Presumably the quoted minimum connection is for passengers who have been checked right through so only need to do the actual moving from one plane to the other. If you're not checked through you'd have to add that time to the checkin time of the second flight plus something for getting your bags from the first flight. So the advice of 3 hours sounds like the least you should allow and 4 hours would be reasonable in this case. So if Benz Travel have not done this I'd say have a go under the care and skill rule.
Nope. I'm afraid the MCT (Minimum Connection Time) is the recommended
time airlines recommend you should leave between flights, irrespective of whether it's a through ticket. The terminals / flights numbers / airline to airline connections are is then loaded to show the MCT. This would allow you to book (online or offline) to book connecting flights that adhere to this. It's calculated in conjunction with the airline and airport authority, and should be fine should everything be working most of the time.
However, it rarely does at Heathrow as many of us have said. What might surprise you is that as little as 20 minutes is the accepted norm (for domestic flight connections to / from the same terminal). For a BA flight arriving at Terminal 5 connecting to a flight departing from Terminal 3, 90 minutes is the MCT.
I think you'd have a hard job proving Benz Travel are negligent rather than rubbish at what they do, as they are going by what the BAA have established as being fine, not that that helps much.
I'd still like to know why they put you on BA as opposed to bmi though. Can the OP expand on whether they were offered bmi, or the difference explained to them?