's you, the customer), the creditor (the credit card company) and the supplier (in this case, Thomas Cook). If you booked via a travel agent, it's likely that relationship could be deemed to be broken, which would mean you wouldn't be able to claim, though the Financial Ombudsman Service told us it would come down to the exact nature of your contract with the travel agent.

    Granted there is some ambivalence in that wording but there's no doubt in my mind that if all agent-booked packages now benefit from s75 coverage then it would be stated here.  That's not to say that MSE is the ultimate definitive authority, and they do make mistakes, but I don't recall seeing any coverage of the new regulations effectively resulting in an extension of s75 scope, and can't find any now, whereas something of such benefit to consumers would generally be trumpeted prominently on here and elsewhere!

    wizzywig27 said:
    Ok so after three pages of comments I still don’t have an answer 😬 

    One other point to make is that someone stated that vouchers are being offered therefore S75 won’t work, my problem being is I either go on holiday this year, or not at all due to personal circumstances. I don’t want to wait a year for my voucher to run out THEN get a cash refund.

    It seems that there is already a breach of contract which means I could cancel (as they changed departure airport), however due to reasons above I’d rather just go (obviously casting aside all the dilemmas of 14 day quarantines are both ends, etc).

    As mentioned above, I believe that there is plenty of scope for interpretation, but to pick up on the MSE comment quoted above, the exact nature of the booking is likely to have an impact, so perhaps if you clarify exactly which parties are involved and their roles under the terms of the contract(s) you signed, who you paid, and so on, it may be a bit clearer (spot the optimist!).  As stated in the MSE coronavirus article linked earlier, the 2018 regulations do oblige whoever you paid to refund you, in cash not vouchers, so there's no obligation to accept vouchers - where have you seen that vouchers effectively override s75?
    Someone mentioned above that S75 would be rejected as a refund in the form of vouchers had been offered. 

    I paid loveholidays for a packaged holiday to Las Vegas. The holiday is end of July.

    This is where it may get complicated, the flight is via Virgin (who have already moved my time once (small change) and eventually changed it from Manchester departure to Heathrow.

    My hotel is an MGM resort, but I believe this was also done through a company/service provider called Bonotel.

    I pay LH every month, last payment is due end of this month. 
  • eskbankereskbanker Forumite
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    wizzywig27 said:
    Someone mentioned above that S75 would be rejected as a refund in the form of vouchers had been offered. 
    Reading back, that was born_again, who I believe works for a financial institution and was relaying specifically what his/her company's default position is with regard to how they respond to s75 claims - despite the legal advice used to decide on that company's policy, there is no guarantee that it is actually a 'correct' interpretation as such, and escalation to FOS would remain an option if the s75 claim was rejected.  I'm not aware of anyone suggesting that born_again's employer's position is representative of the industry as a whole so on the law of averages you'd probably be claiming from a different company anyway, although any financial institution will naturally do all in its power to limit its exposure, just like travel companies offering vouchers instead of refunds.

    wizzywig27 said:
    I paid loveholidays for a packaged holiday to Las Vegas. The holiday is end of July.

    This is where it may get complicated, the flight is via Virgin (who have already moved my time once (small change) and eventually changed it from Manchester departure to Heathrow.

    My hotel is an MGM resort, but I believe this was also done through a company/service provider called Bonotel.

    I pay LH every month, last payment is due end of this month. 
    To me this suggests that loveholidays assembled the package and so fall within the undisputed common ground in the above discussion, i.e. they should be on the hook for a s75 claim if that's the route you decided to go down.  Are they named on your ATOL certificate?

    wizzywig27 said:
    Hi all, looking for some advice. I have a holiday booked which may or may not go ahead. The whole balance so far has been paid on my credit card. Should the holiday be cancelled and not go ahead, will section 75 cover my partners half as well, or does she need to make a payment on her credit card just to ensure she is covered? We both live at the same address. The holiday is in my name but she is obviously a passenger. I have paid on Barclaycard and if she pays hers will be on Nationwide.
    Winding the clock back to your original question, there is unlikely to be any benefit obtained by your partner making a payment on her card towards the booking - if Barclaycard accepted a s75 claim from you then they should cover the full cost for everyone named on the supplier's invoice even though payment was only made by one passenger (which I believe to be quite normal!).  IMHO Nationwide would be unlikely to accept a s75 claim if made by someone who isn't the lead passenger.
  • edited 31 May 2020 at 6:30PM
    Life__Goes__OnLife__Goes__On Forumite
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    edited 31 May 2020 at 6:30PM
    eskbanker said:
    Winding the clock back to your original question, there is unlikely to be any benefit obtained by your partner making a payment on her card towards the booking - if Barclaycard accepted a s75 claim from you then they should cover the full cost for everyone named on the supplier's invoice even though payment was only made by one passenger (which I believe to be quite normal!).  IMHO Nationwide would be unlikely to accept a s75 claim if made by someone who isn't the lead passenger.
    I'm sure I remember reading a ruling that stated that if something is part paid with two credit cards (call them A&B)  with the  retailer (call them c)   the claim can be from A, B or C.
    I can't remember if what the "product" was,  and if it matters, but will try and find the ruling

    I agree with Nationwide likely reject a S75 claim,  as CCC do like to avoid payment  even when legally they should do so,  so if there is any doubt I expect a rejection.
    New User name as MSE gave me a number in my old one.
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  • eskbankereskbanker Forumite
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    Life__Goes__On said:
    I'm sure I remember reading a ruling that stated that if something is part paid with two credit cards (call them A&B)  with the  retailer (call them c)   the claim can be from A, B or C.
    I can't remember if what the "product" was,  and if it matters, but will try and find the ruling
    Yes, I'm sure I've seen posts on here about payment being spread over multiple cards and each creditor technically being liable for the whole transaction (together with the supplier), although think these have been in the context of one person using multiple sources of credit for an expensive purchase rather than multiple cardholders looking to use their own credit facilities with a view to sharing qualification for s75.

    I agree with Nationwide likely reject a S75 claim,  as CCC do like to avoid payment  even when legally they should do so,  so if there is any doubt I expect a rejection.
    I'd expect Nationwide to be able to argue (not without justification IMHO) that the contract is between wizzywig27 and retailer, with their cardholder not actually being a party to it, rather than seeking to evade obligations for spurious reasons....
  • edited 31 May 2020 at 8:27PM
    Life__Goes__OnLife__Goes__On Forumite
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    edited 31 May 2020 at 8:27PM
    eskbanker said:

    I'd expect Nationwide to be able to argue (not without justification IMHO) that the contract is between wizzywig27 and retailer, with their cardholder not actually being a party to it.
    I disagree,  the contract is with all parties on the booking form, otherwise all others would be third parties.

    Example
    Mr A pays for a flight for Mrs A, and there is trouble with the flight,  Mr A can not claim S75 via his credit card because there is not a link as Mrs A  is the third party.

    If you are correct If Mr A books a flight for Himself and Mrs A,  and they get to the airport and there is trouble with the flight,  then Mr A could only claim a S75 for himself,  as in your view Mrs A  has no contract so is a third party.

    I don't think I have a seen a ruling such as this

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