Lloyds v Me

[emandcole]

Hi Viano,

Sorry to hear the outcome. This probability thing however really bothers me. How vague can you get when no default notice is then ruled in favour of the party bringing an action and if that default notice is incorrect due to charges contrary to common law, irrespective of no prior mention in skellies?

 

As this is a credit card dispute the inclusion of charges contrary to common law is perfectly relevent rendering any default notice incorrect. The OFT have not put any hold on credit card charge claiming contrary to the banks' insistence that it all falls under the same umbrella. Therefore, unless the bank will show how each charge applied (I'm assuming they have as they can't help themselves) is a fair reflection of the true cost of any administrative process the default notice has to be incorrect and should not have been the foundation Lloyds relied upon to commence litigation.

 

It sucks a lot. I'd request a copy of the default notice and check the statement history to ensure the amount they defaulted you for is correct. Also, check your T&C's as Lloyds credit cards depending on the age of any agreement often failed to provide any details on how much any default charges would cost you, effectively meaning they never reserved the contractual right to apply these charges. Clearly, if the amounts claimed were incorrect then their original claim amount would have been wrong. The subsequent default would be incorrect also which is fatal to their action and surely legitimate grounds for appeal in the light that they did 'on the balance of probability send a default notice'.

Edited November 18, 2009 by emandcole

[Viano]

Hi emandcole,

 

Sorry for the tardy reply. Thanks for your and everybody else's commiserations.

 

With regard to the DN, they say they sent one, but they have no copy or proof of posting. The Judge accepted their explanation on the grounds of a 'written' synopsis of a telephone conversation I had some 48 hours later with someone in Mumbai !!!

 

A template of a DN was produced in Court so as such we can't prove or dis-prove it's accuracy BUT the statements do show late payment charges

etc.

 

Regarding Default Charges they say on the copy of card conditions '(see also 9 for default charges), 9 being in the booklet called 'Credit Cards' is says sic '9 DEFAULT CHARGES. We charge your account for reminders and other expenses resulting from you breaking these Conditions. Ask if you want to know what our standard charges are'.

 

As to your last sentence what do I do now?

 

V

[emandcole]

Ok, forgive me if I ask something you've already written but did you send a Subject Access Request to obtain all of your statement history? Personally, I'd use this history to then work out if the default notice amount was incorrect, I think that'd be one of your best arguments. To determine if it is incorrect just look for any default charges, particularly ones in excess of £12.00 as the banks are still maintaining £12.00 is the 'allowed' amount but in truth this amount has only been suggested by the OFT as a maximum figure whilst the test case rumbles on.

 

As stated earlier the OFT test case has nothing to do with credit card accounts and you therefore have every right to insist that any charge that is applied to your account as a penalty/default cost is a true reflection of the actual cost to the creditor for your infringement of account rules. They are not allowed to profit from this as that is contrary to common law. So, unless the creditor is prepared to back their charges up with an itemised breakdown of costs involved for each charge applied (which they will not do) you have every right to question them and ask for them back. Clearly this then results in an inaccurate balance which the creditor would have listed in their particulars of claim. If this is incorrect and you can show how it's incorrect you're off to a decent start.

 

Considering the court has accepted that 'on probability' you did get a default notice sent you should also have every right to ask to see it, it should exist and the creditor should have provided it in court if they intended to rely on it against you according to Civil Procedure Rules. Probability is all well and good but is insufficient when documents should exist, if they can't produce one then you could argue it 'probably wasn't sent'. It works both ways after all and if the creditor is relying on something of that nature to support their claim but can't/will not produce it the balance of probability should be given in your favour and against the party looking to rely upon it. This is to stop anyone making an agreement up out of nowhere and claiming you owe them a fortune for example, they need to provide those original documents in the correct format with the correct amounts on to show all is above board, they should be able to physically show you the default notice, not just say 'we sent you one'.

 

It is disgusting that the creditor has turned up and merely stated they sent one when they don't even have a copy, let alone the original default notice to show to the court. The default is important and without it the creditor should not have been able to achieve what they did against you. Why did the judge not pick up on this I wonder?

 

You say that the creditor effectively directs people to look through a seperate booklet with details of costs and charges? This info should be clearly visible as part of your agreement. As an example of this in practice I recently had Lloyds TSB on this for a 1997 Mastercard account as they had not included any info at all on the agreement/T&C's. As such they had reserved no contractual right to add any charges to the account. After 10 months or so of arguing with them a letter before action resulted in the quick refund of nearly £900 to the account but they insisted they could still keep the first £12.00 of each charge which is of course incorrect. The rest is a story for another day!

 

Your creditor stating you have to go look for them or to ask about these charges is effectively making it difficult for you to understand the true nature and actual cost of entering into an agreement with them, this is unfair. An example is them applying a £1000 charge each time you'd made a late payment and then telling you it was listed in some pamphlet somewhere seperate from your agreement. £1000 or £20.00, the principle is the same. The charges need to be clearly displayed so you know what you're getting into from day 1. This lack of clarity in addition to a seemingly non-existent default notice is not good enough, I think the court let you down and the creditor of course took advantage of that.

 

Moving forward you only have a certain amount of time to appeal and you can only do so if you can show the judge made a mistake on a point of law, you can't just disagree with no point of law to support you.

 

You'd need to check but I believe you are still within the time allowed to appeal. Have you posted your agreement anywhere so caggers can review it? If it were me I'd fight it as initially it seems this is all very wrong and perhaps you got a judge who lacks knowledge of the consumer credit act and its finer points. I'd have put the claimant to proof of a few issues, seems they got an easy time no doubt helped by general lack of info from the court. If an appeal is not possible I'd consider going after the creditor (if evidence can support it) as a seperate action entirely. Apologies for the wordy response, this stuff really winds me up

[Viano]

Hi emandcole and good morning,

 

Thanks for your reply,

 

Re para 1. I didn't send an SAR but I do have the statement history going back to March 03 and yes it does contain both £20 & £12 default charges.

 

re para 3. I did ask to see the alleged DN and sent them a CPR 18 and a CPR 31.14 and requested proof of post of a DN. I, as others have been, was told they don't keep copies of DNs and don't need to, nor do they have a proof of posting. They provided to me and in their Court Bundle a template of a DN. On the 'probability' point they provided a print out showing what they say is proof of a DN, the print out does not record whether it was sent or not, it was claimed that because it was showen on that print out that it would have automatically been sent. It is claimed that because I had a telephone conversation with someone in Mumbai within 48 hours of the print out date that I had in fact received that DN. The Judge read and re-read the synopsis of this conversation and concluded that I had had the DN. The memo data records that 'CH upset abt the ltr which he recive' and went on to say 'Advsd tht he's still been receivin threatnin letters' sic.

 

Re para 4. See the last sentence above.

 

Re para 5. I tried the 'Four Corners' argument, it didn't work on this occasion.

 

Re para 6. See para 5.

 

Re para 7. The Order was for 28 days, how much time do I have? There is a copy of the application/agreement early on in the thread which was deemed enforceable by the team. Bear in mind though that the application was made in 2003 when I believe that the prescribed terms should be on the signature page above the signature.

 

I hope that answers some of your queries.

 

By the way SCM follow this thread.

 

V

[citizenB]

IMHO, if the print out did NOT provide the information that would have been necessary to have been included in the DN ie remedy date, amount requested in arrears then they should not have been allowed to rely on a template and the print out.

 

The template could have been amended to look as though it was correct. There is a whole defence for invalid default notice below.

 

 

 

The requirement for a valid Default Notice to lawfully Terminate an Account whilst in default

 

1. Notwithstanding the matters pleaded above, the Claimant must under Section 87(1) of the Consumer Credit Act 1974 serve a valid Default Notice before they can demand early payment of sums not yet due under a Regulated Credit Agreement.

 

2. Under the Interpretation Act 1978 Section 7, it states:

 

Where an Act authorises or requires any document to be served by post (whether the expression "serve" or the expressions "give" or "send" or any other expression is used) then, unless the contrary intention appears, the service is deemed to be effected by properly addressing, pre-paying and posting a letter containing the document and, unless the contrary is proved, to have effected at the time at which the letter would be delivered in the ordinary course of post."

 

2. Practice Direction

Service of Documents - First and Second Class Mail.

 

With effect from 16 April 1985 the Practice Direction issued on 30 July 1968 is hereby revoked and the following is substituted therefore.

1). Under S7 of the Interpretation Act 1978 service by post is deemed to have been effected, unless the contrary has been proved, at the time when the letter would be delivered in the ordinary course of post.

2). To avoid uncertainty as to the date of service it will be taken (subject to proof to the contrary) that delivery in the ordinary course of post was effected:-

(a) in the case of first class mail, on the second working day after posting;

(b) in the case of second class mail, on the fourth working day after posting.

"Working days" are Monday to Friday, excluding any bank holiday.

3). Affidavits of service shall state whether the document was dispatched by first or second class mail. If this information is omitted it will be assumed that second class mail was used.

4). This direction is subject to the special provisions of RSC Order 10, rule 1(3) relating to the service of originating process.

 

8th March 1985

J R BICKFORD SMITH Senior Master

Queen's Bench Division

 

3. Further to point 2 above, CPR rules on service also state the required timescales to be given for serving of documents :-

 

Under CPR 6.26 First class post (or other service which provides for delivery on the next business day) is deemed to be “served” The second day after it was posted, left with, delivered to or collected by the relevant service provider provided that day is a business day.

 

4. The Default notice supplied by the Claimant is dated Friday 3rd August, to allow service in line with the statutory requirements mentioned in points 2 & 3 above, 2 working days were required to allow for 1st Class postage. Thus the Rectify date should be 14 calendar days from Wednesday 8th August, namely Wednesday 22nd August 2007, not the 14 calendar days from the date of the letter as stated in the Default notice which would have been 17th August.

 

5. I therefore put the Claimant to strict proof that any Default Notice sent to me was valid and allowed the statutory 14 clear days to rectify the breach. I also note that to be valid, a Default Notice needs to be accurate in terms of both the scope and nature of breach and include an accurate figure required to remedy any such breach. The prescribed format for such document is laid down in Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) and Amendment regulations the Consumer Credit (Enforcement, Default and Termination Notices) (Amendment) Regulations 2004 (SI 2004/3237).

 

6. The failure of a Default Notice to be accurate not only invalidates the Default Notice (Woodchester Lease Management Services Ltd v Swain and Co - [2001] GCCR 2255) but is an unlawful rescission of contract which would not only prevent the Court enforcing any alleged debt, but give me a counter claim for damages Kpohraror v Woolwich Building Society [1996] 4 All ER 119.

 

7. It is submitted that the above Default Notice served s87(1) Consumer Credit Act 1974 failed to comply with the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561).

 

8. For a Creditor to be entitled to terminate a regulated Credit Agreement where there is a breach, demand repayment in full or take any legal action to recover any monies due under the Agreement, a creditor must serve a Default Notice under section 87(1) of the Consumer Credit Act 1974 which states:

 

Section 87. Need for Default Notice

 

(1) Service of a notice on the Debtor or hirer in accordance with section 88 (a "Default Notice ") is necessary before the creditor or owner can become entitled, by reason of any breach by the Debtor or hirer of a regulated Agreement -

 

(a) to terminate the Agreement, or

 

(b) to demand earlier payment of any sum, or

 

© to recover possession of any goods or land, or

 

(d) to treat any right conferred on the Debtor or hirer by the Agreement as terminated, restricted or deferred, or

 

(e) to enforce any security.

 

9. The Act also sets out via Section 88(1), that the Default Notice must be in the prescribed form, as below:

 

Section 88. Contents and effect of Default Notice

 

(1) The Default Notice must be in the prescribed form…

 

10. The wording must make it clear that no variation is acceptable. Therefore it cannot be dispensed with as a De Minimus issue.

 

11. I note that the regulations do not allow any variation in the form of these statements and therefore it is suggested that where the statements are not as laid down in the regulations the Default Notice is rendered invalid as a consequence.

 

12. In the case of Woodchester Lease Management Services Ltd v Swain & Co - [1998] All ER (D) 339 in the Court of Appeal, the Court addressed in some detail the issue of the contents of a Default Notice and should the notice fail to comply with the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) it would render the Default Notice invalid I quote the comment of KENNEDY LJ: "This statute was plainly enacted to protect consumers, most of whom are likely to be individuals" the judgment appears to confirm the consumer credit legislation made under the Consumer Credit Act 1974 as plainly enacted and set out to offer protection to the consumer. Therefore it is suggested that the failure of the Claimant to set out the Default Notice in accordance with the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) could unduly prejudice me as it failed to allow the required time to remedy the alleged default.

 

13. The Claimant’s failure to issue a valid Default Notice must surely prevent a right of action and would make any termination of the Agreement unlawful, as statute provides the procedure that must be followed. Since the Claimant has failed to adhere to statutory procedure it is averred that the Claimant does not have a right of action, and can never now have a right of action having terminated the Agreement unlawfully.

 

14. Furthermore, the Arrears Total outlined cannot be accurate, as the Balance on the Account was at least partly comprised of Unlawful Charges plus additional Charges and Interest added unlawfully whilst the Account was in Dispute. Therefore, the Arrears claimed cannot be accurate, as they are themselves calculated using a Total that was itself inaccurate.

 

15. This is at all times an Agreement Regulated by the Consumer Credit Act 1974. There is no provision in the Act that allows a large financial institution to terminate an Agreement that is in alleged default or breach simply by giving notice to the Consumer. Section 98(6) makes that quite clear. The Creditor must follow the steps outlined in Section 87 and Section 88 if they are to lawfully Default and Terminate, and enjoy the benefits of Section 87.

 

16. Finally, an invalid Default Notice cannot be remedied by simply issuing a new Default Notice. The Claimant may not serve a second effective default notice in prescribed form post-termination of the agreement. Any such second default notice will necessarily state a date by when I would be required to comply after which in default the agreement would terminate. The second default notice would therefore contain the fiction that the agreement endured when that cannot be the case, as it was terminated on XX/XX/XX. Terminating an Agreement on the back of a defective Default Notice, simply confirms the undeniable truth that Termination of the agreement by the Claimant was carried out in circumstances which then prohibited them from enjoying the benefits of Section 87, namely the opportunity to seek early Payment of a sum that was, prior to Termination, only payable in the future.

[emandcole]

Agree CitizenB,

Viano, if the claimant did not comply with your CPR request for info, which is sadly very common, you would have had the option of forcing their hand by making an application to the court to force their hand. I believe the form is an N244 and initially you'll have to pay £40 for it and you get to fill out what you want the claimant to provide you with. If the judge considers your request is reasonable (which an application to see documents the claimant is relying upon is) you'll be sent a general directions order. You'll then have to to pay the final £35.00 to cover the cost of a small hearing where the claimants will be ordered to turn up with the documents you have requested. Normally in this sort of scenario 30 minutes or so are allocated for the hearing.

 

I appreciate this is all well and good in hindsight but the producing of templates and the court relying on transcripts of a conversation you might have had is not good enough. A transcript is not proof that it was you on the phone and there are other issues of data storage which you could question putting the claimant to proof that all of this has been stored and processed correctly but that's a whole new ball game. The default notice is essential and the claimant should have had to produce the document in court if they were pushed to do so.

 

It's tricky but I would ring the court and although they cannot give you any legal advice they should be able to advise you of the process involved in an appeal and if indeed you are entitled to do so. I believe your grounds would be that the judge made an order based on insufficient evidence and the lack of that evidence is contrary to consumer credit law for which you have now suffered loss. This defaukt notice thing is absurd. Can you imagine going to the airport to catch a flight and informing the check in crew that you have a passport but have only bought a generic, non-descript template with you instead? Only the original is acceptable.

 

If an appeal is not the way to go for you I'd consider putting an argument together to challenge the creditor and go from there with a fresh start and an enlightened mind! Clearly the default charges have resulted in an inaccurate claim amount and an inaccurate default notice amount.

 

 

As for the SAR I would issue one in order to obtain everything about the account and in order to show that the amount they claimed was inaccurate. As CitizenB has kindly added:

14. Furthermore, the Arrears Total outlined cannot be accurate, as the Balance on the Account was at least partly comprised of Unlawful Charges plus additional Charges and Interest added unlawfully whilst the Account was in Dispute. Therefore, the Arrears claimed cannot be accurate, as they are themselves calculated using a Total that was itself inaccurate.

The arrears should have been listed accurately on the default notice as this is your opportunity to remedy the account. Clearly, it will all be wrong.

 

Given the fact that the agreement appears to be solid (from your earlier confirmation) you could also argue that the issue of an incorrect default notice is an unlawful rescission of contract for which you are technically entitled to claim damages for.

 

Won't be a lot but importantly it adds weight to your argument that the creditor has not played ball and putting doubt in the mind of the court against the other party is a vital tool.

[Viano]

Thanks for your thoughts cB & emandcole.

 

I wonder, are there any other 'big guns' out there that might like to comment on this situation before I go any further.

 

V

[banker_rhymes_with]

Hello Viano!

 

I would Appeal, but you need to crack on with it PDQ.

 

Check out Shakespear62's Thread, as he/she is right in the middle of an Appeal and the advice you need is there.

 

Then save up, and get a Barrister if you can.

 

Cheers,

BRW

[kel123]

Viano you already know what I think!

 

Now with regards to the cca (inc T&C)

 

They are both micofitch copies but they are referenced 200,000 copies apart. The T&C are the earliest, i.e. T&C = 609000 and the signature page = 809000. and the T&C are titled bank copy.

 

Taking 'balance of probabilities' out for a second, they cannot match because of time differentials and I have not come across a film or plate of 200,000 pieces. Now it could be argued that these are batch numberes, the same arguement applies; lets say they they are using the first figure as the reference (8 & 6) which means they are 3 (inc) plates or films apart? So without the original they cannot proove that they match.

 

I bet that you were never given a copy of the application form when you signed it because you were supposed to have been sent 'THE BOOKLET' titled your agreement with the card. But if like me you never received it then they fall short of S62 Then S60 comes into play with reference to S61 then S65 and then 127(3). Now if you look at the memoline data and there is no reference to it being sent, they have no proof,

 

Just a thought

 

Kel

[Viano]

Hi Kel,

 

Interesting comments, thanks.

 

V

[Viano]

Update!

 

Just back from a visit to the CAB, about as much use as t*ts on a bull.

 

I thought I'd let you know, 22 hours to sort the N161 and get it in, hey ho!

 

Further update later.

 

V

[citizenB]

Oh dear. Sorry to hear that.. just shout if you need any help.

[Viano]

Will do, thanks.

 

V