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Case detail

B a c k

Directive article Article 5 2.
Article 5 4. (b)
Article 8 al1
National ID [2009] EWHC 2386
Country United Kingdom Decision date 06/10/2009
Common name McGuffick v. Royal Bank of Scotland Plc Decision type Court decision, first degree
Court Queen's Bench Division (Commercial Court) Plaintiff(s) McGuffick
Court translation Queen's Bench Division (Commercial Court) Defendant(s) Royal Bank of Scotland Plc
Subject legal actions
Keywords financial services

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Headnote

(1) A bank that reports information about a loan agreement to credit reference agencies during the period that the loan agreement is unenforceable, is not committing an unfair commercial practice. 

(2) The UK implementation of the UCP Directive (Consumer Protection from Unfair Trading Regulations 2008) does not confer any right of action or remedy to individuals. The UK government deliberately excluded any civil law remedies from the UCP implementation.

Facts

The plaintiff entered into a loan agreement with the defendant (a bank), but failed to comply with the 60 monthly instalments agreed by both parties. The defendant served a default notice on the plaintiff, stating that no payments were made under the agreement except for a payment in January and February 2007. The plaintiff then made an information request in relation to the agreement, based on a national consumer protection provision (Consumer Credit Act 1974).

The plaintiff argued that the defendant did not comply with the national consumer protection provisions, for two reasons: (1)  the defendant could not locate a copy of the agreement; and (2) the defendant reported information about the agreement to credit reference agencies. Due to this non-compliance with the request for information, the plaintiff deemed the loan agreement to be unenforceable.

Additionally, the plaintiff claimed that reporting information to credit reference agencies constituted an unfair commercial practice.

Legal issue

(1) Is it an unfair commercial practice for a bank to report information about a loan agreement to a credit reference agency during the period that the loan agreement is unenforceable, in order to persuade the consumer to pay the outstanding amounts?

(2) Does a national implementation of the UCP Directive confer the plaintiff an individual right to request an injunction to prevent a bank from reporting information to credit reference agencies?

Decision

(1) Reporting information about a loan agreement to credit reference agencies is not unfair during the period that the loan agreement is unenforceable, as such reporting is an essential aspect of responsible lending and of the licensing process.

(2) The plaintiff cannot impose an injunction on the basis of the UK implementation of the UCP Directive (Consumer Protection from Unfair Trading Regulations 2008) because: (a) no right of action or remedy is conferred to individuals by this implementation; and (2) the UK government deliberately excluded any civil law remedies from this implementation.

  URL Decision Decision full text
EN http://www.bailii.org/ew/cases/EWHC/Comm/2009/2386.html Click here

Result

The plaintiff's arguments were rejected by the court.

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