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Does a Tomlin order provide ‘credit’ under the Consumer Credit Act 1974? (Gertner v CFL Finance)

Does a Tomlin order provide ‘credit’ under the Consumer Credit Act 1974? (Gertner v CFL Finance)
Published on: 02 March 2021
Published by: LexisPSL
  • Does a Tomlin order provide ‘credit’ under the Consumer Credit Act 1974? (Gertner v CFL Finance)
  • What are the practical implications of this case?
  • What was the background?
  • What did the court decide?
  • Case details

Article summary

Restructuring & Insolvency analysis: In this case, the Court of Appeal considered the issue of what is ‘credit’ in the context of an agreement that is scheduled to a Tomlin order which compromises proceedings. The decision has significant repercussions for litigators settling certain types of claims. Allowing the respondent’s cross-appeal, the Court of Appeal held that there was a ‘genuine triable issue as to whether the settlement agreement provided [the respondent] with “credit” within the meaning of [the Consumer Credit Act 1974 (CCA 1974)] and, hence, [was] at present unenforceable for non-compliance with one or more of sections 40, 61–64, 77A and 86B of [the CCA 1974]’. Giving the lead judgment, Lord Justice Newey noted that the appeal raised ‘an important and difficult issue as to when, if ever, the Consumer Credit Act 1974 applies to agreements settling litigation’. Lord Justice Popplewell agreed, and Lord Justice David Richards further noted that it was a ‘point of real difficulty’. Written by George Spence-Jones, barrister at Gough Square Chambers. or take a trial to read the full analysis.

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