Recently, we saw a landmark ruling in the Doran v Paragon case. We take a look at what this means for consumers.
Doran v Paragon
Christopher and Joanne Doran took Paragon Personal Finance to court. The broker charged excessive commission on the Dorans’ payment protection insurance (PPI). The Dorans were unaware that 76% of their PPI premium was paid to the broker.
The Financial Conduct Authority (FCA) rule states that customers can claim back money from their broker. This is if more than 50% of their PPI payments went through as commission. The information was usually also not disclosed upon taking the policy.
The judge ruled that the Dorans would not have bought the policy if the commission had been disclosed. As a result, Paragon was ordered to pay back the full £7,985.46.
One of our expert litigators, Glyn Taylor, said: “This judgement is extremely important as the Defendant tried to persuade the Court that the unfairness related to matters that took place at the time of entering into the agreement.
“The average commission banks were paid was 67%. As a result, millions of people who were sold PPI could be entitled to this additional compensation.
“The court held that appropriate redress that should be awarded is the full amount of the PPI policy and the interest paid. APJ welcomes this decision.”
The ruling also shows that individuals can get access to justice through the Court.
Glyn continues: “As a result, Doran v Paragon opens space for people who have previously been unable to secure compensation to do so. Even if a PPI policy was not mis-sold, customers could still reclaim due to excessively high commissions that were paid out.”
If you have taken out a credit agreement, you might have PPI and be eligible for compensation because of high commissions you weren’t aware of. Get in touch with our expert team for a no obligation consultation to find out if you’ve been affected.