Clarification of CRA and S75 rights.

DullGreyGuy

RJM219 said:
My understanding of the S75 process was that I'd have given the retailer the opportunity to resolve and if I was unhappy with their resolution, to *then* go to the S75 process, but my knowledge of it is, again, as I mentioned, surface level.

No, the law simply makes them jointly liable under S75 so no need to ever even have spoken to the retailer. In practice retailers often can resolve matters quicker though as those selling cookers tend to have cooker engineers (or at least preferred partners) whereas banks dont and they cannot realistically cover every product and service sold anywhere in the world. 

S75A, which deals with higher value goods does require you to have attempted to deal with the retailer first.

A_Geordie said:
Assuming you are seeking a refund, the next step is to consider any deduction for use during that period which is what the retailer is entitled to under the CRA. There is no set formula for calculating deductions as it will depend on the goods. 

It is not depreciation, its use. If it were depreciation you'd just go on eBay and see how much a secondhand cooker sells for at approximately the same age.

born_again said:

A_Geordie said:

As to s75, I take a different view to @born_again. There seems to be a common misconception that s75 is a process created by banks or other creditors that you must follow in order to claim. You do not need to do that. S75 is enshrined under the Consumer Credit Act 19974 which, if all criteria is met, makes the creditor jointly and severally liable for the breach or misrepresentation. 

Not a different view. 👍

As the retailer has offered a resolution (Even though it is a poor one) then that can be taken that there is not breech of contract. As retailer have fulfilled the CRA.

It can't as a breach happened 3 years ago when they sold a cooker that failed to meet the SAD FART requirement of the CRA. Paying damages due to a breach doesnt mean the breach never happened and nor is automatic that any offer of damages must be considered acceptable; were that the case at least 50% of motor accidents would never be litigated because about half are disputes on quantum not liability.

What may be possible however, were the case to go further, would be that the bank could refuse to pay interest on the amount offered by the retailer given the OP could have accepted it as interim payment and therefore reduced their losses but the bank would still be liable for any uplift in damages awarded and the statutory interest on that uplift. 

the_lunatic_is_in_my_head said:

Perpetuating this idea that everything should last 6 years isn't of benefit to consumers, here is an independent document with an opinion of 9-15 years for cookers and hobs 

What is also often perpetuated is that "use" is uniform and so you have a straight line reduction in price. Whilst I'd probably argue for a cooker it is actually a straight line there are many goods etc where there is a clear spike when you first take ownership and then a quick fall off... the bread maker that the average person uses a ton in the first months of ownership and by year 2 is sitting in the back of the cupboards likely never to be used again until some spring clean gets it put on eBay or Freecycle. Other things have seasonal use, a winter coat rarely sees the light of day in summer. 

The OP states its an induction cooker, it seems fairly consistent that people say they have a 10,000 hours of use average lifespan, what's less consistent is the view of how long it takes someone to use up that many hours. 

born_again

A_Geordie said:

born_again said:

Not a different view. 👍

As the retailer has offered a resolution (Even though it is a poor one) then that can be taken that there is not breech of contract. As retailer have fulfilled the CRA.

I think based on the above then we do have a different view.

The fact that an offer of settlement has been made doesn't absolve the CC co. of liability under s75 and that certainly doesn't mean there is no longer a breach. It remains a breach of contract until it has been resolved/settled. So OP could accept part payment from the retailer and pursue the rest from the CC co.

We will have to beg to differ on this.
I'm going by known cases where customer has been rejected on S75, as retailer has fulfilled the requirement under the CCA & offered a settlement.

DullGreyGuy

born_again said:

A_Geordie said:

born_again said:

Not a different view. 👍

As the retailer has offered a resolution (Even though it is a poor one) then that can be taken that there is not breech of contract. As retailer have fulfilled the CRA.

I think based on the above then we do have a different view.

The fact that an offer of settlement has been made doesn't absolve the CC co. of liability under s75 and that certainly doesn't mean there is no longer a breach. It remains a breach of contract until it has been resolved/settled. So OP could accept part payment from the retailer and pursue the rest from the CC co.

We will have to beg to differ on this.
I'm going by known cases where customer has been rejected on S75, as retailer has fulfilled the requirement under the CCA & offered a settlement.

Any of those been escalated to an ombudsman? Banks (and insurers) arent always perfect and the Ombudsman at times will decide that an organisations approaches are not fair. 

born_again

DullGreyGuy said:

born_again said:

A_Geordie said:

born_again said:

Not a different view. 👍

As the retailer has offered a resolution (Even though it is a poor one) then that can be taken that there is not breech of contract. As retailer have fulfilled the CRA.

I think based on the above then we do have a different view.

The fact that an offer of settlement has been made doesn't absolve the CC co. of liability under s75 and that certainly doesn't mean there is no longer a breach. It remains a breach of contract until it has been resolved/settled. So OP could accept part payment from the retailer and pursue the rest from the CC co.

We will have to beg to differ on this.
I'm going by known cases where customer has been rejected on S75, as retailer has fulfilled the requirement under the CCA & offered a settlement.

Any of those been escalated to an ombudsman? Banks (and insurers) arent always perfect and the Ombudsman at times will decide that an organisations approaches are not fair. 

I have no idea. Do Talk to complaints team, but tend to only be on any complaints we have been part of. 

A_Geordie

DullGreyGuy said:

A_Geordie said:
Assuming you are seeking a refund, the next step is to consider any deduction for use during that period which is what the retailer is entitled to under the CRA. There is no set formula for calculating deductions as it will depend on the goods. 

It is not depreciation, its use. If it were depreciation you'd just go on eBay and see how much a secondhand cooker sells for at approximately the same age.

I never said it was depreciation, I stated deduction for use, but a method for calculating that can be based on depreciated value of the goods. Your eBay example isn't a good example for depreciation, since they are mainly arbitrary figures subjective to the seller based on what they think the goods are worth. That is more of a market value method and is a distinct method to depreciation. 

Whether you calculate 10,000 hours of use or the total number of years, you are still deducting an amount based on the value of the goods over its expected lifepsan, which in simple terms, is an amount based on depreciation. 

Out of curiosity, how does one go about calculating or evidencing how many hours of use of the cooker they have had in order to deduct an amount for use? It's definitely not something I have ever thought about or monitored when I buy a cooker.

eskbanker

born_again said:

DullGreyGuy said:

born_again said:

A_Geordie said:

born_again said:

Not a different view. 👍

As the retailer has offered a resolution (Even though it is a poor one) then that can be taken that there is not breech of contract. As retailer have fulfilled the CRA.

I think based on the above then we do have a different view.

The fact that an offer of settlement has been made doesn't absolve the CC co. of liability under s75 and that certainly doesn't mean there is no longer a breach. It remains a breach of contract until it has been resolved/settled. So OP could accept part payment from the retailer and pursue the rest from the CC co.

We will have to beg to differ on this.
I'm going by known cases where customer has been rejected on S75, as retailer has fulfilled the requirement under the CCA & offered a settlement.

Any of those been escalated to an ombudsman? Banks (and insurers) arent always perfect and the Ombudsman at times will decide that an organisations approaches are not fair. 

I have no idea. Do Talk to complaints team, but tend to only be on any complaints we have been part of. 

So you're really saying that you've been told that your company has sometimes rejected s75 claims on the basis that the merchant has offered a settlement in response to a breach of contract?

born_again

eskbanker said:

So you're really saying that you've been told that your company has sometimes rejected s75 claims on the basis that the merchant has offered a settlement in response to a breach of contract?

No. I know they do, as we have to inform customer at times.

eskbanker

born_again said:

eskbanker said:

So you're really saying that you've been told that your company has sometimes rejected s75 claims on the basis that the merchant has offered a settlement in response to a breach of contract?

No. I know they do, as we have to inform customer at times.

OK, but what you're referring to is your company's interpretation of its obligations under s75, which, while presumably endorsed by legal/regulatory compliance folk, isn't really definitive in the wider context and obviously can't be verified?

It still seems to me that there are crossed wires somewhere along the line here, as a merchant offering any resolution to a breach of contract can't automatically be assumed to have settled the contractual dispute, so, to take an extreme example, if a merchant offered a derisory token refund instead of the full amount, that can't nullify the potential to raise a s75 claim with the creditor, so the quality and scale of any offered resolution must come into play?

A_Geordie

eskbanker said:

OK, but what you're referring to is your company's interpretation of its obligations under s75, which, while presumably endorsed by legal/regulatory compliance folk, isn't really definitive in the wider context and obviously can't be verified?

It still seems to me that there are crossed wires somewhere along the line here, as a merchant offering any resolution to a breach of contract can't automatically be assumed to have settled the contractual dispute, so, to take an extreme example, if a merchant offered a derisory token refund instead of the full amount, that can't nullify the potential to raise a s75 claim with the creditor, so the quality and scale of any offered resolution must come into play?

In my experience, it's company policy they apply rather than the law and on a risk/reward ratio hoping that people will not pursue it. Similar position to finance companies who refuse to collect a financed vehicle that's faulty and would rather make low ball offers of settlement before collecting in the hope individuals just give up and accept what's in front of them.