S & U PLC Update on Advantage Finance Limited
October 29 2024 - 9:00AM
RNS Regulatory News
RNS Number : 0759K
S & U PLC
29 October 2024
29 October 2024
S&U
plc
("S&U" or "the Group")
Update on Advantage Finance
Limited
S&U, the specialist motor and
property financier, today notes the recent Court of Appeal
decisions on Johnson and Wrench v Firstrand Bank Limited and
Hopcraft v Close Brothers Limited, the implications of which it is
considering. These decisions provide guidance for lower courts on
the subject of commissions disclosure in the financial services
industry. They unexpectedly overturned hitherto received
judicial positions on the duties of motor dealers, credit brokers
and lenders to disclose and obtain consent for the payment of
commission. The Group also notes the intention of those companies
to appeal those decisions to the UK Supreme Court.
The Court of Appeal decisions set a
higher bar for the disclosure of, and consent to, the existence,
nature, and quantum of any commission paid than that required by
current FCA rules, as adhered to by regulated motor finance firms
including the Group's motor finance subsidiary Advantage Finance
Limited ("Advantage Finance"). However, the Court of Appeal
recognised the 'tensions' between previous lower court judgements
on the extent of commission disclosure in the cases of 'Hurstanger'
and 'Wood'. It therefore called for 'a definitive announcement to
be made by the Supreme Court about the circumstances in which the
payment of a commission …. will give rise to a liability …. on the
part of the payer.' It is therefore unsurprising that it is the
intention of the companies involved to appeal the judgement to the
UK Supreme Court.
In the meantime, S&U notes that
these decisions do not specifically relate to 'difference in
charges' models of commission (currently the subject of an FCA
review) in which Advantage Finance has never been
engaged.
Given the Court of Appeal's judgement
and its implications for the whole of the financial services
industry, S&U is aware that it has been the subject of urgent
discussions between the FLA, the FCA and the Government, and looks
for an expeditious resolution to the issue.
The Group will update the market, if
and as appropriate.
ENDS
For further information, please
contact:
Enquiries
Anthony Coombs
|
S&U plc
|
c/o SEC Newgate
|
Financial Public
Relations
Bob Huxford, Molly Gretton, Harry
Handyside
|
SEC Newgate
|
020 7653 9848
|
Broker
Andrew Buchanan, Oliver
Jackson
|
Peel Hunt LLP
|
020 7418 8900
|
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END
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