Since the 2021 FCA rule changes regarding sales commissions, a major headache for RMI members has been the extremely high number of solicitors and claims management firms seeking to prosecute civil claims for return of commissions earned during the sale of vehicle finance.

In a series of previous articles, we detailed the arguments/issues involved and provided template responses for the most common types of these claims (see NFDA newsletters 08 October 2021 and 15 October 2021). Over the last two years we have put these templates into practice for several RMI members and provided advice and assistance to members defending themselves in the Courts.

We are proud to say that to date we have not only dissuaded a number of claimants from bringing cases but also successfully defended all claims moving to litigation in which we have been involved.

There remains however a great deal of uncertainty over the issue, and despite over two years of legal argument we are still unaware of any precedent from a higher court that settles this matter once and for all.

In the absence of such a precedent all cases remain a question of fact for individual Courts to decide based on the facts and arguments presented on the day. However, it is noticeable that Courts are increasingly willing to subject claimants to rigorous testing of any claims, and with the right arguments there is a better than even chance of successful defence.

Members can greatly help themselves by maintaining copies of all documents; particularly any IDD or disclosure documents detailing which financial services are provided, what limitations apply, what fees will be paid and what commission (if any) will be paid.

This advice is general in nature. As an RMI member you have full access to the RMI Legal advice line, as well as a number of industry experts. Should you find yourself in the situation above, please do not hesitate to contact us at any stage for advice and assistance.

Motor Industry Legal Services

Motor Industry Legal Services (MILS Solicitors) provides fully comprehensive legal advice and representation to UK motor retailers for one annual fee. It is the only law firm in the UK which specialises in motor law and motor trade law. MILS currently advises over 1,000 individual businesses within the sector as well as the Retail Motor Industry Federation (RMI) and its members.