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Credit Hire –
Defendants fighting back
Gavin Clark
5th September 2013
Ramirez -v- EUI Ltd
Bicycle Credit Hire
Recovery and Storage
What does the future hold?
Ramirez -v- EUI Ltd
Pre-issue advice
 Is liability disputed?
 Settle non-contentious heads
 Consider hire
• Issues on locus standi, enforceability, need?
• Make admission to ensure balance is below SCT
limit and discharge by way of interim payment
The claim comprised:• Repairs of £1,588.65.
• Hire charges of £5,907.60.
• Miscellaneous expenses of £50.
Liability not disputed
Repairs were admitted
Admission made of £3,459.60 for hire
An interim cheque issued leaving a balance of £2,498.
 Issued for the full amount.
 No credit given for the interims.
 We admitted liability, quantum for
repairs and the claim for hire up to the
admission i.e. £3,459.60.
 We put the claimant to proof as to the
balance and argued that this was a SCT
The arguments
 The admission was not accepted
by the claimant and therefore
the whole of the claim for hire
charges was disputed.
 This was a clever ploy to deprive
a claimant of his costs and to put
pressure on claimants to under
settle claims
 No issues re locus standi, enforceability
or need and therefore the issues were
not at all complex.
 By virtue of the admission the amount in
dispute was just £2498.00.
 If the claimant was awarded less than the
admission we would not seek repayment
of the balance.
 This was a FT matter.
 This was a SCT matter.
 DJ Wakem cited the explanatory note in Part 14
“It follows from these provisions that if in relation to a claim the
value of which is above the small claims track limit of £5,000, the
defendant makes before allocation, an admission that reduces the
amount in dispute to a figure below £5,000 the normal track for the
claim will be the small claims track”.
 Matter allocated SCT but gave permission to appeal.
 NB – the claimant did not apply for costs
The appeal
 When considering allocation the court must consider:– Any amount for which the defendant does not admit liability is in dispute.
– Any sum in respect of an item for which judgment has been entered is not in
– Any specific sum claimed as a distinct item and which the defendant admits
he is liable to pay is not in dispute.
– Any sum offered by the defendant which has been accepted by the claimant
in satisfaction of any item which forms a distinct part of the claim is not in
 As to recovery of pre-allocation costs, the claimant can, before allocation, apply
for judgment with costs on the amount of the claim that has been admitted
Court of Appeal
Withdrawn at eleventh hour
Appeal marked as dismissed
Appellant to pay costs
But is this the end?
Cost savings
Pre-August – £1000s
Post August
Willingness to negotiate
More favourable outcomes?
Potential saving
£1160 + VAT + 20%
£1880 + VAT + 20%
£2655 + VAT + 20%
£1495 + VAT
The new battleground
 Cycle Accident Management Services (CAMS)
 Agreements typically claim charges in the
region of £35.00 plus VAT together with an
additional daily amount of £5.00 plus VAT for
 Also claimed are charges for delivery and
 Charges are often grossly disproportionate to
the value of the bicycle.
How to defeat these claims
 Enforceability
 Need
 Higher threshold?
 Alternatives
 Period
 Rate
 Impecuniosity
 (£50.00 p/week)
 Intervention?
 Johnston -v- Loizou
Recovery & Storage Charges
 Increase in frequency of Recovery
& Storage
 The arguments:
– Enforceability
• Valid credit agreement?
• Regulations 2008
– Need
– Mitigation
 Hasnath -v- Shahid
Intervention - Prevention is better
than cure
 ABI/GTA restrictions
 A successful intervention:
– Telephone calls
– Telephone transcripts
– Copley compliant letter
 Smith -v- Currier
What does the future hold?
The referral fee ban
Closer cooperation
between CHOs & solicitors
Increase in the small
claims limit to £10k
The future of the ABI GTA
 Office of Fair Trading &
Competition Commission
 GTA mediation
 The GTA Portal
 Hire rate reviews
Office of Fair Trading – report May 2012
 Inflating the costs of replacement vehicle.
 Estimated increased cost - £560.00/hire
 Remedies:
– Reforming the GTA
– An extension of the referral fee ban
– The at fault insurer to have first option
of supplying a vehicle
– The introduction of a first party
insurance model
 Referral to the Competition Commission
Competition Commission
Possible Remedies
 Improvements to the GTA.
 An extension of the referral fee ban
 Non fault insurer having first option of intervention
 Each insurer deals with its own policyholder.
 An independent monitoring and rate setting scheme for
non fault claims.
Ramirez -v- EUI Limited
Bicycle Credit Hire
Recovery and Storage
Credit Hire - Post LASPO
What does the future hold?
Any Questions

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