The FSA’s business plan for 2009/10 confirms that helping retail consumers to achieve a fair deal will include a renewed focus on the UTCCR. In her speech of 13 January, Katherine Webster of the FSA’s UCT team, said: “We are still surprised by how many consumer contracts are drafted in legal jargon. Last year we published a statement advising firms that the use of language such as ‘consequential loss’ in their consumer contracts is not, in our view, plain and intelligible and that terms using this kind of language may be unfair. ... And, towards the end of last year we also published an undertaking from a firm which agreed not to use the word ‘indemnify’ in its consumer contract as, among other concerns, we did not think that the average consumer would understand the implications of a term whereby he agrees to ‘indemnify’ a firm. … It is worth bearing in mind that the whole purpose of Regulation 7 and the obligation on firms to use plain language is to ensure that consumers – and not just lawyers – can understand the contract and can make an informed choice as to whether to become a party to it in the first place.”

The FSA will not accept the excuse that an otherwise unfair term is applied fairly. They say the fair treatment of the term should be plain from the term itself. It will not be acceptable to use legal terminology, even though their meaning is wellestablished through case law. Firms with long-standing consumer contracts need to review them for plain English and compliance with the Regulations. Whilst the Unfair Contract Terms Act does not apply to contracts of insurance, UTCCR does.