HC Deb 19 July 1974 vol 877 cc878-80
Mr. Alan Williams

I beg to move Amendment No. 76, in page 33, line 43, at end insert— ' (1A) In the case of a debtor-creditor-supplier agreement for restricted-use credit financing—

  1. (a) the doing of work or supply of goods to meet an emergency, or
  2. (b) the supply of goods which, before service of the notice of cancellation, had by the act of the debtor or his relative become incorporated in any land or thing not comprised in the agreement or any linked transaction,
subsection (1) shall apply with the substitution of the following for paragraph (i)—
  1. "(i) to cancel only such provisions of the agreement and any linked transaction as—
  1. (aa) relate to the provision of credit, or
  2. 879
  3. (bb) require the debtor to pay an item in the total charge for credit, or
  4. (cc) subject the debtor to any obligation other than to pay for the doing of the said work, or the supply of the said goods".
(1B) Except so far as is otherwise provided, references in this Act to the cancellation of an agreement or transaction do not include a case within subsection (1A)'.

Mr. Speaker

It will be convenient to consider at the same time Government Amendments Nos. 73 and 75.

Mr. Williams

This Amendment again meets points argued previously and raised in particular by the Mail Order Traders Association. It deals with cases where a debtor cancels a credit agreement after the goods to which it relates have been supplied to him and after he has himself fixed the goods into land or into something else in such a way that they cannot readily be returned to the firm.

Originally, there was to have been no redress whatever for the mail order operators, but I promised in Committee that I would meet anyone who wished to come and see me about the matter. I had a constructive meeting with the mail order traders and I felt that they presented a valid point. I have therefore made this change in relation to goods fixed to land and so on. The hon. Member for Gloucester (Mrs. Oppenheim) will recall the precise terminology. The same provisions have been made in relation to an emergency.

Accordingly the amendment provides in effect that where a debtor cancels a debtor-creditor-supplier agreement for restricted-use credit financing the supply of goods after he has incorporated them in any land or thing, the debtor shall remain liable to pay for the goods themselves, but not any charge for credit, because the credit agreement has been cancelled.

This goes a long way to meet the objections of the mail order traders, and to my personal knowledge they have not come back with any complaint since I said that I would try to meet their case in this way.

Mrs. Sally Oppenheim

We are extremely grateful for this concession, which will be helpful. Will the fact that the consumer will not be able to cancel such an agreement in any way interfere with the rights under the Sale of Goods Act? Is it also the case that where the goods have been fixed by the mail order supplier himself, and therefore are not merchantable, it will not be a cancellable agreement? Where they are not fixed but are incorporated—for example, like paint on a wall—would that be a cancellable agreement?

Mr. Williams

The Sale of Goods (Implied Terms) Act provisions would not be affected. The duty is specific in relation to the quality of goods. I made this clear to the mail order traders. They made the counter-point that of course they allow the customer to have the goods on approval so that the customer has time to consider whether the goods meet his needs and whether they are of adequate quality.

I am sorry, but I did not quite get the second point raised by the hon. Lady.

Mrs. Oppenheim

My second point concerned where goods have not been fixed by the mail order suppliers but where they have been incorporated beyond the point where they could be returned.

Mr. Williams

That, too, is intended to be covered. There is an amendment later dealing specifically with paint, petrol and other items.

Amendment agreed to.

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