Legal News – May 2014

Legal News – May 2014

Consumer protection: Can you be sued if you have not read the contract? 

In Figurasin and another v Central Capital Ltd and another company [2014] EWCA Civ 504, [2014] All ER (D) 178 (Apr) the county court found that the first defendant had mis-sold the claimants PPI in breach of the Insurance Conduct of Business Rules and ordered it to pay damages.

The first defendant appealed on the basis that a telephone conversation and the relevant documents, taken together, had given the claimants a full and clear breakdown of the cost of PPI. The claimants admitted that they had not read the documentation. The Court of Appeal dismissed the appeal, holding that, even if treated as part of one overall process, the judge had been entitled to find that there had been a breach of the ICOB rules and there were no grounds for interfering with his judgment.

Harriet Quiney, a partner with DWF Fishburns’ commercial insurance team, discusses the ruling and how failing to read documents may not be fatal to claims if other documents are actively misleading.

In particular she advises that the court was clear that consumers must act responsibly, but if a firm positively misleads a consumer, the consumers’ failure to pick up on information that was contained (and only contained rather than explained) in a loan agreement will not cancel out the firm’s failing. Lawyers should therefore be advising firms that they should be reviewing their telephone scripts and client letters and advising consumers that failing to read documents may not be fatal to their claims if other documents are actively misleading.

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About the author:
Helen Hart studied in Cardiff and Germany and qualified as a solicitor in 1998 after a training contract at Allen & Overy in London and Frankfurt. She spent over six years working in-house at Centrica plc and Palm Europe Limited focusing mainly on consumer, advertising and data protection law before returning to private practice at Stevens & Bolton where she was an associate in the corporate and commercial team. She worked for a legal publisher between 2008 and 2012 and has also worked in local government library services. Her main areas of expertise are general commercial law, advertising law and consumer law.