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Drive Assist backs down in electronic signature appeal

26 June 2009

The validity of credit hire agreements that have been signed using electronically imported signatures is once again being called into question.

In the case of Tyrell v Staniforth [2009], heard at Northampton County Court, in-house counsel for Browne Jacobson LLP argued that the claimant should not be entitled to recover any of her claim for credit hire charges, because she freely admitted having never signed a credit hire agreement with Drive Assist, the credit hire company.

The claimant, Miss Tyrell, gave evidence that she had been offered a courtesy car by her insurers; and that when the vehicle was delivered she was simply asked to sign an electronic pad to acknowledge receipt of the vehicle. After the vehicle was returned, she received a copy of the terms & conditions, complete with her signature incorporated into the hire agreement.

So as not to penalise Miss Tyrell, who was an innocent party, the District Judge awarded the claim in full. The defendant appealed on the basis that the claimant had no residual liability to pay the credit hire charges, as she openly accepted she was not made aware of her liability until after the vehicle hire had ended.

On appeal, Drive Assist decided not to defend their practice of unilaterally completing hire agreements using the imported signature of clients who sign a hand-held device. This contrasts with earlier comments attributed to Ralph Ferguson, claims director at Drive Assist, who said:

"We are satisfied that our procedures for ensuring customers understand the credit hire agreement are rigorous and would stand up to any scrutiny, and that the agreements are enforceable." (Post Magazine, Nov 2008).

As a result the company consented to repay the full value of the credit hire charges totalling £1,179.10.

The result follows the recent case of Company Call Centre Technology v Sheehan [2009], involving another credit hire company, in which Browne Jacobson LLP successfully argued that credit hire agreements, signed months after the vehicle hire period had come to an end, did not create a liability.

According to recent media reports, the rise in claims made by credit hire companies adds £20 to the average insurance premium of every UK motorist. We advise making careful enquiries of claimants who have hired vehicles on credit hire terms.

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