Hey guys,
There’s been a lot in the news recently about the Supreme Court’s decision on whether car dealerships owed a selfless loyalty to consumers, a decision that was issued on Friday and has been rolling through the news over the weekend.
I came across it when I saw Martin Lewis’ video telling people not to sign up to any ‘no-win, no-fee’ companies claiming they can get you compensation if you ever owned a car on finance. I started looking into it and found that there are actually three different car claims in the courts at the moment and they all have different pieces of advice.
I was particularly interested in this because I’ve created a petition on the ‘diesel-gate’ compensation claims and have been sharing a link for you to register with no-win, no-fee claims for these, so I wanted to check that advice hadn’t changed (which it hasn’t), so I thought it’d be useful to write this article quickly to explain the three potential claims and what you should be doing for each of them.
Diesel-gate Claims
Okay, these claims are against a selection of manufacturers who cheated diesel emissions tests on thei new cars between 2009 and 2020. These claims are being tried in court in October and right now, the best advice is to join a claim if you can. Use the button below if you’ve owned any diesel car between 2009 and 2020, even if you don’t own that car today you may still be entitled to compensation due to excess emissions being produced when you did own the car, reduced fuel efficiency increasing your running costs or potentially the value of the car being reduced after diesel-gate hit the news.
This has nothing to do with what has been in the news this weekend. With the diesel-gate claims, your best bet is to join one of the legal cases if you can, this is how you are most likely to get compensation. It’s worth noting that the first major court case for diesel-gate claims is expected to take place this October. It’ll be around the same time the FCA make a decision on DCA compensation (explained below), but they are different things.
Supreme Court Decision on Finance Agreements with Car Dealerships
So, on Friday, the Supreme Court effectively made the announcement that a car dealership has no legal obligation to be entirely selfless for the consumer, they are entitled to pursue their own commerical interests as it is a commercial establishment. As the BBC perfectly summised “They had a personal and commercial interest in getting the customer to secure finance – and then sign – and there was nothing legally improper about that.”
What this has meant is that a lot of claims about there being commission for car dealerships have been legally dismissed, but there is one exemption to that rule.
FCA looking into compensation for Discretionary Commission Arrangement and Martin Lewis’ Advice
Car dealerships aren’t fully off the hook though. While the court has determined that it is legally fine for them to seek commissions through financing plans, it didn’t rule on discretionary commission arrangements (DCAs). These are agreements between the car dealership and the bank or financing company that gives the dealership larger commissions if they can get customers to sign up to higher interest rates.
The FCA is now looking into implementing an AUTOMATIC COMPENSATION redress scheme, effectively stating that millions of people will still be entitled to compensation if there was a DCA in their finance agreement with a car dealership.
It is expected that millions of people will get up to £950 compensation if their finance agreements contained discretionary commission arrangements, but that will ultimately come down to the FCA’s decision, which is expected this October.
Martin Lewis’ Advice: The big advice i’ve being seeing everywhere on this is that if you think you might be eligible for compensation, then DO NOTHING! It is expected that the FCA will give enforce AUTOMATIC compensation, you won’t need to apply for it. So if you see some “no-win, no-fee” legal companies trying to get you to join their class action cases for discretionary finance agreements, ignore them, because if you sign up then you will owe them 30% of your compensation and they would have done nothing to deserve it.
Right, that’s it from me on this one. If you have any questions or comments on this, please feel free to email me at Richard@TheRegulatorGuy.co.uk.
Thanks all,
Richard Winstone
The Regulator Guy.
