The ‘New and Improved’ Consumer RA 2015

Tuesday, 15 November 2016 | Leonard Scudder

Unfortunately the RA doesn’t stand for Rental Agreement.

At Ascot Lawyers we’ve been known for striking out a few big hitters who have come chasing our consumer clients for monies that they are liable to pay by virtue of a vehicle rental agreement. These agreements are often provided on a credited basis and tend to be resultant from a negligent driver careering head first into innocent and now injured third party.

In any case, these Credit Hire Agreements (CHAs) cause quite a kerfuffle among Insurers, Credit Hire Companies (CHCs) and Solicitors alike, and (aside from the generic arguments made) there is a serious point to be taken from the consumer’s new and as yet un-used weapon - The Consumer Rights Act 2015 (the CRA).

The principles aren’t new but the fact they are now written down is problematic, unless everything is done by the book of course – which of course it is - but then it becomes a matter of evidence; and therein lies the rub.

In relation to Credit Hire particularly, we’ve got the long standing principles of misrepresentation. In equity, a party guilty of misrepresentation cannot rely, as a defence, upon the fact that the innocent party could have discovered the deception.[i] Further, under the somewhat dense Unfair Terms in Consumer Contract Regulations 1999[ii] consumers were readily able to sell to the courts the proposition that oral representations made in contradiction to written terms stated were not enforceable against them.[iii]

The pertinent parts that the people will deploy are found under ‘Chapter 4 – Services’. Under this Chapter any contract to supply a service that isn’t employment, apprenticeship, or a gratuitous Scottish contract is subject to the regulation as a ”contract to supply a service”[iv].

Particularly of relevance is section 50(1) CRA which states:

“Every contract to supply a service is to be treated as including as a term of the

contract anything that is said or written to the consumer, by or on behalf of the

trader, about the trader or the service, if —

(a) it is taken into account by the consumer when deciding to enter into the contract, or

(b) it is taken into account by the consumer when making any decision

about the service after entering into the contract.

For consumers this is great, if they can show that the decision to hire a vehicle was based on the fact they wouldn’t have to pay for it, they’re home free (of charge). Again it’s not new but now it’s black and white.

As such, if you are being chased for charges you don’t believe you should be held responsible for there’s a proper way to defend any proceedings issued against you and it’s worth having a chat with Ascot Lawyers’ Road Traffic Litigation Department to have your case reviewed.

But if you’re a CHC this is probably as devastating as this ‘Admin Fee’ unenforceability malarkey, which though easily avoidable has put another spanner in the works.

Issues that commonly arise in respect of credited charges include:

  1. That hire was provided at no charge,
  2. That hire was provided at cost but the consumer would never have to pay for it, or
  3. No cost was ever stated.

One could be dangerous, Two is recoverable, and with Three equity’s on the side of the CHC.

The CRA at s54(3) also provides a damning[v] remedy to the consumer:

“If the service does not conform to the contract [including any of those inducements over the phone] the consumer’s is statutorily entitled to:

(a) the right to require repeat performance, or 

(b) the right to a price reduction.”

It gets better; section 54(7)(a) CRA states that the consumer is also entitled to damages in addition to their price reduction. Not only could a CHC have to take a hit on the hire charges but they could have to pay out compensation to their ‘client’ (a term loosely used at this stage).

The ‘hit’ is quantified to an extent in section 56 CRA which painfully states that the right to a price reduction is the right to require the trader to reduce the price to the consumer by an appropriate amount, and where appropriate, this may be the full amount of the price!

A full refund, damages, and costs?! This must be avoidable… It is, but if you’re an operating CHC it’s imperative to be mindful of what is said and how it’s said. It’s not always the words used that are the issue but how they are perceived by the recipient consumer.

In these circumstances an evidential trail is required. The CRA is an important reminder to provide clear and concise advice to consumers about what they’re getting into and how the ‘reclaiming’ process works, especially where the additional element of compensatory damages is concerned

Ascot Lawyers has taken a forward initiative in relation to this legislation and the seemingly rampant enforceability arguments that have jumped out of nowhere.

Ascot Lawyers are not only practiced in with these assertions but are able to take action to ratify current agreements for CHCs and to provide solutions to the problems that surround ‘price reductions’. These steps not only ensure that future agreements are unquestionable but are concurrently increasing the protection for the signing consumers too.

There’s a saving grace to section 56 which can guarantee a recovery in any case, but this will be the subject of the next article alongside the consumer’s ‘right to a refund’ - particularly pertinent where the consumer demands a refund under s56 after the CHC has successfully pursued the third party insurer through litigation.

If you want more information on any of the above topics please get in touch with Ascot Lawyers on 01344 512 370 or email This email address is being protected from spambots. You need JavaScript enabled to view it..



[i] Redgrave v Hurd (1881) 20 Ch. D. 1; which in these circumstances would include reading the agreement for hire.

[ii] Applying primarily Schedules 2, 5, and 8.

[iii] County Court at Medway; Day v CGU Life [2001] CLY 906, April 23, 2001.

[iv] s48 CRA.

[v] (but avoidable)