www.gdisolutions.co.uk - No Win No Fee Claims

This service has been temporarily suspended pending the outcome of on-going, precedent-setting Court cases and will be resumed as soon as possible.

A Judge has written off a woman's £8,000 credit card debt in a landmark ruling on a case involving the sale of payment protection insurance (PPI).

A County Court Judge ruled that Lynne Thorius, 49, from South Shields, was charged thousands of pounds by MBNA for a PPI policy that she had never requested from the creditor.

Deputy District Judge Jacqueline Smart decided that MBNA could not demand repayment of the customer's debt and that there had been an unfair relationship between Ms Thorius and MBNA because of the way she had been sold the PPI policy. In a crucial point MBNA was also unable to provide copies of the original loan documents.

The ramifications for the PPI industry of this case are immense. The sword of damocles is now hanging over a huge number of PPI policies. The Judge decided that in this case that how the PPI policy was sold failed the unfair relationships test under the Consumer Credit Act. The test has never been used in this way before in relation to PPI.

Ms Thorius' credit card was issued in 2002 and the PPI policy was recommended alongside the card by MBNA to help her pay off her account if she fell ill or was made redundant.

But it emerged during the case that she had not been told that MBNA would be receiving regular commission payments from the insurance provider ITT London & Edinburgh, a subsidiary of the Aviva insurance group.

Judge Smart decided that Ms Thorius' credit card debt was "unrecoverable" because MBNA could not provide a copy of the original signed loan agreement, a requirement under consumer credit legislation.

The Judge ordered the company either to repay the customer's PPI premiums and interest, or the value of the commissions it had received which so far has been undisclosed.

A spokeswoman for MBNA said the case was brought by one of the firm's agents who appears not to have been provided with full documentation.

She added: "As such the case was lost by MBNA, as MBNA was not able to rely on materials that it would ordinarily rely on in these circumstances. The case was not lost on any finding that there had been any unfair relationship. The Judge found that there was no fiduciary duty owed by MBNA to the customer regarding the sale of PPI."

The mis-selling of PPI remains a hugely controversial issue for the financial services industry. In the year to March 31 2009, the Financial Ombudsman Service received 31,066 complaints regarding PPI. The FSA also this week ordered companies which sold the product to reopen 185,000 rejected PPI complaints in light of new guidance over how the policy should be sold.

City regulator, the FSA, is planning to force firms to compensate millions of victims of missold Payment Protection Insurance.

The FSA announced today that it wants to re-open nearly 200,000 PPI complaints that had previously been rejected by the firm selling the cover.

Furthermore, the FSA will focus on those cases where single premium cover had been missold. With this type of PPI, the cost of the insurance is added to the cost of the loan at the start of the arrangement, and interest is charged on this additional cost.

These measures could lead to massive payouts, estimated at over £10billion. The highest individual PPI claim is reported to be in excess of £42,000.

Claims for missold loan insurance have risen rapidly over the past few years as people have realised that the insurance is either unsuitable or poor value for money.

Earlier in th emonth, the Financial Ombudsman service revealed it upholds almost 99% of insurance-related complaints, mostly relating to the misselling of PPI.

The FSA reports that a number of firms, representing 40% of the single premium market, will review the methods used to sell cover dating back to January 2005. This review will be monitored by the FSA to ensure fairness. Where misselling is uncovered, customers will be written to inviting them to file a claim for their money back.

The FSA has additionally pledged to take 'ongoing supervisory action' with firms not reviewing their past sales.

The FSA is consulting the industry with a number of proposals which, if agreed, could be put into practice later this year.

They are:

New guidance to ensure PPI complaints are handled properly, with consumers getting fair compensation where appropriate. The Ombudsman has indicated support for the FSA's approach.
A new rule will require firms to re-open a total of 185,000 previously-rejected PPI complaints and reassess them against the guidance.
The FSA may also extend the forced reviews to other types of PPI sales.

that some of the Claims Management companies offering this service do not have your best interests at heart and are charging large fees whilst not giving correct and competent advice to clients. Please see the BBC News article and the Ministry of Justice website shown below:-

Many lending contracts taken out before 2005 are either unenforceable or void-able and you could be entitled to compensation, or a refund of some or even all money paid. This applies to most secured and unsecured borrowings whether they are personal or business; including mortgages, secured loans, insurances (including GAP & MIG), home improvement loans, credit cards, HP agreements, leasing contracts, payment protection policies, buy to let mortgages, & business bank charges.

It doesn’t matter if you’ve already repaid the borrowings, are in default / debt to the lender, or if the mortgaged property or HP goods were repossessed.

Most companies will charge around £500 per account to establish whether you have a claim, but the company I work with have a team of specialist solicitors who will assess and pursue your claim on a

basis. Each of the lenders will require a £10 fee (made payable to them) to produce the relevant documents from their files. So, there’s very little to lose and you could gain a great deal.