Part VI Matters Arising During Currency of Credit or Hire Agreements
C175AF1Further provision for liability of creditor for breaches by supplier
1
If the debtor under a linked credit agreement has a claim against the supplier in respect of a breach of contract the debtor may pursue that claim against the creditor where any of the conditions in subsection (2) are met.
2
The conditions in subsection (1) are—
a
that the supplier cannot be traced,
b
that the debtor has contacted the supplier but the supplier has not responded,
c
that the supplier is insolvent, or
d
that the debtor has taken reasonable steps to pursue his claim against the supplier but has not obtained satisfaction for his claim.
3
The steps referred to in subsection (2)(d) need not include litigation.
4
For the purposes of subsection (2)(d) a debtor is to be deemed to have obtained satisfaction where he has accepted a replacement product or service or other compensation from the supplier in settlement of his claim.
5
In this section “linked credit agreement” means a regulated consumer credit agreement which serves exclusively to finance an agreement for the supply of specific goods or the provision of a specific service and where—
a
the creditor uses the services of the supplier in connection with the preparation or making of the credit agreement, or
b
the specific goods or provision of a specific service are explicitly specified in the credit agreement.
6
This section does not apply where—
a
the cash value of the goods or service is £30,000 or less,
b
the linked credit agreement is for credit which exceeds £60,260 F3and is not a residential renovation agreement, or
c
the linked credit agreement is entered into by the debtor wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by him.
F27
Article 60C(5) and (6) of the Regulated Activities Order applies for the purposes of subsection (6)(c).
8
This section does not apply to an agreement secured on land.