CCA s59 Question

[seabro]

Hi all,

 

I am going to be honest here.

 

Does anyone really understand what s59 means?

 

I have read it over and over and I have to admit I don't.

 

I mean, what exactly consitutes a void agreement? Or is it open to interpretation? up to a judge to decide?

 

Or is there a doc somewhere that explains in detail..

 

Sorry to ask the obvious ones!

 

59.—(1) An agreement is void if, and to the extent that, it purports to bind a person to

enter as debtor or hirer into a prospective regulated agreement.

(2) Regulations may exclude from the operation of subsection (1) agreements such

as are described in the regulations.

 

 

seabro

[Edz11]

It's to stop dodgy outfits saying, "but you said you'd enter into a credit agreement by signing this bit of paper" (so trapping you into an agreement that starts weeks, or months into the future). As far as consumer credit is concerned, there is either an agreement, or there is nothing. If someone has signed that "bit of paper" the agreement is voided (scrapped/does not exist).

 

Para 2 is a "get out" in case someone thinks of something that it might be a good idea to allow later on - could be linked with a credit union or similar. It enables the Government to issue a statutory instrument whch is a speedier way of bypassing Parliament and it becoming law.

[pt2537]

 

Consumer Credit (Agreements to enter Prospective Agreements)

(Exemptions) Regulations 1983 (SI 1983/1552)

 

 

2 Exempted agreements

(1) The agreements specified in paragraph (2) below shall be excluded from the operation of section 59(1) of the Act

(which provides that an agreement is void if, and to the extent that, it purports to bind a person to enter as debtor or hirer

into a prospective regulated agreement).

 

(2) The agreements referred to in paragraph (1) above are agreements in writing to enter into the following prospective

regulated agreements--

 

(a) prospective consumer hire agreements for the bailment or (in Scotland) the hiring to the hirer of goods where the

goods are required by the hirer for the purposes of a business carried on by him, or the hirer holds himself out as

requiring the goods for those purposes; or

 

(b) prospective restricted-use credit agreements for fixed-sum credit to finance the purchase of goods where the

goods are required by the debtor for the purposes of a business carried on by him, or the debtor holds himself out as

requiring the goods for those purposes;

where the agreement to enter into the prospective regulated agreement embodies at the time it is signed by the debtor or

hirer such information relating to the prospective agreement presented clearly and together as a whole as is required by

the Consumer Credit (Quotations) Regulations 1980 to be contained in a quotation within the meaning of those

Regulations; and either

 

(i) is not preceded by antecedent negotiations which included oral representations made when in the presence of the

debtor or hirer by an individual acting as, or on behalf of, the negotiator; or

 

(ii) 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)--

 

(aa) the creditor or owner;

 

(bb) any party to a linked transaction to the prospective agreement (other than the debtor or hirer or a relative of his); or

(cc) the negotiator in any antecedent negotiations

 

 

 

And theres the regulations made under subsection 2 of s59

 

the thing to remember is if an application form embodies all the prescribed terms signed in the prescribed manner by both debtor and creditor then it would be possible that a court could enforce it as a credit agreement by virtue of s127(3) even if it had application plastered all over it

 

Regards

paul

[seabro]

Thanks alot guys.

 

So as I understand it, a document with application form plastered over it, even one requesting details of employment and salary, other financial commitments etc - a real genuine application form can also be a valid agreement if it has all prescribed terms etc and s59 would not void it.

[pt2537]

“consumer credit agreement ” has the meaning given by section 8, and includes a consumer credit agreement which is cancelled under section 69(1), or becomes subject to section 69(2), so far as the agreement remains in force;

 

 

a credit agreement is defined in s189 cca 1974, s189 goes on to say that the definition is in s8 so thats where we need to go next

 

 

8. Consumer credit agreements.

— (1) A personal credit agreement is an agreement between an individual ( “the debtor ”) and any other person ( “the creditor ”) by which the creditor provides the debtor with credit of any amount.

 

(2) A consumer credit agreement is a personal credit agreement by which the creditor provides the debtor with credit not exceeding [F1 £15,000].

 

(3) A consumer credit agreement is a regulated agreement within the meaning of this Act if it is not an agreement (an “exempt agreement ”) specified in or under section 16.

 

rights so now we have the deifinition of a credit agreement lets look at what the courts can do to enforce the agreement if it complies with the above

 

127. Enforcement orders in cases of infringement.

—

(3) The court shall not make an enforcement order under section 65(1) if section 61(1)(a)(signing of agreements) was not complied with unless a document (whether or not in the prescribed form and complying with regulations under section 60(1)) itself containing all the prescribed terms of the agreement was signed by the debtor or hirer (whether or not in the prescribed manner).

 

 

so looking at it, the court can enforce an application for as long as it contains the required terms

 

 

i hope this clears it up

 

Regards

paul

[seabro]

Great Paul thanks alot.