Richard Durkin has won his appeal – HFC liable for damages for breach of duty and trashing his credit rating (but the court can’t re-award the original damages).

So lenders had better beware when falsely recording defaults with the CRAs and crapping on people’s financial reputations.

Well done Richard.

http://www.bbc.co.uk/news/uk-scotland-north-east-orkney-shetland-26731192

There are lost of implications from this judgment (which existed before his original win was reversed on appeal) which I’m sure will filter out over the next few days.

s75.1 of the CCA is now much stronger as a result of this.

 

This is now a precedent to be used when others face a similar situation.

 

http://www.supremecourt.uk/decided-cases/docs/UKSC_2012_0135_Judgment.pdf

The full judgment

good news

dx

Richard Durkin has won his appeal – HFC liable for damages for breach of duty and trashing his credit rating (but the court can’t re-award the original damages).

 

So lenders had better beware when falsely recording defaults with the CRAs and crapping on people’s financial reputations.

 

Well done Richard.

 

http://www.bbc.co.uk/news/uk-scotland-north-east-orkney-shetland-26731192

 

There are lost of implications from this judgment (which existed before his original win was reversed on appeal) which I’m sure will filter out over the next few days.

 

s75.1 of the CCA is now much stronger as a result of this.

Section 75 argument failed in this, and there was little mention of the damages issue as the SC was not entitled to over rule the previous decision.

However the rescission of an associated credit agreement due to the implied term contained in section 11 of the act may well be useful to consumers in the future.

Good result CB. I still try and keep up with events. You are doing a sterling job. Regards to all on the team

Woohoo. Richard wins and alanalana pops up out of nowhere. A good day even if Richards damages aren't what they were it's a moral victory.

Nice to see you AA.

Nice to see you are still keeping in touch, alanalana

Good to see this ruling. Well done Richard.

I notice that nearly all newspapers and media outlets are saying:

"hfc put him on the credit blacklist for several years"

I thought there was no such thing so why does the mainstream media spread this myth.?

Good to see this ruling. Well done Richard.

 

I notice that nearly all newspapers and media outlets are saying:

 

"hfc put him on the credit blacklist for several years"

 

I thought there was no such thing so why does the mainstream media spread this myth.?

It is black listing in all but name, isnt it ?

A default on a credit file does indeed put pretty much all creditors off lending but I really think the public need educating about how credit reporting works.

There is no "list"

I am certainly in agreement with that martin lewis guy when he says we should teach personal financial management in schools. Way too much misconception out there imo

I really don't understand this.

He bought a laptop, paid £50 deposit and rest on credit.

He then returned the laptop and got £50 back

He was still obliged to make payments on credit

So what happened to the £1000 odd that came from the credit agreement? Did PC World keep that and the laptop after it was returned? Or did the finance company receive a refund of the amount from PC World and still demanded he make payments even though they'd received a refund of the loan amount?

Really seems like a ridiculous case and something common sense should've sorted years ago!!

Really seems like a ridiculous case and something common sense should've sorted years ago!!

Yep !!!

Silly case really. I don't think PC World accepted the return of the computer under SOGA (they just returned the deposit) and they said the finance was a totally separate issue. There was still finance outstanding, which tarnished Mr Durkins credit record, to the extent that he got turned down for a mortgage. The silly thing is that PC World would have been acting as an agent for the credit providers and they could have cancelled the credit arrangement, but they didn't.

Mr Durkin has gone bankrupt due this case and if there has now been an important SC decision that will benefit consumers, it would be great if some form of charity appeal was raised, so atleast it could put Mr Durkin back in a better position. It does take people like Mr Durkin to pursue such cases to gain some form of justice to consumers.

Excellent news, but poor Mr Durkin has lost his livelihood, home etc, as the case has taken SIXTEEN years to get resolved!! This is absolutely disgusting of our legal system. So, no mention of all the money the legal 'profession' have made from this case even though they're the ONLY winners for now and some future consumers with similar problems.

Has he got the right to 'appeal' on the measly £8k compensation he's received or is that it for him now?

Rgds.

radmm0

It's a shame though he had to spend over a quarter of a million pounds to prove his point. While a victory for the consumer it certainly didn't seem so for him. Maybe someone should start an online charity and donate to him so he can recoup his losses. After all we all benefit from it don't we?

It is certainly going to be interesting to see how the DCA's and CRA's respond to this precedent. If as the judgement suggests the burden of proof is now upon the OC's before they can credit reference will it open the floodgates for all their past misdemeanor's?

There is a worry for me though that the outfall from this may work against some of us who defend claims based upon proof of debt and production of evidence.

There will invariably now be further test cases where "Debt removal" companies pick up on a persons old debt and the credit referencing that has come with it and try to "clean credit files" and try to obtain compensation. This will then set further precedent on what validates agreements.

Whilst I am pleased for Mr Durkin and as unclebulgaria67 says it was a silly case I am worried how this pans out going forward! It may be a double edged sword and the implications will be far reaching!

Summary from Compass Chambers:

Durkin v DSG (Trading as PC World) and HFC Bank - Supreme Court Judgement 26/3/14

This case arose from an appeal from the First Division of the Inner House to the Supreme Court in which the appeal was successful on the Pursuer’s behalf. The Pursuer was represented by Andrew Smith QC and Richard Pugh, both of Compass Chambers. The Defender (HFC) was represented by Alastair Clark QC and Fintan McShane.

The facts have attracted a lot of publicity in the popular press, but turned on the whether when a consumer bought goods with credit, if the goods were validly returned to the supplier did the contract of credit also fall thus relieving the consumer from the obligation to make any further payments under the contract of credit?

The second issue for determination was what obligations there were on a creditor under such a contract to investigate the existence of the debt (which would fly off in the event that the principal argument was correct that the contract of credit fell simultaneously with the fall of the contract of supply of the goods) and whether a report could be made to a credit reference agency.

The Supreme Court held that once the contract of sale fell (for example because of the goods being faulty or not conform to contract) then the contract of credit automatically fell too, thus relieving the consumer from any obligation to make further payments under the contract of credit. Further, the court held that the creditor was under an obligation to investigate whether a debt existed prior to making any report to credit reference agencies. In the event of disputed debt, they must not make a report until the existence of the debt is adjudicated upon by a court if necessary, but whilst there is such dispute, they must make no report to the agencies.

This case will cause a major shift in the practices of creditors and debt collection agencies. Instead of using the threat to report bad debt to the agencies as a means of forcing payment from a consumer, the creditors are now prohibited from making a report until the debt is actually established. An example may assist.

A consumer purchases a computer and has credit provided for its purchase. It develops a fault and he takes it back to the shop. The shop refuses to accept it is faulty.

Usually the creditor would, if payments under the credit agreement are stopped by the consumer, threaten to report the consumer to a credit reference agency. This dramatic and effective threat would often result in the consumer paying for goods that were faulty.

In the light of the Durkin judgment, the creditor must investigate whether the debt is due – and that means investigating whether the goods were validly rejected by the consumer. If there is a dispute – other than a plainly ridiculous one – there can be no report unless and until the matter is determined by agreement of the parties or by court action. The court action envisaged by the Court is either an action for payment by the Creditor (where the Debtor can defend on the basis that the goods were validly rejected), or an action by the consumer (for example against the supplier for refund of sums already paid.

It is highly likely that there are many consumers who have been subjected to damage to their credit, or paid sums under threat that it now appears were not in fact validly extracted who now have claims for past losses.

The judgment is a major victory for consumers which restores power to the consumers which was intended when the 1974 Act was passed, but eroded by creditors using threats to extract sums without resorting to litigation.

Andrew Smith and Richard Pugh were asked to review the papers via the Free Legal Services Unit, and thereafter when accepting the instructions did so without charging any fee to Mr.Durkin. A copy of the judgement can be found here.

http://www.compasschambers.com/news/durkin_v_dsg_trading_as_pc_world_and_hfc_bank_supreme_court_judgement_26_314

I agree that this is potentially good news for consumers being hounded but not such great news for Mr Durkin after being taken to the cleaners!!

How does this relate to 3rd party interlopers (aka debt recovery agencies/parasites) who claim to have purchased a debt, often without proof, and then adding a "black mark" (default) to a credit file?

I speak from personal experience where two of these companies have entered a single entry each on a credit report pertaining to me (both relating to credit cards); no previous payment history, just a default. They then refuse to remove it and refuse to provide proof of ownership of the debt and/or notice of assignment proof.

This is genuinely affecting my ability to obtain a mortgage and I desperately wish to move (and can genuinely afford to)!!

Any thoughts?

I agree that this is potentially good news for consumers being hounded but not such great news for Mr Durkin after being taken to the cleaners!!

 

How does this relate to 3rd party interlopers (aka debt recovery agencies/parasites) who claim to have purchased a debt, often without proof, and then adding a "black mark" (default) to a credit file?

 

I speak from personal experience where two of these companies have entered a single entry each on a credit report pertaining to me (both relating to credit cards); no previous payment history, just a default. They then refuse to remove it and refuse to provide proof of ownership of the debt and/or notice of assignment proof.

 

This is genuinely affecting my ability to obtain a mortgage and I desperately wish to move (and can genuinely afford to)!!

 

Any thoughts?

Why don't you write to the Head of Legal at the DCA's quoting the Durkin judgement. Ask them to remove any marks they have applied to your credit record, in the absence of any proof that the debt exists and that they have bought the debt under the law of property act 1925. I am sure you can come up with a wording and see how they respond.

Just thought. Doesn't the other side in such cases have to pay all costs? So, does that mean Mr Durkin will actually get all the money back?

Enlighten us please someone with the right knowledge!

radmm0

Does this decision mean that many people can get their name removed from credit register? If true than all of them should help Mr Durkin to compensat his losses.

Just thought. Doesn't the other side in such cases have to pay all costs? So, does that mean Mr Durkin will actually get all the money back?

 

Enlighten us please someone with the right knowledge!

 

radmm0

I guess it depends on what the judge said.

Why don't you write to the Head of Legal at the DCA's quoting the Durkin judgement. Ask them to remove any marks they have applied to your credit record, in the absence of any proof that the debt exists and that they have bought the debt under the law of property act 1925. I am sure you can come up with a wording and see how they respond.

Need to research the relevance of the law of property act 1925 (unless you care to enlighten me/us) but I do have every intention of writing to the DCAs, and previous CCs who have pressurised me into actions that I would not have taken if defaults weren't threatened and applied to accounts that were in dispute!

Is this retrospective in that respect, i.e. where a case has been taken to court and settled, or settled out of court due to such threats/applications of defaults?

Certainly is a very interesting change and finally the people are getting something in their favour. Hence it taking 16 years!!!

I will need to check the judgement in full, but does this apply to mortgages where a dispute arises, or just in relation to credit agreements under the CCA?

Don’t forget that there are already judgments in place regarding banks’ actions that cause harm to a customer’s financial reputation, eg. Kpohraror v Woolwich Building Society [1996] – http://e-lawresources.co.uk/cases/Kpohraror-v-Woolwich-Building-Society.php

I know Richard frequents this forum, so if you read this, Congratulations!

I know the judgement did not yield all you deserved, but if it wasn't for people like you this world would be a worse place!

Hope Richard Durkin is adequately compensated or does he go back to a lower court for his costs / damages?