Does it matter when the creditor signs an agreement and do they have to send a copy to the debtor?

[banker_rhymes_with]

Hello All!

As this Thread has grown out from another Thread, I'm just adding some Comments here to explain the background.

Tonka99 had what looked like a well executed Agreement for a Fixed Term Loan with PPI from the MBNA. It looks grim, but then it was spotted that the bankers had Signed and Dated the Agreement before Posting it to Tonka99.

As the Loan was a Cancellable Agreement, this raised some questions about s63 and s64 of the Consumer Credit Act 1974.

The Agreement effectively became Executed the moment Tonka99 Signed it. It was sent via Post, so it was not an Agreement made at a bank or in the presence of a bank employee authorised to Sign.

Below follows where it was spotted that the Signature Dates were potentially an issue worth exploring. This Thread can now take things from here...

I also think the Signature Dates is a big issue, and that, along with Charges and PPI reclaim could well come together to make a good Defence/Counter-Claim.

The Signature Dates may be worth holding back on, and then bring them out in your Defence. If I'm right on that, the issue could preclude a Court from Enforcing that Agreement...see the details I outlined in Post #4.

Cheers,
BRW

(Note: this thread was created from posts from Mbna Loan V M1plg and some of the points may relate to that thread)

[steven4064]

BRW

I've had a look at the signature date thingy and I think I don't agree with you

As you point out in post #4, the relevant section is s63 of the CCA 1974

63. Duty to supply copy of executed agreement.
(1) If the unexecuted agreement is presented personally to the debtor or hirer for his signature, and on the occasion when he signs it the document becomes an executed agreement, a copy of the executed agreement, and of any other document referred to in it, must be there and then delivered to him.

(2) A copy of the executed agreement, and of any other document referred to in it, must be given to the debtor or hirer within the seven days following the making of the agreement unless—
(a) subsection (1) applies, or

(b) the unexecuted agreement was sent to the debtor or hirer for his signature and, on the occasion of his signing it, the document became an executed agreement.

This identifies 2 cases where a copy does not need to be sent. Both relate to situations where the document becomes an executed agreement at the time when the debtor signs it:

1) when it is presented to the debtor personally and (s)he signs it and it becomes an executed agreement and it is given to her/him there and then. This would be in a shop or during a visit to the debtor's home when (s)he signs it and a representative of the creditor also signs it.

2) when it is sent to the debtor for signature and it becomes an executed agreement at that time. This can only happen if the debtor receives the document already signed by the creditor.

[banker_rhymes_with]

Hello Steven!

Firstly, I think this was not Signed by T99 on site at the MBNA Offices, so I don't think s63(1) applies.

Thus, if the Agreement arrived on T99's dormat via Post, pre-Signed, then when T99 Signed it, then I agree that s63(2b) applies. The Agreement is executed upon T99's signature.

s63(2b)
the unexecuted agreement was sent to the debtor or hirer for his signature and, on the occasion of his signing it, the document became an executed agreement.

However, if this is a Cancellable Agreement, which I think it was, then would not s63(3) apply, in other words, s63(3) over-rules s63(2b) in the case of a Cancellable Agreement. That would seem logical, as the debtor must be given an option to bang out, even after signing, otherwise it can't be Cancellable.

If it's Cancellable, then the Creditor has a Duy to remind the Debtor of those rights after execution. In the case of an Agreement that becomes executed upon the Debtor Signing, then a Copy plus Cancelling Rights can only follow via post, there's no other way if it was signed in their own home having arrived there in the first place via post. The Creditor can't remind the Debtor via Mental Telepathy! They have a Duty, and the only way to discharge that Duty has to be via Post after execution, which was why I'm sure s63(3) was added to the Consumer Credit Act.

T99 had to return it, and the seven day clock was ticking from the date that T99 put pen to paper. The MBNA had just seven days to get the Agreement back, copy it, and send out a copy for T99 along with Cancellation Rights.

s63
(3) In the case of a cancellable agreement, a copy under subsection (2) must be sent by post.

This does seem to say that despite what s63(2b) says, if it was a Cancellable Agreement, then a Copy has to be sent by Post if the MBNA are to be in compliance with s63(3) as well.

If they did not post a copy, then they have not complied with Section 63(3).

If they failed to comply with s63(3) then I think that means the Agreement is not properly executed by virtue of s63(5):

s63
(5)A regulated agreement is not properly executed if the requirements of this section are not observed.

Furthermore, under s64, they have a duty to also send cancellation rights. Specifically:

64.
Duty to give notice of cancellation rights.
— (1) In the case of a cancellable agreement, a notice in the prescribed form indicating the right of the debtor or hirer to cancel the agreement, how and when that right is exercisable, and the name and address of a person to whom notice of cancellation may be given,—
(a)
must be included in every copy given to the debtor or hirer under section 62 or 63, and

(b)
except where section 63(2) applied, must also be sent by post to the debtor or hirer within the seven days following the making of the agreement.

As s63(3) over rules s63(2b) then they had to send cancellation rights within seven days of making the agreement, i.e. seven days from when T99 signed it, as it was pre-signed by the MBNA and executed when T99 put pen to paper. It's their tough luck that the clock started ticking so soon, as they could've avoided that by NOT pre-signing the Agreement. Had they sent out an unsigned Agreement, then the Agreement would remain un-executed even after T99 had signed it, until sent back to the MBNA, and executed when they signed it. Then they could've made a copy and post it, plus cancellation rights back to T99.

But they did not do this! They pre-signed it before T99 even saw it.

I do know why they did it this way, and that was because they were in a mad rush to get these Loans wrapped up to stop people taking a closer look at the PPI Cost. I was offered Marks and Spencers Gift Vouchers if I sent mine back within 7 Days! Why was that I wonder!

The MBNA therefore only had 7 Days from T99's Signature Date to receive the Agreement back from T99, crank out a Copy, add cancellation rights and post these back to T99.

I can't see how they managed that, although it is just about possible if T99 sent it back fast, and they returned a copy with cancellation rights as fast! Most would agree that's pretty unlikely. I know I never received a copy and did not receive any cancellation rights after Signature...and certainly not within seven days of me putting pen to paper (on a pre-Signed Agreement).

If I'm reading this correctly, and I stand to be corrected, as I am no expert, then I think the Agreement is not properly executed by virtue of s63(5), and cannot be Enforced by virtue of s127(4a) and s127(4b), as they failed to comply with section 63(3), and they also failed to comply with s64(1b).

Does that make sense?

I think there is some merit in this, as the MBNA seem very reluctant to press this one home. I suspect they have already been defeated on this, which was why they bent over so fast for Davefirewalker, and why they seem reluctant to stick the dagger in on T99.

I hope this helps, but any help to untangle my thinking would be appreciated. If I am wrong, I would much rather know that for my sake and that of T99.

Thanks in advance Steven!

Cheers,
BRW

[banker_rhymes_with]

Hello T99!

I think they are required to add cancellation rights at every step anyway because of s64:

64.
Duty to give notice of cancellation rights.
— (1) In the case of a cancellable agreement, a notice in the prescribed form indicating the right of the debtor or hirer to cancel the agreement, how and when that right is exercisable, and the name and address of a person to whom notice of cancellation may be given,—
(a)
must be included in every copy given to the debtor or hirer under section 62 or 63, and

But the other bit is really what I am trying to say:

the crediter will send you exact details of how and when you can do this

Exactly!

I think that they are required to follow up with both a Copy of the executed Agreement and details of your cancellation rights after execution.

Execution took place when you signed it, so there was an important step yet to happen for them to fully comply.

They should've sent you a Copy of the Agreement, and they should've sent you Cancellation Rights to go with that Copy.

Failure to do either and the Agreement...

...is not properly executed by virtue of s63(5), and cannot be Enforced by virtue of s127(4a) and s127(4b), as they failed to comply with section 63(3), and they also failed to comply with s64(1b).

I do hope I'm right in the way I have understood these sections of the CCA-74, as it's important for many of us who have Loans (usually with PPI) that were also pre-Signed before we saw them.

Must go to bed!

Cheers,
BRW

[steven4064]

BRW

You make some interesting points in posts #35 and #37. It's sent me back to re-read that part of the CCA 1974.

Firstly, s64 says that the right to cancel must be included in every copy and must be sent by post within 7 days except where s63(2) applies - ie where no copy of the agreement needs to be sent for the reasons I listed in post #33.

Secondly, s63(3) is odd! It only applies where s63(2) applies since it says "a copy under subsection (2)" - you could read it as saying "for a cancellable agreement, the copy you have to send under subsection (2) must be sent by post but a copy of a non-cancellable agreement can be sent by carrier pidgeon" - I don't know what its intention is.

s64(1)(b) says the right to cancel must be sent by post within 7 days except in the cases where a copy of the agreement does not need to be sent at all (ie where s63(2) applies).


(ps I wonder whether we ought to take this discussion out of Tonka's thread to a seperate thread - what do you think?)

[banker_rhymes_with]

Hello Steven!

Many thanks for your thoughts.

ps I wonder whether we ought to take this discussion out of Tonka's thread to a seperate thread - what do you think?

Yes, I think this could be a good one to start a New Thread. It's relevent to this Thread by T99, so I think T99 needs to keep an eye on any New Thread because of this.

But it's one of those issues that I think needs as many Mods and experienced Caggers to discuss as possible.

As you say, it's a bit misleading. But whilst it looks like it could be read either way, my feeling is the 63(3) requirements were added to specifically cover Cancellable Agreements. Otherwise, the 63(3) requirements have almost no purpose. But if 63(3) was inserted to cover Cancellable Agreements, as seems to be the case then, in that context, 63(3) makes sense, and I read it as outlined above in posts #35 and #37.

I am very sure these Loan Agreements were only pre-signed by the bankers because they were absolutely desperate to get people hooked to the Loan because it also had up-front single premium PPI.

At the time, they were falling over themselves to rail-road these highly profitable PPI Loans as fast as they could. I have all of my Paperwork from that time, and the hard-sell was obvious.

Everything was geared to pushing it through quickly and, taken in that context, you can probably see why they pre-Signed the Loans before they Posted them. Indeed, all the ones I have seen (x3 and now x4 if T99's is the same) were signed via machine, and not actually signed by a human!

It looks to me like another example of bankers rushing things without fully considering if their actions were compliant with the Consumer Credit Act 1974. None sent me copies of the Agreements within 7 Days of the "making" of that agreement, and none sent me any Cancellation details either within that key time limit.

There's definately a smell of weakness on the bankers side, as this same theme has cropped up a few times on CAG. I know of Davefirewalker, and have also read of a couple of others in the same position, but damned if I can find the Threads now! I read a post by Car2403 just yesterday on the BIG CCA Thread that was arguing the same point.

Should I start a New Thread to dicuss this do you think? Which section would be most appropriate, as it's a general issue, not limited to MBNA.

I have a similar Loan that started with another bank, and the same non-human pre-printed pre-signature issue applies.

Thanks again for your thoughts Steven.

I really hope this is right, as it could help T99 no end! We may have snatched Victory from the Jaws of Defeat. T99's Agreement otherwise looks properly done! But if the dates are an issue, and they never sent a Copy of the Executed Agreement and Cancellation Terms, then this Agreement may be irredeemably munged!

Cheers,
BRW

[steven4064]

None sent me copies of the Agreements within 7 Days of the "making" of that agreement, and none sent me any Cancellation details either within that key time limit.

But I think that's because they have interpreted s63(2) as I did - they didn't need to send a copy within 7 days because it became an executed agreement as soon as you signed it as they had signed it already.

What I will do is to move al the relevant posts from post #32 onwards to a new thread in General and lerave a link here

[banker_rhymes_with]

Hello Steven!

Many thanks, hopefully others will join in here to discuss s63-s64 of the Consumer Credit Act 1974.

Cheers,
BRW

[banker_rhymes_with]

Hello All!

I've now revised the first Post of this Thread to try and help people to follow what its purpose is.

I hope others can join in and comment, as it could well affect many Loan Agreements. It is also quite likely these Loans all came with PPI, which was probably why the ones seen so far were all pre-Signed and pre-Dated before posting to the Debtor.

Cheers,
BRW

[car2403]

I could be missing the point here, but this argument is only relevant where the agreement is cancellable - in order for that to be the case, s.67 would have to apply;

67.
A regulated agreement may be cancelled by the debtor or hirer in accordance with this Part if the antecedent negotiations included oral representations made when in the presence of the debtor or hirer by an individual acting as, or on behalf of, the
negotiator, unless—
(a)the agreement is secured on land, or is a restricted-use credit agreement to
finance the purchase of land or is an agreement for a bridging loan in
connection with the purchase of land, or
(b)the unexecuted agreement is signed by the debtor or hirer at premises at
which any of the following is carrying on any business (whether on a
permanent or temporary basis)—
(i) the creditor or owner;
(ii) any party to a linked transaction (other than the debtor or hirer or a
relative of his);
(iii) the negotiator in any antecedent negotiations

Where are the antecedent negotiations in the linked thread, exactly?

[banker_rhymes_with]

Hello Car2403!

If the agreement was Cancellable, i.e. after Execution, then would that not make it a Cancellable Agreement?

Is s67 therefore applicable in the case of all Agreements than can be Cancelled?

This doesn't seem to tie in with the Loans being looked at, as they did have a period after Exectution when they could be Cancelled.

s67 seems to be saying that certain Agreements can also be Cancelled by it, but I'm not reading that as meaning all agreements that can be Cancelled have to be covered by s67.

Cheers,
BRW