Thread: Response By Trading Standards Re B/card Complaint

This was a tad too long to go on my B/card thread. It is a further response from Trading Standards ref my complaint to them about Barclaycard Visa sending and Application mailer form, plus current T&cs.

They say:...


Subject: Complaint regarding Barclaycard and non compliance with Section 78 requirements.

Dear XXX XXXXXXXXXXXXXXXXX

I apologise for not responding to you before now, however, Section 78 has been an issue of some discussion between this department and Barclaycard and also between the Office of Fair Trading and the credit industry in general. Unfortunately the conclusions do not appear, in the first instance, to be of any assistance with your complaint concerning Barclaycard.

I have, for your information, reproduced some exerts of a document originating from the Office Of Fair Trading that discusses the matters which you raised in the first instance as I believe Barclaycard did provide you with a terms and conditions sheet and sheet containing your details. It is certainly Barclaycard's argument that by sending out copies of the application form, which contain the debtor’s signature, they have complied with the requirement of Section 78 and are therefore entitled to enforce the agreement.

In addition to the information given below, although the provision within Section 78 remains that if the creditor fails to supply the required documentation he is not entitled to enforce the agreement until it has been complied with the criminal offence for the creditor to fail to supply the documentation within one month has recently been removed by the The Consumer Protection From Unfair Trading Regulations 2008.
If you should wish to discuss this matter further please feel free to contact me on the telephone number given below.

THE CONSUMER CREDIT ACT 1974 - Sections 77 and 78

Summary

On request and when accompanied by £1, a consumer has the right to:
a copy of their executed agreement

any other document referred to in it

a statement showing

the total sum paid under the agreement by the debtor

the total sum which has become payable under the agreement by the debtor but remains unpaid, and the various amounts comprised in that total sum, with the date when each became due, and

the total sum which is to become payable under the agreement by the debtor, and the various amounts comprised in that total sum, with the date, or mode of determining the date, when each becomes due. If the creditor is unable to give this information, he can state instead how the dates and amounts fall to be ascertained.

The copy of the executed agreement need not be an exact copy but it must be a ‘true copy’ and not some reconstruction of what the original might have been and it must contain the same terms as the original. Where the terms have been varied as provided for within the agreement, the copy of the original agreement must be accompanied by a document setting out the current terms, as varied. Certain details may be omitted from the original agreement e.g. the signature but the debtor must be in no doubt as to the true nature of his obligations under the loan.

Should no original agreement be in existence it is very hard to say that the copy the creditor offers to the debtor is, in fact, a true copy as there would be no original with which to compare it. In our view the onus of proof would be on the creditor to show that the copy is a true one and where none existed he may have difficulty discharging this. Neither should creditors suggest that a consumer has signed a credit agreement where they are unable to provide evidence to support this – to do so is likely to be a misleading action under Regulation 5 of the Consumer Protection from Unfair Trading Regulations 2008 (the CPRs) and would also constitute an unfair or improper business practice.

In our view a debt collector who has bought the debt is the ‘creditor’ and as such takes on the liabilities of section 77.
Under section 77(4), if the creditor is unable to provide this information, he is not entitled to enforce the debt while he remains in default.

Legal Argument

A copy of the executed agreement

Under the prescribed condition, section 77 of the Act requires the debtor to ‘…give the debtor a copy of the executed agreement (if any)….’. The ‘if any’ most naturally refers to the exception for agreements older than1985.

Where a creditor receives a request to supply a copy of the executed agreement, the Consumer Credit (Cancellation Notices and Copies of Documents) Regulations 1983 (‘1983 regs’) apply. Regulation 3(1) sets out the basic position that ‘every copy of an executed agreement… shall be a true copy’.

Regulation 3(2) goes on to concede that there may be omitted from this true copy various information such as details which are not required to be in the agreement by law: the signature box, signature and date of signature. In our view the effect of

Regulation 3(2) is that the creditor is only obliged to send out a generic copy of the agreement the debtor has signed up to. The creditor is not obliged to make an actual photocopy of the agreement.

However, the copy does have to be a ‘true copy’. This is a technical term, which has been discussed in a number of cases, mostly relating to bills of sale and the need to register a ‘true copy’ of the bill with the High Court. These cases come from the days before typewriters, when copies were made by hand. The consequences of filing a copy which was not a true copy were severe, since the bill would then be void and the creditor deprived of his security.

Meaning of ‘true copy’

In this context, the courts decided that a ‘true copy’ need not necessarily be an ‘exact copy,’ but it must be ‘so true that nobody reading it can by any possibility misunderstand it’ or be misled by it

(In re Hewer ex parte Kahen (1882) LR 21 Ch.D. 871 at 875). The copy must contain ‘every material provision which is contained in the original’ (except that if the defect is made good by reading the document as a whole, the omission will not be fatal) (Court of Appeal in Burchell v Thompson [1920] 2 KB 80 at 98-99). Further, it is not sufficient for the copy merely ‘to state with complete accuracy in a summary form the effect of the stipulations contained in the original. It is not merely a document that is to state the true legal effect of the original; it is to be a copy of the original’ (per Atkin LJ in Burchell at 105).

Hewer, ex parte Kahen

- the filed copy of the bill omitted the precise day of the month on which payment was to be made. The court held this was trivial, and no debtor would be misled by it.

Sharp v McHenry

(1888) LR 38 Ch.D. 427 - the copy contained blanks which were not in the original. The court decided that the blanks were unimportant, since the omitted words were not required for the original bill to be valid.

Burchell v Thompson

[1920] 2 KB 80 - the copy failed to include the words ‘per annum’ after the interest rate of 55%. The reader of the copy would have to guess whether the interest was per annum, per month or something else but as one could sensibly assume, correctly, that it was per annum it was a true copy.

Commercial Credit Company of Canada Ltd v Fulton

[1923] AC 798 - suggested further that where there are a raft of smaller differences in a bill of exchange copy, this could prevent it being a true copy. However where the differences were such as to make the copy contract actually different to the original, the copy will not be true. Lord Sumner, speaking of the man who may wish to refer to the copy, concluded that ‘the Act promises him … a true copy, not a puzzle. He is to inspect it, not to recover the original by a process of conjectural emendation’ (at 807).

Regards,

************************* *******

I would be interested to receive comments on the above inasmuch as in addition to the Application Mailer form which would have had NO T&cs on the back unless it was for the benefit of the postman. There was no mention of T&cs on the mailer form and those sent in respect of my CCA request were from a later date than when the Application form was signed. I am also wondering if the case law presented above will be what B/Card will be using in court in future.

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Thank you Yourbank

So they are focusing on the whole, "we can omit information" angle rather than the "four corners".
Well what they say is true to an extent, BUT the copy MUST include all the prescribed terms, that includes your signature.
As B'card Applications normally fail in this regard, they have failed to comply with your CCA request of a true copy of the executed credit agreement.

Originally Posted by CCA74 s77(1)

shall give the debtor a copy of the executed agreement

Originally Posted by CCA74 s189

“ executed agreement” means a document, signed by or on behalf of the parties,
embodying the terms of a regulated agreement, or such of them as have been reduced
to writing;

Without the signatures it ISN'T executed at all so invalid for s77-79 compliance.

Thanks for looking in Curlyben.

Well the Mailer form they sent certainly didnt contain any prescribed terms although it does have OH's signature. It doesnt even make any reference to terms and conditions so I guess what has been said on "four Corners" applies in this instance.

My next question is should I reply to Trading Standards or just wait until B/Card decide on their next move ?

I would be inclined to gently point out TS's incorrect advice in this matter, and also the fact your complaint concerns the non-compliance of B'cards "agreement"

Originally Posted by Curlyben

I would be inclined to gently point out TS's incorrect advice in this matter, and also the fact your complaint concerns the non-compliance of B'cards "agreement"

Will do, many thanks.

None of the regulatory bodies are that bothered at the end of the day.... although it sometimes depends on which TS you're complaining to.

Originally Posted by citizenB

Commercial Credit Company of Canada Ltd v Fulton

[1923] AC 798 - suggested further that where there are a raft of smaller differences in a bill of exchange copy, this could prevent it being a true copy. However where the differences were such as to make the copy contract actually different to the original, the copy will not be true. Lord Sumner, speaking of the man who may wish to refer to the copy, concluded that ‘the Act promises him … a true copy, not a puzzle. He is to inspect it, not to recover the original by a process of conjectural emendation’ (at 807).

"A raft of smaller differences" meaning? What is "conjectural emendation?"

Can I quote it in this case?

http://www.consumeractiongroup.co.uk...burys-2-a.html