Viagogo – the website – had objected to the hand over, saying that to do so would be disproportionate and infringe its users’ data protection rights. The Court of Appeal disagreed. The rights had to be balanced and the RFU was entitled to know about who was infringing its contract terms. The Court of Appeal therefore ruled that it was right to grant the RFU a “Norwich Pharmacal Order” against Viagogo to reveal the data. Whether or not the England rugby body used that data to take action against the sellers or the people who had provided the tickets to the sellers was irrelevant to the ruling.

One particular area of concern for some businesses is the requirement on businesses to seek the express consent of the consumer to any extra payment in addition to the main payment obligation. If there has not been express consent but it is inferred by using default options which the consumer is required to reject in order to avoid the extra payment obligations, the consumer may be refunded for the extra payment.

The UK Government will have two years to implement the Directive, but it may well do so before that, as it has already signalled its desire to amalgamate consumer laws into a single Consumer Bill of Rights, which the Government hopes will be less confusing for consumers and businesses than the plethora of laws that exist today.

The full text of the Directive can be found here: http://register.consilium.europa.eu/pdf/en/11/pe00/pe00026.en11.pdf.

The OFT’s response to the consultation can be found here: http://www.oft.gov.uk/shared_oft/consultations/consumer-landscape/Consumer_Landscape.pdf.

In response to the claims, TripAdvisor gave a strong denial and said it would fight. It said it spent thousands of hours each year in combating fraud and improving fraud detection to ensure the integrity of its site and stop “astroturfing” – the practice of falsely creating the impression of strong customer support for a product or service.

The new Act would consider the perception of the average consumer and aggressive practices would be defined by reference to coercion, abuse of power or harassment. The consumer would have to prove aggressive or misleading practice had occurred, it was likely to cause an average consumer to decide to enter a contract or make a payment that they would not otherwise have done and the practice was a significant factor in that particular consumer’s decision.

The remedies involved would include a right to unravel the contract, get a refund, have a reduction in price and obtain damages for provable losses. A trader could avoid damages if he could prove that he took all reasonable precautions to avoid committing the offence.

The OFT has also signalled its intention to change the law to abolish charges altogether for consumers paying by debit card. Some travel companies have signalled their intention to incorporate surcharges into the headline price that appears online – at present the OFT noted that some companies do not inform a consumer of the surcharge until the fifth or sixth webpage of a booking process.

The ECJ ruled that the supplier had to not remove and replace but also install the replaced goods despite not having been responsible for the original installation as the goods had been faulty on delivery and consumers needed to have an absolute right for them to be put right without suffering loss. Alternatively, the supplier would have to bear the cost of someone else doing so. The ECJ further said that if only one remedy is possible then the seller cannot refuse to provide that remedy even if the cost of removing and reinstalling would be disproportionate to the value. In this case, the tiles cost €1,382 and the cost of removing and replacing was €5,830. The seller would not have been liable for the replacement if the reason for the defect was the poor installation (that the supplier was not responsible for), although proving who was at fault may not be easy.

• Failed to deliver the products within the timeframe required by the Distance Selling Regulations.
• Failed to respond or otherwise comply with consumers’ decisions to exercise their statutory rights to cancel their contracts under those Regulations.
• Failed to be available in a rapid and effective manner for consumers to contact him, as required by the Electronic Commerce Regulations.
• Misled as to the availability of the products and the timeframes, contrary to the Consumer Protection from Unfair Trading Regulations.

The OFT took action under the Enterprise Act and brought proceedings against the website operator after written undertakings previously given by it to offer refunds to customers were not complied with. The OFT has said that it will continue to monitor the website’s future practices.

The High Court has agreed with the OFT that such a minimum term was unfair and designed to take advantage of the naivety and inexperience of the average consumer and were weighted in favour of the gym or health club causing a significant imbalance in the parties’ rights and obligations. Gym members would not anticipate all the events which might render the use of the gym impractical and the agreements did not address the tendency of users to overestimate the amount that they would want to use the gym when signing up. Accordingly, those provisions were unfair contrary to the Unfair Terms in Consumer Contracts Regulations 1999 and were unenforceable.

In addition, the practice of describing members who wanted to terminate their agreements as defaulters and registering or threatening to register that with credit reference agencies was an unfair commercial practice and harmed the collective interests of consumers, contrary to the Consumer Protection from Unfair Trading Regulations 2008.

The Law Commission is looking to enable consumers to cancel and claim a refund if they return or reject goods or services within three months. The Law Commission is looking for responses to the consultation by 12 July 2011, and it can be found here: http://www.justice.gov.uk/lawcommission/docs/cp199_consumer_redress.pdf.

The European Parliament has meanwhile indicated that it supports the 28^th contract law regime. Other options floated by the Commission range from full harmonisation in place of all Member States’ contract laws through to non-binding recommendations.

The OFT investigation centred on concerns that consumers were being unfairly pressured into selling their gold. Payments for gold were sent to consumers with the requirement that consumers had to reject and return the payment within a restrictively short time period if they wanted their gold returned, failing which their gold would be melted down.

There was also concern in relation to the clarity of the pricing methods for any gold sent in and insurance arrangements for the time when the gold was in transit. It was also noted that consumers were being denied their legitimate cancellation rights and legal redress rights for loss or damage to goods when in transit, and that the terms and conditions of the companies were not in plain and intelligible English.

Whilst the companies denied any wrongdoing, the OFT was of the opinion that the trading practices of those companies under investigation were a breach of the Consumer Protection from Unfair Trading Regulations 2008 and the Unfair Terms in Consumer Contracts Regulation 1999.

In lieu of court action, the OFT obtained written promises from the three remaining trading companies to change their trading practices to ensure compliance with the law. The promises included:

• The provision of an option for consumers to receive either a quote requiring acceptance or payment for their gold.
• The provision of clearer pricing information.
• Explaining the risks.
• Making clear that the ‘top’ price for gold they were receiving was based on the scrap value of the gold rather than the marketable commercial value.
• Not claim to be the number one buyer when this was not the case.
• Have clearer information about consumers’ legitimate rights.

Under a 2001 European Union Regulation called the Brussels I Regulation (which can be found here), a consumer can only be sued by a business supplier that ‘directs its activities in that consumer’s state’ in the consumer’s own domicile, but the consumer can choose whether to sue such a business in their own domicile or that of the business. The ECJ said that, for a business to be considered to be ‘directing its activities’ to one or more other ‘Member States’ (i.e. other countries within the EU), a number of factors should be considered by national courts. The factors include:

• the nature of the business (tourism would be an obvious pointer);
• use of phone numbers with international dialing codes displayed;
• use of ‘top level’ domain names such as .com or .eu or a top level domain name that is different to where the business is established;
• the currencies, languages and translations used on the site;
• referring to a country by name;
• money spent online to facilitate the placing of the business’s site in a way that is targeted to another country; and
• the mention of customers who live in other states.

For the full text of the ruling, click here.

As this case shows, anyone trading online with consumers may need to be prepared to fight legal battles in the courts of other countries. If they want to avoid that, they should seek appropriate legal advice.

It will not be a surprise if there is soon going to be a succession of high-profile actions under the misleading selling regulations. CPUTR came into force two years ago, and so far the OFT seems to have tried to encourage businesses to comply rather than simply prosecute. However, there will come a point when the OFT will no longer tolerate continued misleading selling practices and will look to make examples of offenders. If that happens, traders could face criminal sanctions.

The ECJ has ruled that the Hungarian court should consider whether a term dealing with jurisdiction of disputes is fair for consumers. If it is a long way for the consumer to travel, it could have the effect of denying the consumer access to justice. Depending on the circumstances, this may not be fair. A national court should consider this issue of its own volition even if the point is not specifically argued by the consumer.

The Government’s ability to do this will depend on the outcome of the European Commission’s ambitions to introduce a new Consumer Rights Directive. If enacted, that Directive would harmonise all consumer laws across the European Union. However, that proposal has been controversial and opposed by the UK Government because it would water down the rights that UK consumers currently have to reject goods that do not conform to the contract.

For more on the Government’s latest recommendations, click here: http://www.bis.gov.uk/assets/biscore/consumer-issues/docs/c/10-1255-consolidation-simplification-uk-consumer-law.

Unfair trading is prohibited by the Consumer Protection from Unfair Contract Trading Regulations. However, consumers are generally not able to take action in the event of unfair trading. Instead, action under those Regulations is taken by the Office of Fair Trading or the local Trading Standards office.

A new report by the Law Commission is aimed at reviewing the current law in due course, and states that whilst consumers have no direct course of action in many instances, in those instances where direct action is available, for example under the law of undue influence and duress, the law is largely redundant as consumers cannot understand it sufficiently to make use of it.

It is expected that a consultation paper will be issued by the Law Commission in early 2011, highlighting how the law should be reformed. The Law Commission’s initial report can be found here: http://www.lawcom.gov.uk/docs/misrep_summary_evidence_web.pdf.

The European Commission is considering a new Directive on Consumer Rights. The Government asked businesses and consumers whether they agreed with an extension of laws concerning unfair contract terms to cover other elements of a particular transaction that may not be its core focus, such as holiday surcharges and luggage frees. The question posed by the Government was whether such charges needed to be justified as not being ‘unfair’ to the consumer.

It was not surprising that business responded negatively, arguing that market forces and competition already kept prices fair, and that additional regulation was not needed. Consumers argued that such ‘side-show’ charges were not necessarily paid attention to be consumers, and therefore they required protection in this area as well as the core charges.

The Government anticipates having the discretion to implement such regulations domestically if it chooses, rather than the issue being dealt with at EU level.

The Intellectual Property Minister says that the consequences of fake goods are more significant than damage to brands – goods can be dangerous. This month, a teenager was badly burnt after he was electrocuted from hair straighteners that had seemed genuine.

The Commission is also on a drive to boost cross-border trade. It announced another consultation recently, following research that showed that just 8% of consumers buy online from a retailer based in another European Union Member State and that 61% of sellers refuse to deal with a consumer based in another country. The Commission claims that this is due to regulatory and legal concerns or uncertainty. For more on that story, please click here: http://www.mablaw.com/2010/07/european-commission-consults-on-new-eu-wide-contract-law/.

The latest consultation is open to comment until 15 October and can be found here: http://ec.europa.eu/internal_market/consultations/2010/e-commerce_en.htm.

The ASA acknowledged that ASDA applied the 100 day guarantee to the goods whether they were faulty or not and therefore this did go beyond the consumer’s rights at law for non-faulty goods, but this had not been made clear from the advert. Accordingly, ASDA had breached the Broadcasting Code of Practice and was ordered not to repeat the ad in that form.

The Commission’s Green Paper proposes seven alternatives:

• Simply publish findings and recommendations as a possible way forward in the future without any particular change now.
• Have a toolbox for legislators, such that it would act as a referencing tool for any new legislation introduced by Member States. This would not really create harmonisation or certainty, however.
• The Commission to issue a Recommendation to encourage Member States to incorporate the laws into their own laws. This could allow a gradual implementation over time, although there would be no common consistent approach and implementation would be patchy and incoherent.
• Establishing a 28^th contract law regime. In effect, this would be a new optional contract law that could be used as an alternative to those within each Member State. The system could therefore run in parallel to existing contract law regimes.
• Minimum harmonisation of European contract law. Not everything would be harmonised, but some bits would be. Member States could still retain stronger rules, but this solution would require minimum standards as a base.
• Full harmonisation, in which the new EU law would replace the contract laws of all Member States.
• A full civil code. This would involve full harmonisation of all civil laws – not just contract law, but tort and property law too.

The consultation also considers a number of relevant issues including the scope of contract law issues affected (such as rights, remedies, incorporation, formation of contracts, validity), whether it should just apply to cross-border contracts or purely domestic contracts as well, and whether business-to-business contracts as well as business-to-consumer contracts should be affected.

Paul Gershlick, a Partner at Matthew Arnold & Baldwin LLP and editor of Upload-IT, comments: ‘Previous attempts to create a standard EU contract law have been resisted. However, the Commission would like to push this through again. They talk about a time of crisis for the European economy, and this new approach would present a historic opportunity to drive economic growth by easing the cost of cross-border transactions. They believe now is the time to make that quantum leap. It will be interesting to see whether or not each country wants to radically change the way they do business, though.’

The consultation closes on 31 January 2011. A link to the Green Paper can be found here: http://ec.europa.eu/justice_home/news/consulting_public/news_consulting_0052_en.htm.

Trading Standards has issued a stark warning to users of auction sites like eBay: ‘If they shill bid or encourage family and friends to place fake bids to push up prices artificially, they too face prosecution.’

In this particular case, Caja de Madrid, a Spanish mortgage lender, had a contract term saying that interest would be rounded up to the nearest quarter of a percentage point. Ausbanc, a consumer group, argued that the term was unfair. The matter went to the highest Spanish court. Caja de Madrid said that it was a core term and so should not be assessed for fairness, but Ausbanc countered that the Spanish laws implementing the Directive had not made that proviso and so it could be assessed.

The question was whether Spanish laws could bring the Directive into law in a more consumer-beneficial way than was provided for under the Directive. The European Court of Justice said that it could. That Directive was one that ensured consumers had minimum rights, but there was nothing to stop each country from increasing the benefit for consumers by the way they implemented the laws. The UK implemented the Directive with the exemption, so the consumers would be unable to challenge it here. However, the case is interesting if the Government ever wants to change English law to give consumers more protection. A key reason for the banks winning their high-profile bank charges case a few months ago was that those terms were core to the bargain and so could not be challenged under English law.

Paul Gershlick, a Partner at Matthew Arnold & Baldwin LLP and editor of www.Upload-IT.com, comments: ‘This case impacts on anyone who deals with consumers for long-term contracts. The impact is serious. The OFT has clearly taken the view here that three year terms without the right to cancel are too long. The business in question presumably thought it had a debt owing and sent the matter to debt collectors. However, since the OFT considered the clause to be unfair, its tactics in pressurising the consumers to pay up was deemed to be aggressive. Breach of the 1999 Regulations only mean that a term is unenforceable, whereas breaching the 2008 Regulations would amount to a criminal offence. For now, we don’t know what a court will decide – only that the OFT doesn’t like what AMS has done – so it will be worth watching the outcome from the courts.’