B e f o r e :
| 1. MRS SALLY REDPATH
2. MR TERENCE REDPATH
|BLACK HORSE LIMITED
Posib, Y Gilfach, Ffordd y Pentre, Nercwys, Flintshire, CH7 4EL
Posib, DX26560 MOLD
Tel: 01352 757273
Fax: 01352 757252
Crown Copyright ©
"(a) any of the terms of the agreement…" – I am not going to refer to the related agreements as they do not directly affect the issue;
"(b) the way in which the creditor has exercised or enforced any of his rights under the agreement" – as far as I know, apart from receiving the payments, the creditor has not taken any steps to enforce his rights under the agreement); and
"(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)."
"(2) In deciding whether to make a determination under this section the court shall have regard to all matters it thinks relevant (including matters relating to the creditor and matters relating to the debtor)."
And for the sake of total completeness section 140A(3) provides that:
"(3) For the purposes of this section the court shall (except to the extent that it is not appropriate to do so) treat anything done (or not done) by, or on behalf of, or in relation to, an associate or a former associate of the creditor as if done (or not done) by, or on behalf of, or in relation to, the creditor."
In other words, anybody who is doing anything in connection with it. I am also entitled under the section thus:
"(4) A determination may be made under this section in relation to a relationship notwithstanding that the relationship may have ended" – which is not of course the case in this particular instance.
And exempt agreements are exactly what they say they are; exempt from these provisions.
"(4) At the beginning of the meeting, the first claimant provided the details of the first and second claimant's personal circumstances to the sales assistant. The sales assistant was given the claimants' address history, details of outstanding credit, employment details, and she was informed that the purpose of the loan was to consolidate debts".
The Particulars of Claim goes on to say:
"After confirming these details, the sales assistant represented as follows: Firstly, the loan application would only be approved if the claimants agreed to the addition of PPI as part of the loan application. Secondly, the PPI was required to obtain the loan; and thirdly, that on a big loan like this we would always have the cover anyway."
I say immediately that that is not pursued. Those matters are not proved indeed. Talking to the claimants (as opposed to the lawyers who drafted the document), that was never a matter that was at issue.
"(6) During the meeting, the first claimant asked what would happen if the second claimant became unemployed? This reflected the only substantial concern that the claimant had as to whether they would be able to meet the future repayments of any loan agreement."
"(8) I feel that those representations were false" and goes on to say "the further representation was false because the PPI ultimately sold to the claimant provided life cover only".
And in paragraph ten:
"(10) the sales assistant failed to inform or explain to the first claimant the whole number of matters dealing with the life cover including cooling off period, cancellation, money could be borrowed over a decreased term if the PPI policy was not taken out, it could be taken out with a payment by monthly instalments, they could go to an alternative lender" and so forth (I am not going to go to every paragraph in detail).
"(11) Following the meeting, the paperwork was sent to the claimants' address so that the second claimant could provide his signature"
It also confirms that the second claimant did not meet any representative of the defendant; he was dependent on the first claimant as his source of information for the happenings during the meeting between the first claimant and the sales assistant. It then avers with the detail of the loan that the claimants relied on the representations, were induced by them to enter into an agreement in writing dated 5th August 2003, and in paragraph thirteen:
"(13) It is asserted that if the sales assistant had informed the claimants of one or more of the features set out in paragraph 10," (that includes such things as the availability of borrowing elsewhere, or monthly instalments and the like) "then it is likely that the claimants would not have entered into the agreement with PPI".
"This was worthless to the first claimant as she already had life cover provided by Prudential, thus the vast majority of the cover provided by the policy was irrelevant to the needs of the claimants due to the percentage ratio of PPI determined borrowing … alleges that the claimants were sold expensive PPI that was not wanted, needed or useable".
It repeats the particulars concerning the possibility of taking out insurance elsewhere and of the like (again I am not going to go through it all in detail). It then avers that the defendant received a commission from the underwriter; that is not pursued (again, I make that clear). It then alleges that the sale of the PPI was governed by the General Insurance Standards Council (GISC) and that the defendant acted as an insurance intermediary in respect of the said sale.
"I had other existing insurance which already provided me with some of the cover the PPI included within my loan application would subsequently provide. In particular, I had life insurance with my private pension."
"The application was completed by a female representative whose name I cannot now recall, who I believed was employed by the defendant".
I do not think that is remotely an issue; that clearly is the case. It took twenty to thirty minutes to complete, with only the two of them involved in the discussions. Again in the application process:
"I confirmed the purpose of the loan and that we were looking to consolidate our debts into one monthly repayment. I recall providing the defendants' representative with details of our personal circumstances including employment details, address history, outstanding credit and the reason why we required the finance".
And she then goes on to say:
"I recall a discussion took place in relation to obtaining a loan, and I recall asking what would happen in the event that either the second claimant or myself could not meet the repayments, for example if either of us were unable to work due to sickness. And the defendant's representative advised that we would be covered by a PPI policy and we could claim on the policy in those circumstances, providing that we were not off work for more than six months. I only found out that the policy provided life cover only when I was off work due to sickness for 14 weeks last year."
(I hasten to say that this statement is dated 3rd July, so we are talking about 2011). She then says:
"I would not have taken out the policy if I had known it only covered us for life insurance, particularly as I already had life cover in place. The defendant's representative did not ask whether we had any existing insurance policies in place or other means to pay off the loan if needed. Further, the defendant's representative did not advise me during the application process, that the PPI policy provided life cover only."
She goes on to say:
"The defendants' representative did not explain why the insurance was suitable for our needs or provide any further information in relation to the insurance, and I just assumed that it came as part of the loan. Therefore, I did not think that the insurance was optional. I am aware that I have had PPI with previous borrowings. However, I was given the impression with previous applications that the PPI came as part of the loan and I was never aware that the PPI was optional. I do not recall that we were provided with any policy documentation. I have retained the original loan agreement, but there is no policy documentation with it in respect of the insurance and I do not consider that we were provided with this, as I consider that I have retained everything we had been given".
"When a quote for the personal loan repayment was provided to me, I do not recall being told the price of the loan without the PPI added. I was not advised that the PPI was a single premium policy which would be charged interest on in addition to the loan. Had it been made clear to me that the monthly repayment could have been significantly reduced had PPI not been added, I consider I would have asked for the loan without insurance, in particular where only life cover was provided. Ultimately, I was looking to consolidate our debts into the lowest possible monthly repayment and I would have opted for the loan without PPI had I known the significant cost we would have avoided over the course of the loan agreement."
"In addition to my previous statement, I would like to add that at the time the loan was being taken out I made it clear that we wanted a consolidation loan to help resolve our existing car loan and credit card loans. After some discussion about the size of the loan, we agreed an appropriate sum would be £25,000, and that at the time appeared to be in accord with us having sufficient equity in our home" (because of course this was to be a secured loan).
Then she confirms the explanation to her that there was a life cover only policy attached to the loan, and (I mention this for the sake of completeness) they were in difficult times because of their daughter's illness.
"Mrs Redpath attended the branch to apply for the loan. They had that conversation, the conclusion of which was that the defendant would be sending out a loan agreement for us to sign for us to obtain the loan. That came through in the post, the agreement had been prepared to include the PPI details and was marked where we should sign".
And he says (and again this stresses the importance of Mrs Redpath's evidence) he only signed the agreement documentation in reliance upon the information that Mrs Redpath had given to him from the defendants representative. Very simple, she had been there, she had talked to them, she knew what went on; it is as simple as that.
"We did try to contact her but had no response. They have no records left of that time."
Again, I stress this is an agreement entered into in 2003, which is some nine years ago.
"I have a very clear memory of being in the room and the essentials which were discussed, the basic parts and the essential parts".
Bits were missing that she could not remember. She said:
"I signed the loan agreement. We were asked about basic things like earnings and future earnings. I have had PPI before".
She accepted when Miss [inaudible] asked her that she was an experienced borrower:
"But not for big ones like this," she said.
They had had five previous loans with Black Horse and she did not realise that she must have bought insurance with all of those. She had a credit card with Lloyds, a Barclaycard, a car loan and two other credit cards, and she intended to pay off the Barclaycard and the Lloyds and the car loan (that being about ten or eleven years ago). She was familiar with making applications for loans and with insurance on the loans, although she had never heard the term PPI (which is not surprising; I do not think any of us met PPI unless you were in the industry, until very recently ago). She had had previous Black Horse loans within twelve months prior to entering into this loan and she says:
"No insurance was discussed until the end of the meeting, until I asked if either of us were out of work or sick. The reply was 'Don't worry, you're covered'. That is clear in my mind" she said. "This time," she said, "we went straight to Black Horse because we had said that we needed to consolidate".
She did not sign the loan agreement at the meeting:
"They posted it out to us".
Of course, that contradicts what is said in the Particulars of Claim or her statement (I cannot immediately remember which). She said:
"I must have been wrong; they sent them out to us to sign."
She could not remember the employee who had dealt with her, she did not have a name badge on, but she had only dealt with her. It was a structured interview,
"a small room off a large room with people at desks." (which sounds very like 95.5 per cent of banks, building societies and financial institution offices that one may go into), "Just a table and two chairs in the room and the two of them, no computer, she had the forms but nothing else".
Asked about personal circumstances and Mrs Redpath was basically concerned about the repayments; what was the cost going to be? That is something certainly that one could appreciate would be in their minds:
"When told that we had to have the insurance, it was just explained that, at the end, that we were covered. When she said that, I assumed it must be compulsory. I had asked 'What if either of us were off sick or unemployed?' and she said 'It's alright, you're insured for that'. We needed sickness or off work insurance, and she told us we were covered. My husband could have been out of work, anything could happen. We wanted this insurance on a loan that size".
And she says again:
"I did not sign anything at the time. Clearly the Particulars of Claim was incorrect."
But then says:
"I cannot remember if I signed on the day or later. I know they were sent out to the house to be signed. There was a bundle of the loan agreement and the direct debit instructions".
Yes, she agreed, it was a document pack that was sent out to the house. They received the money about a week to ten days later. She did remember the basic facts. She said:
"We were in such a mess financially, we went to a broker and Black Horse were the only ones who would give us a loan".
"The insurance was just on the agreement and I signed it. I can remember the main points; we needed to consolidate, did not want to pay too much extra."
And then again for the first time:
"Wanted to pay for home improvements as well."
I asked about the home improvements, and I am told that home improvements probably cost something like £11,000. So it was not an inconsequential add-on to the amount of money that was being borrowed; it was a significant sum of money:
"Signed the loan agreement, cannot remember where, signed a charge over the property, that was done way after. I had forgotten about that one. Daughter signed the disclaimer, debts were paid off by the lender, the loan started in the September. I don't remember the other forms, only the loan agreement and the main facts stand out in my mind. You can remember a lot and you can't remember other things. When I went in for the loan there was no discussion of insurance. I was not told I had to have the insurance. I knew there would be some insurance, but I wanted loss of earnings or hospitalisation, whatever. Basic facts stay in my mind. I did ask at the end what insurance there was and was told we were covered".
"I didn't read this when it came through".
She accepted that it says [inaudible] covered for life. She said:
"It was shown to me during the meeting, which didn't mention life insurance."
"The sickness and unemployment insurance I wanted was for this big one," (big loan) "I just assumed it was normal."
"(6) During the meeting, the first claimant asked what would happen if the second claimant became unemployed. This reflected the only substantial concern that the claimants had as to whether they would be able to meet the future repayments of any loan agreement." (That of course is the claimant's Particulars of Claim) "The only substantial concern was Mr Redpath's unemployment".
"Following the meeting, the paperwork was sent to the claimants' home address so that the second claimant could provide his signature. She said she herself must have been signing it at the office. She didn't know where she signed it, she couldn't remember. And she said she didn't want life insurance; she had life insurance. It referred to her pension plan, which shows that the life cover was £5,000 and accepted that that was inadequate to cover the loan and said that Mr Redpath had life insurance also and she didn't want life insurance on the loan. Didn't discuss any other types of insurance. She was so anxious to get the loan that we just signed at the bottom. Just read the bottom part and the payments. It didn't sink in; she said 'I assumed any insurance on that would be the right one.' She said she wasn't allowed to read the PPI document in the office and she (i.e. the sales assistant) didn't mention about not having one or going to someone else. 'I didn't realise it was as serious as mortgaging the house.'."
"There was a phone call to my husband, I have no idea how we came this route. We just followed instructions for 18 months now; don't know how we've got involved with solicitors etc. This is the only claim that we have pursued".
End of judgment