Money Grouse: No compensation after slow post wiped out share profits

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The Independent Online
ANDREW HICKSON, a tax adviser, has been dabbling in new share issues.

In June he applied for shares in Carpetright but missed out because his application did not arrive in time. 'I estimate that I lost about pounds 50 to pounds 60 on first-day dealing profits that I could not take advantage of,' he complained.

Mr Hickson posted his application by first-class post on Monday 14 June, in time for collection at noon. 'I thought there would be no problem for it to reach National Westminster Registrars in Bristol, a distance of less than 100 miles, by the deadline on Wednesday morning.

'Imagine my surprise when I received a letter from NatWest advising me that the application was not received until Thursday and therefore my application had to be rejected.'

The Post Office apologised but offered no compensation. Mr Hickson complained again and this time received four first- class stamps, as a gesture of goodwill. The Post Office said he would have been entitled to more only if he had insured his letter.

A spokesman for the Post Office Users National Council, the consumer watchdog for the Post Office, confirmed that this was correct and recommended that people send share applications by registered post.

This seems an expensive way to apply for shares. But the Post Office agreed with the watchdog. A spokesman explained that the maximum compensation available for items sent by first- or second-class post or recorded delivery was pounds 24, but this was payable only on items actually lost or damaged, not on late deliveries.

Items posted special delivery qualify for a payment for delay but the maximum would be twice the special delivery fee of pounds 2.70, a total of pounds 5.40.

By registering an item you would automatically be entitled to a higher level of compensation for loss or damage, but not 'consequential' loss, such as first-day dealing profit. The share application papers would have no value in themselves, the Post Office spokesman said, but there was a value attached to the consequence of losing them.

Someone who wants to protect against this, he said, should register and pay for additional insurance cover. The premiums range from 45p for pounds 1,000 of cover to pounds 1.35 for pounds 10,000. This covers loss of business, profits or sales that may result if the item is lost, damaged or delayed in the post.

The cost of registering a letter is pounds 3 for an item weighing up to 2kg. The insurance is available only on registered items, not ordinary post.

Write to Money Grouse, The Independent, 40 City Road, London EC1Y 2DB. Include a daytime telephone number. Do not send SAEs or original documents.

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