Ms Wilson pawned her car to First County Trust for a loan of £5,000. The pawnbroker charged an agreed documentation fee of £250, which would be added to the loan. Ms Wilson signed a regulated consumer credit agreement, which recorded the loan amount as £5,250. She did not repay the loan but issued proceedings claiming that the agreement was unenforceable because it did not comply with s.61, and that the rate of interest was exorbitant. The district judge rejected the first contention but reduced the monthly interest charge. Ms Wilson redeemed the car on payment to the pawnbroker of £6,900.
She then appealed from the judge’s order on the grounds that the agreement and the security were unenforceable, and claimed return of the £6,900 as well as the car. The Judges agreed that the loan was totally unenforceable under the Consumer Credit Act 1974, but the appeal was then adjourned for legal argument after the pawnbroker claimed that such a decision would infringe his rights under the Human Rights Act 1998. The case was then referred to the government as being possibly incompatible with the European Convention on Human Rights (ECHR), and was continued with the Secretary of State for Trade & Industry being joined as a party.

The Court of Appeal held that:

1.    There was no conflict between the Consumer Credit Act 1974 and the Human Rights Act 1998. It was the court’s judgement that had to be made subject to the 1998 Act.

2.    The rights of a creditor under a regulated credit agreement who failed to obtain a document signed by the debtor which contained all the prescribed terms were subject to restrictions on enforcement. Enforcement was made subject to judicial control. That restriction engaged the ECHR. The guarantee of a fair determination of a party’s civil rights was of no substance if the statute prevented enforcement where that was just and where there was no prejudice to the debtor. The provisions of s 127(3) were to be contrasted with s 127(1) which required the court to consider the justice of the case and the fact that a court was not prevented from making an enforcement order if the failure to comply with s 61(1)(a) of the Act was the omission of a term which was not a prescribed term. The exclusion of any judicial remedy engaged not only Art 6(1) but also Art 1 of the First Protocol because the effect of ss 65(1) and 127(3) was to deprive the pawnbroker of their ability to enjoy the benefit of the contractual rights arising from the agreement or of the rights arising from the delivery of the security. That did not strike a fair balance between the rights of the individual and the public interest. Judicial control of enforcement was a legitimate means of pursuing a legitimate policy objective of making sure that particular terms were included in a document signed by the debtor.

The Secretary of State appealed to the House of Lords, neither the original plaintiff nor defendant being represented. However, counsel did appear for the Finance & Leasing Association, four leading motor insurance companies, the Speaker of the House of Commons and the Clerk of the Parliaments, such was the importance of the hearing. The Law Lords reversed the judgement on the following grounds:

1. The Human Rights Act 1998 could not apply to the original transaction, which preceded the inception of the law. Legislation could not be retrospective except where it was for the good of the public. (The Court of Appeal had presumed that it was the date of its decision that had to be after the start of the Human Rights Act.)
   
2. The Consumer Credit Act contains sanctions laid down by Parliament. UK legislation cannot be overridden by the Human Rights Act even if it is incompatible with the Convention.
   
3. The Consumer Credit Act is a legitimate measure to provide consumer protection. Borrowers are vulnerable and not on an equal footing with lenders.

It was also noted that the agreement was unenforceable except on an order of court (s.65(1)) and did not become void or unlawful. Only a court could make the agreement enforceable, and s.127(3) barred them making such an order under certain circumstances.