Perfect Home - Coverplus

[vjohn82]

Hi all,

 

Been a while since I've needed to start a new thread... been busy helping others. But hey this one dropped in my lap from someone nearby to me and I said I would take a peek and upload the docs on here for others to peruse and advise on. Many hands making light work and all that.

 

So, we have a lady who visited the Perfect Home branch and took out an agreement to purchase a laptop. She took out a PH Coverplus agreement too after being told these two things:

 

1) It was an essential part of the sale because it offers protection for the consumer in that you get a replacement TV while yours is being repaired

 

2) That it covers you if you wanted to return the TV and not be liable for the outstanding balance

 

Furthermore, she was really pressured to take out this plan having gone through 2 sales people (who kept quoting the laptop with the coverplus), the store manager (who looked confused when she said she was unsure about taking out the plan) and then a credit manager (who took her through the final docs in a haphazard manner).

 

I've scanned all of the docs here relevant to the plan and removed any personal identifiers save for the figures.

 

CONCERNS

 

My concerns with this plan are as follows:

 

1) On page 1 (the Fixed Sum Loan Agreement) it states in "Key Information" that you have "no rights to cancel this agreement under the Consumer Credit Act 1974, the Timeshare Act 1992 or the Financial Service (Distance Marketing) Regulations 2004.

 

2) This Coverplus plan costs £628.07.

 

3) On page 3 (Coverplus T's & C's) it states in section H (a) that you can cancel the cover within 45 days of purchase but the heading states "YOU CAN CHANGE YOUR MIND AT ANY TIME" - clearly misleading because it states you only have 45 days to do so.

 

4) In E (1) it states that PH can cancel the warranty at any time of their choosing by giving 7 days written notice - this seems to me to be an imbalance of the parties rights in favour of the creditor in this regard.

 

MAIN QUESTION

If the Coverplus plan can be cancelled within 45 days of purchase, yet the fixed sum loan agreement for that plan CANNOT be cancelled (as there are no rights to do so under the terms) how on earth can the person actually cancel it and not incur the charges within the fixed sum loan agreement?

 

Comments and thoughts appreciated

[vjohn82]

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[vjohn82]

2 guests within a few seconds of posting this? Must be a new record? ;-)

[DonkeyB]

First thoughts: If the plan/finance was provided by a third party (ie. the shop acted as a representative and the actual cover was with another company), then a cooling off period is necessary, as the shop would have been an intermediary/broker. That’s the first thing to check – finance supplied by Temple Finance. Is that the same as the people selling the laptop?

[cerberusalert]

I'm just thinking allowed here but the laptop agreement cannot be cancelled because the agreement was signed 'on premises' whereas the PPI should be as it's technically a second agreement with a third party insurance company & was not signed on their premises so should have the full cancellation rights.

[DonkeyB]

Introduced in June 2010, the European Consumer Credit Directive stated ALL credit agreements will have a 14 day right of withdrawal. So when was this signed?

[vjohn82]

First thoughts: If the plan/finance was provided by a third party (ie. the shop acted as a representative and the actual cover was with another company), then a cooling off period is necessary, as the shop would have been an intermediary/broker. That’s the first thing to check – finance supplied by Temple Finance. Is that the same as the people selling the laptop?

 

Finance for Coverplus is provided by Temple Finance too

 

I'm just thinking allowed here but the laptop agreement cannot be cancelled because the agreement was signed 'on premises' whereas the PPI should be as it's technically a second agreement with a third party insurance company & was not signed on their premises so should have the full cancellation rights.

 

Doesn't seem to be a PPI agreement even though it looks like one... but it was signed on the same day

 

Introduced in June 2010, the European Consumer Credit Directive stated ALL credit agreements will have a 14 day right of withdrawal. So when was this signed?

 

Signed on 16/10/10 and first instalment paid.

[DonkeyB]

Well, sounds like you may have them. Looks like the form they are using is out of date and incorrect. Have a look here – it’s Article 14.

 

http://webarchive.nationalarchives.gov.uk/+/http://www.berr.gov.uk/whatwedo/consumers/consumer-finance/ec-directives/CCD-draft-regs/page52321.html

 

 

If they’re happy with the laptop, fine. This sounds like a glorified extended guarantee. When I’m offered one, I always say: “Are you telling me the product you’re selling me is ****e and you expect it to break down?” Usually shuts them up.

[vjohn82]

When was it enacted as law or merged into the present Act DB? Can't seem to find it...

[Lefty]

Interesting that Perfect Home (unlike our old friends at BrightHouse) prefer a fix sum loan agreement instead of a good old-fashioned hire purchase agreement! Are the weekly payments made via a TV coin meter by any chance (like Buy As You View)?

 

You will find that the cover plus agreement is nothing more than an uninsured service contract - a weekly pay-as-you-go thing - and would probably lapse (as does the BrightHouse version) if the weekly premium is not paid. I would suggest to cancel it would simply require 7 days written notice.

 

Is there a theft and accidental damage policy, too? Usually there is. And, more often than not, they are farmed out to a dodgy Malta based insurer to avoid most of the FSA regs.

 

I'm curious as to what method Perfect Home use for security on their agreements.... Like I say, BrightHouse (and Buy as You View) use Hire Purchase... Is there any mention of security on the forms?

 

Cheers

Lefty

[vjohn82]

Hi,

 

The actual product is based upon a Hire Purchase agreement.... but this coverplan is based upon a fixed contract. I've posted the links for the contracts and the product mentioned for the "Coverplus" is called "Maintenance Vouchers". Weird!

 

Anyway, there is a TAD policy in place too but this is not important just yet as it can be cancelled upon proof of suitable cover. That bit is easy.

 

The bit I'm having trouble reconciling is the fixed sum loan agreement being used for a warranty product which in itself can be cancelled but the credit agreement for it cannot; are they effectively saying you can cancel your Coverplus (coverplus t's and c's H (a)) but you'll still pay for it? (save for the 14 day exclusion mentioned by DB above).

 

All seems rather bizarre - I think the CPUTR's 2008 will be relevant in this particular case as there seems to be a gross imbalance regarding the credit/debtor relationship.

[coledog]

My advice to your friend VJ is to keep well clear of this bunch. If they can return anything they have bought and get it elsewhere, do it. I very stupidly bought something from them 3 years ago when they first opened and wish I had not. I have had a list of problems with them and was intending to write a full account of these on the appropriate retail forum when I have calmed down and can deal with this rationally. At the moment red rags and bulls come into the equation.

 

I do not owe them any money and have in fact overpaid them. The head office is a front, there is no office or phone line and you cannot contact them. All contact has to be through the shop staff and their 'computer' which is God.

 

Things got to a head when I told them that the account should now be nearly paid and they informed me that the computer said that I had opened it in December 2008, not 2007 and that I was wrong. Also, it was up to me to prove when I opened it and how much I have paid as according to their records they were right. I was to bring in all the evidence.

 

I left the shop with a comment that they were the most 'badly managed and disfunctional organisation that I had ever come accross' (which went way over the guy's head) and said I would be back (in terminator fashion).

 

Round 2 to commence when I have taken a couple of vallium and can put on my 'professional' scary front!

Edited October 22, 2010 by coledog

[vjohn82]

Oh don't worry, I'm nowhere near companies like this.

 

But the issue is still at hand, how can a warranty be cancelled yet a consumer credit agreement signed to support it cannot? Sounds like extortion doesn't it?

[coledog]

Everything about this company is very suspect, which I think is my point. There is no customer service or complaints process other than the shops. Also they do not have a proper accounting system or produce statements.

 

They are relying on having a customer base that is not very bright or consumer aware and cannot cope if anyone questions what they are doing. I think trading standards really need to look at them.

 

I originally bought 2 appliances and did return one after 6 months without paying more than I had already paid but got no breakdown or figures. They did cancel the service contract and have not charged any more on that one.

 

I would like to get to the bottom of how they are operating.

[coledog]

New thread on retail

http://www.consumeractiongroup.co.uk/forum/showthread.php?281244-Perfect-Homes-and-a-Laptop-problem&p=3171080

[vjohn82]

Everything about this company is very suspect, which I think is my point. There is no customer service or complaints process other than the shops. Also they do not have a proper accounting system or produce statements.

 

They are relying on having a customer base that is not very bright or consumer aware and cannot cope if anyone questions what they are doing. I think trading standards really need to look at them.

 

I originally bought 2 appliances and did return one after 6 months without paying more than I had already paid but got no breakdown or figures. They did cancel the service contract and have not charged any more on that one.

 

I would like to get to the bottom of how they are operating.

 

I think all companies like this operate on a very fine line. I'll just have to see how this one pans out methinks.

[coledog]

I think you have opened a can of worms to be honest, this company have only been around for about 3 years or so and their original agreements will only just be ending. Their customers are not going to be the best at complaining and are largely just happy to be able to get a telly or whatever.

[vjohn82]

I think you have opened a can of worms to be honest, this company have only been around for about 3 years or so and their original agreements will only just be ending. Their customers are not going to be the best at complaining and are largely just happy to be able to get a telly or whatever.

 

I walked past a PH store last week and was amazed how many people were in there looking for things. Even with huge signs showing the payments/APR etc. Shocking really but this is why they have set up I guess; the recession has hit people hard and credit is hard to come by.

 

I'll keep plugging away with this set of documents.

[coledog]

I will try and put my research/analyst head on and look at this rationally. Will keep you posted.

[vjohn82]

I'm writing a simple letter... the credit agreement is automatically cancelled as no warranty will have been purchased. Essentially a consumers rights to cancel an agreement remain intact despite the credit agreement itself stating that the consumer has no cancellation rights.

 

It would be classed as an unfair term simply because the creditor in this instance has the ability to cancel the agreement giving 30 days notice. If the debtor is unable to take such action then the term is unfair.

 

Here's the letter going out to them today... I'll find some further case law/legislation to back up my assertions (as I always try to do) so that people have the full information to hand if challenged by the might of the PH store manager ;-)

 

FAO: Operations Director - Cancellation of Coverplus

 

Dear Sir/Madam,

 

I would like to exercise my right to cancel the Coverplus plan under section H (a) of the Coverplus Terms and Conditions. The purchase date of the plan is XX/10/10.

 

I am cancelling because I believe that the Coverplus plan is no better than the rights afforded to me under the Sales of Goods Act 1973 or even superseded by the manufacturers standard 12 month warranty.

 

If you can explain any compelling reason why the Coverplus plan contains any significant benefits over and above the standard warranty period or of the Sales of Goods Act 1973 I am willing to receive them in writing only. As I understand if goods are faulty within a 6 year period it is the responsibility of the seller to put this right either through repair or replacement at no cost to the consumer. I cannot see any additional benefit that I would require as such statutory rights appear to be more than requisite and the benefits afforded under the Coverplus plan do not appear to be worth the eventual £1XXX.XX cost.

 

If Perfect Home have no confidence in the product or have some figures for me demonstrating the rate of breakdown for this particular product it will of course assist me with any further decision I need to make. Assuming that no such information is available it seems improper for me to have even considered taking out the cover without all of the information to have to come to a rational decision on whether the Coverplus plan was right for my circumstances.

 

I trust that this will be enacted without any unreasonable delay and that the weekly payment will be reduced from £XX.XX to £XX.XX. I am of course happy to retain the insurance cover at present until such a time that I find a contents insurance policy that offers better value and which of course covers HP products.

 

I look forward to any response you may have to the above and trust that you will forward on my request to the appropriate Perfect Home branch so that my weekly payments are updated and effective immediately.

[Lefty]

I'm writing a simple letter... the credit agreement is automatically cancelled as no warranty will have been purchased. Essentially a consumers rights to cancel an agreement remain intact despite the credit agreement itself stating that the consumer has no cancellation rights.

 

It would be classed as an unfair term simply because the creditor in this instance has the ability to cancel the agreement giving 30 days notice. If the debtor is unable to take such action then the term is unfair.

 

Here's the letter going out to them today... I'll find some further case law/legislation to back up my assertions (as I always try to do) so that people have the full information to hand if challenged by the might of the PH store manager ;-)

 

Excellent letter...

 

I would point out, though, that if the actual agreement (not the cover plus agreement) is a Hire Purchase agreement, then it is the SUPPLY of Goods (Implied Terms) Act 1974 and NOT the SALE of Goods act that applies.

 

Hope this helps.

 

Cheers

Lefty

[vjohn82]

Excellent letter...

 

I would point out, though, that if the actual agreement (not the cover plus agreement) is a Hire Purchase agreement, then it is the SUPPLY of Goods (Implied Terms) Act 1974 and NOT the SALE of Goods act that applies.

 

Hope this helps.

 

Cheers

Lefty

 

Of course... dim of me.

 

Thanks for the comment

[vjohn82]

Ok... time to update.

 

Letter of cancellation was sent... and...

 

They agreed! No arguing... no funny business... no trying to talk anyone out of it...

 

Very surprised.

 

I'm not one for praising companies like this but on this occasion they have got it absolutely right.

[DonkeyB]

Maybe they have a Star Wars handle on CAG and knew they would lose!

 

PS If I were a bank, I would immediately dump any client whose online ID was a Star Wars character, cos they’re all on CAG with debt problems...

[vjohn82]

Haha... well I suppose I should have concealed my intentions more when I left the store last time saying "May the force be with you"?