Me v 1st Credit (Stat Demand)

[GaryH]

Thought I'd (finally) post details of this, in case it helps anyone else in the same position.

Got into a dispute with Citi financial in August last year when I missed a few payments. It was actually a simple cock up between them and my bank when I switched bank accounts - payments were leaving my new bank account and reaching Citi's holding account but the standing order instruction did not contain the correct reference (their fault!!) so they did not recognise the payment had been made. I showed them my bank statements and told them I was not going to pay any more until they'd sorted it all out, which being utterly imcompetant, they seemingly had neither the intelligence or the inclination to do. Instead, they started ringing me about 10 times a day (even Sundays!) and adding ridiculous amounts in charges.

I then sent off the usual CCA request and S.A.R - (Subject Access Request). The agreement was suspect to say the least with no signature or date, and they also had the cheek to tell me that they don't comply with the Data Protection Act and that a full copy of my file will cost me £30!!

So to cut a long story short, the 'debt' was assigned to the charming 1st Credit and they have been chasing me since October 07.

25/10/07 - Letter informing me debt had been assigned, pay us now, do not ignore this letter, blah, blah, blah..

Ignored.

26/11/07 - Letter from LCS 'solicitors'. Pretty standard by the looks of it, telling me that they have been instructed by 1st Credit to to recover a seriously overdue debt, pay our 'client' within 14 days or we will issue county court proceedings, blah, blah, blah. Also stating that they are not instructed to negotiate prior to issuing!!!

My response -

LCS Claims Handlers
The Omnibus Building
Lesbourne Road
Reigate
Surrey
RH2 7JP


Dear Sir/Madam

Your ref: ***

Thank you for your letter dated 26th November 2007.

As has previously been made plain in numerous phone calls and correspondences and telephone calls with Citi Financial, I do not acknowledge the debt to which you refer.

On 19th July 2007, I made a formal request under section 77 of the Consumer Credit Act 1974 (‘the CCA’) for a copy of the credit agreement under which Citi Financial allege monies to be owed. They could not produce any executed agreement which complies in form or content to the relevant provisions of the CCA. Any debt is therefore precluded from being enforced by order of the court by virtue of CCA s.127 (3).

Furthermore, on 13th June 2007, a request was made to Citi Financial under s7 of the Data Protection Act 1998 for copies of all data relating to me and my alleged account. Citi Financial refused to comply, and in one tape recorded telephone call did in fact state that they do not have to comply with the Data Protection Act and that a copy of my file would cost £30.

Citi financial have also caused me significant damage and distress by way of their campaign of harassment conducted against me between July and September 2007. On some days I was receiving in excess of ten telephone calls a day from their “Capital Collections” department and was signed off of work with stress for 3 weeks as a result. All such harassment has been fully documented and should you require particulars no doubt you will advise by return.

In view of the above, I demand that you withdraw your threat of legal action immediately. Any claim for enforcement of a CCA regulated credit agreement cannot succeed without disclosure of the executed agreement and the persual of a claim in these circumstances is vexatious, intimidatory and stands no prospect of success. Accordingly, you are hereby advised that any claim will be met with a defence and counterclaim followed by an application for summary judgment on your claim in its entirety.

Finally, I would take issue with the statement in your letter that you will not negotiate prior to the issuing of legal proceedings. This statement beggars belief from a firm purporting to be “solicitors”. You should be well aware of the overriding objectives and the duty to exchange information in accordance with the Pre-Action Practice Direction of the CPR. Attention is drawn in particular to Pre-Action PD 4 and you are therefore required to provide the following documents prior to commencement of any possible litigation;

• If such is to be relied upon, a true copy of the Credit Agreement under which you allege monies to be owed;
• A copy of the Deed of Assignment which substantiates your right of action in this matter;
• A copy of any default notices served;
• A full set of statements relating to the alleged account.

Kindly provide the information requested within 21 days. Should you not respond to this letter, I reserve the right to disclose it to the court as evidence and/or in respect of your unreasonableness on the issue of costs.

Please also provide a copy of your complaints procedure and confirm whether or not you are a firm regulated by the Law Society.


Yours Faithfully,

7/12/07 - Response from 1st credit. Comments noted, please call our office to discuss, etc.

10/12/07 - Letter from 1st credit 'debt help team'. Offers me the chance to negotiate a 'generous reduction' to the debt and a payment plan. I assume this must be the letter they send out when they realise they are stuffed.

Response -

Collections Department
1st Credit
PO Box 278
Reigate
RH2 7WB


12th December 2007


Dear Sir/Madam

Your Ref: ***

Thank you for your letter dated 7th December, and also from your ‘Debt Help Team’ dated 10th December.

Please be advised that I have no intention whatsoever of discussing this matter with you over the phone and I once again repeat my request that you withdraw your frivolous threats of legal action immediately.

Alternatively, should you be minded to carry out your threat please ensure proceedings are served correctly using the address provided in the top right hand corner of this letter.

However, may I remind you that my last letter contained a perfectly reasonable request for information and documentation which is fundamental to your allegations and you have chosen to completely ignore this request. My request was made under CPR Pre-Action PD 4 and attention is drawn to the consequences provided therein of failure to comply.

I also require a copy of the complaints procedures of both 1st Credit and LCS “Solicitors” as well as confirmation of whether or not the latter is a firm regulated by the Law Society.

I trust this clarifies my position.


Yours faithfully

Nothing then until 07/02/08, when I received this letter from who I gather is their 'top' man -

Thank you for your letter dated 12/12/07

I note a 'true copy' of the agreement and statements were posted to you on 2nd January. We have therefore complied with your request.

We look forward therefore to your proposals to settle this debt within a reasonable timescale.

Please be assured that any legal proceedings will be served correctly at the address you recently provided.

A copy of our complaints proceedure is attached.

LCS solicitors is not a firm regulated by the law society. We have already been in contact with the solicitors regulation authority who have visited our offices and, we are pleased to say, confirmed that it is not a breach of the professional rules of conduct in the way that our in house team of solicitors is set-up, administered or indeed operates.

I do hope we are able to reach an agreement to clear this long overdue loan.

Yours sincerely,

They never sent an agreement. Or I never received it anyway. My response -

Dear Mr ------

Your Ref: ***

Thank you for your letter dated 7th February 2008.

I can confirm that the documents which you state were posted on 2nd January 2008 have not been received. Kindly resend at your earliest convenience and upon receipt I will be happy to consider my position further.

Your comments with regards to ‘LCS Solicitors’ are noted.

Yours Sincerely

I then got a letter dated 11/02/08, enclosing exactly the same suspect and completely unenforceable agreement that Citi had provided previously under the CCA request.

My response -

Mr --------
1st Credit
PO Box 278
Reigate
RH2 7WB

16th February 2008


Dear Mr -----

Your Ref: ***

Thank you for your letter dated 11th February 2008.

As you will no doubt be aware, the alleged ‘agreement’ you have disclosed is unenforceable.

Not only is it lacking many prescribed terms, but it is also not executed, neither properly nor at all. As such, your claim cannot succeed as a matter of law; any debt which may be owing under such an unexecuted ‘agreement’ is precluded from being enforced by order of the court by virtue of the Consumer Credit Act 1974 s127(3). A copy of the relevant section of the Act is enclosed for your perusal.

No doubt you will also be aware of the decision of the House of Lords in the case of Wilson v Secretary of State for Trade and Industry[2003] UKHL 40, where the Law Lords held that CCA s127(3)barred the court from making an order to enforce an unexecuted agreement under these very same circumstances, and that the same did not constitute an infringement of Human Rights Legislation. The House also rejected submissions that the creditor had an alternative restitutionary cause of action. A summary of this judgment is enclosed for your perusal.

You are therefore required to show cause as to how exactly your claim could succeed contrary to an Act of Parliament and binding precedent set by the unanimous judgment of the highest appellant Court in the United Kingdom.

Should you still be minded to issue proceedings notwithstanding the above, then please do so at your earliest convenience.

Alternatively, please withdraw your threat of legal action until or unless you are able to present any valid or legally recognisable claim.

I await either of the above responses within 7 days.

Surprise, surprise, they did not respond.

Until just over a week ago that is, when they changed tactics and issued a statutory demand.

For those who don't know, a stat demand is a demand for payment of a debt under s268 of the Insolvany Act and is the first step to a bancruptcy petition. Failure to respond to one within 18 days means the creditor is entitled to commence bancruptcy proceedings after 21 days. For this reason, a stat demand should never just be ignored. However, they are used mainly as a scare tactic by creditors, which is clearly the case here and which in my view amounts to an obvious abuse of process.

There is some excellent advice on stat demands and how to deal with them here -
http://www.consumeractiongroup.co.uk...statutory.html

As per sequenci's thread, one of the ways to respond to a statutory demand is to apply to have it set aside. You can only do this if you have grounds to - one of the grounds is if the debt is disputed, which, in this case, clearly it is.

The forms required to set aside a stat demand are;
http://www.insolvency.gov.uk/pdfs/forms/6-4.pdf
http://www.insolvency.gov.uk/pdfs/forms/6-5.pdf

This is my affidavit on form 6.5 -

(1) Do not admit the debt because the existence/enforceability of the alleged debt is in dispute:

The respondent alleges that the applicant is indebted to it in the sum £4127.00, being the amount outstanding under an agreement regulated by the Consumer Credit Act 1974 (“CCA”). It is further alleged that the debt was assigned to the respondent from Citifinancial Europe Plc on 17/10/2007. The applicant will say that the statutory demand should be set-aside upon the following grounds;

a) The applicant does not admit that the debt exists. The respondent is put to strict proof that that the alleged agreement was entered into between CitiFinancial Europe Plc and the applicant; and at what place and on what date and upon what terms.

b) In the event that the burden of proof is discharged as set out in paragraph 1) above and entirely without prejudice to the same, the applicant does not admit that the debt is legally enforceable. The respondent has disclosed a copy of the agreement under which it alleges the debt to be owed in response to a request under CCA s.77(4). The alleged agreement is unexecuted and devoid of CCA prescribed terms and accordingly is unenforceable as a matter of law. The alleged agreement is exhibited hereto as ‘B’.

c) The respondent is put to strict proof that the alleged debt has been properly assigned.

d) The respondent is put to strict proof that a compliant default notice was served in relation to the alleged agreement pursuant to CCA s.88(1). Further or alternatively, the alleged debt contains sums levied by way of penalty charges which the applicant will say are contrary to common law. Accordingly, any default notice which may have been served could not have contained accurate particulars of the outstanding debt and would therefore have been defective and invalid.

e) The applicant has potential grounds of action against the respondent for damages in respect of the applicant’s pain, suffering and loss of amenity caused by the respondents excessive harassment and that of Citifinancial Europe Plc. Accordingly, any proceedings initiated by the respondent may be subject to a counterclaim.

f) Attention is drawn to recent correspondence between the applicant and the respondent, exhibited hereto as ‘C’, in which the grounds upon which the alleged debt is disputed were set out clearly, coherently and in full. The respondent was invited to file a County Court claim in order that, in the interests of justice, the many matters at issue can be fully, fairly and properly determined before a judge at trial. The respondent has declined to do so.

g) The respondent has chosen to serve a statutory demand by ‘regular’ post in full knowledge of the fact that the debt is subject to an ongoing vigorous legal dispute. In view of this, and of the matters pleaded above, the applicant avers that the service of the statutory demand is demonstrably frivolous, intimidatory and an abuse of process.

Accordingly, the applicant respectfully requests that the statutory demand be struck out or set-aside. Further, the applicant invites the court to make an order of costs in favour of the applicant in respect of the reasonable cost of preparing this application and of attending any hearings in respect thereof.

I make this statement with the sworn belief that all facts stated are true.

I'm filing it at the court on Monday. Obviously nothing is certain but I'm not sure how they could possibly be successful. Hopefully there will be a hearing and I get the chance to hammer them for costs!! I'll post as soon as I know the outcome.

Feel free to use any of the letters/application, but only if they are approprite to your circumstances. Seek further advice if in any doubt!

[babybear39]

Subscribing...

Bet I know who you've been corresponding with

Good luck and best wishes.

[GaryH]

Thanks BB!

Yep, I think you probably do...

[MrCollio]

Just come accross your thread.

The point 1st Credit make about LCS Solicitors is rubbish. The principal solicitor of LCS Solicitors is actually registered with the Law Society as LDS Solicitors.

This is currently being investigated. I know this as I have an outstanding complaint which is being investigted.

[GaryH]

Exactly - I'm sure most people would sus out the fact that they're just 1st Credit in disguise, although I'm sure their silly letters under the guise of 'solicitors' probably have the disired affect of scaring old ladys so for that reason they probably think its worth it.

Set-aside hearing is 1st May btw. Can't wait!

[pt2537]

Awww Bless em, theyve sent you a stat demand eh? the wallies , they seem to be sending these things out like confetti at the mo

cant wait til the 1st although the result really isnt in any doubt

[PGH7447]

Subscribing, got my 1st crud letter yesterday

HFC + CapQuest now 1st Credit

Good Luck

[nicsussex]

This one will be well worth subscribing to - go get'em Gary!

[icepop55]

Just what I've been looking for-SUBSCRIBING.

[GaryH]

Thanks for your support everyone.

All went according to plan on Thursday. Other side never turned up (shock!), they sent a snivelling letter to the court instead saying they "meant no disrespect" by their non-attendance and they had no objections to the demand being set-aside. Which raises the blindingly obvious question - why serve the bloody thing in the first place?

Of course we all know why - which I submitted to the judge and luckily she agreed. In fact she was noticably annoyed by the fact that statutory demands were being thrown around like confetti as a debt collecting tool by half-witted snotty nosed fee earners without any intention whatsover of seeing them through. Got what I asked for in costs - £157, (I thought I'd over-egged it a bit before I went in but in hindsight I now wish I'd asked for a bit more because I would probably have got it) to be paid by 14 days. Lets hope they don't pay so I can send the bailiffs in.

As far as the 'debt' goes, I will now invite them to withdraw their threat of legal action and cease chasing me in return for my agreement not to assert any right of action I may have against them. I doubt they will go for it, because they are stupid, but just maybe someone will have the tiniest modicum of common sence enough to realise that the longer they drag this futile excercise on the more money it will cost them and the more silly they will feel.

[spiritgirl59]

Hiya Gary

A big well done to you!

Am subbing because 1st Credit have just got on our case too.

BB if its the same guy hounding us now, what a little sweetie he is !! I have just call barred their number because of his pleasantries (!!) ... he must have a huge pile of dummies he's spat out on his floor by now ... but have a feeling it won't stop him and we are in for a long battle!

Love SG x

[babybear39]

Congratulations GaryH


Hi SG, there are a few at 1st credit who do that so best ask his name and them I can confirm

[zootscoot]

Nice one Gary!