Militant Consumer's Friend v Egg Loans PPI - WON

[N.P]

Hi MC,

 

I`m not exactly sure how to proceed with this. I do beleive you could take Egg to Court over wether or not the Agreement IS enforceable or not. I`m sure I read a post by PT2537 over this, in another thread, but I`m not sure which one it was.

 

Perhaps he will read this and remember?

 

You could just keep disputing the amount with Egg and explain your reasons. If they have any sense they with look into it for you, but they also might send your account to a DCA or Solicitors, in which case you would use the non-compliant Agreement as your defence.

 

They shouldn`t be passing a disputed account around in the first place.

 

If a DCA does ring you, just tell them EXACTLY where to go, they`re NOBODY`s!

 

If you don`t get any sense from Egg, you can complain to the FOS after 8 weeks.

 

 

 

N.P

[Mistermind]

 

That's very helpful, but what I still don't know is how we to proceed on this. We really don't want to sit back and wait for it to be sold to a DCA, suffer months of telephone harrassment, and finally get sued with risk of a CCJ if the judge doesn't agree with our interpretation of the legislation. Does anybody reading this know how we could take the fight to Egg and get a judge or even the FOS to rule that this agreement is unenforceable?

I take it you do not want to defend enforceability in court in case it goes wrong for you resulting in a CCJ. You do not want to wait for DCA harassment, but want to land a pre-emptive strike at Egg.

 

This would suggest an injunction, a separate area of law and more reading for you. But hard to apply for an injunction against harassment by DCA (when by your submission you do not owe any enforceable debt), BEFORE such harassment demonstrably occurs.

 

Perhaps this is a matter of degree. If for example your name is John Smith, and Egg repeatedly claims from youself payment of a debt owed by another John Smith who happened to be the previous occupant of your address, and Egg will not take no for an answer, then I suspect you would have a better case applying for an injunction to stop the nonsense once and for all.

 

As things are, hard to think of a judge willing to let you hit Egg first, on the off chance that Egg might hit you later.

[militantconsumer]

Thank you both for suggestions on the multiple agreement unenforceability angle again.

[militantconsumer]

I've been looking through the SAR recently sent by Egg and it's a real eye opener, especially the notes that their staff make on your file. Their sales people are constantly proposing to top up the loan into an ever increasing mountain of debt (even when you phone up about an entirely different matter).

 

And every time, they write a note on the file to say who "owns" the loan, and who is presumably entitled to some kind of commission or bonus as a result of their work.

 

Most of these applications were then rejected at the credit search stage - I would say fortunately, though it won't have helped my friend's credit rating very much.

 

We will be requesting a few copies of telephone conversations, as they seem immensely keen to make lots of sales of loans with "full 180" PPI added on top. It will be interesting to hear how they did it - unless Egg have lost the transcripts of course...

[militantconsumer]

Of particular interest is the phrase "full 180pp auto accept" noted on our file by an Egg staff member during a top-up telephone sale. Now, I wonder what an "auto accept" could be???

[Josie8]

This is what pt2537 has posted in pinknico's thread about my agreement:-

 

ITs easier to run a claim on a multiple agreement as there can be no dispute of fact as the agreement speaks for itself.

 

a claim for misselling can be much harder to run.

 

having just looked at your agreement, its clearly a multi agreement and i would suggest can be rendered unenforceable as a result, its your call ultimately though

 

That's very helpful, but what I still don't know is how we to proceed on this. We really don't want to sit back and wait for it to be sold to a DCA, suffer months of telephone harrassment, and finally get sued with risk of a CCJ if the judge doesn't agree with our interpretation of the legislation. Does anybody reading this know how we could take the fight to Egg and get a judge or even the FOS to rule that this agreement is unenforceable?

 

 

For what its worth I agree with PT here and I think that the egg agreement is a multiple agreement and unenforceable but also of course you would then be able to claim a refund of the PPI too.

[pinknico]

Doesnt the citizen advice bureau check agreements for free?

[N.P]

Doesnt the citizen advice bureau check agreements for free?

 

 

Not sure pinknico, but I know people on here have had them checked by their local Trading Standards.

 

You could also put your complaint to the FOS and see what they think.

[militantconsumer]

Thanks Josie8

 

I'll consider the options suggested as an alternative to paying a lawyer, as I'm still thinking it has to be worth checking this unenforceability angle out more thoroughly - especially if we can then come back at them with a PPI claim to boot!

 

I don't know if FOS would consider it but if they did it would take so long that with all the repayments made in the meantime it would be cheaper to pay a lawyer to look over the agreement now!

Edited January 4, 2009 by militantconsumer
forgot to thank Josie8

[N.P]

I`m not sure if you have a scanner or not, I can`t remember, but if you don`t it might be worth getting one and scanning it up for everyone to check out. Don`t forget to edit out any idenifying features though.

 

The thing is, a Solicitor might think it`s unenforceable but a Judge might still enforce it, for whatever reasons, so why pay a Solicitor?

 

 

 

N.P

[militantconsumer]

Agreement is scanned up on page 1 of this thread.

[N.P]

Agreement is scanned up on page 1 of this thread.

 

 

Oh yeah, sorry about that mc, I`ve been busy messing about in the coal house and garden today, so I`m a bit tired and not with things.

 

Anyway, this does seem to be a Multiple Agreement as their is PPI involved, so therefore should have seperate Terms for both the Loan and PPI as well as a Signature for each. The fact is hasn`t should render the Agreement unenforceable, in my opinion anyway, that`s if a Judge goes by CCA legislation and not off the fact that you`ve had the money so pay it back.

 

Shouldn`t this Agreement also show how much Interest should be paid? It just states amount borrowed, the amount of PPI and total owed. Is this right people?

 

 

 

N.P

[N.P]

Also, forgot to mention, this is a Top Up Loan, isn`t it?

 

So, that should mean you will have borrowed the original amount, to pay the original loan back + the extra you actually wanted to borrow. Again, this is a Multiple Agreement, Restricted and UnRestricted.

[militantconsumer]

Another issue to be considered here is something I have just found on the WHICH guide to PPI mis-selling:

http://www.which.co.uk/advice/how-to-tell-if-youve-been-mis-sold-ppi/quick-check-were-you-mis-sold/index.jsp

 

The fifth point is the one I hadn't considered before and didn't ask about in my follow-up SAR letter. Selling a 5 year policy for a 6 year loan? It means we would still be paying off a PPI policy for 12 months after it had expired at 7.94% APR. Scandalous.

Mis-selling checklist

 

If you can answer ‘no’ to one or more of these questions, then you may have been mis-sold PPI.

• If the insurance was optional, was that made clear to you?
  
• Did the adviser tell you about any significant exclusions under the policy – for example, the exclusion that says you won't be covered for any pre-existing medical condition?
  
• If you took out a loan or finance agreement, did the adviser make it clear that you would have to pay for the insurance up front in one single payment?
  
• If you had to pay for the PPI as a single payment, did the adviser make it clear that the insurance cost would be added to the loan and you would be paying interest on it?
  
• Single premium PPI insurance normally only lasts for 5 years. If your loan or finance agreement was for longer than this, did the adviser make it clear that the insurance would run out before you had finished paying for your loan or finance agreement? The adviser should also have told you that you would continue to pay interest on the insurance premium, even after the insurance expired.
  

[militantconsumer]

It has occurred to me that one way of testing the multiple agreement angle in court (with less risk than just sitting back waiting to be sued) would be if we had a successful PPI reclaim via the FOS and Egg tried to net this refund off the alleged debt owed to them.

 

In this case we could bring a County Court Claim on the small claims track for the PPI money, claiming that they had no right to set this off because our alleged indebtedness exists only under a Consumer Credit agreement that was improperly executed under the CCA 1974 and is therefore unenforceable.

 

Does anybody know:

 

1. Assuming the agreement is indeed unenforceable, would this actually work (i.e. would the judge actually rule on the agreement in such a case or would the CCA 1974 enforceability of a debt that could be otherwise showed to exist be irrelevant)

 

2. Assuming the agreement DID turn out to be enforceable and we lost this claim, does losing as claimant (e.g. via a counterclaim) count as getting a CCJ - i.e. is it as serious as being sued and losing as defendant?

 

Thanks to anybody who can answer either/both of these questions.

Edited January 5, 2009 by militantconsumer
technical rephrasing of point 1

[N.P]

Hi MC,

 

I`m not sure about either of your questions, but I do know the FOS take misselling of PPI very seriously.

 

Maybe you should put a complain in to the FOS asking them to look into your claim as you beleive you were missold PPI. They will then do all the work on your behalf and let you know if indeed your were missold. If you were, they will request you be given a refund.

 

If the FOS beleive you weren`t missold PPI, you still have the option of taking Egg to Court.

[Mistermind]

The onus is on the plaintiff to prove his case.

It is not for the defendant to defend a separate case not mounted by the plaintiff, unless said case comprises of two parts.

 

I cannot see any judge saying, "Based on the evidence presented before me alleging PPI mis-selling, this is my ruling on the legality of PPI."

 

"Oh, and by the way, that CCA looks unenforceable, did you know that? I shall rule it as unenforceable for all time, at no extra charge."

[militantconsumer]

Thanks for adding your comments Mistermind, but I don't think that's really what I meant. I'm not talking about a PPI legal case, but the enforcement of the FSA/FOS decision.

 

What I'm saying is:

- We have a successful PPI complaint and the FSA/FOS orders Egg to pay us (for example) £3k in refund of premiums and interest.

- At this point Egg say: rather than paying you we will net the £3k off your outstanding debt

- We challenge this by saying there is no outstanding debt, just a dodgy CCA that has no legal basis

- So we claim against Egg for the full £3k in the County Court as the FSA says that Egg owe us the money, but they are refusing to pay us

- Surely the judge would have to comment on whether our CCA was enforceable or not at this stage in order to decide whether Egg have to pay us or whether they can legally offset against out alleged indebtedness

 

Sorry if I've missed the point somewhere, but why wouldn't this work?

[Mistermind]

 

- We have a successful PPI complaint and the FSA/FOS orders Egg to pay us (for example) £3k in refund of premiums and interest.

 

- At this point Egg say: rather than paying you we will net the £3k off your outstanding debt

 

- We challenge this by saying there is no outstanding debt, just a dodgy CCA that has no legal basis

 

- So we claim against Egg for the full £3k in the County Court as the FSA says that Egg owe us the money, but they are refusing to pay us

 

- Surely the judge would have to comment on whether our CCA was enforceable or not at this stage in order to decide whether Egg have to pay us or whether they can legally offset against out alleged indebtedness

 

Sorry if I've missed the point somewhere, but why wouldn't this work?

 

Lets presume the CCA is ruled unenforceable by the judge, i.e. in the eyes of the law there was no credit agreement. I take it nobody disputes that cash passed from Egg to the cardholder. If there was no legal framework governing this transfer then there is no legal obligation for its repayment to Egg, and the money transfer was no different from a gift.

 

But does this sword not cut both ways? If there was never a legal framework, no loan agreement and no PPI agreement, and the law does not get involved, then on what basis are PPI instalments paid to Egg to be reclaimed? Were these payments not also like gifts?

Edited January 6, 2009 by Mistermind
typo

[militantconsumer]

Much of the PPI claim would relate to the first two agreements, for which unenforceability is not an issue as they are fully settled (topped up into new agreements) and so perhaps no question of gifts would come into it. So that does change things a bit, as Egg would be trying to net old amounts due to us off a new agreement.

 

However, I take your point, and it might not be possible to have it both ways.

 

Thanks a lot for your input Mistermind.

 

I think I'll try and stop speculating for a bit!

[Josie8]

Lets presume the CCA is ruled unenforceable by the judge, i.e. in the eyes of the law there was no credit agreement. I take it nobody disputes that cash passed from Egg to the cardholder. If there was no legal framework governing this transfer then there is no legal obligation for its repayment to Egg, and the money transfer was no different from a gift.

 

But does this sword not cut both ways? If there was never a legal framework, no loan agreement and no PPI agreement, and the law does not get involved, then on what basis are PPI instalments paid to Egg to be reclaimed? Were these payments not also like gifts?

 

 

The PPI is a seperate issue to the unenforceability. The creditor can't enforce the agreement if it is unenforceable but the Debtor still can

[Mistermind]

Contract enforceability based on complete fraud-proof documentation is for an impartial judge to rule on.

 

It would be surprising if he rules an incomplete and unsafe document cannot be enforced towards the left, then rules the same can be enforced towards the right.

[Josie8]

Contract enforceability based on complete fraud-proof documentation is for an impartial judge to rule on.

 

It would be surprising if he rules an incomplete and unsafe document cannot be enforced towards the left, then rules the same can be enforced towards the right.

 

 

Fortunately the House of Lords disagrees with you

[N.P]

What about the Wilson case?

 

I beleive this agreement for a Car Hire Purchase was judged as unenforceable. I beleive Wilson also was allowed to keep the Car and claim back all payments she had made.

 

Can anyone confirm this?

 

 

Also, I beleive when you claim money back, you are allowed a cheque, so you can do whatever you want with the money. Tell Egg you will accept a cheque only or you will take futher action.

 

 

 

N.P

[militantconsumer]

Here is an interesting document. It "proves" that the loan was a multiple agreement with elements of restricted credit. It didn't accompany the loan at the time of signing, but was disclosed as part of our Subject Access Request.

 

I may need to ask Egg why the PPI amount here is different from the one on the loan agreement as I have no idea why. The monthly payment is different as well.

 

Edited January 7, 2009 by militantconsumer
Added comment about monthly payment