Are you saying that it is impossible to write a contract with someone that gives them authority to withdraw monies at various times in the future? I can instruct my bank to pay standing orders at any frequency I choose, however I have the right under banking code to cancel this instruction at any time. Unless there is a right to cancel a continuous payment agreement unilaterally there may well be no right to cancel without agreement. Is there legislation that allows this? I have heard that the CCA 1974 legislation doesn't actually cover it.
Of course it's possible to write a contract saying pretty much anything the parties want.
What I'm saying is that it is possible to decide to change one's mind in the future. It happens all the time. Whether you authorise something to happen, is simply a state of your mind at the time. So, it is effectively impossible for me to agree *now* that, in (say) 6 months' time I will have a mind to authorise a particular payment from my credit card. I simply cannot know how/what I will be thinking that far in the future.
It is exactly the same as agreeing, now, to send cheques every month into the future. I may fully intend to do so at the time of agreement, but may end up not doing so in 6 month's time.
There are consequences, of course, if I don't do (in the future) what I have agreed in advance to do - whether this be sending a cheque or authorising payment on credit card. One consequence may well be that I owe the retailer some money - and the retailer can then pursue this in the courts.
But I'm afraid that I cannot predict what my "state of mind" will be in the future, certainly not months (or even years) in advance.
So, credit card fraud would be allowed until it is *proven* to be fraud?
I'm afraid that if I found a fraudulent payment on my credit card account, I would refuse to pay it while an investigation was being done! [I'd pay the other, authorised, transactions of course.]
In general the subscriber and ISP will have entered into an agreement (i.e. contract) for the supply of services. That agreement may well not be cancellable unilaterally by the subscriber before its minimum agreed period except in extraordinary circumstances, such as the ISP being in material breach of contract.
This agreement will specify what payments are required and in the absence of breach there will never be any question that the amounts are in fact due.
Generally there is no such thing as a "continuous payment agreement", in the sense of it being a separate contract from the original service supply contract. There is merely an informal arrangement in place under which the subscriber has consented for the time being to give authority for repeated card payment requests. That arrangement not being consequent upon an agreement, there can be no question of unilaterally withdrawing the authority being in any way subject to consent by the ISP.
This is exactly the same as if it had originally been arranged to pay by Direct Debit, which can again be cancelled at any time, but without affecting the subscriber's obligation to pay elsehow.
It could, of course, have been a term in the original agreement for supply of services, that all payments would be by CCA and no other means, but it could be argued that such a term could be voided for being unfair in the UCT sense. I doubt whether that has yet been tested.
Consider the parallel case where it had been agreed (as a contract term) to pay by DD (and indeed receiving a discount for so agreeing). The customer then cancels the DD. Who's in the doghouse then? The answer would be clear: The subscriber would be in breach of contract.
So the answer in the CCA case depends primarily on the exact terms of the ISP service agreement. If it does not explicity specify that CCA shall be the only acceptable method of payment, then obviously the subscriber is free at any time to withdraw his card authority. If it does, then it might, as you say, only be possible subject to the ISP's consent, unless that contract term is deemed unfair.
At the end of the day, there's nothing really wrong with this, except in cases where the merchant involved is so dodgy that they're apt to help themselves to monies to which in fact they are not entitled. It appears that the proliferation of CCA merchants may be due to the fact that the vetting and accreditation procedures are simpler than those involved in being allowed to originate Direct Debits.
Any trader who helps themselves to funds to which they are not entitled can of course be pursued in the courts, both civilly and criminally, but this can be difficult if they're operating out of where they can't be traced.
But this still flies in the face of what really happens, i.e. the CC company still honour payments until the dispute process is over with. It seems just writing to them with proof of withdrawal of authority does not stop these payments by itself. Why not? Why have a costly (as admitted by the CC companies themselves) dispute process at all if this is all clear cut? And why is this not the method that consumer programmes advise should be taken?
Is it that the CC comapny does not actually know the content of the agreement between the parties and cannot tell whether a CCA agreement is the only agreed method of payment until they have evidence?
Me too, and I think that is the right way to do it as interest acrued would be compounded and eventually returned. If you paid and then got it back you've lost some compounded interest that you're entitled too.
Again I don't think this should happen, but it does. If you send a letter, at least to my credit card company, proving you had withdrawn authority from the retailer, then they still go through their dispute process before stopping payments. Wouldn't you say that's fraudulent too?
Because, as I've already said, I suspect they simply don't have the mechanisms in place to blacklist merchants on a per cardholder basis.
Just writing to them with proof of withdrawal will be enough to action a refund of the one or more payments referred to in a specific dispute, but meanwhile further new payment requests roll in, are treated in the normal way, can't be blocked on the way in, and will need to give rise to a *new* dispute. No wonder the queue lengths grow.
The clear-cutness simply makes the disputes easier to resolve, it doesn't stop them happening. And of course just because it's clear-cut doesn't mean the resolution will be instant, it still has to sit in the queue waiting to be looked at by the resolver.
I don't think so, because the card company is not a substitute for a court, and the only way to resolve a breach of contract issue would normally be through the courts. It seems unlikely that the card company would want to set itself up as some kind of mediator to try to knock the two parties' heads together and hope they sort things out amicably without proceeding to court.
Even if the contract between subscriber and supplier sets down that the customer shall not revoke card authority, then it should be *possible* (physically, not lawfully) for the customer to do so nevertheless (just as would be the case with a DD), whereupon it would be up to the supplier to sue the customer. Surely as far as the card company is concerned, all that matters is whether authority was in fact withdrawn, irrespective of whether such withdrawal constituted a breach of contract.
No. You're not being defrauded. You have a balance sitting on your card account, which will be cleared in due course, and in the meantime you're refusing to pay it. What's the problem?
One more thing. You said "they still go through their dispute process before stopping payments". I was under the impression they don't ever actually stop future payments, all they ever do is reverse wrong past payments. Do you have information to confirm or deny? Or do they just "have a quiet word" with the merchant and "persuade" them to stop issuing requests?
Ahh. I understand now,the CC company takes the risk. In fact, I think they get also paid per transfer by the retailer! (I bet they don't give that back if the transfer was in error either :-) Now this is all making sense.
I don't think I was right by saying they stop payments, just reconcile accounts after the fact as you say. After all they wouldn't know whether the authority had actually been re-affirmed or not, even for a specific transfer request.
Apologies for my posting in the wrong part of the thread, my proxy server is complaining about the reference field being too long!
As I pointed out earlier the OFT guidance on unfair terms states Terms are open to objection if they force the consumer to pay in full for goods or services regardless of whether there may be a legitimate complaint about them. Such terms can allow a business to take money to which it has no good claim, forcing the consumer unnecessarily to go to court to get it back, with all the costs, delays and uncertainties that involves. Section (vii) on page 8 of unfair.pdf downloaded from
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Therefore a standard contract is not allowed to set down that the customer shall not revoke card authority.
I am now going to bow my head in shame. I didn't realise the significance of this when originally posted. Now I'm clear: If the credit card company continues to allow monies to be taken and the consumer disputes it, then the credit card company cannot force the comsumer to pay these monies (or presumably any interest accrued on it), and they in effect take a risk by paying out monies that may later have to request be returned to them from the retailer.
FWIW, my CC company have confirmed that they'll be refunding the charge that the ISP took (after we'd given them written instructions to stop and they bungled it up).
For the record, to answer my own question, I've received confirmation from Alliance & Leicester that the premiums taken using my debit card are indeed on a CCA basis.
I can't remember, I haven't got a copy of the agreement, and didn't read through it, simply because I was sure CCAs only applied to credit cards, so I thought I was safe using the debit card.
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