Court holds “debtor” must be contractual party

The Court of Appeal has held that an individual cannot bring a claim under s75 CCA unless they were party to the relevant credit agreement, as otherwise they cannot be a “debtor” for those purposes. In  Cooper v The Freedom Travel Group Ltd [2022] EWCA Civ 1557, Mr Cooper paid for a package holiday with a subsidiary of the then Thomas Cook using his Halifax credit card. He was the only cardholder under his card agreement, and the invoice for the holiday contract was addressed only to him, just naming his wife as the “other passenger”.  While on holiday, Mrs Cooper had an accident and brought a claim against the travel agent under the Package Travel Regulations 1992. She accepted an offer to settle, but the travel agent and its parent went into liquidation before a scheduled quantum only trial could take place. It was not possibly for the appellant to claim under the original defendant’s travel insurance, so she applied to add the Bank of Scotland as the issuer of the Halifax brand card to the proceedings as it had joint and several liability with the travel agent.

The Deputy District judge dismissed the application, saying, among other things, that Mrs Cooper was not a “debtor” under the CCA. Mrs Cooper appealed, and again her argument was dismissed, with HHJ Simpkiss saying that, under the CCA, the debtor is the party who receives credit and would be liable to repay the debt if the credit had not been contractually extended to him. So the only person to whom credit had been extended, and therefore the only debtor, was Mr Cooper. The judge dismissed an argument that, if the meaning of a term in domestic law was in conflict with EU law (in this case the Package Travel Directive), then the court must depart from the unambiguous meaning to bring it in line with the aims of the relevant EU law. The judge said the aims of the Directive were not directed at claims like this, and so it could not be said that the meaning of “debtor” in the CCA was contrary to the PTD’s aims.

Again, permission to appeal was granted. Again, the court held with the original judgment.  The CCA is clear that a “debtor” within s75 is the “individual who is a part to the credit agreement”, adn held that this does not produce a result that conflicts with the PTD. The CCA is not legislation implementing the PTD and has a different purpose.