Mobile Credit Limits

[Spiceskull]

I heard somewhere that Carphone Warehouse did a dirty trick with kiddy mobile phone accounts. Effectively the parent would set an upper monthly credit limit for the kids, and when this was reached the phone switched off. Great for three months, bills as they were expected to be. On the fourth month CW decided to remove the upper limit, wihout telling anyone. As a result the kiddies thought "my phone still works, ergo I still have credit..." At the end of the month parents were getting hit with £200 bills...

CW's reason for lifting the limit unannounced? "We felt that you were such a good customer you would like to increase the limit for your child..."

The last I heard was that CW were still holding out for the money...

[Bookworm]

Yes, it was on Watchdog the other day. I watched gobsmacked. The CW's attitude of "well, you still made the calls, you still have to pay the bill" floored me.

How many teenagers do you know who are going to think "oh, I have made a lot of calls so far, I wonder if I should maybe check if there is something wrong here"? Especially when it comes to mobile phones, which you normally have to surgically remove from teenager's ears while they're asleep...

I wonder if there would be ground for the payer to allege breach of contract from CW's... T&cs, anyone?

[Maxie]

There clearly was a breach of contract. The CW allowed the customer to set the credit limit and knew the specific reason - it was for a child. Now, they say, the bills were paid so we increased the credit limit.

I suspect that they may have a defence if the T&C say that from time to time they will assess the credit limit and assign a new limit at its discretion etc or something similar. There is also the basic principle that you are responsible to calls made.

However, there was an agreemnt in place and by not informing the account holder ot informing them they were charging the agreement could be the basis of a claim.

Let put it this way - I'd put a claim into court if it happened to me! Thet'd most likely settle.

[Bookworm]

Pretty much what I'd do too, actually.

Isn't it amazing on how we hear day in day out that this country is getting litigation happy, when it's the companies that far too often force us into taking action by their refusal to act properly in the 1st instance...

[Maxie]

Originally Posted by Bookworm

Pretty much what I'd do too, actually.

Isn't it amazing on how we hear day in day out that this country is getting litigation happy, when it's the companies that far too often force us into taking action by their refusal to act properly in the 1st instance...

A good point. My argument has always been we have these agreements/contracts which set the rules and how parties will conduct themselves. Usually, if one party is a consumer and the other a company, if the consumer breaches the contract the company will hammer you with the cosumer with the T&C and take enforcement action (usually agressive) if required. But when the consumer dares to attempt to enforce the same contract for their benefit the companies (and sometimes the regulators!!) cry foul and talk about how litigation happy we are getting.

[joneshousehold]

I used to think I was just awkward and argumentative but I have changed my view.

Now when anyone talks about the litigation explosion I always say that I look upon it as a sort of regulatory system. We can't rely on genuine regulators such as OFT (just look at what happened over the credit card charges fiasco). They lack strength and will power at times. We also can't rely on legislation (just look at the Guinness affair - just how did Mr Saunders get out of prosecution because of Alzheimers and then seemingly 'recover'). The only way to make the big fish take notice is to take Court action. It is sad that we have to do it but don't blame the small fry, blame the big fish - they were the ones who took advantage in the first place.

Sometimes it's the only way to get those pavements fixed, stop abuse of power etc etc etc.

I sound like my kids now - 'It wasn't me, they did it first!!!'

[Spiceskull]

Originally Posted by Maxie

There clearly was a breach of contract. The CW allowed the customer to set the credit limit and knew the specific reason - it was for a child. Now, they say, the bills were paid so we increased the credit limit.

I agree completely - the setting of a limit must surely be a definition of the contract, which would imply that this particular definition is void if CW ups the limit without authority.

I would also contest the charge, and would let them chase me for the money if they were that determined. It would make a great story - single mum, £10 credit to kids phone, £200 bill, mum taken to court by big bad bully company...

[seylectric]

What particularly annoys me with contracts is that companies often insert a clause which goes something like, "We reserve the right to amend these terms and conditions....blah blah blah."

Surely if a contract can be altered at will by the company it isn't worth the paper it is written on?

[gizmo111]

Well whilst I agree that they shouldn't just change T&C with no warning - there must be an implied parental responsibility here. Both my children (aged 11 and 13)have contract phones and they pay out of pocket money if they go over their free usage minutes. Surely if I just said to them it is phone co's fault for letting you do it so carry on and I'll sue -
then I'm teaching nothing about indepenence & responsibility as they grow into adults. They have to be responsible for their actions and finances at some stage so asimple call to their provider to see what they have spent so far this month is no great hardship? In later years they will ahve far greater financial obstacles to overcome and I don't want them to be struggling with debt and budgeting to pay debt so an early start in takng their finances serioulsy is what I am trying to teach.
I have been in debt big style in the past and know the misery t causes and there is no quick fix.

[ian cognito]

I am battling with Vodafone over exactly the same issue at the mo and struggling with my POC (if anyone would like to help), it's easy when you have a template to copy!!!!

The basis of my claim is the Misrepresentation Act 1967, which was confirmed by someone on the site who obviously had more than a little legal knowledge and helped me draft a letter if anyone wants it. Pity I missed the Watchdoog programme, can anyone give me more detail please.

[ian cognito]

Just thought I'd add this for info:

Misrepresentation Act 1967
A misrepresentation is a false statement of fact made by a party or their agent, which is intended to and does induce the other party to enter into a contract.
The party who has relied on the misrepresentation will have the remedy of rescinding the contract or in accordance with the Misrepresentation Act 1967 may be entitled to damages for non-fraudulent misrepresentation unless the representor can show he reasonably believed the representation to have been true.

[buzby]

Not really relevant. The problem was (for CW and some Vodafone custoimers) that the network allowed the dealer to place a limit on the spend to ensure the users acted responsibly. Once a few bills were paid the system automatically removed the cap, as it saw the criteria was being met. Technically, this was a 'service' provided by the network, not a selling feature, and should never have been sold as one. The error was not contractural, as it forms no basis of the agreement, and its removal without notice is reasonable if you accept that it was an internal function to protect the network (NOT the customer). Any claim would be against the store or salesman who promoted it as a way to restrict calls, when it was never designed for that purpose.

[seylectric]

Originally Posted by buzby

Not really relevant. The problem was (for CW and some Vodafone custoimers) that the network allowed the dealer to place a limit on the spend to ensure the users acted responsibly. Once a few bills were paid the system automatically removed the cap, as it saw the criteria was being met. Technically, this was a 'service' provided by the network, not a selling feature, and should never have been sold as one. The error was not contractural, as it forms no basis of the agreement, and its removal without notice is reasonable if you accept that it was an internal function to protect the network (NOT the customer). Any claim would be against the store or salesman who promoted it as a way to restrict calls, when it was never designed for that purpose.

I seem to remember that it was touted very heavily a few years ago as being a way to restrict calls and call spending, in fact when PAYG was first introduced it was all over the news being promoted as a great way of people controlling their spend. That may not be the purpose it was designed for but that's definately what it was portrayed as to the buying public.

I wouldn't mind betting that in every mobile phone operators sim card handbook there is a line somewhere that refers in some way to PAYG being a great way to control your call costs!

[buzby]

Now I'm confused. PAYG was launched in 1994-5 (from memory) so the need for a credit restriction on PAYG is irrelevant as the phone just stopped working when the credit was exhausted.

The issue here is not about PAYG, but Contract phones that have a cap for call usage, that certain sales staff promote as a method of restricting high bills for voice calls. This has become s nonsense, as data, premium texts inbound and other services like WAP can all slip through, so anyone promoting this 'cap' as one to benefit the customer is wrong.

[ian cognito]

so anyone promoting this 'cap' as one to benefit the customer is wrong.

Think this exactly the point hat has been made from the beginning of this thread.