The company sought to enforce its loan agreement and charge over the defendants’ property. The defendants appealed saying that the agreement was unenforceable under the Act, since a commission had been paid to the introducing broker, and his fee had been added to the loan amount. The agreement was a fixed sum credit agreement regulated under the 1974 Act, but it did not say how the fee was to be repaid.
Held: The regulations provided some flexibility on how the sums were to be described, and the borrower’s appeal failed. Nevertheless the payment of the fee was to be deferred and the company’s appeal also failed. A secret commission would be repayable. Was the commission secret? The broker was their fiduciary agent, and the onus fell on him to demonstrate disclosure. There had been insufficient disclosure, and the fee was repayable.
Judges:
Waller LJ VP, Tuckey LJ, Jacob LJ
Citations:
Times 11-May-2007, [2007] EWCA Civ 299, [2007] 2 All ER (Comm) 1037, [2007] 1 WLR 2351, [2008] Bus LR 216, [2007] 4 All ER 1118
Links:
Statutes:
Consumer Credit Act 1974 8 10(1)(b), Consumer Credit (Agreements) Regulations 1983 Sch6 p5
Jurisdiction:
England and Wales
Citing:
Cited – McGinn v Grangewood Securities Ltd CA 23-Apr-2002
The lender used part of the loan to repay a small amount of arrears of the claimant on another loan. The part so used was not part of the objective of the loan, but one of the costs of obtaining it.
Held: The deduction was properly part of the . .
Cited – O’Hagan v Wright CANI 15-Jun-2001
Lord Carswell CJ discussed the necessary contents of a consumer credit agreement: ‘the debtor must receive fairly precise information about the times and amount of repayments to be made’. . .
Cited – Panama and South Pacific Telegraph Co v India Rubber, Gutta Percha, and Telegraph Co 1875
Where his agent has taken a secret commission, the transaction is voidable at the election of the principal who can rescind it provided counter-restitution can be made. . .
Cited – Johnson v EBS Pensioner Trustees Limited CA 2002
The court considered a request for rescission. A guarantee had been given by one of the defendants as security for a loan made by solicitors to his company. He complained that the solicitor acting for him had a conflict of interest and had been in . .
Cited – Shipway v Broadwood 1899
Where an agent takes a secret commission, ‘the real evil is not the payment of money, but the secrecy attending it’ . .
Cited – Bartram and Sons v Lloyd 1904
A secret commission had been agreed and paid to the agent. The court was asked whether the principal had elected to affirm the contract with the other party at a later meeting when he was given some information about what had happened.
Held: . .
Cited – Mahesan v Malaysia Government Officers Co-operative Housing Society PC 1978
The appellant, the director and employee of a housing society was bribed by a real estate agent, one Manickam, and the appellant then caused the society to buy land at an overvalue. The agent was sued for money had and received (for the amount of . .
Appeal from – Hurstanger Ltd v Wilson 2006
(Coventry County Court) Michael Douglas discussed the 1983 Regulations, saying: ‘The 1983 Regulations prescribe, among other things, the minimum contents of a regulated agreement, the information which must be brought to the attention of the . .
Cited by:
Cited – Sternlight v Barclays Bank Plc QBD 22-Jul-2010
Various credit card customers said that the respondent banks had mis-stated the interest rates applied to them, in that the interest charged did not match the APR advertised, and that therefore the agreements were unenforceable.
Held: The . .
Cited – HSBC Bank Plc v Brophy CA 2-Feb-2011
The customer appealed against an order finding that his credit card agreement was binding upon him.
Held: The appeal failed. His argument that the application form amounted only to an invitation to treat, and that the contract was one made by . .
Lists of cited by and citing cases may be incomplete.
Consumer, Financial Services, Agency
Updated: 09 November 2022; Ref: scu.250988