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The law on undisclosed commissions: ripe for review by the Supreme Court
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The judgment in the conjoined appeals of: (i) Johnson v FirstRand Bank Limited (London Branch) T/A Motonovo Finance; (ii) Wrench v FirstRand Bank Limited; and (iii) Hopcraft v Close Brothers Ltd [2024] EWCA Civ 1282 is the most recent in a series of Court of Appeal decisions on secret and half-secret commissions paid in a consumer context. The appeals considered claims regarding the payment by lenders of commission to car dealers for arranging claimants’ hire-purchase agreements. The judgment sent shock waves through the motor finance industry triggering falls in share prices and withdrawals from the motor finance market with warnings that the decision may lead to a wave of consumer claims similar to the PPI scandal. Two aspects of the judgment that have caused concern are the decision that the commission was “secret” when the terms and conditions of the hire-purchase agreement said it might be paid ...
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