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UKSolicitorJA, Solicitor
Category: Law
Satisfied Customers: 4312
Experience:  English solicitor with over 12 years experience
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Client signs with an PPI management company(refered to the

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Client signs with an PPI management company(refered to the CO hereinafter)to pusuue a PPI claim against bank with 25% fee for any money recovered. After several months the client found unprofessional management & errors by the CO & cancelled verbally the agreement . Client then pursues the Bank direct & completes a complaint form to the Financial Ombudsman( FOS) . After 12 months and constant checking wih the FOS the Bank accepts the Clients claim and refunds with cheque direct to Client. After no communication at all from the CO with Client or with the FOS or Bank (after it initially rejected the claim put in by the CO) the CO has put in invoice for full 25%. The Client states there is no debt , the CO is now threatening Court Summons. Does Client resist or negotiate a compromise ?

If the client cancelled the contract with the CO validly, then the client is not liable to pay any fees to the CO as the contract was cancelled due to poor service from the CO.

The CO is obliged to,provide the service with reasonable care and skill and in a reasonable time period under the Supply of Goods and Services Act.

If it did not do so, as appears here, the client should defend any claim brought by the CO and not offer to compromise unless it is for a token sum.

The claim was successful as a result of the client's initiative, not the COs.

Hope this helps
Customer: replied 4 years ago.

Thanks for reply. The Cancellation agreement states "Cancellation of Agreement can be made within 14 days in writing of the date it is signed. After this date our fee of 25% will apply on any offer that has been made in writing or verbally to eithr ourselves or the Client". My argument here is that errors & mismanagement by CO relating to the Client business was found several months after 14 days of signing the agreemen, As CO did not pursue the claim to the best inerests of the Client (which is stated as one of COs responsibilities under the agreement) the Client verbally cancelled agreement to which no objection was made or a cancellation fee mentioned.

Do you still uphold your original advice

Yes, my advice still stands although the final say will rest with the court.

You may argue that the cancellation clause is unfair and unreasonable in the circumstances and should not be held up by the court.

Hope this clarifies.
Customer: replied 4 years ago.

Finally I hope last question. The law firm representing the CO is suggesting that if Client continues to dispute all or any part of the debt the dispute will go to alternative resolution (ADR) in an attempt to settle the matter.

Is that procedure OK or should I go to court.


Thanks John Palmer

That is normal as the courts prefer that parties settle out of court as far as possible.

You may accept to go for ADR.

All the best
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