Excess mileage enforceable?

Geranium44

My work colleague has a contract hire vehicle not a PCP with her contract termination date Nov 2023. I’m aware a PCP can be voluntary terminated and understand excess mileage charges cannot be enforced without a court appearance. I’ve extracted the following text from car expert www but interesting in comments on contract hire excess mileage
… 

There’s no provision for excess mileage charges in the law, so in theory, you can’t be charged for exceeding your mileage allowance. However, if you exceed the pro-rata mileage allowance, you can expect the finance company to come after you for an excess mileage penalty.

You do not have to pay this charge, but you will need to be prepared to fight it – potentially for months and against threats of legal action. Despite repeated assertions from the legal community that excess mileage is not enforceable, the finance companies keep trying to charge customers for it.

Car_54

That advice seems dubious, to say the least. There doesn't need to be a provision in "the law": it's a term in a contract and enforceable through the courts unless found to be illegal in some way.

molerat

Complaints over excess mileage charges on a PCP when using VT are generally, >50%, rejected by the ombudsman. Most of the cases that are won are on other points rather than the excess mileage. The ombudsman usually looks at excess mileage as damage outside what is contractually allowable that affects the value of the vehicle which is chargeable on VT.  The  courts are the only ones that can enforce any debt but would fairly likely side with the ombudsman unless a case can be made that the ombudsman was wrong.

Excess mileage on contract hire is enforceable as it is a contractual term on which the price is based.

jlfrs01

I took the decision not to pay BMW Finance for excess mileage I'd incurred, their response was immediate and robust. I dug my heels in and it dragged on for several months until I realised that because I'd not paid, the contract was showing as a default on my credit record. I only found this out when a mortgage lender reduced the amount they were willing to lend against a property I was planning to buy. Furthermore, when I returned to BMW Finance a few years later for another PCP contract my application was declined so I'd obviously been blacklisted.
Honestly, if you've gone over your contracted mileage it's best to take it on the chin and pay up, after all you'd have paid it anyway as part of your monthly direct debit if you'd taken out the PCP with higher mileage stated from the outset.

Geranium44

Would there be any difference between contract hire and pcp? It’s clear from the attached article even if the ombudsman judgement is rejected it’s unlikely a finance company would want to pursue in the courts although you disagree … https://www.thecarexpert.co.uk/car-finance-voluntary-termination-pcp-hp/2/#13-can-i-be-charged-for-excess-mileage

WellKnownSid

Geranium44 said:

Would there be any difference between contract hire and pcp? It’s clear from the attached article even if the ombudsman judgement is rejected it’s unlikely a finance company would want to pursue in the courts although you disagree … https://www.thecarexpert.co.uk/car-finance-voluntary-termination-pcp-hp/2/#13-can-i-be-charged-for-excess-mileage

PCP is a type of car finance.  Being a finance agreement there is statutory protection for the buyer.

Contract hire is a hire agreement - similar to hiring from Hertz or Europcar but over a longer term, you are simply borrowing someone else's car.

Car_54

WellKnownSid said:

Geranium44 said:

Would there be any difference between contract hire and pcp? It’s clear from the attached article even if the ombudsman judgement is rejected it’s unlikely a finance company would want to pursue in the courts although you disagree … https://www.thecarexpert.co.uk/car-finance-voluntary-termination-pcp-hp/2/#13-can-i-be-charged-for-excess-mileage

PCP is a type of car finance.  Being a finance agreement there is statutory protection for the buyer.

Contract hire is a hire agreement - similar to hiring from Hertz or Europcar but over a longer term, you are simply borrowing someone else's car.

Statutory protection from enforcement of a contract the consumer has agreed to?

motorguy

Geranium44 said:

My work colleague has a contract hire vehicle not a PCP with her contract termination date Nov 2023. I’m aware a PCP can be voluntary terminated and understand excess mileage charges cannot be enforced without a court appearance. I’ve extracted the following text from car expert www but interesting in comments on contract hire excess mileage
… 

There’s no provision for excess mileage charges in the law, so in theory, you can’t be charged for exceeding your mileage allowance. However, if you exceed the pro-rata mileage allowance, you can expect the finance company to come after you for an excess mileage penalty.

You do not have to pay this charge, but you will need to be prepared to fight it – potentially for months and against threats of legal action. Despite repeated assertions from the legal community that excess mileage is not enforceable, the finance companies keep trying to charge customers for it.

PCH is a rental, not a HP finance agreement.

The excess mileage charges are enforceable and i'd fully expect the hire company to pursue it.

motorguy

jlfrs01 said:

I took the decision not to pay BMW Finance for excess mileage I'd incurred, their response was immediate and robust. I dug my heels in and it dragged on for several months until I realised that because I'd not paid, the contract was showing as a default on my credit record. I only found this out when a mortgage lender reduced the amount they were willing to lend against a property I was planning to buy. Furthermore, when I returned to BMW Finance a few years later for another PCP contract my application was declined so I'd obviously been blacklisted.
Honestly, if you've gone over your contracted mileage it's best to take it on the chin and pay up, after all you'd have paid it anyway as part of your monthly direct debit if you'd taken out the PCP with higher mileage stated from the outset.

Worth noting this is a Contract Hire agreement in question, not a PCP.

So basically a long term car rental.

Grumpy_chap

As I understand it, the discussions that crop up from time to time relate to the excess mileages charges being unenforceable when surrendering a car under VT of a PCP.

The OP's colleague has a contract hire car, so VT is not an option and it is moot as to whether or not excess mileage charges can be enforced under VT.

WellKnownSid

Car_54 said:

WellKnownSid said:

Geranium44 said:

Would there be any difference between contract hire and pcp? It’s clear from the attached article even if the ombudsman judgement is rejected it’s unlikely a finance company would want to pursue in the courts although you disagree … https://www.thecarexpert.co.uk/car-finance-voluntary-termination-pcp-hp/2/#13-can-i-be-charged-for-excess-mileage

PCP is a type of car finance.  Being a finance agreement there is statutory protection for the buyer.

Contract hire is a hire agreement - similar to hiring from Hertz or Europcar but over a longer term, you are simply borrowing someone else's car.

Statutory protection from enforcement of a contract the consumer has agreed to?

Some think it's a get out of jail free card...