Help ... Been to Court ... Big Credit Card Problem

[creditcardmug]

Click the red triangle to alert a mod, who may be able to get x20/pt etc to look at this.

 

i think there may be something in continuing because,

 

1 the DN is invalid (and i dont think they can now issue another)

 

2 you need to insist on the original agreement be brought to court (to establish the prescribed terms are indeed on the back)

[pt2537]

 

If that document was supplied in response to a s78 request, then they have not complied with their s78 obligations

 

i refer you to Regulation 2 Consumer Credit (Cancellation Notices and Copies of Documents) Regulations 1983 (SI 1983/1557)

 

2 Legibility of notices and copy documents and wording of prescribed Forms

 

(1) The lettering in every notice in a Form prescribed by these Regulations and in every copy of an executed agreement, security instrument or other document referred to in the Act and delivered or sent to a debtor, hirer or surety under any provision of the Act shall, apart from any signature, be easily legible and of a colour which is readily distinguishable from the .

 

 

i havent had time to fully read this thread yet but thats my initial observation

[atwozee]

And to reiterate – if they are saying that those t&c’s are on the back of the agreement then it has to be doubtful because it clearly states ‘BANK COPY’ in the top left hand corner.

I had a similar application/agreement sent to me and mine didn’t say bank copy – so either they have variations of the same application form floating around or the copy of the document isn’t front and back – that’s how I see it anyway.

What’s their argument going to be? We think the back of your application looked like this or something similar…who can tell really.

If they haven’t got the original then they haven’t got a document containing all of the prescribed terms so it’s unenforceable.

[AndyOrch]

Hi Coolerking got your message

 

IMHO apart from the flawed CCA and DN they appear to have gone to a lot of trouble to create said consent order and seem keen to gain your acquiesce in this matter.if so sure of their claim why not just go for the CCJ:confused:

 

 

Regards

 

Andy

[banker_rhymes_with]

Hello Coolerking!

 

I'd fight this all the way. It was never the job of the Judge to give you a lecture on morals.

 

In a nutshell, your case reflects one of mine, and boils down to this:

 

(1) Do they actually have an Original properly executed Regulated Credit Agreement.

 

(2) Did they comply with your s78(1) Request.

 

(3) Did they have a right to issue a Default Notice, i.e. if they failed the above, then they were constrained by 78(6) so were not in a position to issue a Default Notice.

 

(4) Did they issue and Serve a Valid Default Notice? If they failed to do that, then went ahead to Terminate, then they lose the benefits of s87, i.e. the Right to seek early repayment of the Balance that was not otherwise due for Payment at that time. All they can ask for is the Payments that were due at Termination, i.e. the Arrears.

 

(5) Did they Terminate Lawfully. They'd need a valid Default Notice to do that. Without that, they can still Terminate, but it's unlawful. IOW, it's an Unlawful Rescission of Contract, for which you may be entitled to Compensation. They were as bound to the Contract as you, and the Act sets out what they must do if they wish to extract themselves from the Contract in a lawful manner following any Breach by you that was not remedied.

 

Termination means just that, they can't turn back time to un-Terminate it.

 

Once Terminated, they cannot Default you again, as there is by then no live Agreement to issue a Default Notice upon.

 

Assuming you have not already done so, please take a look at my Thread below, as many of the same key points apply:

 

BRW v A Particularly Nasty Bank

 

I do fully appreciate your position. The worry is acute I know. However, as I see it, you are in the right, they are in the wrong.

 

Their position should be fatal if they fail on any of the main points listed above.

 

I do hope this helps.

 

Cheers,

BRW

[coolerking]

thanks for your comments everybody, really appreciate it,

 

i agree with all you have said as this was essentially going to be my approach at the pre trial hearing.

 

However, to be honest the judges stance/views shook me a bit and I should have asked him to look at the copy CCA then.

 

He basically said if he threw the case out in my favour because they had not complied with my initial request for the CCA it would really **** them off. He believed that they would make sure they get they story right next time, go to fastrack, which they would probably win, i would have to pay costs, get a CCJ, and involve the papers.

 

I do not really want all of that and am not a RANKIN so considered a settlement the best way out.

 

If I go back now and get it wrong I may be in big trouble.

 

I will consider all what you have said and post here later as have to pick up wife/baby now.

 

Laterz

[banker_rhymes_with]

Hello Coolerking!

 

He basically said if he threw the case out in my favour because they had not complied with my initial request for the CCA it would really **** them off. He believed that they would make sure they get they story right next time, go to fastrack, which they would probably win, i would have to pay costs, get a CCJ, and involve the papers.

 

I think the Judge doesn't understand the issues.

 

Your best plan is to work on what you will say, pull together a clear Skeleton Argument that cuts out everything and concentrates on the key points outlined above.

 

If they come back for you a 2nd time, what else are they going to bring to the table that they didn't have the first time?

 

Perhaps they will get the Ironing Board out and some starch, and try to make their invalid Default Notice look flatter and crisper?

 

If they are stuffed now, then they'll be just as stuffed the next time.

 

I know it's hard, but if I were you (which I'm not, so this has to be your call), I'd stick to my guns and hold out for a victory this time around.

 

Saying they will get angry and come back for you in a nastier way next time is just something to disregard and put out of your mind. Sort it now, and that should be that.

 

Being angry is not really for real, as this is all just numbers to them anyway. A banker never gets that upset. It's all show to try and undermine your confidence. Away from this, the bankers will not give you a 2nd thought. They won't give you a 2nd thought on the day, and won't give you a 2nd thought after the day.

 

You are just another little blip on their Spreadsheet, so do not read too much into them being angry. You have to ask why the Judge said all of this. They could be a soft cuddly Colonel Blimp Judge who has no idea but wants to be nice, or they could be a pro-bank Judge who wants to get you to capitulate to avoid having to risk making a wrong Judgement that could be challenged via Appeal. They could be something in between the above two.

 

Whatever they are, the advice they have given you is very suspect and beyond what a Judge should be doing. They are supposed to sit in the middle, listen to both sides of the argument, and make a Judgement.

 

Telling you the other side may get hissy and come back for you again is really odd...especially given the facts that you have already disclosed.

 

So, best advice I can give is to concentrate on the key points, and go back hard, don't back down...and hold your nerve.

 

Cheers,

BRW

[coolerking]

thanks for your views BRW.

 

Lets break things down;

 

1. i defaulted in 2006 due to financial problems

2. agreed to installment plan but not able to keep up.

3. they send the dcas in during 2007

4. i requested cca august 2007 and repeated requests several times to dca, oc and sols

5. they never directly responded until i made a formal complaint and admitted they did not habe one as they do not hold records this long.

6. they then issued court claim even they no valid cca,

7. I issued SAR and asked to provide relevant docs under CPR which they eventually complied with 3 months after court claim was issued.

8. the original copy was not very good but the one provided on witness statement is much better (will post a new copy)

9. the default notice would have included approx 10% charges/interest

10. they can only provide computer generated default notice in their witness statement

11. no they do not have the orginal properly executed document

12. In the witness statement, there is a statement however, stating that the copy provided is that of the original documents and this has been signed by a senior member of staff (i think this is what they call heresay evidence and is acceptable in court of law, as proof that the banks procedures have been complied with) and i did research this.

 

 

witness statement

 

The Credit Card Agreement

1) The defendant originally became concerned due to the unsolicited approach by the ************* (the claimants agent) and under s78 of the Consumer Credit Act 1974 requested a copy the alleged Credit Card Agreement. The defendant first requested this from ********** on ****** and followed this up with requests on **********, ********* *********, ************in response to phone calls and letters from ************* A copy of these letters marked ***********are attached to this statement.

 

2) The claimant admitted in their letter of *********** that they no longer had a copy of the credit card agreement due to the age of the account. The defendant avers that the claimant has a responsibility to retain the original document for at least 6 years after the closure of the account as this good business practice. A copy of this letter marked *********** is attached to this statement.

 

3) In response to the Particulars of Claim issued ********* the defendant wrote to the claimant ************ and requested a copy of the agreement referred to in the claim as per CPR 18. **********

 

4) In their original Particulars of Claim dated ****** the claimant refers to an agreement in writing and regulated by the Consumer Credit Act 1974. I would bring to the courts attention that the claimant failed at the time to provide a copy of the agreement referred to in their particulars of claim and reproduce the relevant extract from CPR 16 7.3 for convenience. The defendant avers that the claimant was premature in bringing a claim at this time as they had already admitted they did not have the original executed credit card agreement. **********

 

5) In addition the defendant issue CPR 18 to defendant on ******* Exhibit *******.

It is requested the court give consideration to using its case management powers pursuant to part 3.4 of the Civil Procedure Rules to strike out the claimants claim for failing to comply with the requirements of inter alia part 16.2(1) (d) and fails to comply with the requirements of practice Direction 16 in so far that it fails to comply with point 7.3 which states

Where a claim is based upon a written agreement:

(1) a copy of the contract or documents constituting the agreement should be attached to or served with the particulars of claim and the original(s) should be available at the hearing,

The claimant failings to supply this documentation has placed me at a serious disadvantage, especially when it is considered that the credit agreement must comply with the Consumer Credit act 1974 and the Consumer Credit (Agreement) regulations made under the act. The consequences of the document failing to comply with the regulations and the Act can render the agreement unenforceable even by the honourable court.

6) In accordance with procedures the defendant completed allocation questionnaire and returned this to the court 28/6/08 together with draft directions where he requested a copy of the regulated agreement and sent a copy to the claimant. Exhibit ******** is enclosed.

 

7) The Claimant may say that they have a copy of the regulated credit card agreement which deems the account enforceable. However, the defendant avers that the copy document does not meet the prescribed terms as follows. This is because the copy is of poor quality and not legible.

A Repayments

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.

 

B Rate of interest

A term stating the rate of interest to be applied to the credit issued under the agreement

 

C Credit limit

This may be a term or the manner in which it will be determined or that there is no credit limit.

 

8) The claimant highlights that a replacement card was issued to the defendant *******. The defendant avers that the claimant did not follow the Consumer Credit Act 1974 s85 at the time as follows;

Section 85 Consumer Credit Act 1974

 

(1) Whenever, in connection with a credit-token agreement, a credit-token (other than the first) is given by the creditor to the debtor, the creditor shall give the debtor a copy of the executed agreement(if any) and of any document referred to in it.

 

(2) If the creditor fails to comply with this section-

 

(a) he is not entitled, while the default continues, to enforce the agreement; and

 

(b) if the default continues for one month he commits an offence.

 

(3) This section does not apply to a small agreement.

 

9) The claimant is likely to rely upon the a poor copy of Credit Card Agreement. The Civil Evidence Act 1995 says;

9 Proof of records of business or public authority

 

(1) A document which is shown to form part of the records of a business or public authority may be received in evidence in civil proceedings without further proof.

(2) A document shall be taken to form part of the records of a business or public authority if there is produced to the court a certificate to that effect signed by an officer of the business or authority to which the records belong.

For this purpose—

(a) a document purporting to be a certificate signed by an officer of a business or public authority shall be deemed to have been duly given by such an officer and signed by him;

(3) The absence of an entry in the records of a business or public authority may be proved in civil proceedings by affidavit of an officer of the business or authority to which the records belong.

If copies of any of the above documents are to be relied on in court rather than originals, and the defendant intends to reply upon: adduce hearsay evidence under s2(1) of the Civil Evidence Act 1995 proof of the authenticity of the document(s) as required under s8(1)(b) of the Act, including is relevant but not limited to:

 

(i) a copy of the procedure(s) used for copying, storing and retrieving documents

(ii) a copy of the relevant log entry showing the time and date of the scan or copy, the name of the member of staff making the copy, the method used for copying, storage and retrieval and time and date of destruction of the original document(s)

(iii) copies of internal and external audit reports covering the entire period from the date of the copy to the present to demonstrate that the procedures have been complied with

(iv) copies of Quality Assurance accreditation certificates covering the entire period from the date of the copy to the present to demonstrate that the procedure(s) and audit process(es) comply with the appropriate quality standards.

 

Charges

The Claimant contends the contractual clauses which permit the Charges are unenforceable by virtue of the common law relating to penalty clauses and or the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCR) and thus seeks return of the said Charges

I have enclosed statement appendix *** and *****

 

 

The crux of the matter appears to rely on;

 

the original credit card agreement

the copy of the original

the default notice

 

The question is how strong is this sort of defence and what is the likely outcome.

 

The judge did seem well briefed as he quoted s78 cca 1974 to counsel and they had no argument against it.

 

I will do some more thinking about this but feel free to contribute,

 

thanks

[atwozee]

My view – the witness statement made by the bank regarding copies of documents needs to be rock solid if it is going to be acceptable as a replacement for the original document which they chose to destroy. I am very concerned as to why the terms and conditions state bank copy (which I doubt would have been on the back of the application they sent you)

Do you have a copy of the witness statement that they wish to rely on?

The default notice contains penalty charges – read BRW’s thread – they will probably reimburse you for these and amend their claim – fine - but the default notice is still incorrectly stated and they may not reissue a corrected default notice now that the agreement has been terminated. That door has been closed.

Very worse case is that the judge enforces the agreement (by virtue of the witness statement) at which point you would be liable for the amount stated in arrears on the default and that’s if the judge allowed it considering it has been incorrectly stated. How would a judge be able to make a ruling on how much you were liable for if the figures were muddy?

Do you have a copy of the default notice and can you post the full details of your defence?

[surfaceagentx20]

In my view the Judge did not acquit himself especially well at the hearing. In my view he was guilty of leaning on a legally unrepresented person with expressions of [1] that person's moral obligations and of [2] the way in which the bank would conduct itself in the future if he made an order striking out the claim. He overlooked the fact the words 'moral obligation' appear in no statue of England (I'm guessing but I'd wager money on it) and the irepairable damage an ineffective DN has on a creditor's case. A better Judge's view would have looked like this.

 

If the agreement is improperly executed or can not be produced as evidence of proper execution, the bank are in difficulties. You have the right to go physically inspect the agreement it and do not have to accept the mere production of copies, leaving you guessing what the original itself looked like. This right has been taken from you. The Act requires agreements to be executed in accordance with the scheme of the Act and regulations and the Act also provides for what should happen where an agreement has not been properly executed. The Civil Evidence Act 1995 was not enacted as a means of enabling creditors to overcome the obligations imposed by the Consumer Credit Act 1974, so that for example, so soon as the ink is dry, the agreement can be scanned, microfiched, binned, reconstructed, distorted or whatever.

 

Section 9(1) of the Act is permissive. It says a court 'may' receive in evidence a 'document which is shown to form part of the records of a business.' The court may therefore decide not to. Equally, the court may allow the document, but since the document is not the agreement but merely what some bigwig certifies is a record of something held by the bank, that record has to be laced into the evidence the creditor presents to the court, the whole of which is designed to show the agreement is properly executed. The bigwig can not say from direct first hand knowledge that the record is a true copy of the agreement the debtor signed. The record will have been made by someone else lower down the creditor's food chain. That person is the person who should be in the witness box. If that person is not in the witness box, the creditor will be in difficulty showing the record is a true copy of the agreement. The court will or at least ought in my opinion be concerned to receive the very best evidence. If someone other than the person who made the record is in the witness box that person's evidence is of little assistance and can be shown to be so under cross-examination. In a case I was concerned with, the creditor's witness was not even employed by the creditor at the time the agreement was supposedly executed. See where I'm coming from?

 

Section 9(1) is helpful to a point, but in my view, where the creditor is unable or inept enough to fail to properly marshall its evidence, the court may decide to hold to the view after hearing that evidence that the creditor had not discharged the burden of showing the agreement had been properly executed.

 

If the DN was ineffective for requiring you to make payment of more than was legitimately due under the agreement, the agreement will be treated by the court as ineffective for the purpose of then enabling the creditor to terminate the agreement and claim early payment. For a case on this very topic see Woodchester v Swayne (1998).

 

In short, the agreement would have been terminated in reliance upon an ineffective DN and your obligations would be limited to making payment of whatever sum truly represented the arrears under the agreement at the time the DN was served.

 

Do you actually have a copy of the DN? I notice for example you do not expressly say in your post about your Defence that you argue a DN was not served, so I'm assuming you accept you received one?

 

As far as I can tell, these issues have been properly raised in your Defence and they are not worthless but solid and supportable if as you say, the DN overstated the amount properly due.

 

I haven't seen the Particulars of Claim, but evidently the creditor advances the credit agreement as the basis of the claim and not the instalment plan agreement you say was reached after you defaulted in 2006, so the making of the instalment plan agreement is not treated by the creditor as superceding the regulated agreement.

 

I'd check the DN. If the DN can be shown to be ineffective as described, leaving just the true arrears at the time of service owing and nothing more and the agreement was subsequently terminated, payments made by you thereafter under the instalment plan may fairly be treated as payments made in reduction of the arrears. If those payments have now discharged the true arrears due at the time the ineffective DN weas served you have no further liability.

 

The question is, is the DN deffective for over-stating? Ask yourself, is the over-stating sufficiently within the scope of over-stating as referred to by Kennedy in Woodchester v Swayne (£634.40 arrears owing, over-stated to be £879.90) or in your case was it so trivial an over-statement that, adapting Kennedy's words, the overstatement was de minimus and capable of being overlooked?

 

x20

Edited November 16, 2008 by surfaceagentx20

[coolerking]

x20 thanks for your reply,

 

DN

I do not have a copy to hand, only that reproduced from the banks systems but have not reason to doubt that they issued one. As a result I do not have any way to show that they have not followed the appropriate process.

 

Charges & De-Minus

However, there are charges but given the debt is >£10k and the charges inc interest are £500-1000 I cannot be sure that this would help me and think it would be considered de-minus anyway.

 

The Agreement

while the agreement is a poor copy, and the reverse does appear to be the bank copy I think this is too subjective, as essentially it relies upon the judges interpretation too much.

 

While I hate to admit it I just think that my defence is just too weak and lacking a little in substance and I do not feel confident enough taking it forward but if had the money I probably would do.

The Consent Order

Can anyone advise me on this and if the terms are negotiatable.

 

Second Thoughts

The only thing that bothers me is how eager they are to settle. Is this because they will have a Consent Order and if I default on the plan then they can easily get judgement against me or is it because they know thw agreement may not be enforceable. I did mention to counsel that if we went to trial I would show that the agreement was not enforceable.

 

I wonder...

[coolerking]

im just trying to scan in my docs so you see the witness statements but having problems

[surfaceagentx20]

OK,

You got me worried now coz may be I misunderstood. Terms of consent orders are by definition non-negotiable. That's because they're orders and the negotiating occured beforehand.

 

You'd best post up the full text of what you call the consent order and we'll take it from there.

 

x20

[coolerking]

x20, please find full text under post 17 which they have proposed following the hearing

[surfaceagentx20]

OK done that. So there is no consent order as such. Merely a proposal of a set of terms which so far have not been accepted.

 

There's a few beers inside me so please forgive any whoppers but, with no consent order and after the Judge imposed himself with some sort of order (pray what precisely) where the frig are we exactly?

 

x20

[coolerking]

the judge has given us 30 days to find an agreeable settlement.

 

in response the oc gave two options;

 

1. cash settlement

2. installment plan

 

you have see the proposed T&C in the consent order which I have not yet signed.

 

as you see from the thread I do not feel confident enough to take this further as i believe the defence is too subjective, ie get the wrong judge and might end up incurring further costs I cannot afford.

 

my orginal defence was stronger as they didnt have the CCA, admitted this and only produced the copy under CPR and very late in the day.

 

my question is what is a consent order and what can i do to protect myself in case i lose my job in this recession which is a possiblity?

 

I need to deal with this over the weekend.

 

Thanks,

[surfaceagentx20]

Signing a consent order commits you to comply with the provisions of the consent order. A failure to comply would be likely to lead to enforcement. I have no idea how you might safeguard against the risk of enforcement if you lost your job and became unable to pay.

 

Not knowing precisely what it is you raise in your defence I am unable to comment on whether it would be sensible to throw the towel in. I would only add that alleging CPR shortcomings in the procedure adopted by the creditor in the litigation will be of no effect and at best would only sound in any costs order made by the court. From what I can tell your lead argument would be the default notice was deffective owing to the inclusion of some penalty charges. Was the DN effective otherwise? How much worth of penalty charges was included and what as a percentage of the total demanded in the DN does the penalty charge element represent?

 

x20

[meanbean]

x20,

 

I have an account that was alledgedly defaulted due to 2 months arrears. Claimant is recontructing default from computer records as they do not have a copy of the default that I deny receiving. I notice in your above post the default may be invalid due to penalty charges (another line of argument I need to follow). With a sum of approx £3400 outstanding the 2 months arrears amount to £348.50, but there are approx £1000 of penalty charges (plus contractual interest acrued on them).

 

This would mean the balance should have only been £2400 and the 2 month arrears (at 5% per month) would then have only been £246

 

Is this sufficient to make the default invalid (aside from the reconstruction issues).

Edited November 21, 2008 by meanbean

[surfaceagentx20]

The notion that a DN is ineffective where it includes penalty charges is moot. Certainly in Rankine, Brown concluded that where a DN included a requirement that the debtor pay a penalty charge of £10.00 the inclusion of such a sum was 'de minimus' as against the totality of the debt specified and incapable of rendering an otherwise effective DN inefective on that ground alone.

 

One question is therefore, at what point does the inclusion of a penalty charge cross the threshhold so as to render a DN ineffective.

 

In Woodchester v Swayne, Kenedy LJ regarded an overstated arrears sum of £879.90 when true arrears were £634.50 as so overstated as to render the DN ineffective. That was an over-statement to the tune of about 38% the true arrears.

 

A second question to be asked in my opinion is, how does the creditor address dual demands in the DN. The payment of arrears is a breach which is capable of remedy. The payment of a penalty charge is not itself a breach or something capable of remedy but rather, is in the nature of a requirement to pay a compensatory charge. The question then is whether the compensatory charge is identified in the DN as resulting from a breach which is incapable of remedy.

 

So that this may be clear, paragraph 3 of Schedule 2 to Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 says:

 

3 Details of breach of agreement and action required to remedy, or pay compensation for, the breach

 

A specification of:--

(a) the provision of the agreement alleged to have been breached; and

(b) the nature of the alleged breach of the agreement, specifying clearly the matters complained of; and either

© if the breach is capable of remedy, what action is required to remedy it and the date, being a date [not less than

fourteen days] after the date of service of the notice, before which that action is to be taken; or

(d) if the breach is not capable of remedy, the sum (if any) required to be paid as compensation for the breach and

the date, being a date not less than fourteen days after the date of service of the notice, before which it is to be paid.

 

It seems to me arguable therefore, that to properly comply with the 1983 Regulations, a creditor seeking in one DN the payment of both arrears and penalty charges will be required to specify

 

[1] a breach which is capable of remedy by specifying the sum to be paid (ie the arrears), and

[2] a breach which is no longer capable of remedy such as would justify the claim specified as due by way of compensation.

 

x20

[meanbean]

second question to be asked in my opinion is, how does the creditor address dual demands in the DN. The payment of arrears is a breach which is capable of remedy. The payment of a penalty charge is not itself a breach or something capable of remedy but rather, is in the nature of a requirement to pay a compensatory charge. The question then is whether the compensatory charge is identified in the DN as resulting from a breach which is incapable of remedy.

 

Not sure I understand this bit:confused:

Are you saying that a 'dual demand' in the DN results from the fact that part of the arrears figure is due to the 'True balance' (Full balance less any penalty charges added to the account over time), and the other part of the arrears figure is due to that part of the full balance which is penalty charges?

[surfaceagentx20]

Kind of. What I'm trying to develop is an argument in favour of the proposition that a DN is defective for a failure to separate in the demand that element which is required to satisfy the arrears of instalments and that element which is required to satisfy any charge other than an instalment.

 

Let's say under an agreement, instalments of £100.00 are due the 1st of the month. To understand where I am coming from, that gives rise to two obligations First to pay £100.00 per month and second, to pay the £100.00 on the first of the month.

 

Let's also say two instalments are missed. The creditor would issue a demand identifying the breach (ie the obligation to pay the instalments in accordance with the agreement) and saying the breach can be remedied by the payment of £200.00 by a specfied date.

 

Let's say also that because these instalments were missed the creditor wants an additional £50.00 by way of penalty charge. I am contending that the demand for the payment of £50.00 is a demand for compensation for a breach which is now incapable of remedy. If the instalments were due on the 1st January and 1st February, payment of those instalments on a day later than the date on which they were due will never remedy the fact that they were not paid on the due dates, but rather were paid late. In other words, the £50.00 is compensatory for the debtor's breach by failing to pay punctually. Is that not why penalty charges are raised - because the debtor failed to pay punctually?

 

There will be terms no doubt in the agreement (if the creditor can produce the terms) which permit the raising of penalty charges and the circumstances when the right arises. It seems to me that for the creditor to escape the kind of obligation to address his DN in the way I am promoting, the agreement will need to provide for the penalty charges to be treated as arrears of instalments or some such similar contractual device.

 

Is any of this making sense?

 

x20

[meanbean]

In other words, the £50.00 is compensatory for the debtor's breach by failing to pay punctually. Is that not why penalty charges are raised - because the debtor failed to pay punctually?

 

Definitely the way the creditor will see it thats for sure.

 

It seems to me that for the creditor to escape the kind of obligation to address his DN in the way I am promoting, the agreement will need to provide for the penalty charges to be treated as arrears of instalments or some such similar contractual device.

 

Yes, I see what you mean ..... the arrears & penalty charges are, in a sense, treated as one of the same thing.

 

Of course if they are treated separately for the purposes of a default notice (i.e part that is capable of remedy and part that is not) there would surely need to be some provision in the agreement that would state how monthly payments (or any payment for that matter) are assigned to any outstanding balance i.e. does a payment reduce the arrears on penalty charges first or the arrears of installments first or in any particular proportion.

 

Now I'm wondering if I'm making sense!