On 12 November 2014, the Supreme Court handed down judgment in Plevin v Paragon Personal Finance (1) Limited. This deals with the unfair relationship provisions in Section 140A of the Consumer Credit Act 1974 ("CCA") and alleged payment protection insurance ("PPI") mis-selling. The Supreme Court considered two issues: (a) whether non-disclosure of the amount of commission received for arranging the PPI could amount to unfairness (particularly given the Court of Appeal’s decision in Harrison & Harrison v Black Horse Limited [2012] Lloyd’s Rep IR 521) and (b) the meaning of “on behalf of” in the context of Section 140A(1)(c) of the CCA.
The effect of the Supreme Court’s decision is that (a) the Court of Appeal’s decision in Harrison was wrong and non-disclosure of the amount of a commission (which was 71.8%) created unfairness in Mrs Plevin’s relationship with Paragon Personal Finance (1) Limited ("Paragon") and (b) the Court of Appeal’s earlier decision in Plevin on the meaning of “on behalf of” was wrong because a lender is only responsible for things done, or not done, by its agent or deemed agent under the CCA.