Help needed with Mercedes Finance VT

[jonbat]

Hi,

I've had an interest in this forum for a while now and finally took the plunge and VT'd my Mercedes at the beginning of March.
I used the standard template that [MENTION=23709]rob[/MENTION] put in his guide and a couple of weeks later the car was collected and the agreement was terminated. When I sent the car back there were a small number of scuffs on wheels, carpark dents and stone chips on the front of the car. But all in all it was in OK condition. I had however gone over my mileage by 15,000 miles so was expecting them to send an invoice for damage and the extra miles.

Then a couple of weeks later i got the invoice, which stated that I only owed for excess mileage, which was £1600 + VAT. I quickly responded to them with the template [MENTION=23709]rob[/MENTION] created to dispute the excess mileage and they came back to be with the following...

"Dear Mr Jonbat,

Thank you for your recent email.

Whether you are returning your car at the end of your agreement or upon use of the Voluntary Termination (VT) clause, as you have not exercised your right to purchase the car, an excess mileage charge will be raised should your return mileage exceed your total mileage allowance. This obligation is set out within the first page of your agreement, under key information. The provisions of the Consumer Credit Act that cover a customer’s right to VT their agreement do permit us to include any over mileage when determining what is 'not reasonable' upon the cars return. It is stated in your agreement under ‘Excess Distance’; ‘If the vehicle is returned to us (whether at the end of the period hire or an earlier termination), we will calculate the total distance travelled by the vehicle whilst in your possession (the “Total Distance”)’.

Your mileage allowance has therefore been re-calculated on a pro-rata basis in line with the length of time you have had the vehicle in your possession and I have attached a copy of the Voluntary Termination acceptance form signed by you confirming your agreement to be held liable for any damages or excess mileage following an inspection of your vehicle.

With this said, I can confirm that your De-Fleet invoice has been raised correctly."

This is where I run out of steam, so I would be really grateful if anyone has any pointers on how I should counter. [MENTION=23709]rob[/MENTION], i'm adding you on the post as hopefully you've seen this many times before and have some examples of what's worked well in the past.
I'm on a tight timescale with this, as they are expecting payment by the 7th of May, so if anyone can help it would be much appreciated.

Thanks
John

[R0b]

Re: Help needed with Mercedes Finance VT

Hello,

I will get back to you on this later today but what I say is really my own view and it depends on whether you want to fight your corner or simply pay up. Many people on here give it a go and then end up paying for a number of reasons such as getting to stressful, the worry of court action etc.

Their response is clearly misguided and their interpretation of the CCA is also wrong and misunderstood (my opinion). Why did you sign their VT form and why did you not read the document before you signed it. If you did read it , why did you sign it anyway knowing that it says you are liable for their charges?

P.s. if you want to tag me properly you need to use a zero in R0b not the letter so it will notify me and I can pick it up.

p.p.s does the invoice show £1,600 plus VAT or £1,600 inclusive of VAT?

[jonbat]

Re: Help needed with Mercedes Finance VT

Thanks for the quick response [MENTION=71570]R0b[/MENTION].

Fortunately I havent signed anything throughout the process, so I havent accepted liability for anything. I'm hoping that puts me in a stronger position further down the line and I look forward to your reply later.

John

[R0b]

Re: Help needed with Mercedes Finance VT

If you did sign something it wouldn't have been fatal but rather an annoyance and you having to justify it. So the VT form the email included has that got your signature on it or is it just a blank copy of it?

Did you receive a condition report for the car either from Mercedes or presumably Manheim?

[jonbat]

Re: Help needed with Mercedes Finance VT

They sent me an invoice that detailed the charges related to the returned vehicle. It's split into sections (damage, additional services and excess mileage). There was no signature on there, as I refused to sign anything they sent me.
The damage section has a charge of £0 and there is a comment to say 'within return standards' , additional services are also £0 and the excess mileage charge is £1600 plus VAT (so circa £1900 in total).

It came from the MB Defleet department, however the condition report was done by BCA, who collected the car.

[R0b]

Re: Help needed with Mercedes Finance VT

Hi Jon,

As I have previously mentioned, the person who sent that email is misguided in their interpretation and understanding of the CCA.

Firstly, the right to claim damages is an entirely separate issue to claiming damages because the car has not been returned in a reasonable condition. What Mercedes are doing is effectively saying that you have breached a term of the agreement and then dressing up the damages as a claim under the reasonable condition of the car - that is wrong.

an excess mileage charge will be raised should your return mileage exceed your total mileage allowance. This obligation is set out within the first page of your agreement, under key information.

Section 100 of the CCA specifically says that when a debtor terminates the agreement in accordance with section 99, the debtor is liable for no more than half of the total price payable including any sums due immediately before the termination took place. It is therefore irrelevant where Mercedes believes they can raise an invoice for the sum of £1,600 because as long as you have paid 50% then you are not obliged to pay anymore. The same applies at the other end of the spectrum where you have paid over 50%, the CCA prevents you from reclaiming any overpaid sums (by virtue of section 99(2)).

The provisions of the Consumer Credit Act that cover a customer’s right to VT their agreement do permit us to include any over mileage when determining what is 'not reasonable' upon the cars return.

Yes it is true that Mercedes can reclaim compensation where the has been returned in an unreasonable condition. The onus is on Mercedes to provide evidence that the car was not in a reasonable condition. Again, it can make assertions as much as it likes but it ultimately needs to provide evidence to that effect i.e. the mechanical soundness of the car was unreasonable. In a court of law, their 'opinion' would not likely to be accepted because such opinions like that would be reserved for expert evidence. In any event, you received a document that says £0 in damages which confirms that the car was returned in a reasonable condition. Equally, I am assuming the condition report makes no reference to the mechanical soundness of the car and on that basis, there is the presumption that there was no issue with its condition. At the end of the day, all Mercedes has done is simply make a statement without backing it up with any proof or expert opinion. So long as the car was serviced regularly and repaired as needed, that is all that is required of you.

Finally, their invoice is unlawful as any invoices to consumers must be presented inclusive of VAT.

One last question, was the car brand new or second hand? You may also want to query why they have enclosed a VT form when you did not sign one and if they are suggesting that one was signed then you may want to make a complaint as someone would have used your signature fraudulently.

[jonbat]

Re: Help needed with Mercedes Finance VT

Thanks very much again for this [MENTION=71570]R0b[/MENTION] , I've sent them a reply paraphrasing your comments above, so I'll let you know what they come back with.

Thanks again

[R0b]

Re: Help needed with Mercedes Finance VT

I expect them to come back with the same garbage just stated in a different way, the ball is ultimately in their court as to whether they choose to take you to court.

For that sum, it is possible.

[DJ-1988]

Re: Help needed with Mercedes Finance VT

Just want to say that you just have to stand your ground.

I VTed in August 2015 and RMS receivables have tried and failed to get me to pay excess mileage, and have so far failed to issue court proceedings, even though I advised them I wouldn't be paying and would be happy to go to court.

They occasionally ring to try to get me to pay, but I just ignore the call now (my last correspondence to them told them not to contact me unless they want to issue court proceedings and only contact me in writing).

Stand your ground.....worst case scenario is they take you to court and win and you end up paying slightly more on top of the excess mileage charge (which I'm sure Rob can confirm isn't a lot as they can't recover legal fees etc.)

Best case is you save £1600 and they back down before you do.

[R0b]

Re: Help needed with Mercedes Finance VT

Just want to say that you just have to stand your ground.

I VTed in August 2015 and RMS receivables have tried and failed to get me to pay excess mileage, and have so far failed to issue court proceedings, even though I advised them I wouldn't be paying and would be happy to go to court.

They occasionally ring to try to get me to pay, but I just ignore the call now (my last correspondence to them told them not to contact me unless they want to issue court proceedings and only contact me in writing).

Stand your ground.....worst case scenario is they take you to court and win and you end up paying slightly more on top of the excess mileage charge (which I'm sure Rob can confirm isn't a lot as they can't recover legal fees etc.)

Best case is you save £1600 and they back down before you do.

Coming up to two years and they've still yet to take you to court... I wonder why!

[jonbat]

Re: Help needed with Mercedes Finance VT

Hi @R0b

So, yesterday I sent the following email back using the info you gave me...

"Dear Ruth,

Thank you for your prompt reply dated Friday 28^th April 2017. I have taken further legal advice on this matter and would like to point out the following.

Under Section 100 of the CCA it specifically sates that when a debtor terminates the agreement in accordance with section 99, the debtor is liable for no more than half of the total price payable, including any sums due immediately before the termination took place. In which case, as I have paid over 50% of the total amount, I am not obliged to pay any more. The same context applies where a customer has paid over 50%, the CCA prevents me from reclaiming any overpaid sums (by virtue of section 99(2)), which I have no interest in pursuing.

I acknowledge that Mercedes could reclaim compensation where the vehicle has been returned in an unreasonable condition, however on the invoice I received it clearly states that the vehicle was returned “within return standards”, in a reasonable condition and therefore no charges were applicable.

Finally and as previously noted, excess mileage is a contractual term of the agreement and therefore cannot be included as an amount which is owed. This position is further clarified under section 173 of the CCA in that “any contractual term which is inconsistent with any rights under the CCA and imposes additional liability, whether direct or indirect, shall be void and unenforceable”. As excess mileage is a contractual term, which imposes additional liability I am not liable for any charges Mercedes have calculated.

I hope this email clarifies the matter and I look forward to drawing this to a conclusion.

Best Regards "

And this morning, they have replied with the following....

"Thank you for taking the time to contact us in relation to the return of your vehicle.

The concerns you have raised will now be investigated fully in line with our Customer Complaint Procedure. Please find attached a copy of this for your reference. I will endeavour to provide you with a response as soon as possible however, this investigation will take no longer than four weeks.

Your file has been placed on hold whilst this is carried out. Should you receive correspondence regarding any charges raised during this time, please disregard.

I hope that the above is satisfactory however, should you have any queries, please do not hesitate to contact one of our advisors on 0370 240 1110.

Yours sincerely,

De-Fleet Complaints Department "

So it looks like the letter has done something and for some reason they are now treating it as a complaint (maybe that's because I said that i'd had some legal advice), my file has been placed on hold until this has been resolved and it's presumably being looked at by someone more qualified than the DeFleet department.
Let's see what they come back with.... it could get interesting!

John

[R0b]

Re: Help needed with Mercedes Finance VT

Well I haven't given you any legal advice just expressed my own views on this but I wouldn't hold much hope on it. They will investigate and they will probably come back with a final complaint and say that they are still entitled to charge the excess mileage, without specifically addressing your issues - probably a template letter. On the other hand they may very well address your issue but in a round about way say that they can still reclaim the charges and then refer you to the financial Ombudsman if your still not happy.

It's a standard procedure although the Ombudsman is pretty useless at this and appears to favour the lenders on these occasions based on previous experience on here as they tend to look at what is fair and reasonable not the letter of the law. I wouldn't say its worth going through the Ombudsman but if you did, you are not obliged to accept their decision and if you do, then you are legally bound by it. If you refuse to accept it, then Mercedes still have to pursue it through the courts and your back to square one.

Ultimately you need to have an end goal in mind because given the sums it is possible they may issue proceedings so you need to be prepared as to what you want to do whether it is paying up or defending it all the way to court. If it is the latter, depending on your income you may want to start saving a little now if in the case the court doesn't side with you (though as it stands there is sufficient evidence abut the reasonableness of the car) then you can pay it off in full or look to settle the matter.

The other option is that they simple write it off and close your account down no further action being taken. You should also keep an eye on your credit report and see if there is a fluctuation in your credit rating or a default being applied on your account. Noddle is free or you can use a free trial for 30 days with Experian too.

[shaunbent]

Re: Help needed with Mercedes Finance VT

[MENTION=101341]jonbat[/MENTION] Wondering if there is any update on this?

Have you received any further correspondence with Mercedes about this? I am about to go through the VT process with my A-class and I am expecting an excess milage change and wondering how best to approach.