Law firm Leigh Day have announced an alternative route to compensation for thousands of Volkswagen owners following the start of a High Court legal action against the car giant by other UK claimant law firms.
On 30 January 2017, the High Court considered an application by another firm for a Group Litigation Order (GLO) to manage claims by consumers who allege that Volkswagen engaged in “fraudulent misrepresentation” in relation to its emissions test defeat device. The GLO application was adjourned until October.
Before the hearing, Leigh Day informed the Court that it intends to seek a separate GLO in respect of consumers who wish to make a claim under a different law called the Consumer Protection from Unfair Trading Regulations 2008 (CPUT).
CPUT makes it unlawful for businesses to engage in various kinds of “prohibited practice”, which Leigh Day will argue includes Volkswagen’s use of a defeat device.
Under CPUT, it is not necessary for consumers to prove that they have lost money as a result of Volkswagen’s conduct. According to lawyer Chris Haan from the Consumer Law and Product Safety group at Leigh Day there is no need, for example, to prove that the resale price of affected vehicles is reduced.
Mr Haan said: “We consider that it will be easier for eligible consumers to establish a claim under CPUT and that the damages recoverable are likely to be higher. We argue that consumers should claim at least a 50% refund on the purchase price of a consumer’s vehicle.”
So, for example, a consumer who bought an affected vehicle that cost £20,000 could be entitled to up to £10,000 plus interest in compensation.
CPUT provides for a discount that depends on the seriousness of the defendant’s prohibited practice. The discount is 25% if the prohibited practice is more than minor, 50% if it is significant, 75% if it is serious, and 100% if it is very serious.
Leigh Day claim that, among other things, the use of the defeat device is at the least significant, entitling consumers to a 50% discount, given that it circumvents protections put in place to protect human health and EU law, and is on any view more than minor.
Mr Haan explained: “There are various other legal differences between CPUT and fraudulent misrepresentation that we consider make it easier to establish a claim under CPUT.”
Those eligible for a CPUT claim includes only those owners who:
- Purchased an affected vehicle (either new or used) from an approved Volkswagen Group dealership on or after the 1st October 2014; or
- Purchased an affected vehicle (either new or used) from an approved Volkswagen Group dealership using Volkswagen Finance before the 1st October 2014 and made one or more payments under the finance agreement after that date.
Leigh Day has also been exploring all avenues for seeking redress for those who cannot make a CPUT claim such as via a court claim alleging fraudulent misrepresentation and claims under the ADR procedure set out with the New Car Code.
They have submitted a test case for adjudication to the Motor Ombudsman and met with the Department of Transport with a view to seeking redress on behalf of UK based consumers.
Shazia Yamin from Consumer Law and Product Safety group at Leigh Day said: “It is disappointing that Volkswagen have refused to take responsibility for their actions and compensate UK vehicle owners. This leaves vehicle owners with no choice but to now engage in complex and costly litigation in order to get proper compensation for Volkswagen’s conduct.”
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