In Canada Square Operations Ltd v Potter [2023] UKSC 41, Mrs Potter took out payment protection insurance (PPI) along with a loan, the agreement ended in 2010. The PPI included substantial commission, which she only discovered in 2018. Canada Square argued that her claim that the undisclosed commission made this an unfair relationship, was out of time.
Section 32(1)(b) of the Limitations Act 1980 postpones the start of the limitation period where ‘any fact relevant to the plaintiff’s right of action has been deliberately concealed from him by the defendant.’
The Court decided that all that is required for ‘deliberate concealment’ is that the defendant has kept the facts secret from the claimant so they don’t know they have a claim. This applies even where the defendant has no specific duty to make the facts known. Mrs Potter’s case was brought in time, even though it was issued more than 6 years after the agreement ended.
You can watch a video of the judgment on the Supreme Court YouTube channel.
In another related case, that of Smith and Anor v Royal Bank of Scotland [2023] UKSC 34, the 2 claimants took out payment protection insurance (PPI) cover with credit cards with RBS in 1998 and 2000. These payments included substantial commission from the insurer to RBS, which was not disclosed until 2017 and 2018. Claims were made in 2019 for the recovery of PPI payments under the unfair relationships (UR) provisions in section 140 of the Consumer Credit Act 1974.
RBS didn’t dispute that its failure to disclose made the relationship unfair but argued that the claims were time-barred under the Limitations Act 1980 as the PPI payments stopped over 10 years ago.
The Supreme Court ruled a relationship ‘extends over a period of time and may continue for as long as there is any sum payable or which will or may become payable under the credit agreement.’ PPI was paid under the credit card agreements, which continued until 2015 and 2019, so the claims weren’t time-barred – ‘the period of limitation begins to run only when the relationship ends.’ The relationship didn’t stop being unfair when the PPI was cancelled, as RBS still hadn’t disclosed the commission or repaid any of the PPI, so the claims succeeded.
This is an important ruling for UR in general, and more clients will now be able to make claims for refunds of PPI through the courts, including those who got partial refunds under the 2019 FCA compensation scheme.
They should still act quickly – the court has wide discretion when considering remedies for a UR, and delays will be a factor when deciding whether this would be just.