Cabot, MSDW, Application Form or CCA?

[Emtec]

Hi

 

This is my first post.

 

I have a problem with Cabot and would be most grateful for any advice on what I should do.

 

I have had financial difficulties since 2003 and entered into private arrangements to pay back nominal sums in respect of 4 credit card debts. One of these was with Morgan Stanley. These arrangements continued until Morgan Stanley, after it became Goldfish, sold the debt to Cabot in April 2008.

 

In May 2008 I requested a copy of the Credit Agreement and a statement of account from them. This kept them quiet until recently when they sent the statement of account and an illegible copy of the original application form and a copy of some terms and conditions that relate to Barclays Bank, who I don’t believe had anything to do with Morgan Stanley when the application was made in 2000.

 

I replied saying that I had only received an illegible copy of the application form and again requested a copy of the original credit agreement.

 

Cabot has now responded saying that the Application Form is the credit agreement and that the form states that “This is a credit agreement regulated by the Consumer Credit Act 1974. Sign it only if you want to be legally bound by its terms”. They also say that the fact that the copy is illegible is not important as I signed the original which was legible. Cabot now claim that they are in a position to enforce the debt and they are demanding that a payment arrangement to settle the account be put in place within 14 days. I'm not in a position to come to any arrangement.

 

I have continued to pay Morgan Stanley a nominal amount each month and these payments have been passed on to Cabot by Goldfish.

 

I am going to attempt to post the relevant documents but this is all new to me. My scanned copies have made the forms even more illegible.

 

 

Thank you for any assistance.

 

 

Application.PDF

 

Application 2.PDF

 

T&C 1.pdf

 

T&C 2.pdf

 

Cabot letter copy0001.PDF

[clemma]

Unenforceable due to the fact it is totally illegible. I can't make diddly squat out of that!! Send them the following letter: (you may need to amend it)

 

Dear Sirs,

 

Account no xxxxxxxxxxxxxx

 

xx/xx/2009

 

Re: my request under the Consumer Credit Act 1974

 

 

Thank you for your letter-dated xx/xx/2009 the contents of which are noted.

 

I note that you have included a copy of the document, which you aver to be the copy of the credit agreement between us

 

Now I wish to draw your attention to a series of concerns that I have with that document and why I feel that you have not discharged your duties under Section 78(1) of the Consumer Credit Act 1974

 

The document received is headed “xxxxxxxxxxxxxxxxxxxx” within this first there are no prescribed terms as required by schedule 6 column 2 of the Consumer Credit Agreements Regulations 1983 SI 1983/1553.

 

To avoid any argument, the prescribed terms for this style of agreement (running account credit) are as follows

 

1. A term stating the credit limit or the manner in which it will be determined or that there is no credit limit,

 

2. A term stating the rate of any interest on the credit to be provided under the agreement

 

3. 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--

1.Number of repayments;

2.Amount of repayments;

3.Frequency and timing of repayments;

4.Dates of repayments;

5.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

 

 

Now im sure you are aware as per Wilson & FCT [2003] All ER (D) 187 among others that if the prescribed terms are not in the agreement then the agreement is rendered unenforceable

 

 

To be honest I cannot tell as its not legible, infact even when blown up on the pc it is not legible and as a consequence I believe that the document fails to comply with Regulation 2 of the Consumer Credit (Cancellation Notices and Copies of Documents) Regulations 1983 (SI 1983/1557)

 

For your information, I reproduce regulation 2(1) for your reference

 

 

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 .

 

Clearly as the document you have supplied is not easily legible you cannot say that you have discharged your obligations under section 78(1) as the document does not comply with the copy document regs referred to above

Now to quote your own words from paragraph 3 of your letter “this means in effect as long as the terms are clearly shown, the CCA requirements are satisfied” well im sorry but they are not as the second part of this document that you supplied in reply to my CCA request is not clearly legible

 

Now to resolve this matter you can either supply me a copy of my agreement, which is in a legible form where all the terms are clearly stated and the prescribed terms are embodied within the agreement

 

Or alternatively, we can lay the agreement which you have produced in reply to my statutory request pursuant to section 78(1) of the Consumer Credit Act 1974 before the county court and I will request pursuant to section 142(1) of the CCA that the court make an order on the enforceability of that document.

 

However I am sure that the bank would not be keen on this happening as should the court rule that the agreement is not enforceable and you cannot provide a better copy than what you already have then the court would have no other option but to rule the agreement unenforceable

 

I think I have set out my position clearly and have even reproduced excerpts of the legislation on which I base my case, therefore I respectfully request that you reply to this letter within 14 days setting out if you can supply a more legible copy of the agreement or what action you propose to resolve this dispute if you cannot although the only real obvious option if you cannot provide a better copy would be for the bank to zero the balance on this debt as it cannot be enforced without a truly legible signed credit agreement containing the required prescribed terms

 

 

I await your reply

[Emtec]

Fantastic! Thank you very much Clemma. I will get this letter off to them. Should I state anywhere that the account is in dispute as Cabot seem to be suggesting that I have failed to establish a dispute so far and that they are therefore permitted to pursue their claim against me.

 

You say that it is unenforceable because it is illegible. From what you say in the letter, it appears that the document is unenforceable in any case because it doesn't contain the prescribed terms. Is that rght?

 

Should I stop paying even the nominal amount to Morgan Stanley (who pass the money on to Cabot)?

 

Thank you once again.

[clemma]

Just put in capital letters at the top of the letter "ACCOUNT IN DISPUTE"

 

As for being unenforceable - I would say so. I can't see it properly to see if there are any prescribed terms......and yes, you can stop paying them if you wish

[Emtec]

Thanks alot Clemma. I really appreciate your help.

[Emtec]

For personal reasons I was delayed in responding to Cabot but I did so earlier this month and have received their reply today, which I attach below. Can I please have some advice on what to do next? As I mentioned in my original post, I haven't paid any money directly to Cabot, as they say I have in their letter, but I have continued to pay Morgan Stanley £6 per month and it appears that they (as Goldfish) are passing this through to Cabot.

 

Cabot letter Apr 09.pdf

 

Cabot letter Apr 09 p2.pdf

[Emtec]

Hi again

 

Can anyone please advise me on what to do next and how to respond, please?

 

Thank you.

[jdene]

Hi Emtec I am sure I have seen a reply to a similar letter from these sharks on the forums which says they are simply using thier own interpretation of the act which is wrong, for the purpose of the act I am sure embodies means it must be contained in the agreement its self not on a seperate document, but hope someone will come and confirm that I am right on this I have been batteling with these sharks for a while myself the arrogance of this company is unbelievable, I am currently writing a letter of complaint to the ICO and FOS on the advice of the information commisioners office (ICO) as they have registered defaults against me 2 for the same account but do not have a copy of the agreement which they are relying on as evidence of me giving my permission for them to process my details so it may be worth checking your credit fila as well as they wont give you any of the required notices before registering a default against you.

hope this is of some help.

Dene

[Emtec]

Hi jdene,

 

Thank you for your comments. Good luck with your battle with Cabot. I hope you get somewhere with the FOS and ICO.

 

Also, is there anybody please who can take a look at the most recent letter I have had from Cabot (please see my post of yesterday at 13.23)and advise me where I stand and what I should do next, please?

 

Thank you.

 

Emtec

[Emtec]

I really would appreciate some advice on how I should respond to Cabot, please.

 

Just to recap, in 2003 I entered into a private arrangement to pay back a nominal sum in respect of a Morgan Stanley credit card. This continued until Morgan Stanley, after it became Goldfish, sold the debt to Cabot in April 2008.

 

In May 2008 I requested a copy of the Credit Agreement and a statement of account from them. In Feb/March 2009 they sent me a statement of account containing an incomplete set of statements (including a statement for somebody else (with his name and address)) and an illegible copy of the original application form and a copy of some recent terms and conditions that relate to Barclays Bank.

 

I replied as advised by clemma above.

 

I referred to the illegibility of the application form referring Cabot to Regulation 2 of the Consumer Credit (Cancellation Notices and Copies of Documents) Regulations 1983 (SI 1983/1557).

They replied as follows:

 

Cabot Doc1.doc.pdf

 

I presume that Cabot are wrong in what they say about the 1983/1553 Regulations but I’d appreciate some advice on how to argue the point, please?

 

As far as the application form is concerned, I advised them that it doesn’t contain the prescribed terms and this is how they replied:

 

Cabot Doc2.doc.pdf

 

As I understand it, they are merely playing with words and that the agreement must contain the prescribed terms within the four corners of the document. Is that correct?

 

Also, I have been continuing to pay Morgan Stanley a nominal amount each month and these payments have been passed on to Cabot by Goldfish. Cabot seem to be using this against me:

 

 

Cabot Doc3.doc.pdf

 

I continued paying Morgan Stanley as I wasn’t certain what I should be doing whilst Cabot tried to obtain the credit agreement. I don’t know how to proceed as far as further payments are concerned. Have I compromised my position by continuing to pay Morgan Stanley? I have never paid a penny to Cabot directly as they claim and I don’t have a repayment plan in place with them.

 

Also, Cabot wrote to me separately as follows claiming that I had failed to make the first payment of a payment plan but, as I say, I have never discussed a payment plan with them let alone agreed one.

 

Cabot Doc4.doc.pdf

 

Any suggestions on how I should respond to this please?

 

Thank you for any assistance.

 

Emtec

[Emtec]

sub

[clemma]

I would file under ignore for now -this is in dispute, and they should be aware of that. If it gets passed on to someone else, then there is a great "bemused" letter you can send them

 

I have just re-read your PM. Just to put your mind at ease a little, Cabot have absolutely NO powers to do anything. They can not force you to make payments, only a judge can - and with the "agreement" they have sent you, they would not even try to take you to court. Even if they were stupid enough to try (doubtful), then you would have a good case to get any judgement set-aside.

 

Yes, you were making payments but that was BEFORE you requested a copy of your CCA. As what they have sent you is not a valid, enforceable CCA, their are in default of your request. You are perfectly entitled to with hold any payments to them until THEY can prove you owe them anything.

Edited May 21, 2009 by clemma

[the_shadow]

Just to back up the great advice from Clemma, the prescribed terms must be found in the same document, they cannot be referred to as the letter from Cabot state.

 

You can ignore as they will never agree with you or you can quote them this back.....

 

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.

 

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”.

Also they state the document doesnt need to be legible, hogwash! that document is so shakey they know it fails under s127(3)[see below] as even if the prescribed terms were on it, you cant read them.

 

(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).

S.

[Emtec]

Thank you, clemma and the_shadow. It is good to know there are decent people around willing to give advice and help.