Case Studies Compensation Summary

Transcription

1 Issue 06 Case Studies Compensation Summary September 2011 Number Reference Case Study name Subject 1 Compensation Compensation to Bill shock C was shocked by a bill for 2, for use of 3G services to download data whilst on holiday. She acknowledged her son used the phone whilst the family were on holiday and that she had received a warning about the high charges being incurred. T highlighted information on charges, setting up the 3G phone and warning services they provided. Found. T s evidence about all the information they provided, particularly about setting up the 3G device, was compelling. C s claim to be released from an obligation to pay the charges failed Bill shock C ran up a bill of 4,00 for data roaming in Egypt. He said that he had never authorised international roaming and the charges were exorbitant, especially as much of the activity had been 'unintentional'. The EU regulations on roaming applied so the charges should be capped. T maintained that C did authorise it, he had been charged for and paid for international roaming at the same rates on an earlier trip abroad (Columbia), the charges applied were the company's published charges, C was responsible for the phone settings (e.g. checking s and social networking sites) responsible for 'unintentional' roaming and there were warnings about the costs of data roaming in the User Guide and on the iphone when the roaming facility was turned to 'on'. Found. The charges formed part of the contract price for the available services. Roaming regulations did not apply to roaming in Egypt. C had authorised international roaming and T had provided adequate warnings Bill shock C incurred extremely high charges for accessing data whilst in Turkey which she wished to have reduced or set aside. She maintained that she did not enable data roaming on her handset, she was never informed of the rates for data roaming charges and she did not use her phone to any greater extent than normal while she was in Turkey. T asserted that the charges were correct, data roaming was automatically turned off on the customer s handset which necessitated her actively turning it on, and that the rates for data roaming are clearly set out in its pricing literature. 1 The customer is referred to as, C, and the communication and internet service provider as, T. 1

2 Found. C s claim failed. She was liable to pay the data roaming charges incurred on her account because the charges for data roaming in Turkey were made clear to C when she entered into the contract with T. C actively turned on data roaming on her handset in spite of warnings about the high rate of data roaming charges she would incur. She admitted to having used data whilst in Turkey, and the bills confirmed the extent to which C used data whilst she was abroad Bill shock C had his phone stolen from his boat in Antigua while he was away. In 10 days a huge bill was run up. T received reports of unusual activity on the phone and blocked the account, but by then it was too late. C said it was T s negligence for not detecting the unusual activity and the bill should be reduced to zero. T maintained that C should have protected his SIM by a password. Found. While things might be different in EU as a result of the roaming regulation, or because of extenuating circumstances (such as where C was unable for reasons beyond his control to contact T), there were no facts indicating why C should not pay. The adjudicator recommended that T abide by its offer of a 50% reduction in the bill Bill shock C was shocked to receive a bill for more than 25 in one month and believed that he was being incorrectly charged for calls to particular mobile numbers. T asserted it had correctly charged the customer and that its pricing guide stated the mobile numbers called were not charged as UK mobile calls. Found. C s claim was unsuccessful as T had neither breached any term of its agreement with C nor failed in the duty of care it owed to him Bill shock C's SIM card had been stolen whilst he was in Ghana on a business trip although he was unaware of the theft as he used a different international SIM card during his trip. He was shocked to receive a bill in the region of 1,00. C argued that T should bear the cost of the fraudulent calls as it failed to block his SIM card after the first few fraudulent calls were made and had allowed charges to escalate. T asserted the contract clearly stated that C was responsible for the safe keeping of the SIM card so C should be liable for call charges incurred on his account up to the point the account had been suspended due to high international usage. Found. C failed to report the SIM card had been stolen. There were no extenuating circumstances which warranted the terms of the contract being set aside. The contract made C liable for the charges incurred on his account, despite the unfortunate circumstances of the case. It was recommended that T abide by its offer to reduce the charges by 20 and arrange a payment plan to allow C to pay off the balance in instalments Bill shock C and her husband went on holiday to America. Upon their return they received a bill for 2,97 which arose mainly from data charges which were applied through the use of her husband s iphone. C maintained that her husband did not use his iphone, in any event T should have placed a bar on the account and the iphone should not be able to automatically connect to the Internet when it was not being used. Found. C s claim was dismissed. The evidence identified that the SIM card within the iphone had made the data connections. As a consequence the charges were properly applied. There were sufficient information and warnings given by T about the potential for such charges to arise Bill shock C wanted T to refund about 1,20 on the basis that T had wrongly charged the customer s account and had not followed C's request (made through an agent) to remove iphone data bundles from a number of mobile phones. T s account note recorded at the time of the request was different to that which C thought had been requested. Found. T had simply acted on an instruction relayed to it by C s agent. C had failed to establish an error by T. The onus was on C to produce the written instruction given to T. Having failed to do so and in the light of an admission by C that in any event T would have calculated data charges correctly in line with its current price guide, there was no basis for C seeking a refund. 2

3 Bill shock C claimed that T had wrongly billed her 20 for calls not made by her household including calls to India and Italy. T argued that the bill was correct as it had carried out diagnostic tests and found no fault or mistake. Found. C had provided no evidence to support the claim. The tests carried out by T showed that the calls were made from C's landline. Under the terms of the contract C was responsible for calls made using her landline with or without her knowledge. The claim failed Bill shock C was shocked to receive an exceptionally high bill after he had returned from holiday in Pakistan. Before travelling, he had contacted T about roaming charges and mobile internet charges. In Pakistan C tried his best not to use the facility and disconnected the mobile internet because where he was staying had free broadband. He believed that the amounts he had been charged by T were incorrect and excessive. T pointed out that switching off data roaming was something which would be done by C. T provided a number of offers and services in connection with using data roaming when abroad. It also sends a text message when the phone is first connected to a foreign network giving details of costs. It sends additional messages to its customers should they continue to use data. Found. C s claim failed. T had correctly calculated the bill and had acted in accordance with the terms and conditions of the contract Price plan C contracted a phone and broadband service from T but her recollection of the price plan differed from that of T. She contended that monthly bills did not reflect her recollection of the plan and the bills should be reduced by 20. T contended that the bills were correct. Found. The price plan described by T was more advantageous to C than her recollection. Bills conformed to the price plan. However, T had not responded very well to C s complaints and questions. There was a breach of the duty of care and nominal compensation was awarded for inconvenience Bill shock C used premium rate multimedia services which he thought were included in his package and ran up a bill of in a month. T had offered to reduce the charges to 25 and give C 6 months to pay in instalments at 14 per month. C did not agree as he could not afford this amount although T had informed a debt collection agency that C had agreed and it applied a termination charge of C contended that he had received poor customer service. Found. T had been in breach of its duty of care to provide a reasonable customer service. 4 compensation was awarded reducing the bill to ( ). As the entire contract value was 84 ( per month x 24 months) and C had almost reached this in charges of , applying a termination charge of was excessive, so the termination charge should be waived. C should pay off the balance in instalments: followed by 23 monthly payments of Upon receipt of the first payment of 61.59, T should remove the account from the debt collection agency and reset C s credit file default :08 Overcharging C overcharged and suffered inconvenience because T delayed cancelling service. Found. T had not provided reasonable customer service. T apologised and explained a mistake had been made :13 Dispute over 3 C upgraded to broadband service from dial up service which T continued to charge for. Found. T had not properly explained its services and not provided CISAS reference number. Dispute over C should bear some responsibility for pursuing such small sum and not acting sooner to stop the double charging :06 Television service C was without broadband and television for six weeks. CISAS not normally consider complaints about television services but T agreed to use the scheme. C claimed compensation of more than 1,70 calculated at his hourly business rate

4 Found. C had suffered frustration by T s breach of duty of care to provide reasonable customer service. Not appropriate to use C s business rates to calculate compensation for a domestic service :10 Broadband service T did not accept termination of contract by C. Termination in accordance with the Consumer Protection (Distance Selling) Regulations Found. T directed to either cancel the service and put a cease on C s phone line or give C a MAC so that he could go to another ISP, whichever of these two options could be achieved quicker :02 Broadband service speed C gave clear evidence of a service promised by T but not provided. Found. Neither C s requests for assistance nor C s complaints had received appropriate responses from T. C suffered inconvenience. T directed to release C from his contract without penalty :05 Broadband trial Consumers duty to ensure they understand and can utilise the services requested and software provided. Found. C did not take care to read contract terms and conditions and confused between dial up and broadband services. T issued confusing literature, failed to properly investigate complaint and tried to force C to pay for a year s broadband service that C could not benefit from :06 No defence: overcharge T unilaterally and erroneously upgraded C s broadband package and tariff resulting in overcharges to C. Found. C s evidence credible as supported by bills, s and letters from T. C was entitled to terminate the contract and be discharged from it without any penalties. C s modest claim for 10 was sufficient to compensate him for the anxiety and inconvenience he had gone through Charges C making many telephone calls and writing many letters but T gave poor customer service. Found. Breach of the duty of care by T to C :02 Moving house C cancelled broadband and telephone as he was moving house. He was due a small credit of Nothing happened, the credit was not paid and T continued to bill for the unwanted service being provided to the old address of C. C was concerned that non-payment would lead to credit blacklisting. Found. C s claim succeeded :05 18 weeks without internet After 18 weeks C was without a broadband service as T tried unsuccessfully to deal with connection problems but T continued to deduct a monthly subscription. C was frustrated trying to contact T to the extent that C telephoned T s helpline at 4.30am in the morning as it was the only time she could get through. C suffered anxiety and inconvenience caused by the failings of T. Found. C s claim succeeded :02 Direct debit C decided to terminate his services with T and move to another service provider. T disconnected his services early without authorisation, re-instated the direct debit without C s authorisation and took two payments from his account. Found. C s claim succeeded :10 Services not transferred to new home in time T did not transfer its telephone and broadband service to C s new home by an agreed date. Found. C s claim succeeded

5 25 08:12 Poor service T, without C s authorisation, upgraded C s broadband service accidentally making C s address inoperable. T took 76 days to restore the service. When C phoned T to cancel the anti-spam package on the service, T cancelled the whole account and refused to reinstate it. Found. T had not provided a reasonable service :06 Broadband service failed 27 13:03 Not supplying broadband 28 05:03 Reasonable procedure not followed Broadband connection failed. T tried unsuccessfully to find a fault and restore the service. T agreed to cancel the contract, offered to reimburse the monthly fees which had been paid by C and cost of calls made to technical support team. C refused the offer and claimed cost of all telephone call charges, car parking and bus fares in lieu of on-line shopping, mobile top-ups and 100 for time, stress and the unsatisfactory customer service. Found. There was no evidence to support the customer s claims for car parking, bus fares or mobile top ups but the adjudicator directed the company to pay the customer 15 for identifiable telephone calls and 20 for stress and inconvenience. Very slow broadband speed at C s new home. Remedial work was undertaken by T who then said they could do nothing to improve service. Six months later C discovered that T had not been supplying broadband to his home. C cancelled the service and sought a subscriptions refund. T promised a refund but it was never received by C. Found. The compensation claimed by C was appropriate. C ordered a broadband service but was unable to connect. Found. T knowingly failed to provide a service, did not follow its own procedures to refer problem to second level team and attempted to deny C access to a means of resolving the dispute both technically and administratively while at the same time charging for that service causing C inconvenience :08 Wrong debts C had broadband service for less than 1 month. T continued to debit C s bank account each month. C was forced to close her bank account to stop monies being taken. Found. T was directed to refund C all disputed sums debited from C s bank account and pay compensation :09 Inconvenience damages 31 13:09 Moving broadband providers Agreement for services by which C would have enjoyment, peace of mind and would not be overcharged. T overcharged C at mobile phone rates instead of landline rates for calls to Jamaica. T took more from C s bank account on a direct debit than C expected, resulting in bank making an extra charge because there was not enough money in C s account to cover it. Found. C inconvenienced by T s failure. C terminated contract before moving to next door property. C arranged for broadband services at his new property with a different service provider. A short time after receiving a bill from T for alleged outstanding charges C s new broadband connection was suspended. Debt collectors pursued the customer. T acknowledged they had confused C s account but they had no record of C cancelling the contract. T apologised. Found. T was directed to cancel the outstanding bill, to instruct their debt collection agents to stop pursuing C, to pay C s reasonable set up costs with another broadband provider, to investigate and explain in writing why C s line was cut off and to pay compensation :08 Porting a number C had been promised by T that he could port his number to his new address but the number was not ported. Found. C s claim succeeded :08 Compensation for C lost landline phone for two weeks and broadband for four weeks. T accepted there had been a service failure as well as poor 30 5

6 lost landline and broadband customer service and offered 300 compensation which C rejected, claiming 1,00. Found. T s offer of 30 was reasonable :03 Hard of hearing C was hard of hearing and found it difficult to communicate with T by telephone. C used T s Anytime service, opened a different account then requested termination of the account. T took 6 months to terminate the account which was far too long. Found. C was disadvantaged when seeking technical support from T because he was continually referred to a telephone help line when he had difficulty in hearing what was being said to him :08 Providing broadband C took up T s broadband offer which could consolidate his three dedicated lines for home telephone, fax/telephone and computer into two lines, giving an improved level of speed and service without inconvenience. C requested the broadband service be provided on his dedicated home computer line but T provided it to the dedicated home telephone line. Found. It cost C more money for a service he did not receive, he spent a significant amount of time trying to sort out a problem not of his making and he was inconvenienced :10 Broadband in noncable area C asked T to transfer broadband service to his new home. As C was moving to a non-service area she was told by T to obtain a line from others and then broadband could be provided over that. C did so, but broadband service was never provided by T. Bills accumulated at the old address. C terminated the contract after being without broadband service for more than six months. Found. The order went through another division of T but there were problems between T s divisions. T was directed to apologise and pay compensation :04 No broadband C s broadband service disconnected by T due to telephone line (owned by another provider) being upgraded. The telephone line could not take the enhanced service. Found. T could not use problems with the line as an excuse to avoid responsibility. If a provider fails to provide what has been agreed and charged for it is in breach of contract and has no right to demand or to take money for something it does not provide. Exclusion clauses in the contract were void under the Unfair Contract Terms Act 1977 and the Unfair Terms in Consumer Contracts Regulations T was directed to cancel its contract with C, remove its marker from the telephone line, repay all sums paid by C after the broadband service failed, cancel any outstanding invoices and pay C compensation. The stress exacerbated C s psychiatric condition; compensation for personal injury was outside the scope of CISAS :01 Mis-selling unsuitable package C, represented by his daughter, was over 80 years old and died during the course of the application to CISAS. Found. T had not properly charged him, not provided details of the agreement between them and had mis-sold him a package which was not suitable for his needs :10 Bills paid late C had made late payments and failed to pay outstanding sums in the correct manner. Payments were incorrectly allocated by T to another account; T neither recorded communications with C, nor amended its records, nor advised debt collection agencies nor corrected credit references. As a result C was refused a credit card, refused a bank account move and had a County Court judgment entered against him. Found. T was responsible for C s losses :01 No phone service after 14 months C retired from his firm and continued to use his business account for residential purposes. He was not told that this was a problem when he opened a new broadband and telephone account with a second company. Broadband was connected immediately but the telephone service remained unconnected after 14 months. C complained he had had to pay charged by the first company for calls because he still had to use their telephone service. The second company maintained that it was only

7 when they had received the CISAS claim that they had been made aware C s account was a business account with another company and this was the reason why they could not connect his telephone service. Found. The second company should have realised at some point over the 14 months why they could not connect their telephone service to Cs home and advised him accordingly. Instead they continued to state that the service would be connected and at times had told him that it had actually been connected :02 Renewal letters T s two renewal letters were confusing, T had not made it clear which service plan and charges applied to C. C believed he had been overcharged. T s complaint procedure was poor and confusing, also C s letters were not responded to. Found. For T to apply a debt recovery procedure was wrong, as C had been a long standing customer and the dispute was genuine. It caused C distress and inconvenience and affected his credit rating. T was directed to apologise to C, pay compensation, amend C s payment record to show that there has been no bad debt and reinstate C s former credit rating :07 Cancelling contract after serious injury C placed an order for broadband via the web. Before any equipment arrived she was badly injured. In hospital for one month and was still incapacitated when she left hospital. During the time that C had been in hospital she missed the broadband equipment delivery which had been returned to T. A month later C asked T to cancel her contract. Ty asked for payment of 5 for phone calls. C disputed the charges, maintaining she had never requested phone services and, even if she had, the contract was not finalised as she had not received a confirmation from T. C requested a copy of the bills and the contract but T failed to provide them, instead instructing debt collectors. Found. There was a contract for phone services made via the web. C should pay for phone calls. T had also acted reasonably in offering to cancel the debt, recognising they had not answered C s request for copy bills. However T had not compensated C for the inconvenience caused, especially by wrongly instructing debt collectors :05 Paid for assistance Broadband connection problems. C made at least 10 expensive calls for T s technical support, their engineers admitted they were unable to solve the problem. C paid for assistance to solve the problem and then claimed the cost from T. T refused, maintaining if a customer decides to get help outside of T s broadband support options in resolving a problem then it is up to C to meet the associated costs. Found. C had acted reasonably as she had given T every opportunity to put the problem right. T was directed to pay compensation :35 Banking error C paid a cheque to settle an account due on time. After T knew the monies had cleared. Found. T unreasonably barred C s service and instructed debt collectors, this wasted C s time for which C was entitled to compensation. No compensation for business losses as C had not proved them and T did not know the service was for business use :18 Communications provider transfer 46 12:07 Paying to avoid poor credit rating. CISAS rule 5(g) applied C placed an order for broadband which she cancelled a month later as she was entitled to do. T took five weeks to transfer C s line to another communications provider during which C did not have internet access; also C was without phone access for several days. Found. T was directed to reimburse C for phone charges and pay compensation. C paid an overcharge of by cheque and the account ended but T pursued her via its debt collectors, who forced her to pay again. Found. C had been confused and frightened about her credit rating and what the debt collectors would do. A rebate of 64 was due for overcharging, a refund of fees due to poor service, 3 compensation a month for inconvenience caused by poor

8 service plus 15 for upset and inconvenience caused by the company s negligent instruction of debt collectors. However, under CISAS rule 5(g) the award was limited to the amount claimed by C, which was :06 Mobile barring service Compensation to :06 No internet connection C paid for a mobile barring service on her landline to avoid her son incurring high bills. T had not assisted C when she asked if call barring was working although T s records showed they knew it was being avoided. T had not barred calls to mobiles. T had billed 4 months late which meant C did not appreciate the costs she was incurring. Found. C s claim succeeded. Product of another provider used by T on C s telephone line caused loss of C s internet and service. T debited C s debit card with monthly subscriptions without C s permission. Found. T s action highly inappropriate. T was directed to refund C the monthly subscriptions, release C from the contract without any payment, provide a MAC, remove any offending products from line and ensure C s credit rating was not adversely affected Unauthorised access Cost of unauthorised access to C s telephone, broadband and television cables added by T to C s bills. C asked T to terminate the services and investigate who was accessing the cables. Found. T did little to help and failed in its duty of care. T was directed to suspend C s services at no cost to C, liaise with C and carry out a detailed investigation into C s problems, suspend the actions of debt collection agency pending results of the investigations and pay compensation Billing and wrong use of direct debit 50 13:08 Account not terminated C succeeded in a billing complaint against T and awarded 60. T then took more money by direct debit from C. Found. C s complaint succeeded. T s actions were an extremely serious breach of contract and duty of care. C sent letter terminating two telephone accounts. T s records showed only one contract was to be terminated, this they did and chased C for payment of the other account. C s credit record was blighted. Found. The letter referred to both accounts. Extremely serious thing to publicise an alleged credit default because it can damage C s personal reputation, and ability to pay his way through life. It is to be expected that C will suffer from a bad credit entry. It is fair and reasonable to compensate customers for the mere fact that a wrong entry was made, regardless of whether they suffer actual financial loss as a result. Compensation awarded and T was directed to give an explanation and a full apology :14 Inaccurate records T billed C in one month. Found. More likely than not C did not make all the billed calls because of their timings and sheer volume. Serious doubts about the integrity of T s records. 602: :03 Two accounts set up accidently 53 10:07 Lost business revenue A duplicate account had accidentally been set up when an earlier broadband problem had been resolved. C was unaware that an additional direct debit was being taken by T and had not authorised any additional payment. Found. C s claim succeeded. A full repayment should be made by T to C. C experienced problems with mail forwarding which T failed to resolve. C asked for a smooth domain transfer which T took 3 months to confirm. Breach of contract or a breach of duty of care by T. C estimated lost business revenue of more than 30,00 and claimed the maximum of 5,00 under CISAS but failed to submit evidence supporting the amounts. Found. Compensation awarded only for inconvenience and the time and energy expended by C in trying to get the problem

9 resolved :01 Inadequate broadband and defective router Defective router and inadequate broadband service for about a month. The router caused breaches of security by making the contents of C s computer available to other users. C (who was studying for his exams at the time and needed the internet to prepare) was badly affected by the countless attempts to make the service work with the assistance of T s technical department. T was directed to pay compensation for lack of service, vexation and inconvenience. 75 Compensation 1,00 to 5, :07 Creating problems T created problems by wrongly invoicing C annually in advance, making billing mistakes, not providing accurate bills, wrongfully suspending services, not efficiently using the direct debit facilities given by C and instructing debt collectors. Found. C endured inconvenience and the cost of having to repeatedly correspond with T together with vexation through loss of services :25 Fraud C informed T of fraudulent use of mobile phone number to make calls to many countries associated with questionable activities. T did not take complaint seriously nor offer reasonable assistance or advice. Found. T seriously failed in its duty of care towards C. 1,00 1, :10 Error making customer uncreditworthy 58 12:03 Barring outgoing calls C made un-creditworthy due to T s error more than 12 months earlier; their entries on C s credit file were not correct. Found. T failed to rectify the situation promptly after being notified of the error. T was directed to pay compensation for the stress and harassment C suffered for over one year as well as final loss of increased mortgage payment which directly resulted from the T s failures. C had a contract with company 1 for home and business until they transferred to company 2. Two years later traffic was again passing over the network of company 1 but company 1 had no contract to re-prove the service. C refused to pay bills of company 1 who then barred C s outgoing calls and placed the matter in the hands of debt collectors. Significant failure of duty of care by company 1 who had also, through their debt collectors, given notice of legal proceedings after the matter had been referred to CISAS. Found. The disregard of the CISAS adjudication process was in the words of C, cynical, needless intimidation... bullying techniques, which was inexcusable. 1, , :01 Business loss C requested an upgrade to a business package with a static IP address. Constant connection problems for a year. Found. C was frustrated, received little real assistance from T, and his business suffered losses due to the amount of time he was unable to connect to the internet :14 Loss of business C, a small business, cancelled its contract with T which was unable to provide a broadband service. T continued to charge C, threatened action from its debt management team, contacted another provider and placed an order for T s broadband on the line of C. C s existing contract with the other provider was interrupted for several weeks. Found. T liable for loss of business whilst C was without a broadband connection. 1,50 2, Overpayments by small company C, a small IT company, regularly overcharged by T for broadband and phone services. T did not try to resolve the dispute expeditiously. C provided detailed calculations together with copies of tariff and cap agreements. T did not provide any business contract terms excluding liability for any element of losses arising from overcharging nor did it comment upon losses claimed by C 3,64 9

10 for time spent trying to resolve the dispute which included lengthy attempts by C to communicate with T, evaluate opportunities to move service provider, attempts to stop bank payments and assessing bills manually call by call. Found. T was directed to reimburse C 64 for overcharging and 3,00 towards C s total loss :02 Business loss Having purchased a business and since taking over the account, C had numerous problems with T including the phone line being cut at random without warning, being charged on two accounts for more than 12 months and having hundreds of pounds taken by T from a bank account, which C had been unable to retrieve. As a result C had bank charges imposed on her due to the wrongful withdrawals, lost business and had spent 27 hours of her time trying unsuccessfully to solve the problems with T. T admitted they were at fault. Found. T was directed to apologise to C, to stop sending bills for a service that C never had, to stop taking money from C s account for that service, to pay compensation and reimburse all the money wrongly withdrawn from C s account. 3,70 10