Help wanted re Section 75 Consumer Credit Act 1974

  Nosmas 16:27 02 Feb 2003

On the Internet I signed up with Gio Internet for their Broadband service at £17.99 p.m. Subsequently I cancelled my order both by telephone and in writing on the 7th WORKING day after placing my order. Oldham Trading Standards Office has confirmed to me in writing that my cancellation was made within the time allowed ("cooling off period") under the Consumer Protection (Distance Selling) Regulations 2000.

On 25th October 2002 my Visa account was debited with an initial amount of £96.01 (connection charge plus two months charge for the Broadband service), and with £18.00 for another month's service charge on 25th November. When I complained to my CCC (Credit Card Company) they sent me for my signature a form dated 28th November addressed to Gio's collecting agents informing them that I wished to cancel what the CCC called a "subscription" and that any further debits would be returned. Despite this another debit of £18.00 appeared on my account on 25th December and the CCC duly returned this and re-credited my account. No debits appeared in January.

Initially the CCC said they could do nothing about any debits to my account BEFORE I had signed the form they sent me. Subsequently they decided to refund the £18.00 that had been debited on 25th November, but then said that because the £96.01 was below the £100.00 threshold stipulated by Section 75 of the Consumer Credit Act 1974 they were not liable. I feel that all three debits totalling £132.01 should be viewed as part of the same transaction and not looked at in isolation, and therefore within the ambit of Section 75.

Are there any legal beavers out there with a good knowledge of consumer law? If my contention is correct can they cite any legislation or case law that I can quote to my CCC to get them to refund the £96.01? Or are there any other arguments that might persuade the CCC to act honourably?

  Stuartli 16:46 02 Feb 2003

Visa are normally pretty good with such complaints - quite often it overlooks the fact that the sum involved is below the £100 mark.

I would contact them again or fax/write to Mrs Jane Reynolds, who is the Senior Customer Concerns Advisor for Visa (at least in the case of LloydsTSB Trustcard queries).

Her number is 01273-636347 or fax 01273-636306.

In the meantime one, at least, of the forum members is well up in this field and should (hopefully) eventually see your thread.

  Nosmas 17:03 02 Feb 2003

Thanks for the quick response. Unfortunately I am not with Lloyds TSB. My CCC is Tesco Personal Finance - a joint venture of Tesco and Royal Bank of Scotland - and they most definitely are not overlooking the less than £100. Having originally said they could do nothing about the debits made BEFORE I signed their form (at which point the total was £114.01), I think their change of mind was a crafty move to bring the disputed amount BELOW £100.

  blakdog 19:15 02 Feb 2003

My first reaction is that ALL the payments were made under the same contract and therefore could be treated as one claim, after all, all payments were taken despite your cancellation within the fourteen day cooling off period, but I have to say that this is just an educated guess. That being said, however, I think your first port of call should be Gio.

Did they confirm reciept of your cancellation? And are they based in the UK or Europe? if they are then they will obviously have to conform to the relevant law - go back to them, in writing, advising them of the facts and telling them (politely) that you expect to be reimbursed. Enclose a copy of your cancellation (and their confirmation if you have one) and give them 21 days to respond.

A final point here is that card issuers seem to vary widely. From a personal point of view I use Marbles and First Direct Visa, both have treated me very well, perhaps you should think of going with another card supplier? Either way contact Tesco and let them know that you are not happy and are taking legal advice and may come back to them in the near future.

If you can wait that long i have a Law Tutorial on Tuesday the tutor being a qualified solicitor:I will ask the question then, in any case I am intrigued to know the answer myself.

  Forum Editor 19:57 02 Feb 2003

and agree that I would fight on the basis of all the amounts forming part of the same transaction - after all, the Card provider gave the ISP a transaction number when the initial request was made to charge your card account, and I suspect that the same transaction number will be attached to the debit mandate held by Gio internet.

I have no idea if this theory has any legal standing, but it certainly makes common sense to me, and I would certainly recommend that you goo back to Tesco on that basis. Card providers are keen enough for us to open these accounts, and it's not too much to ask that they back you up when you need it. You haven't done anything wrong after all, you've acted within the law. Gio should of course make reimbursement of the wrongly debited amounts.

  Stuartli 20:23 02 Feb 2003

My understanding of Visa (and similar credit organisations) is that the banks, building societies and other organisations that issue its cards are acting as its agents.

I may, of course, stand to be corrected.

Therefore, if I am right, any transaction made under Visa's name is the liability of Visa itself - or MasterCard etc.

In the case of Tesco I have Clubcard Plus and savings accounts with them (again through the BOS) and, whenever I have had to raise any issues, they have been sorted out quickly and efficiently. If financial compensation has been warranted it has paid up without quibble.

I would respectfully suggest that you contact Tesco by telephone and explain the position again - I'm sure it will prove rewarding.

  Stuartli 20:25 02 Feb 2003

Further to above, it might be worth contacting Visa first.

As far as I am aware its operations are based in Brighton - all card issuers seem to provide a Brighton phone number to report stolen cards etc and the contact/fax numbers I gave earlier are for that area.

  blakdog 20:34 02 Feb 2003

One other question. Had you already begun to use the service before you cancelled? The reason I ask is because although you have the right of the cooling off period subject to the Articles of the Distance Selling Directive, Article 6 (3) states that in contracts for the supply of services (which I assume would describe this case) the contract cannot be cancelled once the service has been begun, with the consumer's agreement. I assume in such a case that there would be a minimum notice period for termination in their standard terms and conditions and they would be entitled to enforce them.

If they haven't started the service and try to quote you their terms and conditions as an excuse for debit the amounts from your card then they are in breach of the distance selling directive, not to mention the Unfair Contract Terms Act 1977 and Orders made under the Fair Trading Act 1973 if they are a uk company.

Seven days, not fourteen!


You may wish to view theother thread we have both commented on as well.

  Hunte® 21:59 02 Feb 2003

Being ADSL, the service would usually have been started as soon as the order was placed (or within hours at least). Gio would have contacted BT to arrange for the installation to be activated (BT are actually activating accounts within 7 days nowadays). Once BT were contacted then Gio would have been liable for the activation fee to BT.
If this is so then I would assume you would not be able to cancel under the Distant Selling Regs as the service would have been started.

  Hunte® 22:05 02 Feb 2003

Also, I would have thought the monthly charges would be classed as seperate contracts (as far a visa are concerned) otherwise nearly all continuous credit authority agreements will go over the £100 mark over time.

When you signup for an ISP paying a monthly fee you effectively sign a Continuous Credit Authority for the ISP to charge your card whatever amounts it has advised you of. In this case the £17.99 each month and the £96.01 for the first 2 months. I believe Gio have only a 2 month minimum contract. This would explain why the card company credited the 2 further charges as these occured after you advised of your wish to cancel.

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