Central Statistical Office in contracts

[steve99]

I have a contract with a mobile provider who claim that their terms and conditions allow a price increase that I must pay until my fixed term contract ends.

Here is what the T&Cs say
[we can increase the price by] "an amount equal to or less than the percentage increase in the All Items Index of Retail Prices published by the Central Statistical Office in the Monthly Digest of Statistics in any 12 month period"

The term seems pretty specific about the document being published by the "Central Statistical Office". It doesn't say "the C.S.O., or anybody superseding them, other agencies, or people we might think of later".
A quick check on Directgov shows no government departments, executive agencies, or non-departmental public bodies called "Central Statistical Office"

It seems the "Central Statistical Office" merged with another office in mid 1996 and became a part of the "Office for National Statistics".

Given there has been no "Central Statistical Office" since 1995 they have obviously not published anything since then.

In terms of contract law are the mobile provider allowed to increase prices based on publications by the "Office for National Statistics" or other agencies not referred to in the contract / terms?

Thanks

[factor-fiction]

Is this Orange?

[steve99]

Aggh better proof reading in the future.. "Given there has been no "Central Statistical Office" since **1996** they have obviously not published anything since then. "

[boxtops]

I am no expert, but in our contracts at work these days, we put "X, or their successor organisation". I suspect that this wording is somehow implicit in the T&C on your contract.

[steve99]

Yes - it is Orange.

I'd have expected the contact to say "X, or their successor organisation" but the word successor appears not once in the entire document.

The T&Cs are here:
http://www1.orange.co...Services-20110215.pdf

[ABerrant]

Orange have been remiss in not updating their T&cs within the past 15 years but perhaps the technicality of the (now) misnamed Government department/agency/body may be reasonably offset by the fact that the 'Monthly Digest of Statistics' is still the name of the publication produced by the successor organisation ONS.

[buildersmate]

It is a good spot and worth a try. Write them a letter pointing out the lack of update by the CSO and stating that you can therefore see no reason why a price escalation should occur. Because of the possibility of the issue becoming wider known, they might just back down.
If they refuse, it is probably not worth taking ity further and calling their bluff by threatening court action - unless you can interest one of the consumer watchdog organisations in taking up the challenge.

[factor-fiction]

There was something about Orange I think on Radio 4's Moneybox yesterday (repeated tonight at 9.00) saying how you could get out of an Orange contract becaus eof the price increase they were trying to impose. I only half heard it so it may or may not be relevant to your case

[steve99]

Thanks for all who have answered so far. I had a phone conversation re the C.S.O. no longer existing - unfortunately this didn't get anywhere so as you suggest I will follow it up in writing.

I haven't heard Moneybox's programme but I'll download it and see what was said. I have since been told that Ofcom's General Condition 9.3 says communication providers must notify changes that will be of "material detriment" and allow customers to leave without penalty if they do not agree.
Any increase in cost for provision of the same service sounds like it would be of "material detriment" to me, especially if an identical service was available elsewhere at the original price.
I raised this with Orange and I'm told someone is getting back to me - I'll post an update when they do for anyone with the same problem.


Another question if I may.
Inflation affects both companies and their customers, the pound in your pocket is worth less than it was before. As such Orange's income is worth less than before, but with salaries remaining largely fixed or falling, the customer is also worse off.

While the T&Cs document purports to give Orange a method of passing their problem to the customer (who now has both less buying power and Orange's higher price to deal with), there is no equal provision for the customer to notify Orange they have decided to start paying a lower price (the very ideal is laughable).
Is this not a significant imbalance in rights and obligations putting the customer in a position to his detriment?
Given the contract is not individually negotiated would I be correct that the term is not binding due to the Unfair Terms in Consumer Contracts Regulations?

Thanks

[factor-fiction]

I am not sure that argument would get you far, steve99. If you extend the argument, the government could use it as an excuse to cut benefits/state pensions (rather than uprate in line with inflation) on the basis that their financial postion has deteriorated).
I suppose though that if that practice wa semployed across the board it would drive all prices and incomes down so inflation may no longer be an issue

[steve99]

I'm not really sure I follow you factor30.
Inflation causes benefits/state pensions to become worth less than before because the value of the money paid out is lower, the government is (or should be) looking to raise payments by an equal amount to inflation so that recipients are placed in the same position as before the value of the money changed.
While the value of the income (tax and such) drops the value of the outgoing (benefits/state pensions) also drops. There is no argument to pay a lower outgoing amount. The problem will only come when benefits/state pensions are raised to combat the drop in value and this obviously requires an increase in income via tax and similar.

In my situation both parties (provider and consumer) are suffering from inflation, and one party (the provider) has decided to pass their burden to the other (the consumer). Now the consumer suffers twice and the provider not at all.
That sounds like a deal that is detrimental to the consumer.

This isn't the government making law and policy, this is a simple contract, and it sounds like a contract with a term which is detrimental to the consumer and not individual negotiated - we have laws to stop that.

Maybe I'm wrong, but I'm not sure I follow why. Thanks

[buildersmate]

Contracts where the price charged can vary according to the change in an underlying (and invariably independently-assessed) price or cost index are very common in B2B arrangements - I've been involved in negotiating many of them in long term PFI or PPP deals (where the contract can last for between 10 and sometimes as long as 40 years). I've never seen one yet where your idea of 'material detriment' prevails. It can and does happen that the contractor cost base IS used as a mechanism for the change in price charged - but the terms of this sort of arrangement are complex and spelled out in detail upfront.
I think you are a on a hiding-to-nothing - your better bet is that the organisation that their contractual terms are linked to is now kapput (and hence it is not possible for this term to be invoked in order to escalate the price to be paid by you for the service.
There you are - I've given you some potentially useful wording for use in your letter to Orange.

[ABerrant]

The organisation may be "kaputt" but two qualifying parts of the clause "All Items Index of Retail Prices published ... in the Monthly Digest of Statistics" still exist, so would a reasonable interpretation void the contract?

On a whimsical note, if the argument does indeed fall in your favour I hope the Bank of England does not catch wind of it and invalidate all banknotes not bearing the signature of the current Chief Cashier, which would only leave the new issue of £50 note available since November.

[factor-fiction]

^ I'm not sure I follow you either. You are saying a company should not be allowed to put prices up if your earnings haven't gone up because that's a detriment to you. But Joe Smith's earnings may have gone up by 20%- what should happen to him. And mine recently fell by 100% so should I get a free phone contract. Are you saying prices rises/reductions for contracts should be linked to each person's circumstances? That would be completely unworkable so companies set increases linked closely to RPI/CPI, just as the governement had done with state pensions and unemployment benefits.

If you are going to make a claim i would keep away from that argument if I were you- I would just focus on showing they had breached their terms or their terms were unenforceable because the CSO doesn't exist.

[steve99]

Thanks for all your replies. I don't wish to argue but I would like to discuss if you don't mind.

Sorry if I was unclear, I'm not saying that "a company should not be allowed to put prices up if your earnings haven't gone up". I'm saying that your earnings should not be relevant, and that terms in a business to consumer contract should not contain terms that are detrimental to the consumer.

>Joe Smith's earnings may have gone up by 20%- what should happen to him.
His previous cost per month should remain the same for the duration of his fixed term agreement.

>mine recently fell by 100% so should I get a free phone contract
No. Your cost per month should remain the same for the duration of your fixed term agreement.

>Are you saying prices rises/reductions for contracts should be linked to each person's circumstances
No - I'm saying the exact opposite. A contract was entered into with a cost per month and changes in your circumstance, or the provider's circumstances, should not lead to the other party paying a different amount for the same service (during the remaining fixed term).
I'm saying that you should no more get a reduction in price to allow your expenditure to be reduced than Orange should be allowed to increase their price to make up for their reduced income. If they want to charge more on future contracts then fine, just as you may choose to pay less on your future contracts, but existing contracts should not pas the burden from one person to another - or by the same logic as the price rise you are due your 100% discount.

I'm basing my idea of ending the contract on 9.6b here:
http://stakeholders.o...eneral-conditions.pdf
Is it my definition of material detriment that is wrong?

Thanks

[aquababe1965]

did you get a response to this question as i am seeking the same information?

[aquababe1965]

hi did you get a response from this question as i have the same query?