why you shouldnt use section 77/78 CCA 1974 if you want the signed agreement

[basa48]

Exactly, but as I say (and it has been known) if they subsequently come up with one in court, you're snookered.

 

Well yes, but if the creditor states it cannot locate or provide a true copy there is no problem until and unless they do find an enforceable copy.

 

I don't yet know a way around this except to invoke s60 which in particular requires "regulations shall contain such provisions as appear to him appropriate with a view to ensuring that the debtor or hirer is made aware of (a) the rights and duties conferred or imposed on him by the agreement, (b) the amount and rate of the total charge for credit (in the case of a consumer credit agreement), © the protection and remedies available to him under this Act,"

 

In addition, under the 2003 amendments to CCA 1974, they can supply a 'reconstructed' copy which is not, necessarily, a true copy.

LSP

 

This is news to me. The Copies Regs 1983 always held the the signature could be omitted from copies of executed agreements, but I've never read 'reconstituted' agreements are allowed.

[luckysandpiper]

This is news to me. The Copies Regs 1983 always held the the signature could be omitted from copies of executed agreements, but I've never read 'reconstituted' agreements are allowed.

 

'Reconstructed' - that is, re-typed on a fresh sheet of paper with all the T&C's in place, but without the signatures (as allowed) and to all intents and purposes a 'true' copy, but not an 'actual' copy.

There is a full explanation of this somewhere on this site (which is where I got it from) and I will try to locate it for you.

 

LSP

[luckysandpiper]

'Reconstructed' - that is, re-typed on a fresh sheet of paper with all the T&C's in place, but without the signatures (as allowed) and to all intents and purposes a 'true' copy, but not an 'actual' copy.

There is a full explanation of this somewhere on this site (which is where I got it from) and I will try to locate it for you.

 

LSP

 

Unfortunately, I cannot locate the source and so I am pasting the relevant text from a letter that I have send to Barclaycard - hope it is of use to you:

 

"Contrary to your assertion, you have not complied with the terms of CCA 1974 s78. The document that you have supplied, does not comply with your duties to supply a “True Copy” of any agreement you claim to have been signed by me, for pre 2007 agreements. As you will be further aware, an agreement is not executed, until signed by both parties, so the document that you have supplied, being a reconstruction, cannot be a True Copy of an Executed Agreement.

 

Let me explain here, what a true copy is:

 

In a recent letter from the enforcement department of the OFT, the text below was quoted, explaining what is required.

 

“The copy of the executed agreement need not be an exact copy but it must be a ‘true copy’ and not some reconstruction of what the original might have been and it must contain the same terms as the original. Where the terms have been varied as provided for within the agreement, the copy of the original agreement must be accompanied by a document setting out the current terms, as varied. Certain details may be omitted from the original agreement , for example, the signature, but the debtor must be in no doubt as to the true nature of his obligations under the loan.

 

Should no original agreement be in existence it is very hard to say that the copy the creditor offers to the debtor is, in fact, a true copy as there would be no original with which to compare it. In our view the onus of proof would be on the creditor to show that the copy is a true one and where none existed he may have difficulty discharging this. Neither should creditors suggest that a consumer has signed a credit agreement where they are unable to provide evidence to support this — to do so is likely to be a misleading action under Regulation 5 of the Consumer Protection from Unfair Trading Regulations 2008 (the CPR’s) and would also constitute an unfair or improper business practice.”

 

I also refer you to the information below:

1. A valid credit agreement must contain certain terms within the signature document (s.60(1)(2) CCA 1974). These core terms are the credit limit, repayment terms and the rate of interest (SI 1983/1553 (6 Signing of agreement) which states that the prescribed terms must be within the signature document. (Column 2 schedule 6). s.61(1)(a) states the agreement must contain all the prescribed terms and be signed by both the debtor and on behalf of the creditor.

2. Further, s.127(3) CCA 1974 makes the account unenforceable if it is not in the proper form and content or improperly executed.

In Wilson and another v Hurstanger Ltd (2007) it was stated “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 … 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”.

 

3. The need for prescribed terms to be contained in the credit agreement is confirmed by the Author of the CCA1974 act, I quote: ““As the draftsman of the Consumer Credit Act 1974 I would like to thank Dr Richard Lawson for his interesting and well-argued article (30 August 2003) on Wilson v First County Trust Ltd [2003] UKHL 40, [2003] 4

All ER 97.

Dr Lawson may be interested to know that I included the provision in question (section 127(3)) entirely on my own initiative. It seemed right to me that if the creditor company couldn’t be bothered to ensure that all the prescribed particulars were accurately included in the credit agreement it deserved to find it unenforceable, and that the court should not have power to relieve it from this penalty. Nobody queried this, and it went through Parliament without debate. I’m glad the House of Lords has now vindicated my reasoning and confirmed that nobody’s human rights were infringed.” - 167 Justice of the Peace (2003) 773.””

I am now granting to you a further 7 days to produce a copy of the executable agreement. After that I will consider that the above matter is closed and that you will no longer pursue the alleged debt. If you are insisting that the non enforceable document, that you have supplied, is the only alleged agreement in your possession, then I would suggest that the best course of action would be to immediately set the balance of the above account number to zero."

 

LSP

 

[tifo]

i've changed the text of my letters since the above .... hope this helps some people.

 

The Consumer Credit (Agreements) Regulations 1983 (SI 1983/1553) (as amended by SI 2004/1482) provides clear guidance in Section 2 as to the form and content of regulated credit agreements. I believe the documents you have sent do not conform to this guidance. Section 6 states that the prescribed terms must be within the signature document. CCA 1974 s.61(1)(a) states the agreement must contain all the prescribed terms and be signed by both the debtor and on behalf of the creditor otherwise it is not properly executed.

 

The Consumer Credit (Cancellation Notices and Copies of Documents) Regulations (SI 1983/1557) provides clear guidance on the legibility of copies of agreements. Section 2(1) states “The lettering .... in every copy of an executed agreement .... be easily legible and of a colour which is readily distinguishable from the ”. I do not believe the documents you have sent conform to this guidance and would ask you to clearly identify and state the information contained within the application form.

 

As you may be aware, in the recent case of McGuffick v RBS (2009) at para. 12 it has again been confirmed that, until a creditor fulfils their obligations under a request for a true copy of the agreement made under s.77/78 of the Consumer Credit Act 1974, they are unable to enforce the agreement and it remains unenforceable whilst they are in default. Further, they have to cease all collection activity so that they do not give a false impression that they are entitled to obtain a judgment. Para 14 confirms that the debt remains unenforceable until the creditor fulfils their obligations in relation to s.77/78.

 

I quote “In this case, the bank initially could not locate a copy of the agreement .... the bank wrote to MJP informing them of this and stated that, in the circumstances, if the claimant decided not to meet his obligations under the agreement, the bank would not be able to enforce repayment of the loan .... In cases where the bank has confirmed that it is unable to enforce the agreement, its standard practice is not to pursue legal action against the customer and to put a stop to all collection activity, so as not to give the false impression that it is entitled to obtain a judgment”.

I quote “the bank could .... provide .... so as to render the agreement enforceable once again, because the default would have been rectified”.

In Wilson and another v Hurstanger Ltd (2007) it was stated “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 … and/or the court can identify within the four corners of the agreement .... As a matter of policy, the lender is denied any room for manoeuvre in respect of them”.

Edited December 13, 2009 by tifo

[HP Mum]

Could someone please have a look at my thread.

 

http://www.consumeractiongroup.co.uk/forum/mbna/210845-hp-mum-mbna-new-post.html

 

MBNA have not replied to my S.78 request. Quite predictably.

I am unsure of the next step.

I think I can go the CPR 31.16 route - if I intend to take them to court.

And I think I can write claiming they can not enforce payments until they produce the docs requested. But I am not sure of the best route.

 

Can someone please help ??

[michellej]

Exactly, but as I say (and it has been known) if they subsequently come up with one in court, you're snookered.

In addition, under the 2003 amendments to CCA 1974, they can supply a 'reconstructed' copy which is not, necessarily, a true copy.

 

LSP

 

Not sure if this would be the case as your legal proceedings would be for disclosure of the agreement ,.. and once you get the copy (or do not get a copy) you can consider your route ,.. and I believe either side must place their cards on the table ,.. can not use evidence which it does not refer too on court papers as otherside would be expected to reieve a copy

[basa48]

Unfortunately, I cannot locate the source and so I am pasting the relevant text from a letter that I have send to Barclaycard - hope it is of use to you:

 

"Contrary to your assertion, you have not complied with the terms of CCA 1974 s78. The document that you have supplied, does not comply with your duties to supply a “True Copy” of any agreement you claim to have been signed by me, for pre 2007 agreements. As you will be further aware, an agreement is not executed, until signed by both parties, so the document that you have supplied, being a reconstruction, cannot be a True Copy of an Executed Agreement.

 

Let me explain here, what a true copy is:

 

In a recent letter from the enforcement department of the OFT, the text below was quoted, explaining what is required.

 

“The copy of the executed agreement need not be an exact copy but it must be a ‘true copy’ and not some reconstruction of what the original might have been and it must contain the same terms as the original. Where the terms have been varied as provided for within the agreement, the copy of the original agreement must be accompanied by a document setting out the current terms, as varied. Certain details may be omitted from the original agreement , for example, the signature, but the debtor must be in no doubt as to the true nature of his obligations under the loan.

 

Should no original agreement be in existence it is very hard to say that the copy the creditor offers to the debtor is, in fact, a true copy as there would be no original with which to compare it. In our view the onus of proof would be on the creditor to show that the copy is a true one and where none existed he may have difficulty discharging this. Neither should creditors suggest that a consumer has signed a credit agreement where they are unable to provide evidence to support this — to do so is likely to be a misleading action under Regulation 5 of the Consumer Protection from Unfair Trading Regulations 2008 (the CPR’s) and would also constitute an unfair or improper business practice.”

 

I also refer you to the information below:

1. A valid credit agreement must contain certain terms within the signature document (s.60(1)(2) CCA 1974). These core terms are the credit limit, repayment terms and the rate of interest (SI 1983/1553 (6 Signing of agreement) which states that the prescribed terms must be within the signature document. (Column 2 schedule 6). s.61(1)(a) states the agreement must contain all the prescribed terms and be signed by both the debtor and on behalf of the creditor.

2. Further, s.127(3) CCA 1974 makes the account unenforceable if it is not in the proper form and content or improperly executed.

In Wilson and another v Hurstanger Ltd (2007) it was stated “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 … 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”.

 

3. The need for prescribed terms to be contained in the credit agreement is confirmed by the Author of the CCA1974 act, I quote: ““As the draftsman of the Consumer Credit Act 1974 I would like to thank Dr Richard Lawson for his interesting and well-argued article (30 August 2003) on Wilson v First County Trust Ltd [2003] UKHL 40, [2003] 4

All ER 97.

Dr Lawson may be interested to know that I included the provision in question (section 127(3)) entirely on my own initiative. It seemed right to me that if the creditor company couldn’t be bothered to ensure that all the prescribed particulars were accurately included in the credit agreement it deserved to find it unenforceable, and that the court should not have power to relieve it from this penalty. Nobody queried this, and it went through Parliament without debate. I’m glad the House of Lords has now vindicated my reasoning and confirmed that nobody’s human rights were infringed.” - 167 Justice of the Peace (2003) 773.””

I am now granting to you a further 7 days to produce a copy of the executable agreement. After that I will consider that the above matter is closed and that you will no longer pursue the alleged debt. If you are insisting that the non enforceable document, that you have supplied, is the only alleged agreement in your possession, then I would suggest that the best course of action would be to immediately set the balance of the above account number to zero."

 

LSP

 

 

I've seen that letter, in fact I have a copy of the complete letter. It is from a solicitor working for Trading Standards. Whilst it may be an opinion it is not law.

 

As far as a true copy is concerned, it is a fact a creditor could hand write every word of the original agreement on the back of a cigarette packet and so long as it was legible and exactly word for word the same as the original agreement it would be in law a true copy.

 

Fortunately a court would only accept the original signed copy.

[diddydicky]

exactly basa, and it doesnt even need to be "words for word" and if some words of no importance to the general concept of the agreement are missing/mis spelt etc it would still be a "true copy"

 

however, the copy can ONLY be a true copy if the person producing the "true copy" has before him in his physical presence, the original document which he is reproducing word for word

 

for instance if he is copying from a microfiche -as creditors often do- he cannot be producing a true copy of an original document as what he is looking at is a COPY of the original document and he has no way of knowing if that COPY is itself a true copy of the original document!

[tifo]

I've seen that letter, in fact I have a copy of the complete letter. It is from a solicitor working for Trading Standards.

 

Looks familiar though .... word for word in some paragraphs.

[basa48]

..........................

 

however, the copy can ONLY be a true copy if the person producing the "true copy" has before him in his physical presence, the original document which he is reproducing word for word

 

for instance if he is copying from a microfiche -as creditors often do- he cannot be producing a true copy of an original document as what he is looking at is a COPY of the original document and he has no way of knowing if that COPY is itself a true copy of the original document!

 

Interesting extension on the matter of 'true copies'.

 

Basically that says that unless a creditor has the original hard copy of the agreement they could not ever actually produce a 'true copy'

[diddydicky]

exactly

[HP Mum]

shouldn't the wording on some of these templates be altered to say "original hard copy" then ?

[diddydicky]

alas HP Mum there is what SHOULD be and what is!!

 

unless it is an online application an agreement that has been signed- by the very nature of it- must be written/signed on a "hard" piece of paper (document)

 

it is this that is the original agreement

 

anything photocopied or put onto a microfiche can easily have alterations/omissions/additions therefore cannot be an "original" document therefore any document purporting to be a true copy of a copy of an original would carry the same degree of risk of innacuracy.

 

In court only the original will do and the creditor knows full well what is meant by providing a true copy of the original agreement

 

he has just been allowed over a number of years to "get away with" providing something far less than that

[Mr_Homer_J_Simpson]

I've just printed this WHOLE thread to go and read offline. Will be back soon(ish)...........

 

Oh yeah, Subbed.

 

PT2537, I have a bottle of Moet for you !

[GirlAloud]

subbed

[volvo]

subbing

 

VOLVO

[michellej]

well plenty to think of along our journey ,... as we are going along this route with CPR 31.16

[Ruprecht]

Do we need to update this thread after the recent judgments?

 

It seems to me the courts don't want the great unwashed public flooding them with applications. Some of the High Court Judges have described our requests to see the original agreement as "fishing expeditions" and "abusing their s77/s78 rights". Some of the Judge's words, not mine.

 

Maybe our only legal right to see it is through the Data Protection Act 1998?

 

Is it still safe to go the CPR 31.16 route on the basis that it "might" be unenforceable as per S127(3)?

 

I am thinking from the viewpoint of costs... We have no legal right to see the original other than under the DPA 1998 and even then there are conditions. i.e. if it is stored in a relevant filing system / only the "information" contained on it not the actual original.

 

If you have a letter from the lender threatening legal action then you might be able to justify the CPR 31.16 that way.

 

If the account is still active and live etc then beware!

[diddydicky]

the best way i know of to see the original is to simply ask for it............

 

not necessarily under s 78 or cpr or sar

 

if you have stopped paying as a result of their failure to comply under s78

 

a simple letter stating that you have reason to believe that they do not hold a properly executed or legally enforceable agreement.

 

inviting them to provide you with a true copy of the executed agreement or alternatively making it avialable somewhere where you can inspect it, whereupon if found to be properly executed and legally enforceable you will immediately make arrangements to resume/continue/payments

 

they still will not supply what you want BUT they will (IMO) have a bloody hard time trying to get costs out of you at a later court date

[Bigdebtor]

I have done a variation of this - just a short letter asking for a "full copy" of the original signed agrement and associated T&C's. I got it OK from RBS/Direct Line (but not sure if it's a microfiche or poor photocopy - better than most microfiche copies I have seen).

Egg also sent a proper photocopy - which has the dodgy prescribed terms - so awaiting PT's case in March.

 

Capital One did the usual "this is all we are obliged to send" guff - so I suspect they don't have the original or even a microfiche copy.

 

This way it seems you are less well informed - no templates - so a lesser threat - and you save the £1 postal order costs!

 

BD

[vint1954]

I've seen that letter, in fact I have a copy of the complete letter. It is from a solicitor working for Trading Standards. Whilst it may be an opinion it is not law.

 

As far as a true copy is concerned, it is a fact a creditor could hand write every word of the original agreement on the back of a cigarette packet and so long as it was legible and exactly word for word the same as the original agreement it would be in law a true copy.

 

Fortunately a court would only accept the original signed copy.

Not from a solicitor at all. It was a letter that I cobbled together, mainly from various bits of info widely available, plus other thoughts. The OFT references come from a reply to an MP, who had asked the question of the Chancellor of the Exchequor. Full letter below.

 

xxxxxx 2009.

Dear xxxxxxxxx,

ACCOUNT IN DISPUTE

Re account no xxxxxxxxxxxxxxxxxxxxxxxxxxx

I write regarding recent communication regarding the above account. I acknowledge no debt to your organisation.

Further to my request under s78 of the Consumer Credit Act 1974, your attention is drawn to the fact that this account remains subject to a lawful serious dispute. On xxxxxxxx, by recorded delivery, I requested that you supply me a copy of the executed credit agreement covering this account pursuant to the Consumer Credit Act 1974 section 78, a copy of this request is enclosed. To date you have failed to comply with my request, supplying only an illegible copy of an application form tear off strip, devoid of all prescribed terms, and a copy of your generic terms & conditions, which cannot be linked to any agreement which you claim that I have signed. Without production of the said agreement I am unable to assess if I am indeed liable for any alleged debt to you, nor does it give me any chance to evaluate whether any original agreement was ‘properly executed’ as required by the Consumer Credit Act 1974.

Contrary to your assertion, xxxxxxxx have not complied with the terms of CCA 1974 s78. The documents that you have supplied, do not comply with your duties to supply a “True Copy” of any agreement you claim to have been signed by me, for pre 2007 agreements. As you will be further aware, an agreement is not executed, until signed by both parties, so the document that you have supplied, being a reconstruction, cannot be a True Copy of an Executed Agreement.

While this account remains in serious dispute, the relevant main points of the Law and OFT regulations while the account is in this state and xxxxxx remain in default are:

• You may not ask for payment against this account.
  
• I am not obliged to offer any payment against this account.
  
• You cannot register any data with a third party.
  
• You cannot take any enforcement action, including registering Defaults.
  
• You cannot pass the account on to a third party for collection.
  
• You cannot sell the account.
  

Let me explain here, what a true copy is:

In a recent letter from the enforcement department of the OFT, the text below was quoted, explaining what is required.

“The copy of the executed agreement need not be an exact copy but it must be a ‘true copy’ and not some reconstruction of what the original might have been and it must contain the same terms as the original. Where the terms have been varied as provided for within the agreement, the copy of the original agreement must be accompanied by a document setting out the current terms, as varied. Certain details may be omitted from the original agreement eg the signature but the debtor must be in no doubt as to the true nature of his obligations under the loan.

 

Should no original agreement be in existence it is very hard to say that the copy the creditor offers to the debtor is, in fact, a true copy as there would be no original with which to compare it. In our view the onus of proof would be on the creditor to show that the copy is a true one and where none existed he may have difficulty discharging this. Neither should creditors suggest that a consumer has signed a credit agreement where they are unable to provide evidence to support this — to do so is likely to be a misleading action under Regulation 5 of the Consumer Protection from Unfair Trading Regulations 2008 (the CPRs) and would also constitute an unfair or improper business practice.”

 

I also refer you to the information below.

1. A valid credit agreement must contain certain terms within the signature document (s.60(1)(2) CCA 1974). These core terms are the credit limit, repayment terms and the rate of interest (SI 1983/1553 (6 Signing of agreement) which states that the prescribed terms must be within the signature document. (Column 2 schedule 6). s.61(1)(a) states the agreement must contain all the prescribed terms and be signed by both the debtor and on behalf of the creditor.

 

 

2. Further, s.127(3) CCA 1974 makes the account unenforceable if it is not in the proper form and content or improperly executed.

 

In Wilson and another v Hurstanger Ltd (2007) it was stated “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 … 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”.

 

2. The need for prescribed terms to be contained in the credit agreement is confirmed by the Author of the CCA1974 act, I quote ““As the draftsman of the Consumer Credit Act 1974 I would like to thank Dr Richard Lawson for his interesting and well-argued article (30 August 2003) on Wilson v First County Trust Ltd [2003] UKHL 40, [2003] 4 All ER 97.

 

Dr Lawson may be interested to know that I included the provision in question (section 127(3)) entirely on my own initiative. It seemed right to me that if the creditor company couldn’t be bothered to ensure that all the prescribed particulars were accurately included in the credit agreement it deserved to find it unenforceable, and that the court should not have power to relieve it from this penalty. Nobody queried this, and it went through Parliament without debate. I’m glad the House of Lords has now vindicated my reasoning and confirmed that nobody’s human rights were infringed.” - 167 Justice of the Peace (2003) 773.”

I am now granting to you a further 7 days to produce a copy of an executable agreement. After that I will consider that the above matter is closed and that you will no longer pursue the alleged debt. If you are insisting that the non enforceable document, that you have supplied, is the only alleged agreement in your possession, then I would suggest that the best course of action would be to immediately set the balance of the above account number to zero.

I look forward to your response.

[mashmallow]

Diddyduck,

 

I need to send something off to Welcome Finance as they have given me 14 days to sort my account out. Shall I just send a simple letter asking for an original credit agreement or can I go down the CCA route? Please let me know.

 

Thanks

 

 

Mashmallow

[Bigdebtor]

Marsh

 

Diddy is not logged on at present. I would initially send an "informal" letter like described in my post 1770 above - and asking them to postpone the 14 day deadline until they send the stuff - then if you get nowhere you can do the formal CCA letter with the £1 PO enclosed.

 

Hope this helps - if so tip my scales!

 

BD

[mashmallow]

Thanks for your help how do I tip your scales.

 

regards,

 

Mashmallow

[Bigdebtor]

Just hover your mouse over the scales icon (between green dot and road/ traffic hazard sign icons) and click when it shows "add to reputation" (at the bottom keft hand side of my post (under my name).

 

BD

 

PS Keep us posted on how you get on - either by a post or pm.