Cancellation rights on loan not found - unenforceable?

[Hungryforinfo]

I am trying to establish if a regulated loan agreement must have cancellation rights stated within the agreement document or accompanying terms and conditions. I have an agreement and I cannot find anything about cancellation rights on the signature document. Is it required and therefore the debt is unenforceable without it? I hope someone can help as a court hearing is now being threatened.

[atwozee]

It depends where and when (month/year) the agreement was signed – can you answer those questions first and maybe someone can confirm for you.

[Hungryforinfo]

The agreement was in February2003 in England. I can't recall if it was an online application if this is relevent.

[atwozee]

I am not an expert on cancellation rights but I think if you signed the agreement at the creditor’s place of business (either temporary or permanent) then there wouldn’t be any automatic cancellation rights or cooling off period.

Anything else might require cancellation rights but I’m not sure how or where within the agreement they need to be stated.

If you post up the agreement minus your personal details you might get more comments.

[Hungryforinfo]

I've attached the agreement and would love to know where i stand on cancellation rights. I can't find any reference. SHould tehy be included on the agreement? Aplogies if you are reading this without the ttachment. I haveto do some further editing!

Egg loan agreement for CAG feb09 pdf.pdf

Edited February 17, 2009 by Hungryforinfo
HAd to remove attachment earlier which showed personal information. Am resubmitting now.

[fuzzybobble]

I'm dealing with a CCA on behalf of a friend that has no cancellation rights on it. So I'm also interested to see where she stands on the legalities of that.

 

Hopefully someone will be along soon, to answer the question.

[fuzzybobble]

I've attached the agreement and would love to know where i stand on cancellation rights. I can't find any reference. SHould tehy be included on the agreement? Aplogies if you are reading this without the ttachment. I haveto do some further editing!

 

One thing I noticed about your agreement is that there's nothing linking the two pages together. Ie page 1 of 2, page 2 of two etc. Or see overleaf for the rest.

 

The pescribed terms must be within the four corners of the signature document. So I'd say it's likely to be unenforceable for that reason.

[Hungryforinfo]

Thanks for the comment on the page links. I picked this up from another thread and have written to the DCA about it but they are still intent on claiming it will go to court. It would be useful to have some more ammunition on cancellation rights if they are meant to be stated somewhere on the agreement. If it is acceptable for them to be elsewhere on another document (e.g. terms and conditions) that would be helpful to know too!

[fuzzybobble]

Do you have the defaut notice for the account? That sometimes can prove to be improperly served.

[Hungryforinfo]

Thanks for the suggestion on another area to investigate i.e.default notices. I note the deadline date on the default was after my CCA request was sent and should have been received . It hasn't shown up on the Royal Mail online recorded delivery checking system for some reason. I will have a search for default notice related threads and look at the sticky's unless there is a suggested link.

 

I'm still interested in bottoming out the cancellation issue on this thread. In case it is of help, the agreement is a regulated agreement.

[Hungryforinfo]

Does anybody out there have any information on the cancellation requirements on a loan agreement or know where I can find them easily please? I want to check if the agreement has been executed properly in respect of teh cancellation requirements and know of 1 other person who wants the same information. Help!

[missdpd]

Did you sign it at the companies premises? If you did then you will have no rights to cancel and these rights will not be shown on the document. If it was signed in your own home, then the agreement should have cancellation rights shown on it and you should have received an executed copy of the agreement once it was set 'live' on their system.

[jon888999]

Did you sign it at the companies premises? If you did then you will have no rights to cancel and these rights will not be shown on the document. If it was signed in your own home, then the agreement should have cancellation rights shown on it and you should have received an executed copy of the agreement once it was set 'live' on their system.

I'm in a smilar position with Egg, although an agreement should contain these, would the lack of cancellation rights be enough to make the agreement unenforceable in a court?

Thanks

Jon

[angry cat]

Correct me if I am wrong but weren't all Egg applications made via the internet?

Therefore, separate cancellations rights would have had to be supplied by Egg.

 

AC

[shredder10]

Dont know if this is any help.

 

62.—(1) If the unexecuted agreement is presented personally to the debtor or hirer for

his signature. but on the occasion when he signs it the document does not become an

executed agreement, a copy of it, and of any other document referred to in it, must be

there and then delivered to him.

(2) If the unexecuted agreement is sent to the debtor or hirer for his signature, a

copy of it, and of any other document referred to in it, must be sent to him at the

same time.

(3) A regulated agreement is not properly executed if the requirements of this

section are not observed.

63.—(1) If the unexecuted agreement is presented personally to the debtor or hirer for

his signature. and on the occasion when he signs it the document becomes an executed

agreement. a copy of the executed agreement, and of any other document referred to

in it, must be there and then delivered to him.

(2) A copy of the executed agreement, and of any other document referred to in it,

must be given to the debtor or hirer within the seven days following the making of

the agreement unless—

(a) subsection (1) applies, or

(b) the unexecuted agreement was sent to the debtor or hirer for his signature and,

on the occasion of his signing it, the document became an executed agreement.

(3) In the case of a cancellable agreement. a copy under subsection (2) must be sent

by post.

(4) In the case of a credit-token agreement, a copy under subsection (2) need not

be given within the seven days following the making of the agreement if it is given

before or at the .time when the credit-token is given to the debtor.

(5) A regulated agreement is not properly executed if the requirements of this

section are not observed.

64.—(1) In the case of a cancellable agreement, a notice in the prescribed form

indicating the right of the debtor or hirer to cancel the agreement, how and when that

right is exercisable, and the name and address of a person to whom notice of

cancellation may be given,—

(a) must be included in every copy given to the debtor or hirer under section 62 or

63, and

(b) except where section 63(2) applied, must also be sent by post to the debtor or

hirer within the seven days following the making of the agreement.

(2) In the case of a credit-token agreement, a notice under subsection (l)(b) need

not be sent by post within the seven days following the making of the agreement if

either—

38

(a) it is sent by post to the debtor or hirer before the credit token is given to

him, or

(b) it is sent by post to him together with the credit-token.

(3) Regulations may provide that except where section 63(2) applied a notice sent

under subsection (l)(b) shall be accompanied by a further copy of the executed

agreement, and of any other document referred to in it.

(4) Regulations may provide that subsection (l)(b) is not to apply in the case of

agreements such as are described in the regulations, being agreements made by a

particular person, if—

(a) on an application by that person to the Director, the Director has

determined that, having regard to—

(i) the manner in which antecedent negotiations for agreements with the

applicant of that description are conducted, and

(ii) the information provided to debtors or hirers before such agreements

are made,

the requirement imposed by subsection (l)(b) can be dispensed with without

prejudicing the interests of debtors or hirers; and

(b) any conditions imposed by the Director in making the determination

are complied with.

(5) A cancellable agreement is not properly executed if the requirements of this

section are not observed.

65.—(1) An improperly-executed regulated agreement is enforceable against the

debtor or hirer on an order of the court only.

(2) A retaking of goods or land to which a regulated agreement relates is an

enforcement of the agreement.

66.—(1) The debtor shall not be liable under a credit-token agreement for use made of

the credit-token by any person unless the debtor had previously accepted the credittoken,

or the use constituted an acceptance of it by him.

(2) The debtor accepts a credit-token when—

(a) it is signed, or

(b) a receipt for it is signed, or

© it is first used,

either by the debtor himself or by a person who, pursuant to the agreement, is

authorised by him to use it.

Cancellation of certain agreements within cooling off period

67. A regulated agreement may be cancelled by the debtor or hirer in accordance

with this Part if the antecedent negotiations included oral representations made when

39

in the presence of the debtor or hirer by an individual acting as, or on behalf of, the

negotiator, unless—

(a) the agreement is secured on land, or is a restricted-use credit agreement to

finance the purchase of land or is an agreement for a bridging loan in

connection with the purchase of land, or

(b) the unexecuted agreement is signed by the debtor or hirer at premises at

which any of the following is carrying on any business (whether on a

permanent or temporary basis)—

(i) the creditor or owner;

(ii) any party to a linked transaction (other than the debtor or hirer or a

relative of his);

(iii) the negotiator in any antecedent negotiations.

68. The debtor or hirer may serve notice of cancellation of a cancellable agreement

between his signing of the unexecuted agreement and—

(a) the end of the fifth day following the day on which he received a copy under

section 63(2) or a notice under section 64(1)(b), or

(b) if (by virtue of regulations made under section 64(4)) section 64(1)(b) does

not apply, the end of the fourteenth day following the day on which he signed

the unexecuted agreement.

69.—(1) If within the period specified in section 68 the debtor or hirer under a

cancellable agreement serves on—

(a) the creditor or owner, or

(b) the person specified in the notice under section 64(1), or

© a person who (whether by virtue of subsection (6) or otherwise) is the agent of

the creditor or owner,

a notice (a " notice of cancellation ") which, however expressed and whether or not

conforming to the notice given under section 64(1), indicates the intention of the

debtor or hirer to withdraw from the agreement, the notice shall operate—

(i) to cancel the agreement, and any linked transaction, and

(ii) to withdraw any offer by the debtor or hirer, or his relative, to enter into a

linked transaction.

(2) In the case of a debtor-creditor-supplier agreement for restricted-use credit

financing—

(a) the doing of work or supply of goods to meet an emergency, or

(b) the supply of goods which, before service of the notice of cancellation, had

by the act of the debtor or his relative become incorporated in any land or

thing not comprised in the agreement or any linked transaction,

subsection (1) shall apply with the substitution of the following for paragraph (i)—

" (i) to cancel only such provisions of the agreement and any linked transaction as

(aa) relate to the provision of credit, or

(bb) require the debtor to pay an item in the total charge for credit, or

(cc) subject the debtor to any obligation other than to pay for the doing of

the said work, or the supply of the said goods ".

40

(3) Except so far as is otherwise provided, references in this Act to the cancellation

of an agreement or transaction do not include a case within subsection (2).

(4) Except as otherwise provided by or under this Act, an agreement or transition

cancelled under subsection (1) shall be treated as if it had never been entered

into.

(5) Regulations may exclude linked transactions of the prescribed description from

subsection (l)(i) or (ii).

(6) Each of the following shall be deemed to be the agent of the creditor or owner

for the purpose of receiving a notice of cancellation

(a) a credit-broker ~ supplier who is the negotiator in antecedent negotiations,

and

(b) any person who, in the course of a business carried on by him. acts on behalf

of the debtor or hirer in any negotiations for the agreement.

(7) Whether or not it is actually received by him, a notice of cancellation sent by

post to a person shall be deemed to be served on him at the time of posting.

[jon888999]

Correct me if I am wrong but weren't all Egg applications made via the internet?

Therefore, separate cancellations rights would have had to be supplied by Egg.

 

AC

 

Did this apply in 2003?

[shredder10]

Did this apply in 2003?

 

 

 

Yes i think it does.The electronic communications act did no come in till 31stDecember 2004.

 

http://www.opsi.gov.uk/si/si2004/uksi_20043236_en.pdf

Edited March 14, 2009 by shredder10

[Abby25]

So in simple terms, does this mean that the cancellation notice has to be within the 4 corners of the agreement (i.e not in a seperate t&c booklet)?

 

Also, can the terms and conditions be sent before the agreement was presented for signature, with instruction in the agreement to refer back to them, or do they actually have to be included, even if this means the lender is sending a 2nd copy, with the actual legal docs for signature?

[shredder10]

So in simple terms, does this mean that the cancellation notice has to be within the 4 corners of the agreement (i.e not in a seperate t&c booklet)?

 

Also, can the terms and conditions be sent before the agreement was presented for signature, with instruction in the agreement to refer back to them, or do they actually have to be included, even if this means the lender is sending a 2nd copy, with the actual legal docs for signature?

 

I dont think cancellation terms are perscribed terms so dont need to be in the 4 corners etc. can someone else comment on this as im not sure. thanks

[missdpd]

ok found this, hope it helps......

 

Under the UK Consumer Credit Act 1974 secured loans up to a value of £25,000 are regulated. When you are approved for a loan you will have to sign a credit agreement so make sure you read and understand the terms of that agreement. Regulated loans under £25,000 means that the lender has to give you seven days as consideration period after the loan is taken out in case you wish to cancel the agreement. Beyond that if you decide to pay up earlier than agreed you will probably be charged for it. Always check this.

[Hungryforinfo]

Does the 7 days consideration period to allow cancellation apply for a loan of £25,000 exactly? The last post refers to regulated loans under £25,000. Also does the consideration period need to be spelled out on the agreement in the same way as prescribed terms are?

[jon888999]

I've attached the agreement and would love to know where i stand on cancellation rights. I can't find any reference. SHould tehy be included on the agreement? Aplogies if you are reading this without the ttachment. I haveto do some further editing!

 

Hi, I've just received my agreement from egg, it's the same as this.

Has anybody got a letter template I can send them regarding the lack of cancellation rights?

thanks Jon