Is it a legally binding contract?
In order to know your rights under sale of goods and/or service agreements, it is important firstly to understand the basic principles of contract law. Contract law is all about enforcing promises and making them legally binding irrespective of whether there is something in writing to this effect. Despite the word ‘contract’, and contrary to popular belief, a written contract is not required in order for these obligations to exist in law. A contract may also be formed verbally or by implication, simply by one party making an offer and the other party accepting that offer – even purchasing an item in a shop, or getting into a taxi are examples of this. Of course it must be proved that both offer and acceptance were clearly communicated and understood, that both parties were legally capable of making those promises, and there was something being offered in exchange for the promise (usually money). And while ‘putting it in writing’ is not necessary for a legally binding contract to exist, as the next section will show us, it may be hard to prove what was otherwise agreed.
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Hi , can anyone help me out?
I was selling my vehicle on eBay and about a day before the auction was to end, I had a phone call from a potential buyer who asked me how much I would accept for the vehicle. I told him the amount and he promptly visited me and paid a 10% deposit. When I went to cancel the listing on ebay, I found that someone had placed a bid on ebay and that I was unable to cancel the auction due to it having less than 24 hours till it was due to end. The secound buyer visited almost immediately and paid for the vehicle and took it away. When I found out about this mistake , I did contact the original buyer who had left a deposit and explained the situation to him, however, he was very angry and upset and informed me that he would be taking me to court as i had broken the contract. I had contacted him to explain and to ask for his address to return his deposit to him.
Now, I have received a letter from this guys solicitors stating that he wants his initial deposit back plus £30 fee which the guy paid to transfer the insurance which he had taken out on the vehicle and another £300 to compensate him for his disappointment. A total of £500. the letter says that I must make payment in seven working days or it will be referred to the courts!
Can anyone help me out with this situation or point me in the right direction for me to get some advice?
I saw a camper van on e-bay and consequently made an offer via phone on it which was accpeted. I then transferrred a deposit of 400 pounds to the seller’s bank account. A few days later he said that the funds were not in his account and that the auction would go ahead. It did and the buyer paid more than we had agreed to pay. The next day the seller contacted us to say that the seller had pulled out and that we could have the van but at a higher price now. We agreed and travelled from Sussex to North Wales to pick it up. It turned out to be unfit for purpose (mould growing inside the vehicle by the driver’s feet, electrics that didn’t work, bodywork badly patched up) none of this had been mentioned in the advert or on the phone. We decided not to buy and the seller returned 80 punds saying it was all he had and that he would lose money on the vehicle as we had messed him around. We agreed that he should return at least 200 punds. He promised to readvertise straight away and that if he got the same price he would return the full 400. He did not readvertise having decided to keep the van and has not returned any money. He is not responding to e-mail or texts. Are we in a strong position to reclaim the money through small claims court or was he legally entitled to keep the deposit?
Lou, Sale of Goods Legislation makes mention of three statutory rights – legal title, description and quality. Unfortunately the right to quality does not apply if you have bought from a private seller, but description does. So, if the description was misleading, and you were given the impression from the advert that there would be no issues of the kind you saw, you can claim back the money claiming breach of your statutory right. the fact that you were reliant on the description because you had not seen the vehicle in person puts you in a stronger position.
Hi,
Is it correct that under the Consumer Credit Act 1974 Catalogue debts are not enforcablein law unless a signed agreement is produced by the creditor?
Peter, In a nutshell, yes. Although it is any kind of debt under a regulated credit agreement, not just those to do with catalogues. If the creditor fails to supply a signed copy of the credit agreement within 12 days, the creditor is said to be ‘in default’, and cannot enforce the debt against you while this ‘default’ continues. If the period extends to one month, it becomes a criminal offence. You can pursue the debt collection agency for this document although you must pay a £1 fee for each request.
Hi I hope you can help us
My wife and I applied for a loan online a couple of years ago (13/06/2007) we completed the whole credit agreement online. We were never sent all the required documentation, it wasn’t until recently we were finally sent the following information we requested this when we first took out our loan it wasn’t until recently when trying to sort out our finances we noticed we had not been sent the following information.
The loan amount
The charge for credit
The total amount payable
The monthly instalments
The Annual Percentage Rate (APR)
As this was an online credit agreement no paper work changed hands although it did state that we would be sent a written agreement that we would need to sign and return. We have never received or signed a loan agreement, does the bank still have to provide us with a signed loan agreement to make this credit agreement legally binding.
So basically what I’m saying is if you apply for something online should you or should you not sign a paper agreement as well and if you should sign something and haven’t does that mean the contract is not legally binding.
Please I hope you can help because we don’t seem to be getting anywhere with the bank
Anthony, because you applied for the loan online, the governing legislation will be the Financial Services (Distance Marketing) Regulations 2004, as far as pre-contractual info is concerned. you do not have to be presented with this as a hard copy, the new regs state:
“…or in another durable medium which is available and accessible to the consumer.” i.e. a PDF will do, although it must be prominent, easily distinguishable and separate.
There is still required pre-contractual info on distance credit agreements, just as there is on face to face contracts. The amount of info required is vast, but in a nutshell must include:
• the name and address of the creditor
• a description of the main characteristics of the credit
• the total price payable for the credit
• the arrangements for payment, and
• information regarding cancellation or termination (your 14 day cooling off period)
You can find out more here (refer to schedule 1):
http://www.opsi.gov.uk/si/si2004/20042095.htm
Under the CCA, the agreement must be signed in order to be executed and you can request a copy of the executed agreement at any time – which the creditor must supply within 12 days. There is also a duty on the creditor to provide statements (after intervals of not more than one year). If the creditor cannot do either of these things, they cannot enforce the agreement or charge you interest during their period of ‘default’
Catriona thank you for your advice, i have looked at the info provided and still note that the bank we took the loan out with should have still provided us with the following information:
• the name and address of the creditor
• a description of the main characteristics of the credit
• the total price payable for the credit
• the arrangements for payment, and
• information regarding cancellation or termination (your 14 day cooling off period)
some of this information was displayed on the screen during the application process but not in any other form after the loan had been agreed, it did say online once we had finished the loan application that we would get some information sent to us detailing all the above info but was sent nothing in any form?
So my question is has the bank negated from thier contractual obligations of providing us with the above information in some form ie, email, PDF or even paper?
Anthony, partly in response to your query I have restructured the entire CCA section of this site, see:
whatconsumer.co.uk/consumer-credit-act-required-information/
You must be provided with a separate document containing the required info (either hard copy or PDF), it cannot simply flash up on screen and disappear again. You can request a paper copy at any time, along with your original credit agreement and statement of debt. If they cannot produce this within 12 days the debt is legally unenforceable (without a court order). On the basis of what you’ve told me, yes, the bank are in breach of their legal obligations.