Getting a Section 75 refund on a Season Ticket

[FenMan]

Interesting! How many other frustrated Southern customers will be disputing with their credit card companies that Southern hasn't provided the contracted service?

http://www.telegraph.co.uk/money/co...rail-chaos-wins-3k-back-credit-card-provider/

Commuter hit by Southern Rail chaos wins £2,400 back from his credit card provider: could you get a refund?

A disgruntled train passenger living on the Southern train route has managed to claim a £2,400 refund from his credit card company by citing a little-known clause in the Consumer Credit Act.

The payout could trigger a flood of similar claims from commuters who have paid for tickets with a credit card.

Under section 75 of the CCA, the credit provider is equally liable with the firm that offers the goods or services if things go wrong.

In this case the annual season ticket holder raised a claim with American Express on the grounds that Southern Rail had failed to deliver the service it promised.

The news was posted on the blog of the Association of British Commuters, a campaign group that seeks to represent "the interests of the public in the face of the rail crisis".

According to ABC, "Sean", the commuter involved, submitted the claim last August, once his season ticket had expired.

As part of his evidence, he included punctuality statistics for Southern Rail. He requested 50pc of his money back based on his estimation that......

 

[Merseysider]

Brilliant

And that's on top of any delay repay claimed, to boot.

 

[Master29]

Brilliant

And that's on top of any delay repay claimed, to boot.

I doubt you`d get both

 

[Camden]

My understanding is not that it is both, both either/or, and that the typical use for claiming chargeback is when you have tried and failed to get your money back off the company you dealt with, and that then the CC company pursues the company for the amount they've had to pay you.

Hopefully that is the case, because perhaps credit companies chasing railway companies for many millions of Pounds on behalf of let down consumers might have more of an effect in seeing that they actually do provide the train services they're paid to.

 

[35B]

My understanding is not that it is both, both either/or, and that the typical use for claiming chargeback is when you have tried and failed to get your money back off the company you dealt with, and that then the CC company pursues the company for the amount they've had to pay you.

Hopefully that is the case, because perhaps credit companies chasing railway companies for many millions of Pounds on behalf of let down consumers might have more of an effect in seeing that they actually do provide the train services they're paid to.

What is interesting is that American Express have stumped up for something more onerous than the Conditions of Travel, which may make their discussion with GTR quite interesting. It may or may not be relevant that American Express are Brighton based.

Also, if this does set a precedent, it will be interesting to see what happens to the ability to use credit cards for ticket purchases - and what that may mean. Those of us having to purchase tickets using credit cards for business, or who are not prepared to use debit cards online, may find that we are reluctant to use the train in these circumstances.

 

[island]

Early observations:

1. This compensatory amount would not be cumulative with payments of a similar nature such as DelayRepay
2. A passenger who has bought an item or service costing between £100 and £30,000 has the right to address non-compliance with the contract of sale through their card company first and has no obligation whatsoever to attempt to resolve first with the merchant
3. American Express is far more customer-centric than most other issuers and I would be surprised to see many follow their lead
4. There are plenty of technicalities which have to be satisfied to claim this way

 

[paddington]

Amex has a close relationship with BA and if BA charges you a fee that it shouldn't have, Amex is good at getting the money back for you. Interesting suggestion that being Brighton-based, Amex might be a bit more aggressive with GTR

All Section 75 means that the card company is equally liable with the merchant for purchases with a total amount between £100 and £30k regardless of the amount paid by card.

One would need to buy the ticket directly from Southern. Using trainline or any other TOC website would not work.

 

[35B]

One would need to buy the ticket directly from Southern. Using trainline or any other TOC website would not work.

Is that correct? I thought that purchase through an agent still left the contract between the ticket purchaser and the train operator.

 

[najaB]

Is that correct? I thought that purchase through an agent still left the contract between the ticket purchaser and the train operator.

The contract for carriage, yes. But the initial transaction was between the customer and retailer and (I could well be wrong about this) that's what matters for Section 75.

 

[Camden]

Maybe we might find that CC companies start refusing to process large train ticket payments, at least for some companies, then, if they are on the hook for the failure.

That could also be a very interesting development.

 

[island]

The contract for carriage, yes. But the initial transaction was between the customer and retailer and (I could well be wrong about this) that's what matters for Section 75.

You are correct. Section 75 liability depends on a lot of technical points, so a ticket bought from a third party would not qualify. And a ticket with Travelcard entitlement would be difficult.

 

[talltim]

You are correct. Section 75 liability depends on a lot of technical points, so a ticket bought from a third party would not qualify. And a ticket with Travelcard entitlement would be difficult.

Much discussed in this thread
http://www.railforums.co.uk/showthread.php?t=139311

 

[MikeWh]

You are correct. Section 75 liability depends on a lot of technical points, so a ticket bought from a third party would not qualify. And a ticket with Travelcard entitlement would be difficult.

Given that the total price paid last year was £4800 and the current price for a Hassocks to zones 1-6 is £4936, I'd say that the travelcard element didn't pose that much of a problem.

 

[35B]

Much discussed in this thread

http://www.railforums.co.uk/showthread.php?t=139311

Noted, but I'm still unclear what contract the credit card provider is jointly liable for - or that American Express consider to have been breached.

 

[philthetube]

As I understand it if you buy through an agent that agent has the liability.

If you buy a holiday through a travel agent there is not a problem and I cannot see why a train ticket should be any different, you could conceivably buy them both from the same agent.

 

[talltim]

I can see this causing loads of work for CC companies and TOCs

 

[maniacmartin]

As I understand it if you buy through an agent that agent has the liability.

Usually, yes. However, the very first numbered paragraph of the National Rail Conditions of Travel says differently:

1 When you buy a Ticket to travel on scheduled train services on the National
Rail Network you enter into a legal Agreement with each of the Train Companies
whose trains your Ticket allows you to use.

My guess is that 'Sean' was a valuable customer to Amex and someone they wanted to hold on to. I can't see many other credit card issuers being that interested in paying out in a similar way for the majority GTR commuters without a battle.

 

[LowLevel]

Bear in mind the Consumer Rights Act has effectively rendered the amounts stipulated in the NRCoT meaningless, should someone choose to claim against them, for all sorts of little things, and that the RDG is well aware of this and staff have been briefed accordingly.

 

[paddington]

As I understand it if you buy through an agent that agent has the liability.

Yes, but the point of Section 75 is that for qualified purchases, the credit card company has joint liability with the merchant. As I understand it:

If you buy a ticket from (e.g.) Northern for travel on Southern (that costs over £100) then the credit card company and Northern have joint liability to provide you with the ticket to travel on Southern. By obtaining the ticket, the purchase contract has been fulfilled.

If Southern does not provide the travel, Northern may have responsibility to refund under industry guidelines, but the CC company has done its part of paying Northern to pay Southern.

If you buy a ticket on Southern directly, then the credit card company and Southern have joint liability to provide you with the travel, provided Southern has not done something sneaky like saying you are not actually entitled to travel and only entitled to a ticket. If Southern doesn't provide you with the travel, the CC company can also be held liable.

If you buy a holiday through a travel agent there is not a problem and I cannot see why a train ticket should be any different, you could conceivably buy them both from the same agent.

It's not as simple as saying "there is not a problem"

A credit card company might successfully argue that you paid a travel agent to plan a holiday and thus refuse a Section 75 claim on the basis that you received the service of planning and booking the different parts of the holiday. Whereas if you buy a package sold by the travel agent it may be different.

There are several kinds and levels of protection for travel agent packages, which are described at https://abta.com/tips-and-latest/protecting-your-holiday-and-travel-plans

 

[35B]

Yes, but the point of Section 75 is that for qualified purchases, the credit card company has joint liability with the merchant. As I understand it:



If you buy a ticket from (e.g.) Northern for travel on Southern (that costs over £100) then the credit card company and Northern have joint liability to provide you with the ticket to travel on Southern. By obtaining the ticket, the purchase contract has been fulfilled.



If Southern does not provide the travel, Northern may have responsibility to refund under industry guidelines, but the CC company has done its part of paying Northern to pay Southern.



If you buy a ticket on Southern directly, then the credit card company and Southern have joint liability to provide you with the travel, provided Southern has not done something sneaky like saying you are not actually entitled to travel and only entitled to a ticket. If Southern doesn't provide you with the travel, the CC company can also be held liable.

Leaving aside the logical absurdity of treating a contract entered into for the purpose of travel as being met by provision of the document permitting that travel, I'm confused as to how in the railway circumstances where the contract entered into specifically states that it has been entered into with both the retailer and the operator, the contract could be considered completed.

 

[najaB]

Leaving aside the logical absurdity of treating a contract entered into for the purpose of travel as being met by provision of the document permitting that travel...

There's a subtlety that I think you may have missed. When you purchase a season ticket there are two contracts involved. (Pardon the inaccurate use of language, I know what I want to say but can't quite express it clearly).

Consider what happens if you purchase the season ticket through an agent - e.g. The Trainline. The first contract is between you and The Trainline, they act as your agent to do the needful to get a season ticket created and delivered to you. Once the RDG accepts your money and prints the ticket, there is a second contract for transportation between yourself and the TOCs on whose trains that ticket is valid.

When you receive the ticket, The Trainline has fulfilled their contractual obligations. If you subsequently are unable to travel (e.g. due to strikes) your redress needs to be from the TOCs concerned, not from The Trainline.

 

[35B]

There's a subtlety that I think you may have missed. When you purchase a season ticket there are two contracts involved. (Pardon the inaccurate use of language, I know what I want to say but can't quite express it clearly).



Consider what happens if you purchase the season ticket through an agent - e.g. The Trainline. The first contract is between you and The Trainline, they act as your agent to do the needful to get a season ticket created and delivered to you. Once the RDG accepts your money and prints the ticket, there is a second contract for transportation between yourself and the TOCs on whose trains that ticket is valid.



When you receive the ticket, The Trainline has fulfilled their contractual obligations. If you subsequently are unable to travel (e.g. due to strikes) your redress needs to be from the TOCs concerned, not from The Trainline.

Thanks. I follow that logic for a non-TOC booking agent, but not for a purchase from a TOC which is itself party to the NRCOT - even where that TOC is not providing any of the travel.

 

[najaB]

Thanks. I follow that logic for a non-TOC booking agent, but not for a purchase from a TOC which is itself party to the NRCOT - even where that TOC is not providing any of the travel.

It's the same logic - there are still two contracts, one to provide the ticket, the other to provide travel. The credit card company would be within their rights to say "You got your ticket, any refund has to be from the transportation provider through their refund mechanism".

 

[35B]

It's the same logic - there are still two contracts, one to provide the ticket, the other to provide travel. The credit card company would be within their rights to say "You got your ticket, any refund has to be from the transportation provider through their refund mechanism".

Hmmm. Noted

 

[talltim]

And of course a season ticket (or any ticket) may involve multiple contracts for transport with multiple TOCs, whoever you buy it from

 

[Abpj17]

It may or may not be relevant that American Express are Brighton based.

Yes, I wondered that too. I also wonder whether - as a card with a lower market share - whether it was a cunning ploy to get 'free' advertising.

 

[island]

Just to confirm from a finance industry point of view that najaB is 100% correct.

Another example is if you pay for a ticket (or indeed anything) with PayPal. The service you purchased with the card is a payment being made on your behalf and you can't claim S75 protection on whatever it was you were buying.

 

[Panda]

Several posts here seem to suggest that it is Amex who will bear the loss here - it is most likely not, it will be the merchant as Amex will simply charge the refund straight back to the merchant.

 

[35B]

Just to confirm from a finance industry point of view that najaB is 100% correct.



Another example is if you pay for a ticket (or indeed anything) with PayPal. The service you purchased with the card is a payment being made on your behalf and you can't claim S75 protection on whatever it was you were buying.

Thanks for the clarification of what is the case, as opposed to what I might assume should be the case.

 

[island]

Several posts here seem to suggest that it is Amex who will bear the loss here - it is most likely not, it will be the merchant as Amex will simply charge the refund straight back to the merchant.

Probably a bit more complicated than that. Chargebacks have a 120-day limit from the date of purchase.
--- old post above --- --- new post below ---

Thanks for the clarification of what is the case, as opposed to what I might assume should be the case.

Indeed. One shouldn't lose sight of the fact that the 1970s legislation in question hasn't quite kept pace with developments in commerce.