HMRC has confirmed that, in a significant change from its previous position, as from 1 February 2021 it will regard almost all payments made upon early termination of asset finance agreements as chargeable to VAT.
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HM Treasury (HMT) has just published The Consumer Credit (Enforcement, Default and Termination Notices) (Coronavirus) (Amendment) Regulations 2020 which make changes to the content and form of Default Notices set out in the 1983 Regulations.
These come into effect on 2 December 2020. Firms will have 6 months thereafter to implement them.
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Jonathan Berkson
Back in 2004, Porter Capital Corporation (“Porter”), a US finance Company based in Birmingham, Alabama, financed a US corporation (“Corporation”) via an invoice finance facility. To secure the finance, they took guarantees from three guarantors, one of whom lived in London and was a co-owner of a valuable Knightsbridge apartment on Hyde Park in London and shares in a family company. The finance documentation was expressed to be under Connecticut law.
By 2008, things were going wrong for the Corporation and by March 2010 just prior to the Corporation’s Chapter 7 Bankruptcy in the US, Porter wrote making its demand for the account shortfall against the finance agreement’s three guarantors.
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The High Court has recently held that a party who made contractual representations as to the validity of an aircraft lease was contractually estopped from subsequently alleging that the agreement was invalid.
In Wallis Trading Inc v Air Tanzania Company Limited [2020] EWHC 339 (Comm) the lessee (Air Tanzania) made certain representations including that the lease was legal and valid, and that it had obtained all required authorisations and consents to enable it to enter into and perform the lease. Air Tanzania later argued that the lease was invalid because (among other things) it had failed to comply with Tanzanian public procurement laws.
Continue ReadingThe Consumer Credit (Disclosure of Information) Regulations 2010 have been amended so that references to “SECCI” (the Standard European Consumer Credit Information) are deleted – the documents shall now simply be known as the Pre-Contract Credit Information.
However, there is no substantive change to the contents of the document.
Continue ReadingThe High Court has held in School Facility Management Ltd and others v Governing Body of Christ the King College [2020] EWHC 1118 (Comm), among other findings, that a contract between a school and a construction company constituted a finance lease and was void because of the school’s lack of capacity under the Education Act 2002.
Continue ReadingThe New Year saw the demise of the FLA’s well-established Finance House Base Rate (“FHBR”) essentially to avoid the regulatory consequences of some complex EU Benchmark Regulations.
However, in practice the FLA will continue to publish a figure which will effectively replace FHBR. In the words of the FLA statement explaining the change:
Continue ReadingThe title of this article does not quite rise to the level of “Man Bites Dog”, but it refers to a rather unusual case which was reported recently and which provides a welcome albeit relatively unusual example of a dissatisfied customer accepting its liability under Hire Purchase Agreements and seeking its remedy against the supplier of the defective equipment.
New York Laser Clinic Limited v Naturastudios Limited [2019] EWHC 2892 (QB) involved the supply of a large quantity of laser equipment to the claimant for use in its laser hair removal business, following oral representations made by the supplier as to the performance of the equipment upon which the claimant made detailed profit projections which formed the basis of its business case put to 3 financiers.
Continue ReadingOne of the more nebulous provisions of CONC which has led to widely different interpretations in practice has been the rule relating to the disclosure of commission found at 4.5.3 which currently provides as follows:
“A credit broker must disclose to a customer in good time before a credit agreement or a consumer hire agreement is entered into, the existence of any commission or fee or other remuneration payable to the credit broker by the lender or owner or a third party in relation to a credit agreement or a consumer hire agreement, where knowledge of the existence or amount of the commission could actually or potentially:
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