Breach of contract. Let's get really messy. Sure, the initial thought is that the debtor breached first. That may be the case, however the CCA allows for this with the default system and where remedy is provided the default can be solved 'as if it never occurred'. Additionally, as long as the creditor reserved contractual right to have ever applied charges by inckuding a schedule of charges applicable in the inception T&C's the creditor can even profit by it. It does not cost them £30.00 to construct and post a naughty letter!

In contrast, the creditor by it's own construction offered to contain the operation of the contract within the confines of the CCA. Where the creditor fails to compose a valid DN that doesn't reduce your statutory rights and goes on to act as if the account has been terminated it then involves (we agree unlawfully, technically or otherwise?) a third party who were never privy to any part of the original contract, other than being indirectly referred to by way of assignment perhaps under certain conditions. The OC allows the third party full access to your private details and they use that to perform a number of things.

That 'stepping outside' of the contract and the express terms of the CCA that acts as an umbrella for both parties surely constitutes breach of contract? After all, if you try to call the bank for example and have a conversation about someone elses account they'll send you packing. Why? It has nothing to do with you.

Hmmm, very good point. Scottish Law often seems to be much better than the English equivalent. I suspect if the same were adopted here there would be many opportunistic DCA's without a viable business model. Now, that would be a shame eh?!

I believe (although this needs testing certainly) that an excuse that 'they didn't know' or similar is very poor. Given the fact that there are many thousands of very bad DNs floating around out there the professional attitude would actually be to assume that any debt you now own that was defaulted more than 2 years ago (as some have actually got their act together) is likely to have a DN issue.

I work in architecture and if I were to adopt a 'I didn't know' excuse I wouldn't get far. You're expected to have taken all reasonable steps to ensure what you're doing is completely correct. As stated above and given the DN mess the appropriate attitude for any DCA should actually be to assume that any default notice is bad and needs investigating rather than being lazy, relying on consumer ignorance (and that of too many lower courts) and crossing your fingers with the proviso that you can just excuse your ineptitude by claiming 'we didn't know' if challenged. Rather lame. I believe it would constitute an unlawful act, misrepresentation by omission.

You cannot go round sending litigacious letters demanding money until you've first ensured your house is in order. If I sent you a letter demanding £500.00 and you involved the police could I sit back and go 'Sorry, it was a mistake'? Of course there is a difference as we move from criminal to civil but does that make it ok?

Isn't there case law supporting the notion that a man is bound by his writing/actions and claiming afterwards that you didn't actually know is just not good enough? Think I have it somewhere.

Moving on to the act of litigation, if they've submitted the full nature of their claim in law on any particulars of claim (as they should do clearly) they make a statement there and then that termination has happened and a valid DN has been served and not complied with. If it isn't that would be grounds to have their claim dismissed woud it not?!

All this 'we thought this and we thought that' excuse isn't good enough.

Cool. Look forward to anything you can post on that

Appreciate that section 87 has nothing to do with right to assign and done seperately or even together (properly) then no problem. However, if the creditor assigned with the default situation having nothing to do with it then all the new owner could demand was the monthly installment as the account itself would be live, the debtor still bound to make payments as per agreement terms. Assignment then to the debtor is of no great consequence as nothing really changes that much.

The complications surely arise when the bad DN is issued, the (implication of) termination occurs (whether by letter or by demand of full balance) and then the DCA/new owner goes on to demand full balance 'or else' clearly relying on the belief that the account was defaulted and terminated correctly by the original creditor, thus now giving them the right to demand full balances. This muddies the simple notion of assignment completely does it not? Would this not be a case of attempting to secure monies by misrepresentation or similar?

If it were a matter of simple and absolute assignment then sure, the re-issue of a DN would resolve issues but if the new owner (ever, even once) goes on to make demands for full payment under threat of litigation the bad DN issue becomes an instant problem for them as they can only ever demand lawful arrears/contractual monthly obligation until a valid DN has been issued.

This I feel is where many problems will lie.

Why can’t they have happened? The right to assign has diddly squat to do with default notices. As I’ve said now umpteen times, a debt owner can sell a debt at any time it chooses.

 

You do not have to terminate an account or issue a DN to assign an account. If that were the case, the whole factoring industry would not be able to exist.

Can't have happened as in 'we intended to terminate but now we recognise our DN's were bad so we're recalling them all' (can't have happened as in without a valid DN the termination was never lawful so account still live). Understand assignment no probs but not so straight forward when they did that for debtor breach and assigned after adopting a section 87 path.

All very good stuff. We do seem to have a gap here though, perhaps none of us can explain it yet? Irrespective of the law tolerating breaches such as creditors issuing bad default notices then demanding full balances outstanding and then instructing or assigning absolutely to third party buyers we surely need to examine the wider implications for the consumer.

I suspect many of us would be uncomfortable with the notion that a creditor can step outside of statute and regulation but then ignore the last year of third party demands for full payment or else and simply to return to a state where none of that happened. If we accept that termination cannot 'lawfully' happen even though the creditor and any co-hort go on to behave by their letters and demands that it has, what protection does the consumer have if the creditor realises their gaff and suddenly behaves as if nothing was wrong? The obvious question is:

January 2010 they default you for failing to pay three months accrued arrears of say £150.

February 2010 they issue a termination letter.

March 2010 an assignment notice arrives to tell you Harold Crapton and Partners now own the account.

April 2010 a DCA letter arrives informing you they are the legal owners of the debt and all future payments are to be made to them.

They send a variety of letters on various shades of red paper with selective bold lettering demanding your soul, unicorn hair and fairy dust.

Lets say that in November 2011 (post Brandon) the original creditor decides to recall their assignments (as they can't have happened) and the account is 'returned to normal' as after all they never had the right to terminate, therefore for all these months the account has in fact been very much alive. What are the arrears now? Well:

Original default amount - £150.00 comprised of three missed monthly installments of £50.00 each.

Add another £50.00 month for the time it was with Craptons and the amount lawfully owing is now a mighty £1100.00...and by the way, you have 14 days to pay us or...yeah, yeah, you know what's coming. They cannot just forget about all of those months as the account was never terminated and to do so would result in a very inaccurate arrears demand on the default notice.

In the alternative they can't really forget about that and ask for the same sum as was originally outstanding as that's not how the account is run (unless they've reserved the right to offer you holidays etc on any payment at their discretion perhaps).

Added complications arise if you've made payment to Craptons in the interim as technically they've secured monies fraudulently and under threat. Data Protection has also been compromised as the original creditor farmed your private details out where you were then subjected to all manner of harassment for sums they had no lawful right to demand. The original creditor is responsible for any third party it instructs.

Harrison v Link is a good start for this type of treatment but the consumer must have grounds to counter claim on any amount the creditor tries to litigate for and I suspect the CPUTRs might be helpful as well as the Unfair Terms In Consumer Contracts Regulations. It must surely be a complete minefield?!

Great that this has finally been resolved and daft that an issue set in stone amongst statute has been perverted for so long that it took someone like Brandon to have the arguments and questions settled. However...

We need to look at the paths available in various situations where a creditor has defaulted badly then gone on to terminate. This is bound to form the substance of many threads as we all work to understand how this result influences various scenarios.

1) If a creditor issues a bad DN and hasn't terminated I think we all agree they are still free to issue another correct one. Fair enough.

2) If a creditor issues a bad DN and then terminates (that being by formal letter/notification or by demand for the full amount outstanding) then surely it is not quite so simple as the debtor has been subjected to unwarranted activity and would surely have legal ground for recourse for this...after all DCA letters are designed to be nasty and who wants to be sent one incorrectly? Legal avenues here would be a good discussion point.

3) If a creditor issues a bad DN, terminates and then assigns the debt absolutely to a third party who then attempts collection under threat of litigation I cannot accept it is simply a matter of the new owner constructing a new 'good' DN to skirt around the underlying issues. Numerous questions arise such as -

• Did the creditor have any right to have sold the account anyway?
  
• Is it actually terminated or still live?
  
• Data protection breaches - no third party should have access to your details and use those to forward letters demanding sums of money under the threat of litigation.
  
• Surely the creditor acting in the way they have constitutes breach of contract - they chose to terminate your account having deprived you of your protected opportunity to provide remedy contrary to the terms of the governing CCA it proposed the agreement was subject to. They then want to brush that aside and start again?
  
• What about DCAs who have gone on to secure judgment when a bad DN has been raised by the defendant in their defence and had the same statute ignored as de minimus as has just been upheld by the Brandon judges?
  
• What about cases where the DJ has dismissed requests for stay of process pending the outcome of Brandon and gone on in their wisdom to uphold judgment for the claimant with the wonky DN? Repurcussions surely for bad decisions prejudicial to the (now vindicated) defendant.
  

This is just a start, would throw this out to you all for discussion

Hi Domino, not been about for a bit. That's quite an odd thing for them to do eh? Looking at it from a different perspective however the debt does still technically exist and so they are entitled to chase you for it, presuming of course this is the same debt they litigated on?!

As they've discontinued you'll be aware they'd have a very difficult task to chase you again using the courts unless some very drastic material differences come to light to change the nature of the claim in its entirety. I would perhaps write to them with no acknowledgement of any debt reminding them that as far as you're concerned the matter was explored with court intervention and they discontinued.

As such you will not welcome any further correspondence and will view it as harrassing, perhaps you could be cheeky and include a fee structure for your time if they persist in writing to you that they accept by sending further demands?! It's always possible this is a mistake of course, maybe your name has stayed in their regular collection box as clearly sending you a letter threatening litigation is plain daft.

Great result this so congrats to all involved

Thanks also to whoever tipped my scales, not been on the forum for a bit and your name not left for me to do so personally!

Onwards and very much upwards!!!

Hi Dom, further to PM's you are in very good hands with Andy so nothing to add from me at this stage. Stay sharp and make sure you yourself are comfortable with the various sections of your argument and know it inside out. With any luck the bank will recognise their own difficulties and given the danger of your counterclaim perhaps reconsider their tactics. Will be watching with interest

PM sent re Consumer Credit (Agreements) Regulations 1983.

Good result. Rather messes their claim up though eh?!

Think they'd be silly to ignore reasonable settlement offers.

Good to have some opinion on here. Regarding the DOA and accompanying NOA Link admitted in an earlier letter that they had 1 set. They claimed this was sufficient as LRFC were a 'trading name' of FCE, the organisation who sold the account to Link. When you check however LRFC and FCE are seperate companies each with their own VAT numbers and company numbers. Far as I'm concerned they are as different as Oliver Adams and British Aerospace Engineering, irrespective of 'trading names' and other excuses.

Clearly the consequence is that a transfer from LRFC to FCE is one asset transfer, the sale from FCE to Link is another. To my mind this requires the production of 2 DOA and 2 NOA, not one (even though Link produced no DOA for the second transfer).

With that in mind Olympic was given the authority of Van Lynn Developments v Pelias Construction (but as I understand it Olympic didn't push this and this was overlooked, nay ignored).

Interestingly the judge himself recognised that LRFC, FCE and Link are indeed 3 seperate organisations, not 2 but seemed content to hand over 27k of vehicle to a claimant that doesn't actually seem to have proved they are the legal owner.

To extend the line of thinking that only 1 NOA is ever needed is dangerous. Are we agreeing that a debt can be passed on multiple times before a bottom feeder starts litigation and all that is needed is a shoddy bit of A4 stating 'We've purchased your account now pay up or else' and no proof of posting with no DOA?

My view is that Olympic got mugged by a claimant who hadn't actually proved they were the legal owner and secondly, given that this asset has been transferred between 3 seperate entities the actual question of who actually owns it is open to question. Technically Olympic should still be in debt to LRFC as an ineffectual/entirely missing DOA and NOA renders any supposed assignment invalid.

Link therefore merely rocked up to the party, bullied the court by shouting 'It's ours' and the court said 'Sure, next case please'.

Shoddy.

Full mailbox Olympic - need to message you re PM.

Onwards and upwards though eh? Odd to bang you with forthwith type costs when he's pulled it pending another 'related' case. Still, if Brandon is exposed for what it is all the better, if it's not then ignore it and run with your later argument. Costs aside a positive outcome so far.

Be interesting if you can expose their tricks for what they are. If you can show their disclosure has been less than truthful and transparent (they must disclose what is both beneficial and damaging to their own claim remember) you could put them in a tight spot. Sounds as if you have a logical progression to date but now they're getting creative. Dangerous ground.

Really depends on how busy that particular court is but is usually a fair while. We're here to help of course so stay calm

Just PM'd you. Termination is a formal process that cannot be undone without your consent post termination. It is final and opens up various avenues for the creditor dependent on the nature of that termination.

In the alternative, simply changing an account status to closed is a bit like a traffic light turning red. You must stop for example but there is every expectation that at some point it will become amber and then green. As such the difference is great, a closed account typically means facilities and benefits are withdrawn but at no time are you prevented, as with termination, from making payments to the creditor.

Quite often a 'closed' bank account will actually be open, just have all of the bits and bobs that go with it removed...other than the ability to pay funds in to clear any outstanding sums. If they haven't terminated the account they can't litigate so yes, their position does seem to invite scrutiny. Could be useful, especially with Harrison in mind.

So why haven't they applied for summary judgment if their case is so watertight?! I got your PM, will go over it in a bit

Can think of no valid reason why you shouldn't...completely unfair if you can't respond! I'd still send a copy to the court beforehand and to the other side before any hearing though, permission denied or not you've done your best to be reasonable. If the judge doesn't like it they'll ignore it anyway, better to have one ready to go should it be accepted rather than risk standing there with nothing to rebut their latest with.

Many thanks CB, appreciated as always

In Brandon it was held that the defendant had no prejudice against them by not receiving the full 14 days statute required as the claimant took no enforcement actions in that 14 day period.

 

Just thinking out loud. Read the above and it doesn't sit right. Enforcement and what constitutes enforcement has effectively been agreed upon in McGuffick, the result being that enforcement is judgment and that all actions prior to this did not and do not constitute enforcement. With that in mind how can it be held that no prejudice was caused as the claimant took no enforcement action?

Are they stating that the 14 days became unimportant because the creditor didn't secure a judgment in that time? How could they have done that anyway?! Seems a bit like arguing that you should have to pay for the vase you broke when

A) You broke no vase

B) There was no vase

C) You were incapable of breaking the vase even if it were there and it was breakable

Simply a poor and badly constructed excuse to undermine the 14 day period in favor of the creditor is it not? Roll on appeal hearing date and lets hope we have a judge who doesn't have his or her head firmly embedded in the cracks of the creditor facade

Updates on this one at all?

looking for quick advice as court hearing tomorrow (WEDNESDAY)

 

posted new thread (it wont let me include link)

 

looking to get quick feedback for next steps before hearing June 8

 

Much appreciated in advance

 

Merc

Sorry we missed your date, have posted your thread link below however.

http://www.consumeractiongroup.co.uk/forum/showthread.php?308474-Allocation-court-hearing-tomorrow-urgent-help-needed&highlight=

How'd you get on, still need help?

I think one of Amex's comebacks was that it didnt matter because Brandon had no intention of paying / wouldnt have been able to afford to pay, within the period of time anyway...

Would have to agree with that wholly. This is why it is vital to demonstrate or at least submit your argument that you were disadvantaged by the failure of the claimant to afford you your rights as dictated by statute. Just to balance it out, if this time was not prescribed by statute an argument of de minimus still wouldn't wash as there would be no pre-determined length of time for them to compare the time actually afforded to you to pay to the time they actually gave you before pulling the plug.

An example of prejudice would be:

The amount requested required you to seek the help of family/friends who had agreed to lend you the money. The short time given unlawfully ate into your time to provide remedy as demanded. You therefore needed all of the time parliament stated you should have!

If the claimant tries to counter this with an argument that 'Well, we didn't terminate the account until X days after the date on the default notice, so regardless of it being short you still didn't pay anyway' you simply remind them that you followed the intent of their demand fully and that their demand made it quite clear that unless X was paid by the date shown the account would be defaulted with third party agencies and the account terminated/passed to debt collectors (use whatever threats are on the DN you have).

As such you were under the very reasonable impression that unless you made payment by the date they provided to you your opportunity to prevent further action had indeed expired. Point out that the DN doesn't say for example