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Categories:Advisers,Protection

Alan Lakey wins court case against PPI claims chaser

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Highclere Financial Services has been awarded £340 through the small claims court after contesting a payment protection insurance misselling claim from a claims management firm.

In a case heard on 9 October at Accrington Crown Court, claims firm Aims Reclaim was forced to pay Highclere partner Alan Lakey £100 for wasting his time and a further £240.20 in legal costs.

Aims Reclaim wrote to Highclere in April alleging the firm had missold a client PPI. It stated seven reasons why the policy was missold, including ‘your sales person did not tell our client the policy was optional’.

Lakey says he has never arranged PPI and that the client in question says they did not make a claim against him to Aims Reclaim.

He invoiced the firm for £100 for wasting his time and when the firm refused, commenced legal action.

The judge found in his favour. Lakey says the judge ruled that Aims Reclaim owed him a duty of care in establishing whether a PPI policy existed before alleging it was missold.

Lakey says: “The judge’s decision confirms claims firms cannot recklessly level accusations about events that did not take place. Further, they cannot make allegations the client has not made or was not even aware of.”

Aims Reclaim declined to comment.

Philip J Milton & Company managing director Philip Milton says: “Claims firms which fish for business without having evidence to substantiate their claims are acting in an unacceptable way. It is admirable that Highclere has taken this to court, but it should really be down to the Ministry of Justice to ensure claims firms are acting within its guidelines.”

In November, Steve Foreman, of GraingerCo Financial Services invoiced a claims firm for wasting his time with an unfounded PPI complaint. He received a cheque for £120.

A freedom of information request submitted by Money Marketing found that, as at July, the Financial Ombudsman Service had referred 13 claims firms to the MoJ for “unreasonable behaviour”. 

The MoJ closed down 209 claims firms between April and November last year. 

The MoJ’s website states that Aims Legal, of which Aims Reclaim is a trading name, is authorised with special conditions.

Since August 2012, it has been operating under the following conditions: it is prohibited from taking payment from consumers in advance of the provision of a claims management service; it must keep for six months and provide to the regulator on request copies of call recordings with clients or prospective clients; and it must ensure that any business acting on its behalf or providing services for it complies with these conditions.

A spokesman for the MoJ says: “Where we have concerns about a claims management company’s activities we can impose additional obligations or restrictions on their authorisation to safeguard the interests of current clients and the wider public.

“Varying the conditions of a CMC’s authorisation is a serious matter and is a decision taken after careful consideration of all the evidence and the consequences of such actions for clients.”

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Readers' comments (20)

  • DH

    Well done Alan !!!

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  • Peter Herd

    I'll be the first to say congratulations Alan as it is about time that claims management firms were taught a lesson.

    I've always said that if a claim is bogus then an adviser has the right to reclaim costs through the small claims court and you have just proven that this particular route does work. Obviously this comes with the health warning that you have to treat all clients fairly and it doesn't exclude the client from a complaint process. However saying that this was obviously a fishing expedition.

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  • Blair Cann

    An excellent outcome for all of us.

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  • Harry Katz

    Good for you Alan. I wonder why the police didn't follow this up .

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  • Simon Webster

    10/10 Mr Lakey. Very well done indeed.

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  • ROD LEONARD

    Congratulations Alan, good man for standing up against these plonkers, I am now putting an extra sentence on the bottom of letters to claims companies saying it is a criminal offence to make a false claim and will be reported to the Authority's. please ask your claimant to write to me laying out why he /she believes they have been miss sold. Amazingly the last two claimants have emailed me to say they are no longer pursuing a claim.

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  • Ken Durkin

    Well done!

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  • I'm also delighted to congratulate Alan on his victory against this particular company who (in my view) serve neither their customers or the industry well. I will however add two caveats;

    1) Please don't judge all CMC's by the standards of the worst
    2) Alan - can you please ensure that you make the MOJ aware of this - this is not the first time that this company will have been brought to their attention, indeed it already has a number of conditions attached to its authorisation

    I would also extend point 2 to everybody else reading - if you have a problem with a CMC, let the MOJ know - whilst most of us (including professional CMC's) would prefer stronger action from them they are increasing their investigation activity and slowly managing to weed out the worst within the industry. (And yes, before anyone else says it there is definitely further to go)

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  • E L Wisty (an only twin)

    Most excellent news - serves the bug***s right!

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  • Well done Alan ~ and you had to travel several hundreds of miles to attend the hearing.

    I trust you've reported this to the MoJ?

    As for CMC Manager asking us not to judge all CMC's by the standards of the worst ~ that's how the FSA judges us and regulates us accordingly!

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