No CCA - what if I want to pay?

[nicklea]

Under the CCA, it doesn't matter if you acknowledge the debt or not (unless it's an issue of the debt being statute barred).

 

As you have been making payments then the issue of being statute barred is unlikely to be relevant.

 

The language of the CCA is very clear and this has been confirmed by the authorities of the Court of Appeal and the House of Lords.

 

If there is no document with all the prescribed terms or, if applicable, cancellation details weren't sent to you at the proper time then the debt is unenforceable in a court regardless of whether you have ever paid it or not.

 

However, just because they haven't replied to a s77/78 request doesn't mean that an agreement doesn't exist - it just means that they can't enforce the agreement until they do produce a copy. For example, I am currently involved in a case with Morgan Stanley/ Goldfish. Under s78 they just gave me a load of rubbish, but now it's gone to court they have supplied the actual agreement. Fortunately, it's not actually enforceable anyway - but that's another matter.

 

Don't rely on their non response to s77/78 request as meaning that they don't have the agreement.

 

If you have not been defualted then it's best to carry on paying as getting a default will really hurt your credit rating, but if yuo've been defaulted already then this doesn't matter.

 

 

Some comments from the court:-

 

1. In the case of Dimond v Lovell [2000] UKHL 27, Lord Hoffmann said , at page 1131:-

“Parliament intended that if a consumer credit agreement was improperly executed, then subject to the enforcement powers of the court, the debtor should not have to pay.”

2. Sir Andrew Morritt, Vice Chancellor in Wilson v First County Trust Ltd [2001] EWCA Civ 633 said at para 26 that in the case of an unenforceable agreement:-

“The creditor must…be taken to have made a voluntary disposition, or gift, of the loan monies to the debtor. The creditor had chosen to part with the monies in circumstances in which it was never entitled to have them repaid;”

3. When this case was appealed to the House of Lords on a matter regarding the Human Rights Act (Wilson & Ors v Secretary of State for Trade and Industry [2003] UKHL 40), Lord Nicholls of Birkenhead said:-

49 The message to be gleaned from sections 65, 106, 113 and 127 of the Consumer Credit Act is that where a court dismisses an application for an enforcement order under section 65 the lender is intended by Parliament to be left without recourse against the borrower in respect of the loan… when legislation renders the entire agreement inoperative, to use a neutral word, for failure to comply with prescribed formalities the legislation itself is the primary source of guidance on what are the legal consequences. Here the intention of Parliament is clear.