Credit agreement vs credit card agreement

[underdog13]

I have read on a few threads that agreements must carry the heading Credit Card Agreement, etc as opposed to Credit Agreement, etc.

 

How binding is this and has anyone had any success on this basis? So far all of the bumpf they have tried to pass off on me as agreements has carried the title Credit Agreement.

[cosalt]

I have been wondering the same thing to be honest, most of my agreements are the same. Yet interestingly when they send a copy of the latest terms they do put the correct heading on so they are well aware it was wrong.

 

I dont think the title is a prescribed term, so may not make it unenforcable.

 

Hopefully by bumping up this thread we may get some one in th know to clarify, I think Banker Rhymes With is hot on this.

[underdog13]

just found this on another thread - original post by the superb x20;

 

"Re: BRW v A Particularly Nasty Bank

 

Under Regulation 2(1) to the Consumer Credit (Agreements) Regulations 1983, for the document you posted to be regarded as an agreement it would have been necessary for it to be headed: "Credit Card Agreement regulated by the Consumer Credit Act 1974" in accordance with the Column 2 Information appearing at 1(d) of Schedule 1."

 

[cosalt]

Excellent find, hoping someone 'in the know' will come along to give us their opinion.

[davefirewalker]

Sorry .......would NOT make it unenforceable

 

127 Enforcement orders in cases of infringement

 

(1) In the case of an application for an enforcement order under—

 

(a) section 65(1) (improperly executed agreements), or

 

 

(b) section 105(7)(a) or (b) (improperly executed security instruments), or

 

 

© section 111(2) (failure to serve copy of notice on surety), or

 

 

(d) section 124(1) or (2) (taking of negotiable instrument in contravention of section 123),

 

 

the court shall dismiss the application if, but (subject to subsections (3) and (4)) only if, it considers it just to do so having regard to—

 

(i) prejudice caused to any person by the contravention in question, and the degree of culpability for it; and

 

 

(ii) the powers conferred on the court by subsection (2) and sections 135 and 136.

 

 

(2) If it appears to the court just to do so, it may in an enforcement order reduce or discharge any sum payable by the debtor or hirer, or any surety, so as to compensate him for prejudice suffered as a result of the contravention in question.

 

(3) 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 debtor or hirer (whether or not in the prescribed manner).

 

(4) The court shall not make an enforcement order under section 65(1) in the case of a cancellable agreement if—

 

(a) a provision of section 62 or 63 was not complied with, and the creditor or owner did not give a copy of the executed agreement, and of any other document referred to in it, to the debtor or hirer before the commencement of the proceedings in which the order is sought, or

 

 

(b) section 64(1) was not complied with.

 

 

(5) Where an enforcement order is made in a case to which subsection (3) applies, the order may direct that the regulated agreement is to have effect as if it did not include a term omitted from the document signed by the debtor or hirer.

 

 

Basically put....if it has the precribed terms and your signature on it.....its enforceable EVEN if it is missing some important stuff.

 

The judge may rule that you have been predujiced and that the creditor is a rat faced fink...and may adjust the amount owed from full amount to zero or anywhere in between......your guess is as good as mine.

 

tread carefully

 

 

Dave

[cosalt]

Sorry .......would NOT make it unenforceable

 

127 Enforcement orders in cases of infringement

 

(1) In the case of an application for an enforcement order under—

 

(a) section 65(1) (improperly executed agreements), or

 

 

(b) section 105(7)(a) or (b) (improperly executed security instruments),

or

 

 

© section 111(2) (failure to serve copy of notice on surety), or

 

 

(d) section 124(1) or (2) (taking of negotiable instrument in contravention of section 123),

 

 

the court shall dismiss the application if, but (subject to subsections (3) and (4)) only if, it considers it just to do so having regard to—

 

(i) prejudice caused to any person by the contravention in question, and the degree of culpability for it; and

 

 

(ii) the powers conferred on the court by subsection (2) and sections 135 and 136.

 

 

(2) If it appears to the court just to do so, it may in an enforcement order reduce or discharge any sum payable by the debtor or hirer, or any surety, so as to compensate him for prejudice suffered as a result of the contravention in question.

 

(3) 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 debtor or hirer (whether or not in the prescribed manner).

 

(4) The court shall not make an enforcement order under section 65(1) in the case of a cancellable agreement if—

 

(a) a provision of section 62 or 63 was not complied with, and the creditor or owner did not give a copy of the executed agreement, and of any other document referred to in it, to the debtor or hirer before the commencement of the proceedings in which the order is sought, or

 

 

(b) section 64(1) was not complied with.

 

 

(5) Where an enforcement order is made in a case to which subsection (3) applies, the order may direct that the regulated agreement is to have effect as if it did not include a term omitted from the document signed by the debtor or hirer.

 

 

 

Basically put....if it has the precribed terms and your signature on it.....its enforceable EVEN if it is missing some important stuff.

 

The judge may rule that you have been predujiced and that the creditor is a rat faced fink...and may adjust the amount owed from full amount to zero or anywhere in between......your guess is as good as mine.

 

tread carefully

 

 

Dave

 

Thanks very much for that, although I am not sure I understand it

 

Does this mean that an agreement can be enforceable as long as it contains the prescribed terms and is signed by the debtor, regardless of what else is wrong ?

[davefirewalker]

YES

 

 

Although you "may" get a reduction, due to the amount of prejudice caused and the culpability for it

 

Dave

[underdog13]

Thanks for that Dave.

 

So, in essence, don't base your defence on this, but maybe add it to the creds' list of failings just in case of a possible reduction?

[banker_rhymes_with]

Hello Underdog13!

 

So, in essence, don't base your defence on this, but maybe add it to the creds' list of failings just in case of a possible reduction?

 

Absolutely!

 

It's a potential flaw if they want to turn, say, an Application Form into an Agreement.

 

Don't bet the Farm on it, but it's one of many issues you can raise when fighting a banker that is trying to turn one thing into another.

 

It may render an Application Form improperly executed and Enforceable by Order of a Court only...which could mean that they can't Enforce the Application Form without going to Court.

 

When there, then that's the time to point out if they have blown s127(3), or pick holes in the Copies if it comes to pass that they never had an Original Copy despite their claims!

 

But, it can be a useful issue to make, say, a DCA break their stride if they are hounding you for Payments based on an Application Form that looks very suspect.

 

Point out to them that the Application Form is not Enforceable unless they take you to Court and, if they want to do that, they'd better have an Original Copy of the Agreement that includes your Signature and the Prescribed Terms contained within the four corners of it!

 

Now, how many DCAs like going to Court?

 

Likewise, if you do get hauled into Court, this issue could give you an entirely reasonable explanation why you stopped Paying them...i.e. the alleged Agreement was improperly executed and needed a Court to Enforce it in any event. Point out it was the banker's fault for not doing their job properly when the Application Form was first created...they got the Heading Wrong for the Agreement section!

 

Cheers,

BRW

[underdog13]

An excellent post, as always:) Thank you very much BRW.

[m3man]

Ok, good thread. Does anone have a letter template to send to the creditor pointing out this very important point?

[atwozee]

I am well aware of the argument that an agreement can be enforced under 127(3) if a document containing the (minimal) prescribed terms is signed by the debtor – but, could it be argued that actually any credit card agreement that states it is merely a Consumer Credit Agreement cannot be recognised as an agreement under the act.

 

Sounds like a strange argument but:

 

The creditor can only use the term ‘Consumer Credit Agreement’ if no other prescribed term is applicable – well the prescribed term in schedule 1 column 2 section 1(d) is applicable and that clearly states:

 

"Credit Card Agreement regulated by the Consumer Credit Act 1974",as the case may require.

 

I’m not sure what ‘as the case may require’ means but it is clear that an appropriate heading is applicable but the creditor chose to ignore it and insert the heading under section 2 which states:

 

If none of the headings in 1(a) to (d) above are applicable a heading in the following form of words- "Credit Agreement regulated by the Consumer Credit Act 1974"

 

Can it then be said that an incorrectly headed agreement (where there are clear guidelines to follow under an act of parliament) cannot then be regulated under the act. Therefore s127(3) doesn’t actually apply because actually none of the act applies – this would make the agreement void full stop because a licensed creditor is not allowed to offer such a credit facility unless it is regulated under the act.

 

In other words – to be a regulated agreement under the act it must be a recognisable agreement under the act and in the above case clearly the correct type of agreement hasn’t been stated – so now the document is back to being just an application and not a recognised agreement under the act.

 

Worth stating in any defence as far as I am concerned.

 

Ps Underdog – regarding a similar dispute you have going on you might be interested in my thread here http://www.consumeractiongroup.co.uk/forum/legal-issues/176842-court-claim-received.html

 

In a nutshell they are claiming on the back of 1 agreement for 2 cards/accounts.

[m3man]

Ok, thanks for the tips.

 

So, in a nutshell, do i contest? If so, is there a template for me to use to do so?

[underdog13]

Fantastic post Atwozee; brilliantly argued. Thank you very much. Great to have you on board.

 

Thanks for the link, too - will have a good read through.

[davefirewalker]

Date is important.......

 

prior to apr 2005 the 1983 regs were in force and they only specified a few headings....after 2005 the "credit CARD" term was added to the list of headings....

 

check carefully

 

and in any case it would only make it improperly executed.......not a 100% defence

 

Dave

[cosalt]

Date is important.......

 

prior to apr 2005 the 1983 regs were in force and they only specified a few headings....after 2005 the "credit CARD" term was added to the list of headings....

 

check carefully

 

and in any case it would only make it improperly executed.......not a 100% defence

 

Dave

 

Hi Dave, I am not disputing you in any shape or form, but are you sure this is correct ?

 

All my agreements are pre 2005 and I have mentioned the improper title in defence on some of mine on advice of several others, I hope I am not wrong.

[davefirewalker]

Pretty certain....SI 1983 / 1553 p4944

 

reg 2 schedule1 part1

 

 

Rgds

 

Dave

[cosalt]

Oh dear...

 

Thanks for the info

[cosalt]

So presmably when I have seen quotes from the CCA about correct headings refering to 'credit card' these applied to post 2005 agreements only ?

[banker_rhymes_with]

So presmably when I have seen quotes from the CCA about correct headings refering to 'credit card' these applied to post 2005 agreements only ?

 

Looks like it, sadly.

 

I've got an old Copy of Goode, and the Card issue wasn't there in 1999, so it looks like they did change this between then and 2005 approx.

 

Davefirewalker appears to have pinned the date down to April 2005.

 

Looks like it won't be much help for Agreements made before then, but it may confuse a dull DCA for a while!

 

Cheers,

BRW

[davefirewalker]

Actually Ive found out the comencement is May 31 2005

 

Dave

[cosalt]

Looks like it, sadly.

 

I've got an old Copy of Goode, and the Card issue wasn't there in 1999, so it looks like they did change this between then and 2005 approx.

 

Davefirewalker appears to have pinned the date down to April 2005.

 

Looks like it won't be much help for Agreements made before then, but it may confuse a dull DCA for a while!

 

Cheers,

BRW

 

Oh well, we will just have to find something else to fight them with

 

Mind you it does say the title should be Prominent, I can't see how a document with 'APPLICATION FORM' in big letters at the top and 'Credit agreement' in small letters underneath can comply with this

[underdog13]

Damn. What a disappointment. Thanks for letting us know, though, Dave.

[underdog13]

Mind you it does say the title should be Prominent, I can't see how a document with 'APPLICATION FORM' in big letters at the top and 'Credit agreement' in small letters underneath can comply with this

 

That's good to know, cosalt - in what part of the act does it say that? I've got a few application forms with the CCA heading in tiny letters just above the signature box, so it would be great to be able to quote verbatim about the need for prominency.

[cosalt]

If you look at post 17 where Dave kindly posted an image, it is at the top of the bit which says what the title options are.

 

I hope that makes sense !