# Has the Unfair Terms in Consumer Contracts legislation helped any mortgage customers?



## Brendan Burgess (18 Sep 2018)

I am trying to get my head around this legislation to see if it is of any use to helping people with tracker issues or financial issues generally. I have heard it quoted a few times.

The National Consumer Agency's NCA-guide-to-unfair-terms-in-contracts.docx  is the best guide I have seen.

It's very clear that the answer to this question is, despite the 6 pages of discussion, no.
Can the Unfair Terms in Consumer Contracts be used to challenge high variable rates?

I presume the Ombudsman takes it into account? For example,  when a customer of KBC takes a case to the Ombudsman about their failure to pass on interest rate cuts to existing customers, presumably the Ombudsman considers this legislation in dismissing the complaint?

Has the legislation been used successfully by or on behalf of consumers in Ireland?  A court decision, for example. 

Maybe the Central Bank was influenced by it in pressurising the lenders to give some people back their trackers?

Brendan


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## RedOnion (18 Sep 2018)

When it gets to high court:  a little dated now, but here's a good summary of key cases: https://www.algoodbody.com/insights...unfair-contract-terms-arguments-in-loan-cases

In my experience, when they choose to use them, CBI have plenty of tools in their armour without using this specific piece of legislation.


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## Brendan Burgess (18 Sep 2018)

Red

That is very helpful, thanks. 

So there has been no finding of substance against a lender yet. 

The only success was a procedural issue where the Judge said that the bank should have "placed all the contractual documents before the court" so that the court could assess whether it complied or not. 

That is the most interesting bit. The court has an obligation to consider whether the lender has complied with the legislation, whether or not the borrower has raised it. 

Brendan


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## Sophrosyne (18 Sep 2018)

Brendan Burgess said:


> That is the most interesting bit. The court has an obligation to consider whether the lender has complied with the legislation, whether or not the borrower has raised it.



That was consequent to the Pannon case.

In the Pannon case, the ECJ held that, as the national court is required to ensure the effectiveness of the protection intended under the Unfair Terms Directive, it must examine the possible unfairness of a term of a contract _even where the consumer has not challenged it._ This is a duty of the national court, not merely a right or power.


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## WizardDr (18 Sep 2018)

"....41 My conclusion that the non-disclosure of the amount of the commissions made Paragon's relationship with Mrs Plevin unfair is enough to justify the reopening of the transaction under section 140A [Consumer Credit Act 1974]..."

This is what the Payment Protection Insurance ('PPI') matter in UK hinged on ..and that Act had been amended after Unfair Terms in Contract I & II Directives were issued.

If you want to see how Unfair Terms in Contract should be dealt with in a Member State taking Consumer Law seriously then read 
*
Plevin v Paragon Personal Finance Limited [2014] UKSC 61*

(Put into Google for a PDF)


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