A £93 million claim has been filed against the operators of the South Western (current and previous) and Southeastern rail franchises.
The claim was filed on 27 February 2019 at the Competition Appeal Tribunal by our client Mr Justin Gutmann on behalf of rail passengers who have been overcharged due to the limited availability of boundary fares. The claim is the first stand-alone collective action to be filed in England & Wales.
Boundary fares allow passengers who own a TfL Travelcard to travel beyond the zones covered by their Travelcard without paying twice for parts of their journey. For example, if a rail passenger owned a zones 1-4 Travelcard, but needed to travel from Waterloo to Reading they should be able to purchase a fare from the edge of zone 4 to Reading. However, owing to the difficulty in purchasing boundary fares and the fact that consumer awareness is very low, rail passengers end up paying for the full journey from Waterloo to Reading and, in doing so, pay twice for the part of the journey between Waterloo and the boundary of zone 4.
Independent research has shown that boundary fares are not readily available. Their availability varies by sales channel and is limited compared to fares for ordinary point-to-point journeys which are universally available. Further, even where in theory available for sale, such as at station ticket counters, boundary fares are typically only sold to ‘passengers in the know’ on specific request.
First MTR South Western Trains Limited and Stagecoach South Western Trains Limited operate and previously operated the South Western franchise and London & South Eastern Railway Limited operates the South Eastern franchise. They are accused of not making boundary fares sufficiently available for Travelcard holders to purchase, nor making passengers aware of their existence. We believe that the effective imposition of an unfair price for fares is an abuse of the companies’ dominant positions in the train market and is in breach of UK and EU competition laws.
The claim is being brought by Mr Justin Gutmann, as the proposed representative of the class. Mr Gutmann has spent a large part of his professional life dedicated to public policy, market research and, specifically, to consumer welfare. His final position prior to retirement was a Head of Research and Insight at Citizens Advice. Mr Gutmann also spent eight years working for London Underground as Market Planning Manager. Mr Gutmann has a wealth of experience working in the consumer rights sphere and he has strong expertise in the transport sector.
Passengers who owned a Travelcard at any time from 1 October 2015 and also purchased a rail fare from a station within the zones of their Travelcard to a destination outside of those zones may be eligible for compensation. Millions of passengers are thought to be affected.
Mr Gutmann stated:
“Passengers in London already pay a lot of money for trains that are often delayed or not even running. Now following extensive research, we have found that some passengers are paying twice for parts of their rail journeys.
We are launching this legal action to ensure that the money that South Western and Southeastern have made from this is returned to those train users.
Millions of rail passengers could be eligible for compensation. Let’s put this right and stop train companies taking passengers for a ride.”
Dorothea Antzoulatos, Director of Charles Lyndon, said:
“Charles Lyndon has worked extensively with Mr Gutmann to develop this case which seeks to recover compensation for millions of rail passengers who have overpaid as a result of what we believe is the behaviour of the defendants. We are delighted to be working together with Hausfeld to represent Mr Gutmann in what will be the first stand-alone collective action in this country. A case such as this would not have been practicable before the introduction of the Consumer Rights Act 2015 and we hope that as a result of this action millions of rail passengers will be able to recover the compensation that is due to them.”
Charles Lyndon is jointly instructed with Hausfeld & Co. Philip Moser QC and Stefan Kuppen of Monckton Chambers have also been instructed.
Anthony Maton, Managing Partner at Hausfeld & Co. LLP said: “This claim is about rail passengers being able to recover what is rightfully due to them. This is only the fifth collective action in the Competition Appeal Tribunal and the first brought without the benefit of an underlying regulatory decision. We’re very pleased to be co-counsel for Mr Gutmann on this ground-breaking case.”
The claim is being funded by Woodsford Litigation Funding, a specialist litigation funder, and one of the founding members of the Association of Litigation Funders. Woodsford’s Chief Investment Officer, Mr Charlie Marris, stated:
“Third party funding facilitates access to justice and is an integral part of consumers bringing collective actions such as this boundary fares claim. Woodsford is looking forward to helping consumers achieve the compensation they are entitled to.”
Anyone who would like to receive further information about the claim can visit www.boundaryfares.com to sign up for updates.
If you would like to discuss the claim please contact Dorothea Antzoulatos (e: [email protected] t: 0207 959 2274)