Let's wait and see what the ICO says, I'd be interested to see if the depart from their position under the guidance they've provided.

On another note, I managed to attend a recent court case on excess mileage to try and understand what the lenders are arguing. The short story was that the hirer exceeded the agreed mileage for around 50-60k pro rata and the claimant was claiming damages based on the excess mileage clause in the contract and the formula it set out. As I understood, the Claimant (Mercedes Finance) conceded that it was not seeking to claim damages or outstanding instalments but simply the excess mileage charges. There seemed to be three parts to this though the person acting for the claimant didn't really say much except that the contract was breached and they should be entitled to those damages. Suffice to say, the hirer was a little out of depth although did make some good points but struggled on certain aspects which is perhaps why the judge was persuaded to award damages in full in favour of the claimant which was Mercedes Finance.

That being said, I thought the judge's decision was flawed on several levels. It wasn't clear to me the full reasons why the claimant succeeded and which grounds the claim did succeed, though he did state that there was a failure to take reasonable care but never actually explained why. Second, the claimant was also seeking to add VAT on top of the excess mileage charges (apparently in the contract) however, current law and even HMRC VAT guidance says that VAT is not applicable on compensation for damages of breaching the agreement or any liquidated damages yet the judge awarded the full amount sought.

If the judge did accept that the clause was enforceable, then that would clearly be contrary to section 100(1). As is well documented on here, this provision effectively acts as a limitation of liability clause whereby if you validly exercise that right to terminate then you are liable to pay 50% of the total amount payable. That sum is made up of the difference between what has already been paid including any other instalments due before termination - the right to recover damages for breach of the agreement, compensation etc. is not allowed. That is further evidenced by section 173 which which makes any clause that imposes additional liability void and unenforceable. So I fail to see how the judge could have concluded that this clause was enforceable.

Even if the judge relied on section 99(2) the above would apply, simply because clause 100(1) does state quite clearly, if you terminate under section 99 (meaning as a whole) then your liability will be limited to this. Even if the damages did accrue before termination, it would be capped at a maximum of 50% of the total amount payable. Again, I felt this was flawed and couldn't understand if the claimant succeeded on this point.

The point he did attempt to make clear that there was a failure to take reasonable care by exceeding the mileage agreed. The judge did ask the claimant whether they considered that going over the agreed mileage by one mile, 100 miles etc. as as failing to take reasonable care. She then conceded that she would think it is difficult to argue on that point - nonetheless the judge awarded the full amount as if the breach took place as soon as you go one mile over the agreed contractual limit. I think there was a serious flaw for two reasons. First, the obligation to not exceed the agreed contractual mileage is independent and a separate cause of action to the obligation to take reasonable care. The Claimant (and the judge too) appeared to combine the obligation not to exceed the mileage with the duty to take reasonable care of the car which is inherently wrong in my mind.

The duty to take reasonable care is a statutory one and can often be referred to as 'statutory negligence' because it is akin to the principles of negligence in tort but not exactly the same as the wording of the statutory provision may impose a higher standard than the reasonable care standard for negligence in tort. The hirer did provide evidence of the condition report that effectively said the car was in a reasonable condition so surely that should have discharged the duty to take reasonable care. I can only think that the judge allowed the claim on the basis of 'pure economic loss' (financial loss which arises in the absence of physical damage). However, the general rule of law establishes that when you have a duty to take reasonable care, this means that you have a duty not to cause physical damage but it does not extend to a duty of avoiding pure economic loss unless it is explicitly prescribed (or if you were negligent in making a statement or a professional giving advice or assuming a specific responsibility) - this is the well known case of Spartan Steel v Martin & Co. The claimant must have argued (and the judge agreed) that even though the damage report said the car was in a reasonable state, they should not be left with a depreciated car with high mileage. That point is quite clearly contrary to the law and I think if the judge made his decision along this reason was flawed. Of course if you damage something and you incur a loss as a result of that damage then that is considered consequential loss as explained in the Spartan Steel case but fro losses that occurs without physical damage, it is considered too remote or outside the scope of the duty.

Anyway, that decision is obviously not binding and there's a clear difference in the excess mileage in that case and yours but something about as to whether you want to pursue it. Luckily the hirer had the money to pay if he lost so he doesn't lose out on a CCJ appearing on his record. The gist of the story is that unless you know your defence inside out and can adapt to the questions a judge might ask you, it can be difficult for a litigant in person to argue these points.