Called to court after Sec75 approved

Peacetopher

So after following advice from citizens about faulty goods we received our money through a charge back.

we were left with a bed that we didn’t want and the manufacturer refused to take 

we then have a notice of a court summons in the small claims court from the shop that refused to respond or didnt object to the Section 75 in time.

how can this go to court when it’s basically already over?

we just want this to end, we don’t want the bed (it’s in the way) and we don’t want to waste time and money going to court.

Jenni_D

Because you had a chargeback not a Section 75 ... you said so yourself.

A chargeback simply swipes the money back from the retailer's merchant bank ... the retailer is still free to pursue the alleged "debt" via court. A S75 claim is where the credit provider funds the refund (and the goods then technically belong to the credit provider) ... whether or not the credit provider then pursues the retailer for the funds is another matter.

born_again

Chargebacks have no legal status. They are over & above your legal rights & Visa/Mastercard & Amex regulations.

S75 & chargebacks are not the same.
Chargeback money is claimed back from retailer. S75 is paid out by bank (so retailer in most cases is not aware & not out of pocket)

So retailer has lost money via chargeback, you still have the bed. Thus they are going to court for their monies owed for the bed. You will have to form your defence on the same basis as you did for banks chargeback & hope judge sides with you.

We always warn people when doing chargebacks of this.

Manxman_in_exile

1.  Did CAB specifically advise you to lodge a s75 claim, or did they advise a chargeback?  (They are different things)

2.  Did your purchase qualify for s75 protection, or did it only qualify for a chargeback?

3.  If it is the case (a) that CAB advised a s75 claim rather than a chargeback, (b) that the purchase qualified for s75 protection, and (c) that you specifically asked your bank for a s75 claim rather than a chargeback, then I would complain to the bank on the grounds that they did not carry out your insructions and that they did not act in your best interest as their client.


Regardless of all that, if you have received a court claim you must deal with it - you can't just ignore it.  You will need to acknowledge service of the claim and you will also need to lodge a defence which - as @born_again suggests - will presumably need to be based on whatever you told your bank originally.

Unfortunately, a chargeback is something that a retailer can challenge in court and doesn't have the same certainty as a successful s75 claim.

born_again

I know the whole Chargeback or S75 has been discussed before, when a customer asks for a S75.

But thinking on this subject. The consumer rights gives a retailer the right to mitigate their liability by having the right to refund, replace or repair. 
No matter what the customer wants, so a retailer can choose no matter what the customer instructs them, what they want.

So think of S75 or chargeback along the same lines. The bank is just mitigating their loses. 👍

Jenni_D

I understand your train of thought, but I don't think it's as simple as that ... the bank/credit provider can't just choose what it wants to do without the customer being informed of what they propose to do. (I'm not saying that the OP wasn't informed - maybe they were and didn't understand the differences).

Manxman_in_exile

born_again said:

... So think of S75 or chargeback along the same lines. The bank is just mitigating their loses. 👍

Perhaps I'm mistaken, but doesn't a bank owe a fiduciary duty of care to its customer, so that if there is a conflict of interest between the bank and its customer, the bank should act in the customer's interests, and not its own?

If you have a situation where both a s75 claim and a chargeback are possible, shouldn't the bank be advising its customer to pursue s75 rather than a chargeback?  And especially so if the customer specifically requested a s75 claim rather than a chargeback?   

(In such a case I'm taking for granted - as discussed in previous threads - that a s75 claim, if applicable, will give a better outcome to the customer than a chargeback will.  eg the bank's customer won't get sued later by the trader)

I'm not sure that banks should be deciding whether to pursue a s75 claim or a chargeback based on whether they or the trader will shoulder the loss.  The bank owes a duty of care to their customer, and if there is a conflict of interest it should pursue what is in the best interests of the customer - not its own.

And in any case, AIUI, there's nothing about s75 that prohibits* a bank recovering from the trader any losses that the bank has suffered as a result of the trader's contractual breach that led to the s75 claim?  If the bank chooses not to do so, that's its choice, but that doesn't allow it to act against its customer's interests.

born_again said:

... But thinking on this subject. The consumer rights gives a retailer the right to mitigate their liability by having the right to refund, replace or repair. 
No matter what the customer wants, so a retailer can choose no matter what the customer instructs them, what they want...

But the important differences between what rights a retailer might have and what rights (if any) that a bank has to choose between a s75 claim and a chargeback are: (1) the retailer doesn't owe the consumer any duty of care to act in the consumer's best interests, and (2) the option to refund, replace or repair is a right specifically granted to the retailer under statute.  The abilty to choose between a s75 claim and a chargeback is a "right" selected by the bank itself, and it should exercise that in accordance with whatever is in the best interest of its customer.

*In fact, doesn't s75(2) specifically provide for it?

DullGreyGuy

born_again said:

I know the whole Chargeback or S75 has been discussed before, when a customer asks for a S75.

But thinking on this subject. The consumer rights gives a retailer the right to mitigate their liability by having the right to refund, replace or repair. 
No matter what the customer wants, so a retailer can choose no matter what the customer instructs them, what they want.

So think of S75 or chargeback along the same lines. The bank is just mitigating their loses. 👍

But this is the difference between something written into a statute and where you have two separate things that have no cross reference to each other... in the case of the CRA it obviously goes further and says if you have problems again then the customer gets the right to demand a refund.

It is debatable which of the two is more customer friendly... Chargebacks are quicker and have a lower burden of proof but can lead to situations like this whereas S75 are much slower, often require expert reports etc but are a final conclusion to the matter. If a Chargeback fails it doesnt stop you doing a S75 however because of the time limits the reverse isnt necessarily true. 

In most cases, at least from my experience, you technically raise a "dispute" with the bank and not explicitly a S75 or chargeback and therefore its rightfully at the banks discretion which is does. The problem comes where a customer explicitly asks for one and the bank does the other. Thats not necessarily whats happened here given the OP has used the terms interchangably and so most likely doesnt understand the difference. 

The FCA's BCOBs probably would cover it but because both have aspects of customer benefit it may well be possible to justify doing either over the other as long as you explain it from a customer benefit position rather than saying its damage limitation for the shareholders.

Manxman_in_exile

Jenni_D said:

I understand your train of thought, but I don't think it's as simple as that ... the bank/credit provider can't just choose what it wants to do without the customer being informed of what they propose to do. (I'm not saying that the OP wasn't informed - maybe they were and didn't understand the differences).

That's the very minimum that should happen - and even then I think it wouldn't go far enough...

And unfortunately I think it is the case that many customers don't understand the difference.  To my mind that makes it even more important that banks should be acting transparently in their customer's best interests and not their own.  I'm sure many customer's get fobbed off with a "Sorry your claim has been challenged by the trader" or "Your chargeback is out of time" without realising that what the bank raised was not a s75 claim.

Alderbank

I think I remember that in an earlier thread, @born_again explained to us that for the customer's benefit the bank will try chargeback first for various technical reasons, such as by the time an s75 is rejected the claim might be out of time for chargeback.
I think also that the claim form, at least for some banks, does not give the customer the overt choice of selecting chargeback or s75.

I hope we get confirmation.

DullGreyGuy

Manxman_in_exile said:
To my mind that makes it even more important that banks should be acting transparently in their customer's best interests and not their own.

There are pro's and con's to both and particularly because you can do a S75 after an unsuccessful chargeback but because of the chargeback timelimit the opposite is rarely true is probably the deciding factor in my mind at least why its in the customer's interest to do a Chargeback before a S75 claim.