Egg credit card agreement terminated

[trout]

Toymaker,

 

I will send them a letter as you have advised,however can I also put the acc into dispute and stop the direct debit ( monthly repayments are in excess of £200 ) ?

 

Thanks for your help,it's very much appreciated.

 

trout

[toymaker1]

Toymaker,

 

I will send them a letter as you have advised,however can I also put the acc into dispute and stop the direct debit ( monthly repayments are in excess of £200 ) ?

 

Thanks for your help,it's very much appreciated.

 

trout

Just stop the direct debit payments. I did.

In your letter asking them to indicate to you the relevant section of CCA which provides them with entitlement to terminate your Egg agreement, you could add a paragraph saying that until the matter has been clarified by Egg, you consider that a dispute exists between Egg and yourself, and you will suspend payments until the matter has been clarified.

Thats what I did in 2008.

[Guest HeftyHippo]

Toymaker,

 

I will send them a letter as you have advised,however can I also put the acc into dispute and stop the direct debit ( monthly repayments are in excess of £200 ) ?

 

Thanks for your help,it's very much appreciated.

 

trout

I haven't read all your posts, so I may not know all the facts, but from what you said above, it seems they haven't ended the agreement yet, so you have no reason to stop paying what you owe. furthermore, if you are not in arrears now, if you stop paying, you will be in arrears, and that gives them the right to issue a default notice, and then end the account if you don't pay the arrears.

 

if youre not in arrears, continue to pay - you owe the money and have no legal justification to refuse, and if they end the agreement whilst you are not in default, THEN you have an argument that they broke the agreement.

 

This thread is about Egg ending agreements that were not in default, the argument is that the CCA 1974 makes no provision to end correctly run accounts

 

There is also the semantics. They are talking of ending the facility, not the agreement. It has been said many times that if they had reduced the credit limit to zero rather than ending the agreement, they may have been safe. They could still do that with you. I know they said they wouldnt issue a card, but thats what they say now. You dont say when the card is up for renewal, and anything could happen between now an then

 

Of course, I fully expect a whole pile of criticisms for what I say, because some people are blinded by the chance of avoiding repayments that they jump at any possibility that offers hope without considering whether it applies to them.

 

Whilst Toymaker and some others say the CCA doesn't allow a non-default account to be ended, there are others who say the CCA doesnt prevent or forbid it either. At the moment it has not been decided in court.

[toymaker1]

some say the CCA doesn't allow a non-default account to be ended, there are others who say the CCA doesnt prevent or forbid it either.

Who are they then?

I hope they will post on this site, and indicate to the rest of us the relevant section of CCA 1974 which provides entitlement to credit card providers to terminate agreements which are not in default.

I cant find that section, and by the way, nor can Egg.

[BEC01]

Toymaker,

 

I will send them a letter as you have advised,however can I also put the acc into dispute and stop the direct debit ( monthly repayments are in excess of £200 ) ?

 

Thanks for your help,it's very much appreciated.

 

trout

I would be very careful about ending payments.

Can you scan a copy of the letter?

 

I suspect Egg have taken advice and altered the wording compared to their first effort of termination.

 

If they are restricting the credit facility, then that is completely different from their wording of "ending your agreement" on a specific date.

 

Be very careful with this.

I think they know the first letter would not stand up in court and have therefore got it right this time.

[trout]

[trout]

Have to do this the hard way !

Egg Card Number

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

 

YOUR EGG CARD WILL NOT BE RENEWED.

 

Current balance : £*****

 

Dear****

 

At Egg we are committed to being a responsible lender and review

credit card accounts taking account of all information available to us

in the period prior to the expiry date of the current card.

 

Following a review we have decided not to issue a replacement when your current card expires and to end your credit card facility.

This decision also applies to cards issued to any additional cardholder.

 

Please be advised that this means after the expiry date you will not be able to use your account and any regular payments such as monthly

subscriptions will not be paid.You should contact your service provider

to arrange cancellation and alternative means of payment.

 

If you do have a balance outstanding on this account you will have to

continue to pay at least the minimum payment required under your

Card Agreement each month until any debit balance on the account

is repaid in full.The Card Agreement continues to apply until the balance

is repaid in full.

 

If you'd like to discuss this letter,on your account,you can contact our

Customer Services Team on 08451 233 233

 

Yours sincerely,

 

Collections Department

Egg Banking plc

[trout]

BECO,

 

They have not restricted my credit card facility,they have ended it,

and on a specific date.

 

From what I understand from Toymaker,there are no provisions within

the CCA 1974 that allows them to do so.

 

Toymaker,do you still stand by post 1398 ?

 

Thanks as always,

 

trout

[BEC01]

BECO,

 

They have not restricted my credit card facility,they have ended it,

and on a specific date.

 

From what I understand from Toymaker,there are no provisions within

the CCA 1974 that allows them to do so.

 

Toymaker,do you still stand by post 1398 ?

 

Thanks as always,

 

trout

 

Thanks for posting the info Trout.

They are certainly doing this differently now. They are withdrawing a service, but not specifically ending the agreement. I'm still not sure that they have worded it correctly, but it is not a solid case as per the first wave of termination letters.

 

I would, personally, continue paying them.

Of course, if you can live with a default notice for 6 years, then you may decide differently.

 

This change in wording is a tacit admission that ending the agreements of 160,000 was a big gaffe.

[toymaker1]

BECO,

 

They have not restricted my credit card facility,they have ended it,

and on a specific date.

 

From what I understand from Toymaker,there are no provisions within

the CCA 1974 that allows them to do so.

 

Toymaker,do you still stand by post 1398 ?

 

Thanks as always,

 

trout

Yes. CCA 1974 covers every aspect of termination of credit card agreements. Egg have terminated your Egg agreement outside the provisions of CCA. They did the same with me.

I am still waiting for Egg or it's solicitors to indicate to me the relevant section of CCA which provides them with entitlement to terminate my Egg agreement.

[basa48]

I would certainly agree with BECO1.

 

Egg have not ended the agreement here, as they quite specifically did with the 160,000 in 2008.

 

They have merely ended a credit facility.

 

Section 87 states at (2) Subsection (1) does not prevent the creditor from treating the right to draw upon any credit as restricted or deferred, and taking such steps as may be necessary to make the restriction or deferment effective.

 

I still would have worded it differently if I were Egg, but this is not something I would like to take before a judge. :-|

[trout]

Thanks for the imput Basa, but as I understand, the words restricted or deferred do not mean ENDED.

[toymaker1]

 

Egg have not ended the agreement here, ...

 

They have merely ended a credit facility.

 

Section 87 states at (2) Subsection (1) does not prevent the creditor from treating the right to draw upon any credit as restricted or deferred, and taking such steps as may be necessary to make the restriction or deferment effective.

 

I do not follow your logic. The agreement is to provide a credit facility, therefore if they terminate the credit facility they have breached the agreement (to provide a credit facility).

Also, S87 permits them to restrict or defer the credit facility, but not to terminate it.

[lawtcrav]

Maybe I'm coming at it from a different perspective. If those contract lawyers are correct, then provided Toymaker1 kept to his side of the bargain then Egg must carry on to fulfil theirs.

Most of us see a credit card as access to money and goods but it is more than this. It can be used to reserve car hire without paying a deposit and proving one's identity. Therefore, Toymaker wants to use the Egg card for these type of things amongst other things. Without a breach Egg has unilaterally declared that they are no longer bound by the terms of the contract.

In other words they have declared themselves to be in breach of contract. In my opinion unless they can show you the clause in the contract that permits them to do this then you have an argument to run in court. However, I would expect Egg to argue that a cc agreement is a running credit agreement and each time one tries to use it, this constitutes a fresh application for credit from the credit card holder to the cc provider.

The bottom line, in my opinion, is that it is a contractual argument and judges traditionally favour finance providers.Toymaker1 will have to show some loss directly incurred by the breach, if the court decides there was a breach. This is where in my opinion the case is week and possibly de miminiss

[BEC01]

However, I would expect Egg to argue that a cc agreement is a running credit agreement and each time one tries to use it, this constitutes a fresh application for credit from the credit card holder to the cc provider.

 

This would be highly unlikely to hold any credence in court though.

 

A fair point that has been considered.

[basa48]

I do not follow your logic. The agreement is to provide a credit facility, therefore if they terminate the credit facility they have breached the agreement (to provide a credit facility).

Also, S87 permits them to restrict or defer the credit facility, but not to terminate it.

 

OK you could be right, but IMO Egg have not ended the agreement just a facility provided under that agreement and the Act allows them to do that or at least restrict or defer that facility.

 

It's a close call and one as I say I'm glad I'm not having to make to a judge. Like I said - if I were Egg I would not have used the word 'ending'.

[HP Mum]

I have used Toymakers arguments. I havent paid anything to egg or a dca for more than a year. Neither egg nor a dca has contacted me in 5 months. Lulled into a false sense of security ? Are they about to hit me after 6 months lapse ? Or have they given up ?

[basa48]

I have used Toymakers arguments. I havent paid anything to egg or a dca for more than a year. Neither egg nor a dca has contacted me in 5 months. Lulled into a false sense of security ? Are they about to hit me after 6 months lapse ? Or have they given up ?

 

Me too, but 'trout's' 'letter' from Egg was not the infamous "We are Ending your Egg Card Agreement" letter.

 

Unfortunately I have seen the courts and judges in action and where there is any scope for interpretation of a phrase or clause they seem to always favour the creditor.

[toymaker1]

IMO Egg have not ended the agreement just a facility provided under that agreement

You refer to 'a' facility provided under the agreement. Is there any other facility under the agreement in addition to the credit facility? I am not aware of one. Isn't the agreeement that Egg will provide you with a credit facility, and you will pay the neccessary interest and charges to Egg in order to benefit from that credit facility? And isn't it the case that if Egg terminates the credit facility, there remains no substantive content to the agreement? and doesn't that amount to a breach of the agreement by Egg?.

 

and the Act allows them to do that

Please indicate to me the relevant secton of CCA which alllows them to do that (i.e. end the credit facility where there has been no default by the debtor).

or at least restrict or defer that facility.

As I said in a previous post Egg can indeed restrict or defer the credit facility, but they cannot terminate it.

[toymaker1]

The bottom line, in my opinion, is that it is a contractual argument and judges traditionally favour finance providers.Toymaker1 will have to show some loss directly incurred by the breach, if the court decides there was a breach.

 

The bottom line is that credit card agreements are regulated in every respect, and for the purpose of protecting the credit card holder against the credit card provider, by the CCA 1974.

If Egg terminate an agreement outside the provisions of CCA, they they have not only breached the credit card agreement but have breached CCAA A court would not regard it as acceptable for a creditor to act outside the provisions of CCA. A creditor must act at all times within the provisions of CCA.

[Guest HeftyHippo]

well, as I said, I expected to be criticised, By way of answering your question Toymaker can you tell me the part of the CCA that says a non0default account CANNOT be ended by the creditor?

 

and BTW, they have posted on here, and were met by a refusal to consider that anyone that disagreed with your point of view could even remotely be correct

[Guest HeftyHippo]

I have used Toymakers arguments. I havent paid anything to egg or a dca for more than a year. Neither egg nor a dca has contacted me in 5 months. Lulled into a false sense of security ? Are they about to hit me after 6 months lapse ? Or have they given up ?

I haven't paid anything for a year either, and I haven't given them any explanation, so the fact that they haven't contacted you doesn't mean they were scared off by your argument. sadly

 

although Toymaker seems to assume that anyone putting forward a different point of view from his must be opposed to his argument, I am not. What Egg did was scandalous, but the CCA does not specifically mention the closing of non-default accounts, so it is unclear whether that was deliberate, ie non-default accounts should not be closed by a creditor, or whether it was an omission - ie it's not an issue, a creditor wouldn't want to close a non-default account, or even if it was a pure accident that has had little consequences until now.

 

Until a court rules on how the CCA should be interpreted on this matter, and an Appeal has been heard (because it will almost certainly go to appeal regardless of the decision) it's simply wishes and opinions. Unfortunately, our opinions don't count, nor do Egg's, it's the judicary's

[chelsealove]

As i said a while back, I doubt egg will ever want it to go to court for that exact reason - they don't want to know the answer.

 

Be careful though HP Mum... you're correct to be suspicious. I stopped paying my capital one card because it was clearly unenforcable. They waited a year after the default, then served county court papers on an old address of mine, even though they'd been corresponding with me at my new address. Unless you're sharp on court paperwork [i'm fairly lucky cos i'm a lawyer and i have a friendly neighbour back at my old address who passed the papers to me], they'll sneak lots of these judgments through without it ever having a hearing. I'm sure that's what they'll try to do with the bigger debtors.

 

As it is, Cap One have now received a four page defence from me and a horrific list of part 18s to follow.

 

Be careful is what i'm saying. It's a brutal world out there. The argument in this thread is an academic one [in both senses of the word]. If they sneak a judgment past you, it might be too late, or too expensive, to fight it, irrespective of whose opinion you prefer on whether EGG's decision was legally correct or not.

[Peterbard]

Hi

Re “Where does it say a creditor can terminate “

Today’s assignment , go through the cca and see if you can find anywhere where it says you con do anything.

You wont find anything , because again the law doesn’t work like that. If the act didn’t want creditors to be able to terminate it would have a section entitled ,creditors must not terminate an agreement . And then another titled consequences of improper termination..

As I am continually saying if it isn’t in the act it isn’t unlawful section 170.

Think about it if law was a list of things you could do how long would that list have to be,

You can get up in the morning

You can have your breakfast

You can have sugar in your tea========

Sorry to be facetious but I hope you see my point.

Peter

 

Hi

Thought I would have another go at this, there seems to be a glimmer of rationality emerging so here goes.

Firstly as to why no one else bothers to comment on this, the reason is obvious. As you will see following this post

Secondly forget the idea, just for a minute that I am in the pay of Egg or anyone else, the idea is frankly absurd, click on my name and look at the threads I have started if you need any assurance, if you still have reservations about what I tell you, then I ask you to just put them on hold until you finish reading this post.

Thirdly and most importantly no one is saying that Egg are morally correct or even fair in what they have done, extending a line of credit and then just cutting it off for no good reason leaving the debtor in a position where he has to repay without the leeway that the credit afford them is to my mind grossly unfair, unfortunately it is not unlawful

Egg know this and it may good a good way to explain their reluctance to pursue these cases in court, not good publicity is it for future card holders.

It seems to me that this thread is based around the idea that an agreement for running credit cannot be terminated without a default, this is incorrect.

The act does not have to say that this cannot happen as I have said before it does not have to.

Legislation I general does not work that way, what it does is tell you what you may not do.

With the above in mind pleas re look at section 98, yes I know you have disregarded this as not relevant but please just humour me.

Now bearing the above in mind what is it for.

It says,” Duty to give notice of termination None default cases”

It then goes on to say that if an agreement is for a stated length or term the agreement cannot be terminated without notice.

This is understandable because the agreement you sign has a term and terminating it would otherwise breach that requirement.

A running account agreement has no such restriction, therefore no such notice is required.

It is I admit highly convoluted statutory language, but if you look at it without bias I think you will see the correct meaning.

The fact that section 98 is there at all acknowledges that termination of agreements of this type are totally compliant with the regulations.

I must go on to say that this is not a matter of interpretation , this is fact I am afraid as acknowledged by the OFT the DTI(as was) judges including the one I Rankine and just common sense.

Regards

Peter

[BEC01]

Hi

Thought I would have another go at this, there seems to be a glimmer of rationality emerging so here goes.

Firstly as to why no one else bothers to comment on this, the reason is obvious. As you will see following this post

Secondly forget the idea, just for a minute that I am in the pay of Egg or anyone else, the idea is frankly absurd, click on my name and look at the threads I have started if you need any assurance, if you still have reservations about what I tell you, then I ask you to just put them on hold until you finish reading this post.

Thirdly and most importantly no one is saying that Egg are morally correct or even fair in what they have done, extending a line of credit and then just cutting it off for no good reason leaving the debtor in a position where he has to repay without the leeway that the credit afford them is to my mind grossly unfair, unfortunately it is not unlawful

Egg know this and it may good a good way to explain their reluctance to pursue these cases in court, not good publicity is it for future card holders.

It seems to me that this thread is based around the idea that an agreement for running credit cannot be terminated without a default, this is incorrect.

The act does not have to say that this cannot happen as I have said before it does not have to.

Legislation I general does not work that way, what it does is tell you what you may not do.

With the above in mind pleas re look at section 98, yes I know you have disregarded this as not relevant but please just humour me.

Now bearing the above in mind what is it for.

It says,” Duty to give notice of termination None default cases”

It then goes on to say that if an agreement is for a stated length or term the agreement cannot be terminated without notice.

This is understandable because the agreement you sign has a term and terminating it would otherwise breach that requirement.

A running account agreement has no such restriction, therefore no such notice is required.

It is I admit highly convoluted statutory language, but if you look at it without bias I think you will see the correct meaning.

The fact that section 98 is there at all acknowledges that termination of agreements of this type are totally compliant with the regulations.

I must go on to say that this is not a matter of interpretation , this is fact I am afraid as acknowledged by the OFT the DTI(as was) judges including the one I Rankine and just common sense.

Regards

Peter

 

Ending a credit line without default can certainly be considered lawful, by interpretation. I actually agree with you on this.

 

However, Egg did not actually do this in their first round of terminations. I am sure it is what they intended, but they got it wrong.

 

They ended agreements, and thus no contract in place, so any outstanding balance is thereafter not due. Furthermore, any subsequent reporting to credit agencies is in contravention of the data protection act.

 

It is interesting that they appear to have sorted this out with subsequent restrictions on accounts.

 

We still cannot get them to take anyone to court over this.

I darn well wish they would as I would like to know what the courts make of this...