Shortfall Court Summons - URGENT help needed please!

[inafix]

I have received a County Court Summons for a shortfall that I was paying to a DCA, but stopped after they started harrassing me for the full amount. With interest, the amount has now risen to more than double!

 

I just don't know where to go from here. Should I pay for a solicitor to file my defence, as I feel out of my depth.

 

I have sent back the acknowledgment defending the whole claim as I don't agree to them claiming this amount.

 

I have a new mortgage with equity in my property and I'm so afraid they'll make me sell my house.

[Tawnyowl]

Mortgage Shortfall | Debt Advice | Payplan

Just putting this up-am just going to work but their are some numbers on there-hope it helps-someone will advise-stay calm.Will check tonight. Tawnyowl.

[Tawnyowl]

Mortgage Shortfall, County Court Summons, Urgently Need Advice, Please Help!

 

This thread may give you something to read while waiting for other members to advise-i will ask one of them to look at your thread.Shes is a star-shining in the sky of gloom-and helps many with similar problems.Stay calm-its is like international rescue here-all a big team trying their best.And welcome to CAG.

Edited September 21, 2008 by tawnyowl

[jadzia.dax1]

Hi,

 

Firstly, please try not to worry I know that is easier said than done…

 

I am in a similar situation to you & I also have equity in my new home.

 

It’s a really scary situation but there a loads of people on here who can & will help so please sit tight someone will be along to advise you very soon.

 

You say you have sent back the acknowledgment of service..

 

What date does your defence need to be in by?

 

Jadzia

[inafix]

Hi guys, Sorry I've had issues with my computer, back now!

 

Thanks for your support, I have been trying to deal with everything myself, but now I feel as if I'm in way over my head.

 

Defence has to be in by 27th.

 

I have never had any docs relating to this claim from the beginning. It was only through my own naivety and bullying from the DCA that I started paying them, (if only I'd known then what I know now).

[inafix]

Particulars of claim

 

1. By way of a legal mortgage dated xx xxx 1990, xxx and xxx charged the property kwown as and situated at xx xx to the claimant.

 

2. The claimant obtained possession of the property on xx Oct 1994.

 

3. On xx Dec 1995 the claimant sold the property in exercise of its power of sale as mortgagee in possession for the sum of £24,xxx.xx.

 

4. At the date of sale, the amount outstanding under the martgage was £48,xxx.xx.

 

5. The claimant apportiond the sale proceeds of £24,xxx.xx to the mortgage debt in the following order (i) interest, (ii) capital. Immediately following the sale in point 3, in the premises due and owing to the claimant from the defendant amounted to the sum of £24,xxx.xx. The aforementioned figure represented capital debt.

 

6. The claimant claims interest pusuant to section 69 of the County Courts Act (1984) at the rate of 8% per annum for the period of xx December 1995 and xx September 2008 in he sum of £24,xxx.xx.

 

7. Further, the claimant claims interest pursuant to section 69 of the County Courts Act (1984) at the rate of 8% per annum at a daily rate of £5.30 to the date of judgement or payment if sooner.

 

8. The claimant has received payments to the mortgage account to the value of £3,xxx.xx. between the date of sale and date of intended issue of this claim. On this point the defendant is specifically

referred to the provision of ss29 and 31 of Limitation Act 1980 which provide for Fresh Accrual of Action on receipt of a payment made by the mortgagor or a joint-mortgagor.

 

9. The defendant is jointly an severally liable for the full amount outstanding under the mortgage as detailed above.

 

10. ***Blah about Halifax being taken over by BOS. ****

 

AND THE CLAIMANT CLAIMS:

 

1. the sum of £45,xxx.xx pursuant to details in paragraph 5, 6 and 8 above;

 

2. interest pursuant to details in paragraph 7 above; and

 

3. costs.

[surfaceagentx20]

When was your first payment made to the bully DCA post sale and when was the last? Who paid and how was it paid?

 

x20

[inafix]

1st payment was in 1997 and last was April last year. I told them to take me to court and they closed their file and returned it to Halifax.

 

A few months later I received a letter from another DCA demanding payment. I requested a DSAR which produced microfiche copies of mortgage account,copy of mortgage application (contains no figures), list of dates and amounts of valuations, offers and sale. Request for copy of possession order and further info. (as advised by National Debtline), produced copy of a completion statement. I received a letter from them saying they would take legal action.

 

A few months after that I received a letter from another DCA(solicitors?)

demanding payment. I rang them and told them the acount was 'in dispute'. They said I can't dispute it as I have been making payments. I told them it was my legal right to see a copy of the Possession Order, which they said they had and would send me copy. Waiting for that.

 

Now here we are!!

[inafix]

Sorry x20, didn't answer your second question. I paid by standing order.

[surfaceagentx20]

Damn! Options fast running out on liability but may still have them yet on the amount they are claiming.

 

OK, let's try another tack. Can you tell me whether any interest was still owing after the property was sold and if so how much interest was owing? Was that interest more than £3,xxx.xx?

 

What do you reckon would have been a reasonable sale price for the property back in December 1995?

 

x20

[inafix]

I'm sorry I don't know, as far as I can work out from microfiche docs, there are two loan amounts. One shows end balance as at Jan 96 of £17,xxx.xx and the other £29,xxx.xx.

 

But, looking at No. 5 in particulars of claim does this mean the interest was paid off?

 

Unsure of reasonable sale price, but property was valued at £35,000 then sold for £24,000,14 months later, which was a lot less.

 

MIG was in place but I am unsure if this was claimed on. DCA no.2 said this was being 'investigated'.

Edited September 22, 2008 by inafix

[surfaceagentx20]

Fix,

 

I don't envy you this case. The payments made since December 1997 culminating in the one made April 2007 has the effect of renewing the 12 year limitation period for the recovery of the capital which accrued in December 1995. These proceedings were therefore commenced within the limitation period in my view.

 

I have sought to argue that the payments you made were not freely given but were payments made owing to threats etc. What constitutes a threat is debatable. If I threaten you saying 'give me the £10.00 you owe me or I'll take you to court', that is not a threat for the purpose of duress or undue influence. Saying 'give me the £10.00 you owe me or I'll snatch your car' on the other hand probably would.

 

Likewise, the payment may be induced by false promises, thus saying 'give me the £10.00 you owe me and we'll forget about the other £10.00 you owe me' might be employed to achieve a release from the obligation to pay the other tenner (heavy stress on 'might').

 

I have drawn up a form of defence which I'll run through with you.

 

To be entitled to pursue the claim it will necessarily be a condition of the mortgage that a right to pursue you is reserved. I fully expect there to be such a clause. However, to throw the cat amongst the pigeons the draft does not admit the existence of such a clause, throwing the onus of proof on to the bank.

 

The draft also contends, adopting your £35K valuation, the bank sold it at an under value. You may care to obtain a report from a survweyor as to the market price of the property in December 1995. In the absence of evidence showing £24,xxx.xx was evidently an under sale, the bank is likely to be believed that this price was the best it could reasonably achieve. Nonetheless, the Defence throws this in issue placing the burden of proof on to the bank.

 

Finally, the defence argues the award of interest, being discretionary, should be disallowed.

 

What concerns me is that unless this case is defended the bank will obtain a judgment for some money which it will then seek to secure on your house. You don't want that.

 

I think you must now give very serious consideration to negotiating a deal with the bank.

 

DRAFT / DEFENCE

 

1 Save that no admissions are made as to the existence of a term or condition in the mortgage deed entitlng the Claimant to bring the claim now sued upon, paragraphs 1, 2 and 3 of the Particulars of Claim are admitted.

 

2 At all material times in exercising its powers of sale, the Claimant owed the Defendant a duty to obtain the best price reasonably available and to incur only reasonable costs in relation to the sale. It is denied, alternatively it is not admitted that the sum of £24,xxx.xx represented the best price reasonably available on the sale of the property. A reasonable price would have been not less than £35,000.00.

 

3 No admissions are made as to paragraph 4 of the Particulars of Claim and no admissions are made as to the the manner in which the Claimant apportioned the proceeds of sale. It is denied that on sale of the property there was then due and owing to the Claimant the sum of £24,xxx.xx.

 

4 The Claimant's claim to be entitled to discretionary interest on the sum of £24,xxx.xx under County Courts Act 1984 section 69 is denied. Alternatively, the Defendant will contend at the trial of this case that in the exercise of its discretion the Claimant's claim to statutory interest should be refused in whole or in part.

 

5 It is denied that the Defendant or any person with his/her authority made a payment to the Claimant in reduction of the capital sums now sued for in a manner which would have the effect of giving rise to a fresh accrual of a cause of action for the benefit of the Claimant. Alternatively, that there was a payment by the Defendant or a person with his /her authority and made voluntarily and of his or her own free will with such effect. Such payments as were made (none being admitted) were payments made owing to the representations and/or the duress an/or the undue influence of the Claimant, its servant and/or agent and upon the Claimant and/or its servant or agent falsely representing that (here give particulars of any representation etc inducing payment).

 

6 In the circumstances the Claimant's claim to be entitled to £x and interest thereon is denied.

 

Dated:

 

Signed:

 

x20

[inafix]

Thanks for that, I'm off to work now, will check back tonight for any other advice.

[tinkerbell20]

If I were in your shoes I would be inclined to follow surfaceagentx20's advice and file a defence along the lines of the drfat defence he has kindly drafted for you...................

[inafix]

Have been reading thru' some other similar threads (phew! -headache).

 

Can we go down the prove it route to buy some time?

 

All I have been trying to do is to find out the Why's And Wherefore's of how the original amount owing had been calculated, due to the underhanded way in which the DCA were trying to claim back the debt.

Otherwise, I would still be making payments to them. Therefore, it didn't need to go this far.

 

If no 'enforceable documentation' was forthcoming from two DCA's, why did the 3rd one issue court proceedings? What documents do they have to produce to the court?

[inafix]

Many thanks to x20 for the immediate response. Your help is greatly appreciated.

 

Does sending back the acknowledgement give me 14 days + a further 14 days (not sure what it said now). If so this would give me until 10th Oct.

 

Should I hear anything more before my defence is due?

 

Any more help / advice / input from anyone else that might be of benefit?

[inafix]

Please can anyone help with my questions?

 

x20, thankyou so much for the draft defence. Is this exactly worded for me to send off, or does anything else need to be added. What happens after I have sent this to the court?

 

Sorry to be pushy, but I don't have much time. Do I have 14 days + another 14?

 

Can I ask for more time to request documentation before I am able to file my defence?

 

I'm just trying to pick things up from other cases (or maybe I'm just getting more confused).

Edited September 24, 2008 by inafix
add

[tinkerbell20]

Please can anyone help with my questions?

 

x20, thankyou so much for the draft defence. Is this exactly worded for me to send off, or does anything else need to be added. What happens after I have sent this to the court? YOU CAN FILE IT AND AMEND LATER IF REQUIRED. AFTER COURT RECEIVES YOUR DEFENCE THE CASE WILL BE ALLOCATED TO YOUR LOCAL COURT IF THE OTHER SIDE WANT TO PROCEED

 

Sorry to be pushy, but I don't have much time. Do I have 14 days + another 14? YES

 

Can I ask for more time to request documentation before I am able to file my defence? yOU CAN MAKE APPLICATION TO COURT FOR MORE TIME TO FILE DEFENCE BECAUSE OF WAITING FOR DOCUMENTS IF YOU HAVE ALREADY ACKNOWLEDGED THE CLAIM ALREADY AND ASKED FOR MORE TIME. i THINK THERE IS A FEE PAYABLE

 

I'm just trying to pick things up from other cases (or maybe I'm just getting more confused).

 

 

See above

 

Tinks x

[cat100]

Acknowledge of service gives you 28 days.

[ndcdavis]

If you have sent in the acknowledgement of service, you get an extra 14 days.

I have an extra suggestion for your Defence.

Have you still got a copy of the possession order made in 1994? If not, you should send a letter to the claimant solicitors asap:

"Please can you send me a copy of the 1994 possession order referred to at paragraph 2 of the particulars of claim. This request is made under Part 18 CPR".

(also ask the relevant court for a copy)

The reason is this:

1. When taking possssion proceedings, a mortgage lender can ask for a money judgment for the outstanding balance in addition to possession of the property.

2. some mortgage lenders asked for a money judgments; others did not.

3. if the mortgage lender asked for and was given a money judgment then the current proceedings are liable to be struck out as vexatious and/or an abuse of process, because they are proceedings for the same debt in respect of which the lender already holds a judgment. Effectively the current proceedings are an attempt to re-litigate the previous proceedings.

I have brought this argument for clients twice in the last 3 months. In both cases the Court has struck out the bank's claim (and awarded costs against the bank).

If the 1994 order did make a money judgment, you may then want to add a paragraph to the draft defence along the lines of :

7.1 The Defendant avers that by an Order made on [date] in case number [number] the [xxx] county court made an order that the Defendant pay to the Claimant the sum of £[amount] being the sums due pursuant to the mortgage.

7.2 The Defendant avers that the claim is for the same monies which were the subject of the abovementioned previous proceedings in respect of which the claimant already holds a judgment against the Defendant.

7.3 Accordingly this claim is vexatious and/or an abuse of process and should be struck out pursuant to Part 3 CPR.

If you have already sent the defence - dont worry. Make the part 18 request and then if the 1994 proceedings did include a money judgment, make an application to strike out.

NOte that this doesnt get you totally out of the woods - old judgments are still enforceable subject to judicial discretion. However the lender may be stuck with the amount of the judgment less sale proceeds and payments plus interest for 6 years from date of judgment.

Hope this helps!

Nick.

[citizenB]

 

What do you reckon would have been a reasonable sale price for the property back in December 1995?

 

x20

 

Hi inafix, X20 asked the above question a while ago, I knew I had seen somewhere where you could work out the approximate value of your home at the time of sale. If you follow the link below you will be able to do this. Primarily it is for working out if you are paying too much council tax. However, if you read Martin Lewis's notes you will see there is a way of finding out how much your home was worth at any given date. If you need some help, just yell.

 

Council Tax Rebanding: Lower your band and save £1,000s...

[inafix]

Thanks for that. Unfortunately, it seems to be too vague for my purpose, as it I calculates price by 'region' only.

I appreciate that the figures are only approximate, but I have tried it back to when we bought the property, and also when the house was valued for re-mortgage, and the figures are way, way below what were given at that time.

Having said that, the figure I'm using is when the property was sold in 2006, which is a lot less than other properties in the same street.

Confused?!

[ndcdavis]

valuation - you can try nethouseprices.com but this will only give you prices from 2000. Before that you will need to spend some tiem at your local library going through local papers or instruct an expert.

[inafix]

Defence has to in by 10th.

 

As mentioned in post #5, I have never had ANY docs relating to this claim. I have never tried to say I don't owe them anything, I just wanted confirmation of how it was all calculated in the first place.

Also, when I handed back the keys (incidentally, this was 14 months before the possession order was obtained??), I was told 'not to worry as there was Indemnity Insurance in place'.

There are quite a few discrepancies cropping up as things go on (even down to the incorrect spelling of my name, and the incorrect date for when the mortgage was obtained).

If they don't have the relevant paperwork will the court pursue the claim?

[inafix]

Should I ask for anything else under CPR pt18 ?

 

I want to finalise my defence to send off tomorrow as I don't want to leave until the last minute. Should I use the exact wording given by x20 or does any part need tweaking?

 

Thanks all.