Consumer Credit Act 1974

• “open-end” in relation to a consumer credit agreement, means of no fixed duration;

• “owner” means a person who bails or (in Scotland) hires out goods under a consumer hire agreement or the person to whom his rights and duties under the agreement have passed by assignment or operation of law, and in relation to a prospective consumer hire agreement, includes the prospective bailor or person from whom the goods are to be hired;

• “pawn” means any article subject to a pledge;

• “pawn-receipt” has the meaning given by section 114;

• “pawnee” and “pawnor” include any person to whom the rights and duties of the original pawnee or the original pawnor, as the case may be, have passed by assignment or operation of law;

• “payment” includes tender;

• . . .

• “pledge” means the pawnee’s rights over an article taken in pawn;

• “prescribed” means prescribed by regulations made by the Secretary of State;

• “pre-existing arrangements” shall be construed in accordance with section 187;

• “principal agreement” has the meaning given by section 19(1);

• “protected goods” has the meaning given by section 90(7);

• ...

• “redemption period” has the meaning given by section 116(3);

• “Regulated Activities Order” means the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001;

• ...

• “regulated agreement” means a consumer credit agreement which is a regulated agreement (within the meaning of section 8(3)) or a consumer hire agreement which is a regulated agreement (within the meaning of section 15(2));

• “regulated deferred payment credit agreement” means an agreement—which meets each of the conditions set out in article 60F(2)(a) to (d) (exempt agreements: exemptions relating to number of repayments to be made) of the Regulated Activities Order; andto which article 60F(7A) of that Order applies;

• “regulations” means regulations made by the Treasury;

• “relative”, except in section 184, means a person who is an associate by virtue of section 184(1);

• “representation” includes any condition or warranty, and any other statement or undertaking, whether oral or in writing;

• “residential renovation agreement” means a consumer credit agreement entered into on or after 21st March 2016 —which is unsecured; andthe purpose of which is the renovation of residential property, as described in Article 2(2a) of Directive 2008/48/EC of the European Parliament and of the Council of 23rd April 2008 on credit agreements for consumers.

• “restricted-use credit agreement” and “restricted-use credit” have the meanings given by section 11(1);

• “rules of court”, in relation to Northern Ireland means, in relation to the High Court, rules made under section 7 of the Northern Ireland Act 1962, and, in relation to any other court, rules made by the authority having for the time being power to make rules regulating the practice and procedure in that court;

• “running-account credit” shall be construed in accordance with section 10;

• “security”, in relation to an actual or prospective consumer credit agreement or consumer hire agreement, or any linked transaction, means a mortgage, charge, pledge, bond, debenture, indemnity, guarantee, bill, note or other right provided by the debtor or hirer, or at his request (express or implied), to secure the carrying out of the obligations of the debtor or hirer under the agreement;

• “security instrument” has the meaning given by section 105(2);

• “serve on” means deliver or send by an appropriate method to;

• “signed” shall be construed in accordance with subsection (3);

• “small agreement” has the meaning given by section 17(1), and “small” in relation to an agreement within any category shall be construed accordingly;

• ...

• ...

• “supplier” has the meaning given by section 11(1)(b) or 12(c) or 13(c) or, in relation to an agreement falling within section 11(1)(a), means the creditor, and includes a person to whom the rights and duties of a supplier (as so defined) have passed by assignment or operation of law, or (in relation to a prospective agreement) the prospective supplier;

• “surety” means the person by whom any security is provided, or the person to whom his rights and duties in relation to the security have passed by assignment or operation of law;

• “technical grounds” shall be construed in accordance with subsection (5);

• “time order” has the meaning given by section 129(1);

• “total charge for credit” has the meaning given by section 20;

• “total price” means the total sum payable by the debtor under a hire-purchase agreement or a conditional sale agreement, including any sum payable on the exercise of an option to purchase, but excluding any sum payable as a penalty or as compensation or damages for a breach of the agreement;

• . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• “the UK GDPR” has the same meaning as in Parts 5 to 7 of the Data Protection Act 2018 (see section 3(10) and (14) of that Act);

• “unexecuted agreement” means a document embodying the terms of a prospective regulated agreement, or such of them as it is intended to reduce to writing;

• ...

• “unrestricted-use credit agreement” and “unresticted-use credit” have the meanings given by section 11(2);

• “working day” means any day other than—Saturday or Sunday,Christmas Day or Good Friday,a bank holiday within the meaning given by section 1 of the Banking and Financial Dealings Act 1971.

• (1A) In sections ... 70(4), 73(4) and 75(2) . . . ‘costs’, in relation to proceedings in Scotland, means expenses.

• (2) A person is not to be treated as carrying on a particular type of business merely because occasionally he enters into transactions belonging to a business of that type.

• (2A) For the purpose of the definitions of “authorised business overdraft agreement” and “authorised non-business overdraft agreement” article 60C(5) and (6) of the Regulated Activities Order applies.

• (3) Any provision of this Act requiring a document to be signed is complied with by a body corporate if the document is sealed by that body.

This subsection does not apply to Scotland.

• (4) A document embodies a provision if the provision is set out either in the document itself or in another document referred to in it.

• (5) An application dismissed by the court ... shall, if the court ... so certifies, be taken to be dismissed on technical grounds only.

• (6) Except in so far as the context otherwise requires, any reference in this Act to an enactment shall be construed as a reference to that enactment as amended by or under any other enactment, including this Act.

• (7) In this Act, except where otherwise indicated—

• (a) a reference to a numbered Part, section or Schedule is a reference to the Part or section of, or the Schedule to, this Act so numbered, and

• (b) a reference in a section to a numbered subsection is a reference to the subsection of that section so numbered, and

• (c) a reference in a section, subsection or Schedule to a numbered paragraph is a reference to the paragraph of that section, subsection or Schedule so numbered.

Meaning of “consumer credit EEA firm ”

189A

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Green deal plans

189B

• (1) A green deal plan is to be treated as a consumer credit agreement for the purposes of this Act if (and only if)—

• (a) the property in relation to the plan is a domestic property at the time when the plan is commenced, or

• (b) if paragraph (a) does not apply, the occupier or owner of the property who makes the arrangement for the plan is an individual.

• (2) In the application of this Act to a green deal consumer credit agreement—

• (a) the creditor is to be treated as being—

• (i) the green deal provider (within the meaning of Chapter 1 of Part 1 of the Energy Act 2011) for the plan, or

• (ii) the person to whom the provider’s rights and duties under the plan have passed by assignment or operation of law,

• (b) credit is to be treated as advanced under the agreement of an amount equal to the amount of the improvement costs, and

• (c) the advance of credit is to be treated as made on the completion of the installation of the energy efficiency improvements to the property (but this paragraph is subject to any term of the green deal plan providing that part of the advance is to be treated as made on completion of any part of the installation).

• (3) A reference in a provision of this Act listed in the first column of the table in Schedule 2A to the debtor is, in the application of the provision in relation to a green deal consumer credit agreement, to be read as a reference to—

• (a) a person who at the relevant time falls (or fell) within the description or descriptions specified in the corresponding entry in the second column of the table, or

• (b) if more than one description is specified and at the relevant time different persons fall (or fell) within the descriptions, each of those persons,

and except as provided by this subsection, a person is not and is not to be treated as the debtor in relation to the agreement.

• (4) Where by virtue of subsection (3) a reference to the debtor in a listed provision is to be read as a reference to the improver, it is to be assumed in applying the provision in relation to the green deal consumer credit agreement that the improver is provided with credit on the terms of the green deal plan.

• (5) Where by virtue of subsection (3) a reference to the debtor in a listed provision is to be read as a reference to a person who is not the improver, it is to be assumed in applying the provision in relation to the green deal consumer credit agreement—

• (a) if the provision in question is any of sections 94 to 97A (which together make provision about early payment by the debtor), that the person is provided with credit on terms that the person is liable to pay all the instalments under the green deal plan;

• (b) in any other case, that the person is provided with credit on those terms of the green deal plan that bind or benefit the person for any period by virtue of regulations under section 6(2)(b) of the Energy Act 2011.

• (6) References in this section and in Schedule 2A to the “improver”, “first bill payer”, “current bill payer” and “previous bill payer” are to be read as follows—

• (a) a person is the “improver” if the person—

• (i) is the owner or occupier of the property, and

• (ii) is the person who makes (or has made or proposes to make) the arrangement for the green deal plan,

but this is subject to section 189C(4) in cases where the person is not an individual;

• (b) a person is the “first bill payer” if the person is liable to pay the energy bills for the property at the time when the green deal plan is commenced;

• (c) a person is the “current bill payer” if the person is liable by virtue of section 1(6)(a) of the Energy Act 2011 to pay instalments under the plan as a result of being for the time being liable to pay the energy bills for the property;

• (d) a person is a “previous bill payer” if, as a result of previously falling within paragraph (c) for an earlier period, the person has an outstanding payment liability under the plan in respect of that period.

• (7) References in this Act to a prospective consumer credit agreement, and references to the creditor and debtor in relation to such an agreement, are to be read in accordance with this section in the case of prospective green deal consumer credit agreements.

• (8) In this section and in section 189C—

• “domestic property” means a building or part of a building that is occupied as a dwelling or (if not occupied) is intended to be occupied as a dwelling;

• “energy bill” has the same meaning as in section 1 of the Energy Act 2011;

• “energy efficiency improvements” has the meaning given by section 2(4) of the Energy Act 2011;

• “green deal consumer credit agreement” means a green deal plan that is to be treated as a consumer credit agreement for the purposes of this Act by virtue of subsection (1);

• “improvement costs”, in relation to a green deal plan, are the costs of the energy efficiency improvements to the property which are to be paid by instalments under the plan after the time when credit is to be treated as being advanced by virtue of subsection (2) (but ignoring any interest or other charges for credit in determining those costs);

• “listed provision” means a provision of this Act listed in the first column of Schedule 2A;

• “occupier” and “owner” have the same meanings as in Chapter 1 of Part 1 of the Energy Act 2011;

• “property”, in relation to a green deal plan, means the property to which the energy efficiency improvements under the plan are or are intended to be made.

Section 189B: supplementary provision

189C

• (1) A green deal consumer credit agreement is to be treated—

• (a) as an agreement for fixed-sum credit within the meaning of section 10(1)(b);

• (b) as a credit agreement for the purposes of sections 140A and 140B (and section 140C(1) is to be read accordingly).

• (2) Where a green deal consumer credit agreement is a regulated agreement within the meaning of this Act (see section 8(3)), it is to be treated as a restricted-use agreement that falls within section 11(1)(a).

• (3) Sections 81, 140C(2) and 176(5) do not apply in the case of a green deal consumer credit agreement.

• (4) A person who is not an individual is to be treated as the improver in relation to any listed provision in the first column of the table in Schedule 2A only if the corresponding entry in the second column of the table so specifies.

• (5) For the purposes of section 189B—

• (a) a green deal plan is commenced when—

• (i) the occupier or owner of the property signs in the prescribed manner a document in relation to the plan in accordance with section 61(1) (requirements as to form and content of regulated agreements), or

• (ii) if the occupier or owner of the property does not sign such a document, the green deal plan is made;

• (b) a person is liable to pay the energy bills for a property at any time if the person would be treated as the bill payer for the property at that time for the purposes of Chapter 1 of Part 1 of the Energy Act 2011 (see section 2(3) and (10)).

Section 189B: temporary provision

189D

• (1) For the period beginning on the date when this section comes into force and ending on 31st March 2014, the table in Schedule 2A is to be read as if it included the following entries—

Section of this Act	References to “debtor” are to be read as references to the…
Sections 16, 16A, 16B, 16C	- improver
Section 20	- improver- first bill payer
Section 40	- improver (including an improver who is not an individual)- current bill payer- previous bill payer
Section 55A	- improver- first bill payer, except for the purposes of subsection (1)(b)
Section 55B	- improver- first bill payer
Section 82A	- improver- current bill payer- previous bill payer
Section 145	- current bill payer- previous bill payer
Section 149	- improver (including an improver who is not an individual)- current bill payer- previous bill payer
Section 160A	- improver

• (2) This section ceases to have effect on 1st April 2014.

Financial provisions.

190

• (1) There shall be defrayed out of money provided by Parliament—

• (a) all expenses incurred by the Secretary of State in consequence of the provisions of this Act;

• (b) any expenses incurred in consequence of those provisions by any other Minister of the Crown or Government department;

• (c) any increase attributable to this Act in the sums payable out of money so provided under the Superannuation Act 1972 or the Fair Trading Act 1973.

• (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Special provisions as to Northern Ireland.

191

• (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (3) Nothing in this Act shall authorise any Northern Ireland department to incur any expenses attributable to the provisions of this Act until provision has been made for those expenses to be defrayed out of money appropriated for the purpose.

• (4) The power of the Department of Commerce for Northern Ireland to make an order under section 178 shall be exercisable by statutory rule for the purposes of the Statutory Rules (Northern Ireland) Order 1979, and any such order shall be subject to negative resolution within the meaning of the Interpretation Act (Northern Ireland) 1954 as if it were a statutory instrument within the meaning of that Act.

• (5) In this Act “enactment” includes an enactment of the Parliament of Northern Ireland or the Northern Ireland Assembly, and “Act” shall be construed in a corresponding manner; and (without prejudice to section 189(6)) any reference in this Act to such an enactment shall include a reference to any enactment re-enacting it with or without modifications.

• (6) Section 38 of the Interpretation Act 1889 (effect of repeals) shall have the same operation in relation to any repeal by this Act of an enactment of the Parliament of Northern Ireland as it has in relation to the repeal of an Act of the Parliament of the United Kingdom, references in that section of the Act of 1889 to Acts and enactments being construed accordingly.

Transitional and commencement provisions, amendments and repeals.

192

• (1) The provisions of Schedule 3 shall have effect for the purposes of this Act.

• (2) The appointment of a day for the purposes of any provision of Schedule 3 shall be effected by an order of the Secretary of State made by statutory instrument; and any such order shall include a provision amending Schedule 3 so as to insert an express reference to the day appointed.

• (3) Subject to subsection (4)—

• (a) the enactments specified in Schedule 4 shall have effect subject to the amendments specified in that Schedule (being minor amendments or amendments consequential on the preceding provisions of this Act), and

• (b) the enactments specified in Schedule 5 are hereby repealed to the extent shown in column 3 of that Schedule.

• (4) The Secretary of State shall by order made by statutory instrument provide for the coming into operation of the amendments contained in Schedule 4 and the repeals contained in Schedule 5, and those amendments and repeals shall have effect only as provided by an order so made.

Short title and extent.

193

• (1) This Act may be cited as the Consumer Credit Act 1974.

• (2) This Act extends to Northern Ireland.

SCHEDULE A1

Part 1 — Interpretation

1

In this Schedule—

• “the Deputy President” means the Deputy President of the Consumer Credit Appeals Tribunal;

• “lay panel” means the panel established under paragraph 3(3);

• “panel of chairmen” means the panel established under paragraph 3(1);

• “party” means, in relation to an appeal, the appellant or the OFT;

• “the President” means the President of the Consumer Credit Appeals Tribunal;

• “rules” means rules under section 40A(3) of this Act;

• “specified” means specified by rules.

Part 2 — The Tribunal

The President and the Deputy President

2

• (1) The Lord Chancellor shall appoint one of the members of the panel of chairmen to preside over the discharge of the Tribunal's functions.

• (2) The person so appointed shall be known as the President of the Consumer Credit Appeals Tribunal.

• (3) The Lord Chancellor may appoint one of the members of the panel of chairmen to be the Deputy President of the Consumer Credit Appeals Tribunal.

• (4) The Deputy President shall have such functions in relation to the Tribunal as the President may assign to him.

• (5) If the President or the Deputy President ceases to be a member of the panel of chairmen, he shall also cease to be the President or (as the case may be) the Deputy President.

• (6) The functions of the President may, if he is absent or is otherwise unable to act, be discharged—

• (a) by the Deputy President; or

• (b) if there is no Deputy President or he too is absent or otherwise unable to act, by a person appointed for that purpose from the panel of chairmen by the Lord Chancellor.

Panels

3

• (1) The Lord Chancellor shall appoint a panel of persons for the purpose of serving as chairmen of the Tribunal.

• (2) A person shall not be appointed to the panel of chairmen unless he—

• (a) satisfies the judicial-appointment eligibility condition on a 5-year basis;

• (b) is an advocate or solicitor in Scotland of at least five years' standing; or

• (c) is a member of the Bar of Northern Ireland, or a solicitor of the Supreme Court of Northern Ireland, of at least five years' standing.

• (3) The Lord Chancellor shall also appoint a panel of persons who appear to him to be qualified by experience or otherwise to deal with appeals of the kind that may be made to the Tribunal.

Terms of office etc.

4

• (1) Each member of the panel of chairmen or the lay panel shall hold and vacate office in accordance with the terms of his appointment.

• (2) The Lord Chancellor may remove a member of either panel from office on the ground of incapacity or misbehaviour.

• (3) A member of either panel—

• (a) may at any time resign office by notice in writing to the Lord Chancellor;

• (b) is eligible for re-appointment if he ceases to hold office.

Remuneration and allowances

5

The Lord Chancellor may pay to a person in respect of his service—

• (a) as the President or the Deputy President,

• (b) as a member of the Tribunal, or

• (c) as a person appointed under paragraph 7(4),

such remuneration and allowances as the Lord Chancellor may determine.

Staff and costs

6

• (1) The Lord Chancellor may appoint such staff for the Tribunal as he may determine.

• (2) The Lord Chancellor shall defray—

• (a) the remuneration of the Tribunal's staff; and

• (b) such other costs of the Tribunal as he may determine.

Part 3 — Constitution of the Tribunal

7

• (1) On an appeal to the Tribunal, the persons to act as members of the Tribunal for the purposes of the appeal shall be selected from the panel of chairmen or the lay panel.

• (2) The selection shall be in accordance with arrangements made by the President for the purposes of this paragraph.

• (3) Those arrangements shall provide for at least one member to be a person selected from the panel of chairmen.

• (4) If it appears to the Tribunal that a matter before it involves a question of fact of special difficulty, it may appoint one or more experts to provide assistance.

Part 4 — Tribunal powers and procedure

Sittings

8

The Tribunal shall sit at such times and in such places as the Lord Chancellor may direct.

Evidence

9

• (1) Subject to sub-paragraph (2), the Tribunal may, on an appeal, consider any evidence that it thinks relevant, whether or not it was available to the OFT at the time it made the determination appealed against.

• (2) Rules may make provision restricting the evidence that the Tribunal may consider on an appeal in specified circumstances.

Rules on procedure

10

Rules may include, amongst other things, provision—

• (a) about the withdrawal of appeals;

• (b) about persons who may appear on behalf of a party to an appeal;

• (c) about how an appeal is to be dealt with if a person acting as member of the Tribunal in respect of the appeal becomes unable to act;

• (d) setting time limits in relation to anything that is to be done for the purposes of an appeal or for such limits to be set by the Tribunal or a member of the panel of chairmen;

• (e) for time limits (including the period specified for the purposes of section 41(1) of this Act) to be extended by the Tribunal or a member of the panel of chairmen;

• (f) conferring powers on the Tribunal or a member of the panel of chairmen to give such directions to the parties to an appeal as it or he thinks fit for purposes connected with the conduct and disposal of the appeal;

• (g) about the holding of hearings by the Tribunal or a member of the panel of chairmen (including for such hearings to be held in private);

• (h) placing restrictions on the disclosure of information and documents or for such restrictions to be imposed by the Tribunal or a member of the panel of chairmen;

• (i) about the consequences of a failure to comply with a requirement imposed by or under any rule (including for the immediate dismissal or allowing of an appeal if the Tribunal or a member of the panel of chairmen thinks fit);

• (j) for proceedings on different appeals (including appeals with different appellants) to take place concurrently;

• (k) for the suspension of determinations of the OFT;

• (l) for the suspension of decisions of the Tribunal;

• (m) for the Tribunal to reconsider its decision disposing of an appeal where it has reason to believe that the decision was wrongly made because of an administrative error made by a member of its staff.

Council on Tribunals

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

11

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Disposal of appeals

12

• (1) The Tribunal shall decide an appeal by reference to the grounds of appeal set out in the notice of appeal.

• (2) In disposing of an appeal the Tribunal may do one or more of the following—

• (a) confirm the determination appealed against;

• (b) quash that determination;

• (c) vary that determination;

• (d) remit the matter to the OFT for reconsideration and determination in accordance with the directions (if any) given to it by the Tribunal;

• (e) give the OFT directions for the purpose of giving effect to its decision.

• (3) In the case of an appeal against a determination to impose a penalty, the Tribunal—

• (a) has no power by virtue of sub-paragraph (2)(c) to increase the penalty;

• (b) may extend the period within which the penalty is to be paid (including in cases where that period has already ended).

• (4) Sub-paragraph (3) does not affect—

• (a) the Tribunal's power to give directions to the OFT under sub-paragraph (2)(d); or

• (b) what the OFT can do where a matter is remitted to it under sub-paragraph (2)(d).

• (5) Where the Tribunal remits a matter to the OFT, it may direct that the requirements of section 34 of this Act are not to apply, or are only to apply to a specified extent, in relation to the OFT's reconsideration of the matter.

• (6) Subject to sub-paragraphs (7) and (8), where the Tribunal remits an application to the OFT, section 6(1) and (3) to (9) of this Act shall apply as if the application had not been previously determined by the OFT.

• (7) In the case of a general notice which came into effect after the determination appealed against was made but before the application was remitted, the applicant shall provide any information or document which he is required to provide under section 6(6) within—

• (a) the period of 28 days beginning with the day on which the application was remitted; or

• (b) such longer period as the OFT may allow.

• (8) In the case of—

• (a) any information or document which was superseded,

• (b) any change in circumstances which occurred, or

• (c) any error or omission of which the applicant became aware,

after the determination appealed against was made but before the application was remitted, any notification that is required to be given by the applicant under section 6(7) shall be given within the period of 28 days beginning with the day on which the application was remitted.

Decisions of the Tribunal

13

• (1) A decision of the Tribunal may be taken by majority.

• (2) A decision of the Tribunal disposing of an appeal shall—

• (a) state whether it was unanimous or taken by majority; and

• (b) be recorded in a document which—

• (i) contains a statement of the reasons for the decision and any other specified information; and

• (ii) is signed and dated by a member of the panel of chairmen.

• (3) Where the Tribunal disposes of an appeal it shall—

• (a) send to each party to the appeal a copy of the document mentioned in sub-paragraph (2)(b); and

• (b) publish that document in such manner as it thinks fit.

• (4) The Tribunal may exclude from what it publishes under sub-paragraph (3)(b) information of a specified description.

Costs

14

• (1) Where the Tribunal disposes of an appeal and—

• (a) it decides that the OFT was wrong to make the determination appealed against, or

• (b) during the course of the appeal the OFT accepted that it was wrong to make that determination,

it may order the OFT to pay to the appellant the whole or a part of the costs incurred by the appellant in relation to the appeal.

• (2) In determining whether to make such an order, and the terms of such an order, the Tribunal shall have regard to whether it was unreasonable for the OFT to make the determination appealed against.

15

Where—

• (a) the Tribunal disposes of an appeal or an appeal is withdrawn before the Tribunal disposes of it, and

• (b) the Tribunal thinks that a party to the appeal acted vexatiously, frivolously or unreasonably in bringing the appeal or otherwise in relation to the appeal,

it may order that party to pay to the other party the whole or a part of the costs incurred by the other party in relation to the appeal.

16

An order of the Tribunal under paragraph 14 or 15 may be enforced—

• (a) as if it were an order of the county court; or

• (b) in Scotland, as if it were an interlocutor of the Court of Session.

SCHEDULE 1

SCHEDULE 2

Part I — Lists of Terms

Part II

EXAMPLES

Example 1

Facts.Correspondence passes between an employee of a moneylending company (writing on behalf of the company) and an individual about the terms on which the company would grant him a loan under a regulated agreement.

Analysis.The correspondence constitutes antecedent negotiations falling within section 56(1)(a), the moneylending company being both creditor and negotiator.

Example 2

Facts.Representations are made about goods in a poster displayed by a shopkeeper near the goods, the goods being selected by a customer who has read the poster and then sold by the shopkeeper to a finance company introduced by him (with whom he has a business relationship). The goods are disposed of by the finance company to the customer under a regulated hire-purchase agreement.

Analysis.The representations in the poster constitute antecedent negotiations falling within section 56(1)(b), the shopkeeper being the credit-broker and negotiator and the finance company being the creditor. The poster is an advertisement and the shopkeeper is the advertiser.

Example 3

Facts.Discussions take place between a shopkeeper and a customer about goods the customer wishes to buy using a credit-card issued by the D Bank under a regulated agreement.

Analysis.The discussions constitute antecedent negotiations falling within section 56(1)(c), the shopkeeper being the supplier and negotiator and the D Bank the creditor. The credit-card is a credit-token as defined in section 14(1), and the regulated agreement under which it was issued is a credit-token agreement as defined in section 14(2).

Example 4

Facts.Discussions take place and correspondence passes between a secondhand car dealer and a customer about a car, which is then sold by the dealer to the customer under a regulated conditional sale agreement. Subsequently, on a revocation of that agreement by consent, the car is resold by the dealer to a finance company introduced by him (with whom he has a business relationship), who in turn dispose of it to the same customer under a regulated hire-purchase agreement.

Analysis.The discussions and correspondence constitute antecedent negotiations in relation both to the conditional sale agreement and the hire-purchase agreement. They fall under section 56(1)(a) in relation to the conditional sale agreement, the dealer being the creditor and the negotiator. In relation to the hire-purchase agreement they fall within section 56(1)(b), the dealer continuing to be treated as the negotiator but the finance company now being the creditor. Both agreements are cancellable if the discussions took place when the individual conducting the negotiations (whether the “negotiator ” or his employee or agent) was in the presence of the debtor, unless the unexecuted agreement was signed by the debtor at trade premises (as defined in section 67(b)). If the discussions all took place by telephone however, or the unexecuted agreement was signed by the debtor on trade premises (as so defined) the agreements are not cancellable.

Example 5

Facts.E agrees to sell to F (an individual) an item of furniture in return for 24 monthly instalments of £10 payable in arrear. The property in the goods passes to F immediately.

Analysis.This is a credit-sale agreement (see definition of “credit-sale agreement” in section 189(1)). The credit provided amounts to £240 less the amount which constitutes the total charge for credit (within the meaning given by section 20). (This amount is required to be deducted by section 9(4)). Accordingly the agreement falls within section 8(2) and is a consumer credit agreement.

Example 6

Facts.The G Bank grants H (an individual) an unlimited overdraft, with an increased rate of interest on so much of any debit balance as exceeds £2,000.

Analysis.Although the overdraft purports to be unlimited, the stipulation for increased interest above £2,000 brings the agreement within section 10(3)(b)(ii) and it is a consumer credit agreement.

Example 7

Facts.J is an individual who owns a small shop which usually carries a stock worth about £1,000. K makes a stocking agreement under which he undertakes to provide on short-term credit the stock needed from time to time by J without any specified limit.

Analysis.Although the agreement appears to provide unlimited credit, it is probable, having regard to the stock usually carried by J, that his indebtedness to K will not at any time rise above £5,000. Accordingly the agreement falls within section 10(3)(b)(iii) and is a consumer credit agreement.

Example 8

Facts.U, a moneylender, lends £500 to V (an individual) knowing he intends to use it to buy office equipment from W. W introduced V to U, it being his practice to introduce customers needing finance to him. Sometimes U gives W a commission for this and sometimes not. U pays the £500 direct to V.

Analysis.Although this appears to fall under section 11(1)(b), it is excluded by section 11(3) and is therefore (by section 11(2)) an unrestricted-use credit agreement. Whether it is a debtor-creditor agreement (by section 13(c)) or a debtor-creditor-supplier agreement (by section 12(c)) depends on whether the previous dealings between U and W amount to “pre-existing arrangements ”, that is whether the agreement can be taken to have been entered into “in accordance with, or in furtherance of ” arrangements previously made between U and W, as laid down in section 187(1).

Example 9

Facts.A agrees to lend B (an individual) £4,500 in nine monthly instalments of £500.

Analysis.This is a cash loan and is a form of credit (see section 9 and definition of “cash” in section 189(1)). Accordingly it falls within section 10(1)(b) and is fixed-sum credit amounting to £4,500.

Example 10

Facts.C (in England) agrees to bail goods to D (an individual) in return for periodical payments. The agreement provides for the property in the goods to pass to D on payment of a total of £7,500 and the exercise by D of an option to purchase. The sum of £7,500 includes a down-payment of £1,000. It also includes an amount which, according to regulations made under section 20(1), constitutes a total charge for credit of £1,500.

Analysis.This is a hire-purchase agreement with a deposit of £1,000 and a total price of £7,500 (see definitions of “hire-purchase agreement”, “deposit” and “total price” in section 189(1)). By section 9(3), it is taken to provide credit amounting to £7,500—(£1,500 + £1,000), which equals £5,000. Under section 8(2), the agreement is therefore a consumer credit agreement, and under sections 9(3) and 11(1) it is a restricted-use credit agreement for fixed-sum credit. A similar result would follow if the agreement by C had been a hiring agreement in Scotland.

Example 11

Facts.X (an individual) borrows £500 from Y (Finance). As a condition of the granting of the loan X is required—

(a) to execute a second mortgage on his house in favour of Y (Finance), and

(b) to take out a policy of insurance on his life with Y (Insurances).

In accordance with the loan agreement, the policy is charged to Y (Finance) as collateral security for the loan. The two companies are associates within the meaning of section 184(3).

Analysis.The second mortgage is a transaction for the provision of security and accordingly does not fall within section 19(1), but the taking out of the insurance policy is a linked transaction falling within section 19(1)(a). The charging of the policy is a separate transaction (made between different parties) for the provision of security and again is excluded from section 19(1). The only linked transaction is therefore the taking out of the insurance policy. If X had not been required by the loan agreement to take out the policy, but it had been done at the suggestion of Y (Finance) to induce them to enter into the loan agreement, it would have been a linked transaction under section 19(1)(c)(i) by virtue of section 19(2)(a).

Example 12

Facts.The N Bank agrees to lend O (an individual) £2,000 to buy a car from P. To make sure the loan is used as intended, the N Bank stipulates that the money must be paid by it direct to P.

Analysis.The agreement is a consumer credit agreement by virtue of section 8(2). Since it falls within section 11(1)(b), it is a restricted-use credit agreement, P being the supplier. If the N Bank had not stipulated for direct payment to the supplier, section 11(3) would have operated and made the agreement into one for unrestricted-use credit.

Example 13

Facts.Q, a debt-adjuster, agrees to pay off debts owed by R (an individual) to various moneylenders. For this purpose the agreement provides for the making of a loan by Q to R in return for R’s agreeing to repay the loan by instalments with interest. The loan money is not paid over to R but retained by Q and used to pay off the moneylenders.

Analysis.This is an agreement to refinance existing indebtedness of the debtor’s, and if the loan by Q does not exceed £5,000 is a restricted-use credit agreement falling within section 11(1)(c).

Example 14

Facts.On payment of £1, S issues to T (an individual) a trading check under which T can spend up to £20 at any shop which has agreed, or in future agrees, to accept S’s trading checks.

AnalysisThe trading check is a credit-token falling within section 14(1)(b). The credit-token agreement is a restricted-use credit agreement within section 11(1)(b), any shop in which the credit-token is used being the “supplier ”. The fact that further shops may be added after the issue of the credit-token is irrelevant in view of section 11(4).

Example 15

Facts.A retailer L agrees with M (an individual) to open an account in M’s name and, in return for M’s promise to pay a specified minimum sum into the account each month and to pay a monthly charge for credit, agrees to allow to be debited to the account, in respect of purchases made by M from L, such sums as will not increase the debit balance at any time beyond the credit limit, defined in the agreement as a given multiple of the specified minimum sum.

Analysis.This agreement provides credit falling within the definition of running-account credit in section 10(1)(a). Provided the credit limit is not over £5,000, the agreement falls within section 8(2) and is a consumer credit agreement for running-account credit.

Example 16

Facts.Under an unsecured agreement, A (Credit), an associate of the A Bank, issues to B (an individual) a credit-card for use in obtaining cash on credit from A (Credit), to be paid by branches of the A Bank (acting as agent of A (Credit)), or goods or cash from suppliers or banks who have agreed to honour credit-cards issued by A (Credit). The credit limit is £30.

Analysis.This is a credit-token agreement falling within section 14(1)(a) and (b). It is a regulated consumer credit agreement for running-account credit. Since the credit limit does not exceed £30, the agreement is a small agreement. So far as the agreement relates to goods it is a debtor-creditor-supplier agreement within section 12(b), since it provides restricted-use credit under section 11(1)(b). So far as it relates to cash it is a debtor-creditor agreement within section 13(c) and the credit it provides is unrestricted-use credit. This is therefore a multiple agreement. In that the whole agreement falls within several of the categories of agreement mentioned in this Act, it is, by section 18(3), to be treated as an agreement in each of those categories. So far as it is a debtor-creditor-supplier agreement providing restricted-use credit it is, by section 18(2), to be treated as a separate agreement; and similarly so far as it is a debtor-creditor agreement providing unrestricted-use credit. (See also Example 22.)

Example 17

Facts.The manager of the C Bank agrees orally with D (an individual) to open a current account in D’s name. Nothing is said about overdraft facilities. After maintaining the account in credit for some weeks, D draws a cheque in favour of E for an amount exceeding D’s credit balance by £20. E presents the cheque and the Bank pay it.

Analysis.In drawing the cheque D, by implication, requests the Bank to grant him an overdraft of £20 on its usual terms as to interest and other charges. In deciding to honour the cheque, the Bank by implication accept the offer. This constitutes a regulated small consumer credit agreement for unrestricted-use, fixed-sum credit. It is a debtor-creditor agreement, and falls within section 74(1)(b) . . . . (Compare Example 18.)

Example 18

Facts.F (an individual) has had a current account with the G Bank for many years. Although usually in credit, the account has been allowed by the Bank to become overdrawn from time to time. The maximum such overdraft has been is about £1,000. No explicit agreement has ever been made about overdraft facilities. Now, with a credit balance of £500, F draws a cheque for £1,300.

Analysis.It might well be held that the agreement with F (express or implied) under which the Bank operate his account includes an implied term giving him the right to overdraft facilities up to say £1,000. If so, the agreement is a regulated consumer credit agreement for unrestricted-use, running-account credit. It is a debtor-creditor agreement, and falls within section 74(1)(b). . . . It is also a multiple agreement, part of which (i.e. the part not dealing with the overdraft), as referred to in section 18(1)(a), falls within a category of agreement not mentioned in this Act. (Compare Example 17.)

Example 19

Facts.H (a finance house) agrees with J (a partnership of individuals) to open an unsecured loan account in J’s name on which the debit balance is not to exceed £7,000 (having regard to payments into the account made from time to time by J). Interest is to be payable in advance on this sum, with provision for yearly adjustments. H is entitled to debit the account with interest, a “setting-up ” charge, and other charges. Before J has an opportunity to draw on the account it is initially debited with £2,250 for advance interest and other charges.

Analysis.This is a personal running-account credit agreement (see sections 8(1) and 10(1)(a), and definition of “individual” in section 189(1)). By section 10(2) the credit limit is £7,000. By section 9(4) however the initial debit of £2,250, and any other charges later debited to the account by H, are not to be treated as credit even though time is allowed for their payment. Effect is given to this by section 10(3). Although the credit limit of £7,000 exceeds the amount (£5,000) specified in section 8(2) as the maximum for a consumer credit agreement, so that the agreement is not within section 10(3)(a), it is caught by section 10(3)(b)(i). At the beginning J can effectively draw (as credit) no more than £4,750, so the agreement is a consumer credit agreement.

Example 20

Facts.K (in England) agrees with L (an individual) to bail goods to L for a period of three years certain at £2,000 a year, payable quarterly. The agreement contains no provision for the passing of the property in the goods to L.

Analysis.This is not a hire-purchase agreement (see paragraph (b) of the definition of that term in section 189(1)), and is capable of subsisting for more than three months. Paragraphs (a) and (b) of section 15(1) are therefore satisfied, but paragraph (c) is not. The payments by L must exceed £5,000 if he conforms to the agreement. It is true that under section 101 L has a right to terminate the agreement on giving K three months’ notice expiring not earlier than eighteen months after the making of the agreement, but that section applies only where the agreement is a regulated consumer hire agreement apart from the section (see subsection (1)). So the agreement is not a consumer hire agreement, though it would be if the hire charge were say £1,500 a year, or there were a “break ” clause in it operable by either party before the hire charges exceeded £5,000. A similar result would follow if the agreement by K had been a hiring agreement in Scotland.

Example 21

Facts.The P Bank decides to issue cheque cards to its customers under a scheme whereby the bank undertakes to honour cheques of up to £30 in every case where the payee has taken the cheque in reliance on the cheque card, whether the customer has funds in his account or not. The P Bank writes to the major retailers advising them of this scheme and also publicises it by advertising. The Bank issues a cheque card to Q (an individual), who uses it to pay by cheque for goods costing £20 bought by Q from R, a major retailer. At the time, Q has £500 in his account at the P Bank.

Analysis.The agreement under which the cheque card is issued to Q is a consumer credit agreement even though at all relevant times Q has more than £30 in his account. This is because Q is free to draw out his whole balance and then use the cheque card, in which case the Bank has bound itself to honour the cheque. In other words the cheque card agreement provides Q with credit, whether he avails himself of it or not. Since the amount of the credit is not subject to any express limit, the cheque card can be used any number of times. It may be presumed however that section 10(3)(b)(iii) will apply. The agreement is an unrestricted-use debtor-creditor agreement (by section 13(c)). Although the P Bank wrote to R informing R of the P Bank’s willingness to honour any cheque taken by R in reliance on a cheque card, this does not constitute pre-existing arrangements as mentioned in section 13(c) because section 187(3) operates to prevent it. The agreement is not a credit-token agreement within section 14(1)(b) because payment by the P Bank to R, would be a payment of the cheque and not a payment for the goods.

Example 22

Facts.The facts are as in Example 16. On one occasion B uses the credit-card in a way which increases his debit balance with A (Credit) to £40. A (Credit) writes to B agreeing to allow the excess on that occasion only, but stating that it must be paid off within one month.

Analysis.In exceeding his credit limit B, by implication, requests A (Credit) to allow him a temporary excess (compare Example 17). A (Credit) is thus faced by B’s action with the choice of treating it as a breach of contract or granting his implied request. He does the latter. If he had done the former, B would be treated as taking credit to which he was not entitled (see section 14(3)) and, subject to the terms of his contract with A (Credit), would be liable to damages for breach of contract. As it is, the agreement to allow the excess varies the original credit-token agreement by adding a new term. Under section 10(2), the new term is to be disregarded in arriving at the credit limit, so that the credit-token agreement at no time ceases to be a small agreement. By section 82(2) the later agreement is deemed to revoke the original agreement and contain provisions reproducing the combined effect of the two agreements. By section 82(4), this later agreement is exempted from Part V (except section 56).

Example 23

Facts.Under an oral agreement made on 10th January, X (an individual) has an overdraft on his current account at the Y bank with a credit limit of £100. On 15th February, when his overdraft stands at £90, X draws a cheque for £25. It is the first time that X has exceeded his credit limit, and on 16th February the bank honours the cheque.

Analysis.The agreement of 10th January is a consumer credit agreement for running-account credit. The agreement of 15th-16th February varies the earlier agreement by adding a term allowing the credit limit to be exceeded merely temporarily. By section 82(2) the later agreement is deemed to revoke the earlier agreement and reproduce the combined effect of the two agreements. By section 82(4), Part V of this Act (except section 56) does not apply to the later agreement. By section 18(5), a term allowing a merely temporary excess over the credit limit is not to be treated as a separate agreement, or as providing fixed-sum credit. The whole of the £115 owed to the bank by X on 16th February is therefore running-account credit.

Example 24

Facts.On 1st March 1975 Z (in England) enters into an agreement with A (an unincorporated body of persons) to bail to A equipment consisting of two components (component P and component Q). The agreement is not a hire-purchase agreement and is for a fixed term of 3 years, so paragraphs (a) and (b) of section 15(1) are both satisfied. The rental is payable monthly at a rate of £2,400 a year, but the agreement provides that this is to be reduced to £1,200 a year for the remainder of the agreement if at any time during its currency A returns component Q to the owner Z. On 5th May 1976 A is incorporated as A Ltd., taking over A’s assets and liabilities. On 1st March 1977, A Ltd. returns component Q. On 1st January 1978, Z and A Ltd. agree to extend the earlier agreement by one year, increasing the rental for the final year by £250 to £1,450.

Analysis.When entered into on 1st March 1975, the agreement is a consumer hire agreement. A falls within the definition of “individual” in section 189(1) and if A returns component Q before 1st May 1976 the total rental will not exceed £5,000 (see section 15(1)(c)). When this date is passed without component Q having been returned it is obvious that the total rental must now exceed £5,000. Does this mean that the agreement then ceases to be a consumer hire agreement? The answer is no, because there has been no change in the terms of the agreement, and without such a change the agreement cannot move from one category to the other. Similarly, the fact that A’s rights and duties under the agreement pass to a body corporate on 5th May 1976 does not cause the agreement to cease to be a consumer hire agreement (see the definition of “hirer” in section 189(1)).

The effect of the modifying agreement of 1st January 1978 is governed by section 82(2), which requires it to be treated as containing provisions reproducing the combined effect of the two actual agreements, that is to say as providing that—

The total rental under the modifying agreement is £1,850. Accordingly the modifying agreement is a regulated agreement. Even if the total rental under the modifying agreement exceeded £5,000 it would still be regulated because of the provisions of section 82(3).

SCHEDULE 2A

SCHEDULE 3

Note.Except as otherwise mentioned in this Schedule, the provisions of this Act come into operation on its passing, that is on 31st July 1974.

Part II of Act — Credit Agreements, Hire Agreements and Linked Transactions

Regulated agreements

1

• (1) An agreement made before 1st April 1977is not a regulated agreement within the meaning of this Act.

• (2) In this Act “prospective regulated agreement” does not include a prospective agreement which, if made as expected, would be made before 1st April 1977.

Linked transactions

2

A transaction may be a linked transaction in relation to a regulated agreement or prospective regulated agreement even though the transaction was entered into before the day appointed for the purposes of paragraph 1.

3

Section 19(3) applies only to transactions entered into on or after 19th May 1985.

Total charge for credit

4

Section 20 applies to consumer credit agreements whenever made.

Part III of Act — Licensing of Credit and Hire Businesses

...

5

............................................................

...

6

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

...

7

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Part IV of Act — Seeking Business

Advertisements

8

Part IV does not apply to any advertisement published before 6th October 1980.

Canvassing

9

Section 49 comes into operation on 1st October 1977.

Circulars to minors

10

Section 50 comes into operation on 1st July 1977.

...

11

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Part V of Act — Entry into Credit or Hire Agreements

Antecedent negotiations

12

• (1) Section 56 applies to negotiations in relation to an actual or prospective regulated agreement where the negotiations begin after 16th May 1977.

• (2) In section 56(3), “agreement ”, where it first occurs, means an agreement whenever made.

General

13

Sections 57 to 59, 61 to 65 and 67 to 73 come into operation on 19th May 1985.

14

Section 66 comes into operation on 19th May 1985.

Part VI of Act — Matters Arising During Currency of Credit or Hire Agreements

Liability of creditor for breaches by supplier

15

Section 75 comes into operation on 1st July 1977 but only in relation to regulated agreements made on or after that day.

Duty to give notice

16

• (1) Section 76 comes into operation on 19th May 1985.

• (2) Section 76 applies to an agreement made before 19th May 1985where the agreement would have been a regulated agreement if made on that day.

Duty to give information

17

• (1) Sections 77 to 80 come into operation on 19th May 1985.

• (2) Sections 77 to 79 apply to an agreement made before 19th May 1985where the agreement would have been a regulated agreement if made on that day.

Appropriation of payments

18

Section 81 comes into operation on 19th May 1985.

Variation of agreements

19

Section 82 comes into operation on 1st April 1977.

Misuse of credit facilities

20

• (1) Sections 83 and 84 come into operation on 19th May 1985.

• (2) Subject to sub-paragraph (4), section 83 applies to an agreement made before 19th May 1985 where the agreement would have been a regulated consumer credit agreement if made on that day.

• (3) Subject to sub-paragraph (4), section 84 applies to an agreement made before 19th May 1985 where the agreement would have been a credit-token agreement if made on that day.

• (4) Sections 83 and 84 do not apply to losses arising before 19th May 1985.

• (5) Section 84(4) shall be taken to be satisfied in relation to an agreement made before 19th May 1985 if, within 28 days after that day, the creditor gives notice to the debtor of the name, address and telephone number of a person stated in that notice to be the person to whom notice is to be given under section 84(3).

Duty on issue of new credit-tokens

21

• (1) Section 85 comes into operation on 19th May 1985.

• (2) Section 85 applies to an agreement made before 19th May 1985 where the agreement would have been a regulated agreement if made on that day.

Death of debtor or hirer

22

• (1) Section 86 comes into operation on 19th May 1985.

• (2) Section 86 applies to an agreement made before 19th May 1985 where the agreement would have been a regulated agreement if made on that day.

Part VII of Act — Default and Termination

Default notices

23

Sections 87 to 89 come into operation on 19th May 1985.

Retaking of goods and land

24

Sections 90 and 91 come into operation on 19th May 1985.

25

Section 92 comes into operation on 19th May 1985.

Interest on default

26

Section 93 comes into operation on 19th May 1985.

Early payment by debtor

27

Sections 94 to 97 come into operation on 19th May 1985.

Termination of agreements

28

Section 98 comes into operation on 19th May 1985.

29

Section 99 comes into operation on 19th May 1985.

30

Section 100 comes into operation on 19th May 1985.

31

Section 101 comes into operation on 19th May 1985.

32

Section 102 comes into operation on 19th May 1985.

33

Section 103 comes into operation on 19th May 1985.

34

Section 104 comes into operation on 19th May 1985.

Old agreements

35

Part VII (except sections 90, 91, 93 and 99 to 102 and 104) applies to an agreement made before 19th May 1985 where the agreement would have been a regulated agreement if made on that day.

Part VIII of Act — Security

General

36

Section 105 comes into operation on 19th May 1985.

37

• (1) Sections 107 to 110 come into operation on 19th May 1985.

• (2) Sections 107 to 110 apply to an agreement made before 19th May 1985 where the agreement would have been a regulated agreement if made on that day.

38

• (1) Section 111 comes into operation on 19th May 1985.

• (2) Section 111 applies to an agreement made before 19th May 1985 where the agreement would have been a regulated agreement if made on that day.

Pledges

39

Sections 114 to 122 come into operation on 19th May 1985 but only in respect of articles taken in pawn under a regulated consumer credit agreement.

Negotiable instruments

40

Sections 123 to 125 come into operation on 19th May 1985.

Land mortgages

41

Section 126 comes into operation on 19th May 1985.

Part IX of Act — Judicial Control

42

Sections 137 to 140 (extortionate credit bargains) come into operation on 16th May 1977, and apply to agreements and transactions whenever made.

43

Subject to paragraph 42, Part IX comes into operation on 19th May 1985.

Part X of Act — Ancillary Credit Businesses

...

44

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

...

45

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

...

46

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Advertisements

47

Subsections (1) and (2) of section 151 do not apply to any advertisement published before 6th October 1980

Credit Reference Agencies

48

Sections 157 and 158 do not apply to a request received before 16th May 1977.

Part XII of Act — Supplemental

Interpretation

49

• (1) In the case of an agreement—

• (a) which was made before 19th May 1985, and

• (b) to which (by virtue of paragraph 17(2)) section 78(4) applies,

section 185(2) shall have effect as respects a notice given before that day in relation to the agreement (whether given before or after the passing of this Act) as it would have effect if section 78(4) had been in operation when the notice was given.

• (2) Paragraph (1) applies to an agreement made on or after 19th May 1985 to provide credit on a current account opened before that day as it applies to an agreement made before that day.

50

In section 189, the definition of “local authority ” shall have effect in relation to matters arising before 16th May 1975 as if for the words “regional, islands or district council ” there were substituted “a county council or town council ”.

SCHEDULE 4.

PART I — UNITED KINGDOM

Bills of Sale Act (1878) Amendment Act 1882

1

The following section shall be inserted after section 7

(7A) (1) Paragraph (1) of section 7 of this Act does not apply to a default relating to a bill of sale given by way of security for the payment of money under a regulated agreement to which section 87(1) of the Consumer Credit Act 1974 applies — (a) unless the restriction imposed by section 88(2) of that Act has ceased to apply to the bill of sale ; or (b) if, by virtue of section 89 of that Act, the default is to be treated as not having occurred. (2) Where paragraph (1) of section 7 of this Act does apply in relation to a bill of sale such as is mentioned in subsection (1) of this section, the proviso to that section shall have effect with the substitution of “county court ” for “High Court ”.

Factors Act 1889

2

At the end of section 9 insert

For the purposes of this section— (i) the buyer under a conditional sale agreement shall be deemed not to be a person who has bought or agreed to buy goods, and (ii) “conditional sale agreement” means an agreement for the sale of goods which is a consumer credit agreement within the meaning of the Consumer Credit Act 1974 under which the purchase price or part of it is payable by instalments, and the property in the goods is to remain in the seller (notwithstanding that the buyer is to be in possession of the goods) until such conditions as to the payment of instalments or otherwise as may be specified in the agreement are fulfilled.

3

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Law of Distress Amendment Act 1908

5

The following section shall be inserted after section 4—

(4A) (1) Goods— (a) bailed under a hire-purchase agreement or a consumer hire agreement, or (b) agreed to be sold under a conditional sale agreement, are, where the relevant agreement has not been terminated, excluded from the application of this Act except during the period between the service of a default notice under the Consumer Credit Act 1974 in respect of the goods and the date on which the notice expires or is earlier complied with. (2) Goods comprised in a bill of sale are excluded from the application of this Act except, during the period between service of a default notice under the Consumer Credit Act 1914 in respect of goods subject to a regulated agreement under which a bill of sale is given by way of security and the date on which the notice expires or is earlier complied with. (3) In this section— “conditional sale agreement” means an agreement for the sale of goods under which the purchase price or part of it is payable by instalments, and the property in the goods is to remain in the seller (notwithstanding that the buyer is to be in possession of the goods) until such conditions as to the payment of instalments or otherwise as may be specified in the agreement are fulfilled ; “consumer hire agreement ” has the meaning given by section 15 of the Consumer Credit Act 1974. “hire-purchase agreement” means an agreement, other than a conditional sale agreement, under which— (a) goods are bailed in return for periodical payments by the person to whom they are bailed, and (b) the property in the goods will pass to that person if the terms of the agreement are complied with and one or more of the following occurs— (i) the exercise of an option to purchase by that person, (ii) the doing of any other specified act by any party to the agreement, (iii) the happening of any other specified event; and “regulated agreement ” has the meaning given by section 189(1) of the Consumer Credit Act 1974.

Bankruptcy Act 1914

6

The following section shall be inserted after section 38—

(38A) (1) Goods— (a) bailed under a hire-purchase agreement or a consumer hire agreement, or (b) agreed to be sold under a conditional sale agreement, or (c) subject to a regulated agreement under which a bill of sale is given by way of security. shall not be treated as the property of the bankrupt during the period between the service of a default notice under the Consumer Credit Act 1974 in respect of the goods and the date on which the notice expires or is earlier complied with. (2) In this section— - “conditional sale agreement” means an agreement for the sale of goods under which the purchase price or part of it is payable by instalments, and the property in the goods is to remain in the seller (notwithstanding that the buyer is to be in possession of the goods) until such conditions as to the payment of instalments or otherwise as may be specified in the agreement are fulfilled; - “consumer hire agreement ” has the meaning given by section 15 of the Consumer Credit Act 1974; - “hire-purchase agreement” means an agreement, other than a conditional sale agreement, under which— (a) goods are bailed in return for periodical payments by the person to whom they are bailed, and (b) the property in the goods will pass to that person if the terms of the agreement are complied with and one or more of the following occurs— (i) the exercise of an option to purchase by that person, (ii) the doing of any other specified act by any party to the agreement, (iii) the happening of any other specified event; and “regulated agreement ” has the meaning given by section 189(1) of the Consumer Credit Act 1974.

Compensation (Defence) Act 1939

7

In section 13 after “hire-purchase agreement ” insert “or a conditional sale agreement ”.

8

In section 17(1)—

• (1) After the definition of “aircraft ” insert—

“conditional sale agreement” means an agreement for the sale of goods which is a consumer credit agreement within the meaning of the Consumer Credit Act 1974 under which the purchase price or part of it is payable by instalments, and the property in the goods is to remain in the seller (notwithstanding that the buyer is to be in possession of the goods) until such conditions as to the payment of instalments or otherwise as may be specified in the agreement are fulfilled ;

, and

• (2) for the definition of “hire-purchase agreement ” substitute—

“hire-purchase agreement” means an agreement which is a consumer credit agreement within the meaning of the Consumer Credit Act 1974, other than a conditional sale agreement, under which— (a) goods are bailed or (in Scotland) hired in return for periodical payments by the person to whom they are bailed or hired, and (b) the property in the goods will pass to that person if the terms of the agreement are complied with and one or more of the following occurs— (i) the exercise of an option to purchase by that person, (ii) the doing of any other specified act by any party to the agreement, (iii) the happening of any other specified event ;

Liability for War Damage (Miscellaneous Provisions) Act 1939

9

In section 1(3), for paragraphs (a) and (b) substitute—

(a) a hire-purchase agreement or a conditional sale agreement within the meaning of the Consumer Credit Act 1974 being (in either case) a consumer credit agreement as defined by that Act ; or (b) a consumer hire agreement as defined by that Act.

10

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Rag Flock and Other Filing Materials Act 1951

11

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Reserve and Auxiliary Forces (Protection of Civil Interest) Act 1951

12

In section 4 for subsections (4), (5) and (6), substitute—

(4) Where the appropriate court refuses leave under section 4(2) of this Act to take possession of goods subject to a hire-purchase agreement or a conditional sale agreement or to execute a judgment or order for delivery of such goods, or gives leave subject to restrictions and conditions, and the person to whom the goods are bailed, or, as the case may be, the buyer, before possession is taken or execution on the judgment or order completed, pays the total price, the creditor’s title to the goods shall, notwithstanding any failure to pay the total price at the time required by the agreement, vest in that person. (5) Where the creditor under a hire-purchase agreement or a conditional sale agreement has taken possession of the goods bailed or agreed to be sold under it, the appropriate court on an application under section 3(1)(c) of this Act, may, if it thinks fit, deal with the case as if the creditor were proceeding to take possession of the goods and, if it makes an order under that paragraph, may direct accordingly that the goods be restored to the person to whom they were bailed or, as the case may be, the buyer ; and if, after the creditor has taken possession of the goods, notice is given under that paragraph with respect to them, he shall not, so long as the notice is in force or any application in pursuance of the notice is undisposed of, deal with the goods in such a way as to prejudice the powers of the appropriate court under this subsection.

13

For section 10 substitute—

(10) (1) Where the appropriate court refuses leave under section 8(3) of this Act to take or resume possession of goods subject to a hire-purchase agreement or a conditional sale agreement or to do diligence on any decree for the delivery of such goods, or gives leave subject to restrictions and conditions, and the person to whom they are hired, or, as the case may be, the buyer before possession is taken or resumed or diligence is done, pays the total price, the creditor’s title to the goods shall, notwithstanding any failure to pay the total price at the time required by the agreement, vest in that person. (2) Where the creditor under a hire-purchase agreement or a conditional sale agreement has taken possession of the goods hired or agreed to be sold under it, the appropriate court on an application under section 9(1)(C) of this Act may, if it thinks fit, deal with the case as if the creditor were proceeding to take possession of the goods and, if it makes an order under that paragraph, may direct accordingly that the goods be restored to the person to whom they were hired or, as the case may be, the buyer ; and if, after the creditor has taken possession of the goods, notice is given under that paragraph with respect to them, he shall not, so long as the notice is in force or any application in pursuance of the notice is undisposed of, deal with the goods in such a way as to prejudice the powers of the appropriate court under this subsection

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14

In section 64(I)—

• (1) after the definition of “compulsory national service ” insert—

“conditional sale agreement” means an agreement for the sale of goods under which the purchase price or part of it is payable by instalments, and the property in the goods is to remain in the seller (notwithstanding that the buyer is to be in possession of the goods) until such conditions as to the payment of instalments or otherwise as may be specified in the agreement are fulfilled ; “creditor” means the person by whom goods are bailed or (in Scotland) hired under a hire-purchase agreement or, as the case may be, the seller under a conditional sale agreement, or the person to whom his rights and duties have passed by assignment or operation of the law ; “hire-purchase agreement” means an agreement, other than a conditional sale agreement, under which— (a) goods are bailed or (in Scotland) hired in return for periodical payments by the person to whom they are bailed or hired, and (b) the property in the goods will pass to that person if the terms of the agreement are complied with and one or more of the following occurs— (i) the exercise of an option to purchase by that person, (ii) the doing of any other specified act by any party to the agreement, (iii) the happening of any other specified event ;

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• (2) After the definition of “short period of training ” insert—

“total price” means the total sum payable by the person to whom goods are bailed or hired under a hire-purchase agreement or, as the case may be, the buyer under a conditional sale agreement including any sum payable on the exercise of an option to purchase but excluding any sum payable as a penalty or as compensation or damages for a breach of the agreement

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Clean Air Act 1956

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Restrictive Trade Practices Act 1956

17

For section 26(3) substitute—

(3) In this Part of this Act any reference to selling goods includes a reference to bailing or (in Scotland) hiring goods under a hire-purchase, agreement or to agreeing to sell the goods under a conditional sale agreement. In this subsection— (1) “conditional sale agreement” means an agreement for the sale of goods under which the purchase price or part of it is payable by instalments, and the property in the goods is to remain in the seller (notwithstanding that the buyer is to be in possession of the goods) until such conditions as to the payment of instalments or otherwise as may be specified in the agreement are fulfilled; and (2) “hire-purchase agreement” means an agreement, other than a conditional sale agreement, under which— (a) goods are bailed or (in Scotland) hired in return for periodical payments by the person to whom they are bailed or hired, and (b) the property in the goods will pass to that person if the terms of the agreement are complied with and one or more of the following occurs— (i) the exercise of an option to purchase by that person, (ii) the doing of any other specified act by any party to the agreement, (iii) the happening of any other specified event.

Housing Act 1957

18

For section 94 substitute—

(94) A local authority may fit out, furnish and supply any house erected, converted or acquired by them under section 92 of this Act with all requisite furniture, fittings and conveniences and may sell, or supply under a hire-purchase agreement or a conditional sale agreement, furniture to the occupants of houses provided by the local authority and, for that purpose may buy furniture. In this subsection— (1) “conditional sale agreement” means an agreement for the sale of goods under which the purchase price or part of it is payable by instalments, and the property in the goods is to remain in the seller (notwithstanding that the buyer is to be in possession of the goods) until such conditions as to the payment of instalments or otherwise as may be specified in the agreement are fulfilled; and (2) “hire-purchase agreement” means an agreement, other than a conditional sale agreement, under which— (a) goods are bailed in return for periodical payments by the person to whom they are bailed, and (b) the property in the goods will pass to that person if the terms of the agreement are complied with and one or more of the following occurs— (i) the exercise of an option to purchase by that person, (ii) the doing of any other specified act by any party to the agreement, (iii) the happening of any other specified event.

County Courts Act 1959

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Hire Purchase Act 1964

22

For Part III substitute the following (which reproduces the existing provisions of that Part subject only to changes in terminology)—

(27) (1) This section applies where a motor vehicle has been bailed or (in Scotland) hired under a hire-purchase agreement, or has been agreed to be sold under a conditional sale agreement, and, before the property in the vehicle has become vested in the debtor, he disposes of the vehicle to another person. (2) Where the disposition referred to in subsection (1) above is to a private purchaser, and he is a purchaser of the motor vehicle in good faith without notice of the hire-purchase or conditional sale agreement (the “relevant agreement ”) that disposition shall have effect as if the creditor’s title to the vehicle has been vested in the debtor immediately before that disposition. (3) Where the person to whom the disposition referred to in subsection (1) above is made (the “original purchaser ”) is a trade or finance purchaser, then if the person who is the first private purchaser of the motor vehicle after that disposition (the “first private purchaser ”) is a purchaser of the vehicle in good faith without notice of the relevant agreement, the disposition of the vehicle to the first private purchaser shall have effect as if the title of the creditor to the vehicle had been vested in the debtor immediately before he disposed of it to the original purchaser. (4) Where, in a case within subsection (3) above— (a) the disposition by which the first private purchaser becomes a purchaser of the motor vehicle in good faith without notice of the relevant agreement is itself a bailment or hiring under a hire-purchase agreement, and (b) the person who is the creditor in relation to that agreement disposes of the vehicle to the first private purchaser, or a person claiming under him, by transferring to him the property in the vehicle in pursuance of a provision in the agreement in that behalf, the disposition referred to in paragraph (b) above (whether or not the person to whom it is made is a purchaser in good faith without notice of the relevant agreement) shall as well as the disposition referred to in paragraph (a) above, have effect as mentioned in subsection (3) above. (5) The preceding provisions of this section apply— (a) notwithstanding anything in section 21 of the Sale of Goods Act 1893 (sale of goods by a person not the owner), but (b) without prejudice to the provisions of the Factors Acts (as defined by section 62(1) of the said Act of 1893) or of any other enactment enabling the apparent owner of goods to dispose of them as if he were the true owner. (6) Nothing in this section shall exonerate the debtor from any liability (whether criminal or civil) to which he would be subject apart from this section ; and, in a case where the debtor disposes of the motor vehicle to a trade or finance purchaser, nothing in this section shall exonerate— (a) that trade or finance purchaser, or (b) any other trade or finance purchaser who becomes a purchaser of the vehicle and is not a person claiming under the first private purchaser, from any liability (whether criminal or civil) to which he would be subject apart from this section. (28) (1) Where in any proceedings (whether criminal or civil) relating to a motor vehicle it is proved— (a) that the vehicle was bailed or (in Scotland) hired under a hire-purchase agreement, or was agreed to be sold under a conditional sale agreement and (b) that a person (whether a party to the proceedings or not) became a private purchaser of the vehicle in good faith without notice of the hire-purchase or conditional sale agreement (the “relevant agreement ”), this section shall have effect for the purposes of the operation of section 27 of this Act in relation to those proceedings. (2) lt shall be presumed for those purposes, unless the contrary is proved, that the disposition of the vehicle to the person referred to in subsection (1)(b) above (the “relevant purchaser ”) was made by the debtor. (3) If it is proved that that disposition was not made by the debtor, then it shall be presumed for those purposes, unless the contrary is proved— (a) that the debtor disposed of the vehicle to a private purchaser purchasing in good faith without notice of the relevant agreement, and (b) that the relevant purchaser is or was a person claiming under the person to whom the debtor so disposed of the vehicle. (4) If it is proved that the disposition of the vehicle to the relevant purchaser was not made by the debtor, and that the person to whom the debtor disposed of the vehicle (the “original purchaser ”) was a trade or finance purchaser, then it shall be presumed for those purposes, unless the contrary is proved, (a) that the person who, after the disposition of the vehicle to the original purchaser, first became a private purchaser of the vehicle was a purchaser in good faith without notice of the relevant agreement, and (b) that the relevant purchaser is or was a person claiming under the original purchaser. (5) Without prejudice to any other method of proof, where in any proceedings a party thereto admits a fact, that fact shall, for the purposes of this section, be taken as against him to be proved in relation to those proceedings. (29) (1) In this Part of this Act— - “conditional sale agreement” means an agreement for the sale of goods under which the purchase price or part of it is payable by instalments, and the property in the goods is to remain in the seller (notwithstanding that the buyer is to be in possession of the goods) until such conditions as to the payment of instalments or otherwise as may be specified in the agreement are fulfilled ; - “creditor” means the person by whom goods are bailed or (in Scotland) hired under a hire-purchase agreement or as the case may be, the seller under a conditional sale agreement, or the person to whom his rights and duties have passed by assignment or operation of law ; - “disposition” means any sale or contract of sale (including a conditional sale agreement), any bailment or (in Scotland) hiring under a hire-purchase agreement and any transfer of the property in goods in pursuance of a provision, in that behalf contained in a hire-purchase agreement, and includes any transaction purporting to be a disposition (as so defined), and “dispose of ” shall be construed accordingly; - “hire-purchase agreement” means an agreement, other than a conditional sale agreement, under which— (a) goods are bailed or (in Scotland) hired in return for periodical payments by the person to whom they are bailed or hired, and (b) the property in the goods will pass to that person if the terms of the agreement are complied with and one or more of the following occurs— (i) the exercise of an option to purchase by that person, (ii) the doing of any other specified act by any party to the agreement, (iii) the happening of any other specified events ; and “motor vehicle” means a mechanically propelled vehicle intended or adapted for use on roads to which the public has access. (2) In this Part of this Act “trade or finance purchaser” means a purchaser who, at the time of the disposition made to him, carries on a business which consists, wholly or partly,— (a) of purchasing motor vehicles for the purpose of offering or exposing them for sale, or (b) of providing finance by purchasing motor vehicles for the purpose of bailing or (in Scotland) hiring them under hire-purchase agreements or agreeing to sell them under conditional sale agreements, and “private purchaser” means a purchaser who, at the time of the disposition made to him, does not carry on any such business. (3) For the purposes of this Part of this Act a person becomes a purchaser of a motor vehicle if, and at the time when, a disposition of the vehicle is made to him; and a person shall be taken to be a purchaser of a motor vehicle without notice of a hire-purchase agreement or conditional sale agreement if, at the time of the disposition made to him , he has no actual notice that the vehicle is or was the subject of any such agreement. (4) In this Part of this Act the “debtor ” in relation to a motor vehicle which has been bailed or hired under a hire-purchase agreement, or, as the case may be, agreed to be sold under a conditional sale agreement, means the person who at the material time (whether the agreement has before that time been terminated or not) either— (a) is the person to whom the vehicle is bailed or hired under that agreement, or (b) is, in relation to the agreement, the buyer, including a person who at that time is, by virtue of section 130(4) of the Consumer Credit Act 1974 treated as a bailee or (in Scotland) a custodier of the vehicle. (5) In this Part of this Act any reference to the title of the creditor to a motor vehicle which has been bailed or (in Scotland) hired under a hire-purchase agreement, or agreed to be sold under a conditional sale agreement, and is disposed of by the debtor, is a reference to such title (if any) to the vehicle as, immediately before that disposition, was vested in the person who then was the creditor in relation to the agreement,

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Emergency Laws (Re-enactment and Repeals) Act 1964

23

In section 1—

• (1) In subsection (1) for “or credit-sale agreements, or under agreements for letting on hire ” substitute “conditional sale agreements, credit-sale agreements or hire agreements ”

• (2) For subsection (2) substitute—

(2) In this section — - “conditional sale agreement” means an agreement for the sale of any article under which the purchase price, or part of it is payable by instalments, and the property in the article is to remain in the seller (notwithstanding that the buyer is to be in possession of the article) until such conditions as to the payment of instalments or otherwise as may be specified in the agreement are fulfilled ; - “credit-sale agreement” means an agreement for the sale of any article, under which the purchase price or part of it is payable by instalments, but which is not a conditional sale agreement ; - “hire-purchase agreement” means an agreement, other than a conditional sale agreement under which— (a) an article is bailed or (in Scotland) hired in return for periodical payments by the person to whom it is bailed or hired, and (b) the property in the article will pass to that person if the terms of the agreement are complied with and one or more of the following occurs— (i) the exercise of an option by that person (ii) the doing of any other specified act by any party to the agreement ; (iii) the happening of any other specified event; and “hire agreement” means an agreement for the bailment or (in Scotland) the hiring of an article which is not a hire-purchase agreement.

Trading Stamps Act 1964

24

25

26

Housing (Scotland) Act 1966

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Trade Descriptions Act 1968

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29

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