Charging orders - Change in Law?

[WindmillStew]

Hi,

 

I fell into money problems 5 years back and about 4 years ago when I got the default notices off my (mainly) credit card companies. I contacted CCCS and got the advice/help I needed. I have been paying them as agreed, without fail, and none of them have yet taken me to court for CCJs etc.

 

This week I have been informed one debt has been passed (sold) on to DLC (Direct Legal Collections) and to contact them. When I did they insisted that I increase the monthly repayment by 300% (at first it was 600%) or they WILL place a charging order on my property.

 

The next day I got a call off 1st Credit asking for a 1000% increase in montly repayments else the same thing.

 

Has the law changed of recent? I thought I:-

 

a) Had to have a CCJ raised against me.

b) Be in arrears with the CCJ before this could happen?

 

I have seen on the CAB website

Tribunals, Courts and Enforcement Bill (Charging Orders)

that there are plans, but can't find out if the amendment has happened.

 

Are these 'threats' to get me to either pay a lump sum, or the new higher amount, or can they do what they are telling me?

 

 

Thanks.

[rory32]

No the law hasn't changed, they still need a CCJ which, if an instalment order was made, you would need to default on for a charging order to be granted as per:

Section 1: The Charging Orders Act 1979:

 

Where, under a judgment or order of the High Court or a county court, a person (the “debtor”) is required to pay a sum of money to another person (the “creditor”) then, for the purpose of enforcing that judgment or order, the appropriate court may make an order in accordance with the provisions of this Act imposing on any such property of the debtor as may be specified in the order a charge for securing the payment of any money due or to become due under the judgment or order.

 

If there is an instalment order in place, a creditor would not be able to apply for a Charging Order.

 

Section 86(1) The County Courts Act 1984:

 

Where the court has made an order for payment of any sum of money by instalments, execution on the order shall not be issued until after default in payment of some instalment according to the order.

 

This was further considered in the case of Mercantile Credit V Ellis in The Court of Appeal 1987. It was found that the wording of the Charging Orders Act states quite clearly that no further action could be taken without a default in payment.

 

If you have defaulted on the CCJ there are other arguments but this is something which would be BINDING on the judge.

[rory32]

Are these 'threats' to get me to either pay a lump sum, or the new higher amount, or can they do what they are telling me?

 

DCA's often give the impression that they can apply to the court for a charging order on the Monday (without first obtaining a CCJ) and have it all done and dusted by the weekend. In reality it takes many months and as previously stated you would need to default on the CCJ. It's purely a scare tactic designed to try and squeeze as much money out of you whether you can afford it or not. What type of account is this e.g. loan, credit card, overdraft?

[WindmillStew]

Firstly thanks for putting my mind at rest. A CO doesn't scare me as much as the fees and interest that would accrue. A sub £1000 debt growing greatly in size is not nice.

 

Both (DLC & 1st Credit) companies have taken over my default on (HFC and First National) loans in this case.

 

 

Thanks.

[rory32]

What type of account is this e.g. loan, credit card, overdraft?

[WindmillStew]

Both loans in this case, although as I have said nearly all the rest are credit cards, and 1 overdraft.

[rory32]

Have you asked for copies of the credit agreements?

[WindmillStew]

Wellll no. I'm new to this site and CCA requests...what would be the benefit be at this stage?

 

I don't want to antagonize them...I *am* willing to pay them a sum that I can reasonably afford.

[WindmillStew]

Although having said that what's the worst that could happen....After all they have tried to pressure me into paying more than I could reasonable afford, and 'threatened' me without explaining their precise course of action.

[rory32]

The CCA request doesn't antagonise them, quite the opposite - in most cases it gets them to behave a little better. As you may be aware without a copy of the agreement or if the agreement doesn't contain all the prescribed terms under the Act then the debt is unenforceable. If this is the case with any of your accounts then you are in a very strong position for bargaining with them. While I appreciate that you are willing to pay what you can afford, it is far more easy to negotiate from a position of strength. Also DCA's are more likely to be unreasonable if they think they can get away with it and you don't know what you are doing.

 

Are there any charges on the accounts that you can reclaim e.g. late payment fees, overlimit fees, etc? You may find that these substantially reduce your debt, in some cases they may even owe you money.

[rory32]

Although having said that what's the worst that could happen....After all they have tried to pressure me into paying more than I could reasonable afford, and 'threatened' me without explaining their precise course of action.

Exactly and they will continue to do it until you start ascertaining your legal rights.

[WindmillStew]

Thank-you very much indeed rory32.

 

I don't think there was much if any fees on these two, but my others - I think so.

 

I will issue ALL my DCA's with CCA's, and look into the reclaiming of fees....if I send special delivery at this time of year does the response time still apply?

[rory32]

I will issue ALL my DCA's with CCA's

Remember not to sign the letters or use a digital signature. There is no legal requirement to sign letters.

if I send special delivery at this time of year does the response time still apply?

Sending them all recorded delivery will be expensive (4.30 each) although at this time of year if you can afford it it may be worth it.

 

The timescales are 12 full working days after receipt (so the day of recept doesn't count). Obviously you don't count bank holidays and weekends. After the 12 working days if they haven't supplied the agreement they are in default, this means they can't enforce the agreement and you can lawfully withhold payment on the account if you so wish. Also they can't lawfully apply interest while in default to the account or ask for payment. Once they are in default they can not enforce the agreement until they produce a copy of it that conforms with the Act.

 

After a further calendar month if they still haven't supplied the agreement they commit a summary criminal offence.

[Boro]

I thought recorded was £1 something and special delivery was £4.30, all you realy need is proof that its been sent and that they have signed for it so the cheaper of the two will be fine, you can then check the status on royal mails website and even view (save and print) the copy of the signature of the person taking delivery

[make them aktiv runners]

Special delivery at £4.30 has proved more reliable than basic recorded. The latter tends to be hit and miss with actual signatures, especially for PO Box numbers, and delivery date.

[rory32]

I thought recorded was £1 something and special delivery was £4.30,

Quite correct, typo on my behalf - thought I had typed special delivery. It's only because of the time of year that special delivery may be worth the extra expense if affordable. Although recorded should be fine even though it gets sent with normal post.

[R B 1968]

Hi,

 

I'm very new on here too and my advise would be to consider Special Delivery - the reason is because I sent a 1st class recorded CCA on Monday and It's only shown as signed for yesterday (Thursday). Thats a few days lost AND based on current Royal Mail performance I'm not counting on a signature / POD even being available ! All I have at the moment is 'the date' of delivery !

 

R

[2Grumpy]

I've never had a signature available. They get so many to sign for that they do the lot with one signature.

 

Grumpy

[rory32]

The signature isn't terribly important as long as royal mail say when it was delivered that's all you need.

[tagal]

DLC also contacted me about placing two C.O on two Egg Debts, I had been paying them via Payplan. I had no CCJ in place for insalments, but they immediately went for a forthwith judgement knowing that I couldn't pay the whole amount (that is why I was in a DMP!), no chance to pay in instalments. Anyway, two C.O's were granted.

 

It seems there are two routes a creditor can go (below) and unfortunately DLC went for the first option. Just wanted to make you aware of this, as I knew nothing when all this happened to me and I had not found this site.

 

When can a creditor apply for a charging order?

 

The creditor can apply for a charging order if they have a county court judgment against you and:

• You have been ordered to pay the whole debt immediately or by a certain date, (this is known as a "forthwith" judgment) and have not done so.

or

• The court has ordered you to pay the judgment by instalments and you have missed one or more payments.

[WindmillStew]

tagal - If you completed a budget and made regular payments through Payplan, I'm shocked DLC went straight with the forthwith judgement. I've just spoken to CCSL today and they told me they were probably just scare-mongering me....but maybe they're not.

 

Can you explain a bit more how DLC went about it with you?

[make them aktiv runners]

WindmillStew, it looks as if your CCJ was subject to instalments. Tagal's post (although quite long) is saying he was ordered to pay in full immediately, hence they could go for a Charging Order.

[WindmillStew]

Make them aktiv...I haven't got any CCJs (yet). In a DMP with CCCS.

 

I'm just a little surprised that someone on a DMP can suddenly be taken to court by a DC and ordered by the court to make a full payment immediately, or by a given (presumably short) date...and when they obviously default get a CO for their trouble.

 

I thought DMPs proved that you are paying as much as you can (if you're not lying to them) and a court with a sensible judge (well there's always hope) would throw the DCs case out.

[make them aktiv runners]

Sorry, only read back as far as Tagals post.

 

To obtain a Charging Order (would need the CCJ first) the court would expect equal treatment for all creditors, not just one. A court would never insist on payment of more than you could reasonably afford (again for all creditors).

 

Sorry, if I've missed it but if you are not administering the DMP yourself then they should be corresponding only with your DMP provider.

 

I agree with Rory, most letters/calls are just intended to push you into paying more.

[WindmillStew]

My DMP is self administered at present but going to be administered by CCCS in new-year. Tagals post concerened me as he sounded to be in a similar situation as I am in now, when the DCA got awarded a CO due, to what sounds like, a unreasonable forthwith judgement.