Cabot Just Dont Get It

[DID]

Hello everyone,

 

The problem we are having with Cabot dates back to last year when they wrote to my girlfirend regarding an outstanding Barclaycard credit card debt. I have a little bit of experience of the Consumer Credit Act so wrote to them requesting a copy of the agreement and they responded by sending the application form for the Barclaycard (which was also for her student bank account).

 

I then wrote back to them stating the application form was not the credit agreement as it doesnt contain the prescribed terms, it is also completely illegible. Just about the only part you can make out is the bit that states "This Credit Agreement is regulated by the Consumer Credit Act 1974. Sign it only if you want to be legally bound by the terms".

 

They then sent some Barclaycard terms and conditions and said that these show the interest rate etc and my girlfriend agreed to these terms when she signed the credit agreement. I wrote back saying the T&C's do not contain a signature and are therefore irrelevant, and that they have still not provided a properly executed credit agreement.

 

We have now received a letter from stating the following;

 

In response to your letter Cabot provided the relevant terms and conditions and statements pertaining to your account. However you are claiming that as these documents do not contain your signature, they are irrelevant in this matter. I would with respect refer you to Section 61(1)(b) of the CCA 1974, which states:

61 Singing of agreement

(1) A regulated agreement is not properly executed unless:

(b) the document embodies all the terms of the agreements, other than implied terms.

 

Section 189(4) of the CCA 1974 states:

189 Definitions

(4) A document embodies a provision if the provision is set out either in the document itself or in another document referred to in it.

 

You will note it clearly states that the prescribed terms may be set out in a document other than the credit agreement as long as reference is made to the document.

 

They then supply another copy of the application form and refer to statement regarding the agreement being regulated by the CCA and say that she has agreed to all terms by signing the application form.

 

Now I am almost certain that they are wrong and the application form is not a valid credit agreement as it doesnt contain the interest rate, credit limit and repayment information, but I am fed up of banging my head against a wall with them.

 

I would like some thoughts on whether anyone believes the application form is valid and also some advice on what to do next. I want to start legal action against Cabot to get this matter resolved and get the default removed from my girlfriend's credit file but not sure how to go about this.

 

Any advice is welcome.

 

Thanks in advance.

[miss muppet]

Do a forum search for Cabot Fan Club and join the exclusive set of Cabot admirers!!

[Curlyben]

You will note it clearly states that the prescribed terms may be set out in a document other than the credit agreement as long as reference is made to the document.

 

Oh dear no.

SI 1983/1553 puts this one to bed

 

This is taken from another thread;

Under SI 1983/1553 the prescribed terms MUST be within the signature document to be valid, having them on a seperate sheet headed T&C or similar ISN'T acceptable.

SI 1983/1553 (6 Signing of agreement) which states that the prescribed terms MUST be within the signature document. (Column 2 schedule 6)

This applies to all agreements pre May 2005.

So basically this is unenforceable, under 127(3).

 

Just to add to my comments re terms witin signature doc.

This was covered off in Wilson and another v Hurstanger Ltd [2007] EWCA Civ 299

 

Schedule 1 to the 1983 Regulations sets out the "information to be contained in documents embodying regulated consumer credit agreements". Some of this information mirrors the terms prescribed by Sch 6, but some does not. Contrasting the provisions of the two schedules the Judge said

33 In my judgment the objective of Schedule 6 is to ensure that, as an inflexible condition of enforceability, certain basic minimum terms are included which the parties (with the benefit of legal advice if necessary) and/or the court can identify within the four corners of the agreement. Those minimum provisions combined with the requirement under s 61 that all the terms should be in a single document, and backed up by the provisions of section 127(3), ensure that these core terms are expressly set out in the agreement itself: they cannot be orally agreed; they cannot be found in another document; they cannot be implied; and above all they cannot be in the slightest mis-stated.

As a matter of policy, the lender is denied any room for manoeuvre in respect of them. On the other hand, they are basic provisions, and the only question for the court is whether they are, on a true construction, included in the agreement. More detailed requirements, which are designed to ensure that the debtor is made aware, so far as possible, of specified information (including information contained in the minimum terms) are to be found in Schedule 1.

 

So if the terms aren't in the signature document (fro pre May 05 agreements) then they are irrelevant.

Being on a seperate document identified as T&C isn't acceptable at all.

 

Shame Cabot get it wrong yet again.

[DID]

Miss Muppet - Sorry I may be being really stupid but were should I search?

 

Curlyben - thanks for the info. Can you advise what SI 1983/1553 is? Is it an act? Also do you think we should write to Cabot again correcting them on their error?

[creditcardmug]

Hi, i'm very interested in this, "you will note that it clearly states that the prescribed terms may be set out in a document other than the credit agreement as long as reference is made to the document"

 

Does it say on the page you signed that the prescribed terms are contained in a document linked to this one i. e. overleaf etc?

 

Have you checked what s189 (4) says?

[DID]

Well its difficult to make anything out on the application form but it doesnt refer to another document in the parts I can read.

[creditcardmug]

Well thats it then, the prescribed terms must be on the page you signed, some of them may try to argue they are in a doc linked to the page etc, but if yours hasn't got that then it's totally unenforcable IMHO.

[DID]

What are the options now then?

 

I could write to them but I know they will just try to fob me off with some more bull. How do I go about starting action against them?

[havinastella]

something like this will see them off

 

 

Re: my request under the Consumer Credit Act 1974

 

Thank you for your letter dated 16th June 2008.

 

It would seem that you are of the belief that you have discharged your obligations under the Consumer Credit Act 1974 in particular section 78(1).

 

You have provided me a copy of an application form and I feel it is my duty to draw your attention to some serious flaws in your comments.

 

Firstly, to comply with section 61 of the consumer credit act 1974 which by the way refers to the signing of an agreement (Not an application), a document must conform to regulations made under the provisions of section 60(1) Consumer Credit Act 1974 otherwise it cannot be properly executed

 

Now then, these regulations I refer to are the Consumer Credit (Agreements) Regulations 1983 (SI 1983/1553). These regulations set out the form and content of agreements. For an agreement to be compliant with the regulations it MUST embody within the agreement, the prescribed terms laid out in the SI1983/1553 without the prescribed terms the agreement does not conform to section 60(1) 1974 and therefore cannot be properly executed as described in section 61(1) CCA 1974.

 

For your information in case you are unsure. The prescribed terms referred to are contained in schedule 6 column 2 of the Consumer Credit (Agreements) Regulations 1983 (SI 1983/1553) and are inter alia: - A term stating the credit limit or the manner in which it will be determined or that there is no credit limit, A term stating the rate of any interest on the credit to be provided under the agreement and A term stating how the debtor is to discharge his obligations under the agreement to make the repayments, which may be expressed by reference to a combination of any of the following--

(a)Number of repayments;

(b)Amount of repayments;

©Frequency and timing of repayments;

(d)Dates of repayments;

(e)The manner in which any of the above may be determined; or in any other way, and any power of the creditor to vary what is payable.

 

Now nowhere on the application form that you supplied is there any reference to these terms. I wish to remind you that the absence of these terms will render a document unenforceable in court and I also wish to point out that these terms MUST be contained within the agreement and NOT in a separate document headed terms and conditions or words to that effect

 

Since the document you have supplied is a clear mailer application form, I cannot believe for one moment that these very important terms would be contained on the opposite side of the form, unless they are there for the postman to read while he delivers the mail. Therefore they must have been contained in a separate document, which is prohibited by the SI1983/1553, as there is no clear link to them within the signature document.

 

Therefore, you have failed to supply an enforceable document, which is correctly executed as to be so; it must conform to the Regs under s60 CCA1974

 

I am of the opinion that a court is precluded from enforcing this agreement by s127 (3) CCA1974 as it is improperly executed under s61 CCA 74, the consequences of improper execution are set out in section 65 CCA 1974 and s65 sets out that only a court can enforce an improperly executed agreement subject to certain qualifications, one of those is that the document is signed and contains all the prescribed terms. Now since this document does not contain all the prescribed terms s127 (3) CCA 1974 strictly prevents the court from enforcing this agreement.

 

If you cannot supply me with a document, which complies with the Consumer Credit Act 1974, and ALL of the Regulations made under the Act, I shall be forced to make a complaint to Trading Standards and I will also draw this to the attention of the Office of Fair Trading .

 

I respectfully request you review this matter in light of my comments above and I request that you supply me the required information or alternatively confirm the account is closed and the debt written off with a zero balance.

 

I respectfully request a reply within 14 days of the date of this letter.

 

Yours Sincerely

[DID]

Thanks Havinastella thats brilliant. I will write to them and see what they come back with. If they are still trying to fob me off I will look into to starting legal action against them.

[havinastella]

Thanks Havinastella thats brilliant. I will write to them and see what they come back with. If they are still trying to fob me off I will look into to starting legal action against them.

 

I'd love to take the credit, but I'm sure it's one of PT's

 

 

I sent them this one a few months ago, not heard a thing since.

 

Jogs

[DID]

What are you doing about your credit file if you havent heard from them?

[havinastella]

well, that's a huge Grey area at the moment.

 

I'm watching this thread very carefully

 

http://www.consumeractiongroup.co.uk/forum/data-protection-default-issues/148780-experian-final-battle-commences.html

 

 

JOgs

[DID]

Cheers I will keep on eye on it as well

[miss muppet]

Hi DID, sorry to take time in replying, the blue bar at the top has search just type in Cabot fan Club. OH is in the same situ as you, so I am going to crib the same letter its taken Cabot/Goldfish a year to come up with an application form:)

[miss muppet]

Thanks havinastella for excellent letter.

[creditcardmug]

Can you advise what SI 1983/1553 is? Is it an act?

 

Statutory Instrument, it's a regulation describing part of an Act

[babybear39]

It's part of the Comsumer Credit Act 1974.

Edited July 13, 2008 by babybear39
oops spelling

[DID]

Ok so I sent the letter as per Havinastella's post and have now had a response from Cabot.

 

Dear xxx,

 

I refer to your letter received on 24th of June 2008 and our previous correspondence.

 

As previously advised under the Consumer Credit Act 1974 section 78(1), there is no obligation to provide a true and complete copy of the credit agreement if there is no longer a true and complete copy of the credit agreement in existence. Nor is there an obligation upon us to provide a full statement of account, copy of a deed of assignment and or a copy of a default notice. As a result the information we have provided to you, clearly complies with section 78 of the CCA 1974.

 

With regards to the requirements of the agreement regulations 1983/1553 concerning the form and content of the agreement, these regulations do not deal with this matter, as it is the CCA that deals with this matter as primary legislation. Section 189(4) of the CCA states:

 

"A document embodies a provision if the provision is set out either in the document itself or in another document referred to in it."

 

Section 61 of the CCA , which deal with the "signing of documents", states:

 

"A regulated agreement is not properly executed unless

(a) A document in the prescribed form itself containing all the prescribed terms and conforming to the regulations (Consumer Credit (Agreement) Regulations 1983) under section 60(1) is signed in the prescribed manner both by the debtor...

(b) The document embodies all the terms of the agreement, other than the implied terms..."

 

The word "embodies" does not mean "contain" as you have stated. The word "embody" (in contrast to "contain" which is set out in subsection (a) of section 61) means that the document need not set out all the terms itself, but may refer to another document setting out the terms under section 189(4). In this instance on the application form it is clear that the Terms and Conditions are mentioned and therefore you are incorrect in stating that the agreement cannot be set out in difference documents.

 

As to prescribed terms, this is covered in section 61(a), above, where it mentions "contains". The terms and conditions have set out all the prescribed terms as required under the Consumer Credit (Agreement) Regulations 1983 and therefore there can be no argument as to the validity of the form and content of the agreement.

 

Please be advised that Section 127(3) of the CCA has now been repealed due to the CCA 2006, however, this is not retrospective to agreements commencing 6 April 2007. The section deals with Enforcement orders in cases of infringement and subsection (3) states:

 

"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 debotr or hirer (whether or not in the prescribed manner)."

 

As above mentioned, all the provisions have been complied with and therefore there is no consideration to be given by the Court as to whether the agreement is unenforceable or not. All proper legal and regulatory provision, including prescribed terms, are stated in the agreement.

 

In conclusion, we are perfectly within our rights to enforce the debt against you as your arguments are clearly unfounded and you have no basis for your dispute or claim for failing to pay the outstanding balance under the credit agreement. Therefore I would recommend you contact our collections department, within the next 14 days, to discuss the options available to you in order to settle this account. If we do not hear from you within this time frame we shall consider taking further action against you for the recovery of the outstanding balance.

 

Ok now my first reaction is that they are trying to throw lots of legal information at me in an attempt to confuse me, which they have partly done!

 

I dont have the knowledge to know if some of what they have said is true, but I do know they seem to have confirmed that the original agreement does not exist (if it ever did). Now they seem to be basing their latest argument on their insistence that the application form they have sent clearly states that the Terms and Conditions are mentioned.

 

I have been over the form and the only thing I can make out, because the text is so illegible (I have even looked through a magnifying lense!), is the part which states "This is a Credit Agreement regulated by the Consumer Credit Act 1974. Sign it only if you want to be legally bound by its terms".

 

If this is the statement they are referring to then surely this doesnt constitute referring to a separate document, because it doesnt?

 

If they are referring to another part of the form then how am I supposed to know if they are correct if the copy is so illegible?

 

I would really like some thoughts on what to do next because this is starting to really annoy us but we are also worried about any legal action they may take.

[creditcardmug]

They have just won against 9lives, using these arguments, so going to feel confident they can use this line from now on, it makes a mockery of consumer credit law IMO.

[DID]

Really?

 

Thats a big concern, I guess it comes to down which court deals with the case if it gets that far, but I would like it sorted before it gets to court.

 

Do you think its worth complaining to FOS and the OFT?

[creditcardmug]

Really?

 

Thats a big concern, I guess it comes to down which court deals with the case if it gets that far, but I would like it sorted before it gets to court.

 

Do you think its worth complaining to FOS and the OFT?

 

It is a big concern because most of the defences to claims on here are based on it.

Complaining cant do any harm, how much good it will do you though is debatable

[DID]

I would really like some advice on what people think of the letter Cabot have sent to us, and probably many more people now.

 

My thought is that they are talking a load of bull (wont be the first time) because the application form they have provided does not refer to another document anywhere on it.

 

The part that states "This is a Credit Agreement regulated by the Consumer Credit Act 1974. Sign it only if you want to be legally bound by its terms" surely refers to the terms of the CCA and not the terms of the actual agreement, which would be different and separate.

 

I am going to write another letter to Cabot but would like some thoughts on what people think, or whether it is worth waiting and taking this through the courts.

 

Thanks

[havinastella]

Hi DID,

 

I received the exact same letter on the same date.

 

IMO after reading the 9lives thread, we need BF and the other Site Mods to look over this letter and the 9lives thread and come to some sort of plan of action.

 

IF we can't use the consumer act 1974 as FACT, then Cabot will keep using these wins as evidence in court.

 

Jogs

[DID]

Yeah I was hoping for someone with experience to give their opinion on the best course of action.

 

I am fairly certain that Cabot are wrong (especially with the application form they have sent us), and if this was to make it to a court which could set a precedent then they would rule in favour of the consumer. However that is a long way off, and could potentially end up costing a lot of money in legal fees to get there, and we are not sure we want to take the risk of going that far.