Santander Consumer (UK) PLC v Meher-Un-Nisa Chaudhry

The appeal concerned whether Santander's recovery of a motor vehicle after police seizure amounted to recovery "from the debtor" for the purposes of section 90 of the Consumer Credit Act 1974. The High Court upheld the Recorder's findings that the vehicle had been taken from the police (or their bailee) and not from the debtor, and that the police seizure suspended the debtor's immediate right to possession. The court held that section 90 applies only where goods are recovered from a person who at that time has the immediate right to possession; recovery from the police under statutory powers did not engage s.90. The court also upheld findings that the appellant had breached contractual clauses 4.4 and 4.5 by permitting an uninsured, disqualified driver to use the vehicle, that the claimant was entitled to take the vehicle into safe custody, and that other bases for relief (including s.91 consequences, unfair relationship and unfair terms arguments) were not made out.

The appellant, Miss Chaudhry, leased a Mercedes-Benz under a conditional sale agreement. The vehicle was seized by the police on 11 October 2020 when driven by her brother who was uninsured and disqualified. Santander took the vehicle from the police's bailee and later refused to return it. The Recorder found that (i) the appellant had consented to and permitted her brother's use of the vehicle in breach of clauses 4.4 and 4.5 of the agreement; (ii) Santander recovered possession from the police/bailee, not from the appellant; and (iii) the appellant had been untruthful in evidence and had paid more than one third of the purchase price but property remained with Santander.

The appellant appealed. The central issue was whether the creditor's taking of the vehicle from the police constituted recovery "from the debtor" within section 90 CCA and therefore required a court order. The court considered authorities on when a police seizure suspends the debtor's right to possession and on recovery from bailees or third parties (including Kassam, Costello and other authorities). The court examined the Road Traffic Act 1988 powers and the 2005 Regulations for release of seized vehicles.

The High Court concluded that lawful police seizure suspends the debtor's right to possession and that when Santander removed the vehicle from police custody it was removing it from the police, not from the debtor. The court rejected the appellant's argument that there was a split moment when possession reverted to the debtor such that Santander's collection triggered s.90; that analysis was described as artificial. The court also held that unlawful retention after a lawful repossession is not a fresh "recovery of possession" under s.90 and that the consequences in s.91 therefore did not arise. Other grounds (default notice timing, alleged contracting out, unfair relationship and unfair term under the Consumer Rights Act, and data protection) were considered and dismissed on the facts: the Recorder's findings about breach and credibility were upheld and any unfairness did not justify relief. The appeal was dismissed and the Recorder's orders remained in force.

Appeal dismissed. The High Court agreed with the Recorder that police seizure operated to suspend the debtor's right to possession and that Santander recovered the vehicle from the police/bailee, not from the debtor; accordingly section 90 CCA did not apply and the Recorder's findings of breach and orders for possession and sums payable were upheld.

On appeal from the Order of Recorder Cameron in the County Court at Barnsley (sitting in the County Court at Sheffield/Leeds). Permission to appeal was granted by the Recorder. No prior neutral citation for the County Court order is stated in the judgment.