What Constitutes an Unfair Relationship?

IT'S NOT THE END OF PPI

It was back in 2006, that Parliament recognised that the consumer needed more protection against banks, brokers and lenders. A rise in unscrupulous practices by lenders and brokers, leading to unfair treatment of the customer paved the way for the introducing of new grounds for complaints - an Unfair Relationship Claim. As a result, the Consumer Credit Act 1974 was amended in 2006 with a new section 140A to further support victims of mis-sold financial products.

How is an unfair relationship established?

Many lenders paid commission to brokers and intermediaries who were involved in arranging credit cards, loans and mortgages. This commission was then sometimes added to the cost of the loan without the customer wanting it and/or being aware of it.

If the customer taking out a credit card or loan is not provided with sufficient advice or disclosure of the commissions by the lender, it is highly likely that an unfair relationship has been created.

The unfair relationships test

Section 140A Unfair relationships between creditors and debtors from the 2006 Consumer Credit Act allows courts to make any of the wide ranging orders if the court determines that the relationship between the creditor and the debtor arising out of the agreement (or agreement taken with any related agreement) is unfair because of one or more of the following:-

• (a) any of the terms of the agreement or of any related agreement;
• (b) the way in which the creditor has exercised or enforced any of his rights under the agreement or any related agreement;
• (c) any other thing done (or not done) by, or on behalf of, the creditor (either before or after the making of the agreement or any related agreement)

The test was formulated to focus on three aspects out of which an unfair relationship might arise; the first looks specifically at the terms of the agreement (or any related agreement) and the other two look specially at the how the creditor acted and dealt with the debtor.

In addition to the above the courts may also take into account any or all matters it considers to be relevant to this assessment, including matters relevant to both the debtor and creditor.

If the relationship is found to be unfair by the Courts, the lender can be ordered to:

• Pay compensation to the borrower
• Write off all or part of a loan
• Do or not do something in relation to the agreement

The unfair relationship provision has tried to ensure that the balance of power is in the consumer’s favour when making an Unfair Relationship Claim.

Starting an 'Unfair Relationship' Claim under Plevin Ruling

MoneyPlus Legal is a Plevin Claims specialist, whose core focus is on helping consumers who were sold PPI to use all available and possible options to obtain a legal remedy for compensation of undisclosed & high commission from the finance provider.

If you’re unsure whether you are eligible to make a claim under the Plevin ruling please don't worry as MoneyPlus Legal will always conduct a full review of all your PPI credit agreement(s) to establish whether there is a case for unfair relationship.

MoneyPlus legal will use their specialist 'Plevin' claims experience to investigate, negotiate and settle any claim as quickly as possible. Our Plevin PPI Check and claim service is simple and completed on a no win no fee basis* and you will be kept informed throughout the claim process.

The Plevin Claims Process