New Clause 3 - Duties of lenders and debtors
Consumer Credit Bill
4:30 pm
Mr Gerry Sutcliffe (Parliamentary Under-Secretary (Employment Relations, Competition and Consumers), Department of Trade and Industry; Bradford South, Labour)
There may still be a vote.
The hon. Gentleman eloquently set out the case for what is required. The 1974 Act already covers the points he raised. Section 56 determines the accountability of the lender for representations made by certain persons supplying goods and involved in negotiations to get consumers to enter into credit agreements. It makes lenders responsible for things said or done by such persons or agents.
The existing provisions go further than the hon. Member's new clause in that they apply not only to an actual relationship of agency, but in cases where a relationship can be inferred from the behaviour of the supplier. An agreement will be void if it purports to exclude any person, including the lender, from liability for any act or omission by the credit broker or the supplier acting as agent on their behalf.
In addition, section 75 of the 1974 Act provides that where a connection exists between the lender and the supplier of goods and services, the creditor will be ''jointly and severally liable'' for any misrepresentation or breaches of contract by the supplier. That would apply, for example, to purchases made with a credit card.
Given that the protection already offered to consumers under sections 56 and 75 of the 1974 Act not only covers but goes beyond the hon. Gentleman's points, I hope that he will see that his new clause is unnecessary. However, I understand the nature and detail of his argument.