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Factual and contractual background
Factual and contractual background
The FTT set out their findings of fact at [86] – [117]. The FTT’s findings are not challenged in this appeal. For the purposes of this decision, the relevant background may be summarised as follows.
TalkTalk supplied retail customers with the following services: line rental services, call services, TV services and broadband services. Customers could select a bundle of services to suit their own requirements.
TalkTalk’s contracts with its customers were governed by terms and conditions (‘Ts&Cs’) which were published on its website. The Ts&Cs relevantly provided that:
TalkTalk billed customers monthly in advance for all services except for those relating to calls made by customers and TV Transactional Charges which were both billed in arrears (clauses 10.5 and 10.17);
customers were required to pay all bills for the services provided by TalkTalk by direct debit and TalkTalk would collect the bill payments from the customers’ bank accounts on the payment due date shown on the bill (clause 10.6);
TalkTalk were entitled to amend their charges and such changes would be notified to customers by making the amended list of charges available on the TalkTalk website (clause 10.16);
customers who wished to cancel a service had to give TalkTalk written notice either 15 or 30 days in advance depending on the service (clauses 11.1 and 11.4).
some of the services were subject to a minimum period of 12, 18 or 24 months after which they continued until they were terminated in accordance with clause 11 (clause 1.4, 11.2 and 11.3);
if a customer terminated their contract during the minimum period, they had to pay TalkTalk an additional charge as compensation for losses for each month until the end of the minimum period (clauses 11.2 and 11.8);
TalkTalk could unilaterally change the Ts&Cs by giving its customers notice in writing and/or publishing the changes on the TalkTalk website (Clause 16.1); and
the Ts&Cs set out the whole agreement between TalkTalk and its customers for the provision of the services (Clause 16.2).
The SPD was not mentioned in the Ts&Cs and no amended version of them was sent to customers who accepted an SPD offer. Before the FTT, TalkTalk’s witness, Ms Lorraine Harper, accepted that customers who wanted to access the SPD “had to go through a separate process” under which they were “redirected to a website to make a separate payment”.
Customers could access their accounts with TalkTalk by using a system called “My Account”. This allowed customers to view their bills, change the particular services in their packages and manage their payments. It was accessed via TalkTalk’s website. Information about the SPD was provided on a dedicated page on TalkTalk’s website. The SPD was made available to customers with an active My Account in respect of payments for line rental, calls, broadband and TV services (but not mobile packages). Customers were notified by email when a new bill had been posted on their My Account. The email stated “Pay quickly and save 15% with Speedy Payment Discount” and provided a link to the bills and payment page from which the customer could pay their bill. If the customer accessed the page within 24 hours of receiving the email, they would see their account balance and a message informing them that the SPD was available. The customer could then follow the prompts to pay the discounted amount by credit or debit card, in which case TalkTalk would not request the customer’s direct debit payment for that month. After 24 hours, the page stated that that the customer had missed the period for obtaining the SPD that month but that it would be available again next month.
Customers who did not have an active My Account received paper bills. The paper bills included a text box which informed the customer that they could save 15% every month with the SPD if they set up a My Account online.
Exceptionally, the SPD was offered to customers without an active My Account by call centre agents (for example, where a reasonable adjustment for disability was required or because a customer did not have broadband access). The FTT found, at [98] and [99], that very few SPD offers were made on this exceptional basis and neither party made separate submissions about them. The FTT did not distinguish between the VAT treatment of supplies made to the vast majority of active My Account customers and those made to the very few exceptional cases, and neither do I in this decision.