Invalid Default Notices

[Dotty50]

http://www.consumeractiongroup.co.uk/forum/showthread.php?33174-Consumer-Credit-Act-Agreements&p=3159758&viewfull=1#post3159758

 

Not the only place we are getting confusing posts!

[Bigdebtor]

Fair point - I would not ever wish to deter those who genuinely need help from seeking it, no matter how badly worded their questions were.

 

However I do not believe that to be the case here and I do believe the poster knows the answers to the questions apparantly posed. I do not as I do not even understand the post. If you can understand his post number 5107 perhaps you can paraphrase it for the benefit of those of us who do not understand it?

 

Also, if there is or are one or more questions in it then I do think it is incumbent on those who know the answers to the questions posed to provide them and not leave the rest of us wondering.

 

BD

[the_shadow]

Grammatical criticisms do not always help (I am sure I have read somewhere that peterb has dyslexia) and can deter some people from posting. It also detracts from an important debate for many caggers.

 

Agree 100% cymruambyth

 

Peeps, please can we keep this thread "on-track", discussion is good for us all and a chance to work through a potential argument that we may eventually come up against in court should be taken when available.

 

Comments about spelling and grammer are imvho poor form.

 

S.

[Gallahad]

Oh I see he who is all seeing or could that be all knowing

how interesting

Edited October 14, 2010 by Gallahad
to include quote referred to

[Bigdebtor]

Shadow et al

 

I am sorry if I have caused any offence - that was not my intention.

 

I am genuinely trying to contribute to the debate by ensuring all possible information is given to CAGGERs. Asking a question or questions to which one knows the answer or answers and then leaving the rest of us wondering what such a post was all about is NOT contributing - it is hindering the debate.

 

I shall make no further comment in response to this matter as I do not wish this to become an unnecessary and unpleasant diversion. To this end can we have no further comments on this - other than possibly some clarification of the post in question (and answers) if possible?

 

BD

[cymruambyth]

It would be a shame if yet more people chose to bow out of CAG. Certain members like to play devil's advocate ..........

I agree a clarification or interpretation would be helpful.

Oh and if we could please have some definitive answers on DNs in the next 3 or 4 weeks I would find it very very very helpful (as long as they are the right answers of course!)

[cab1ne]

Hi just a quick question

I have my spell checker on BD so you should be able to understand it..

Creditors actions in recovering all liabilities under the contract is not the result of the debtor repudiating the contract, then what is the mechanism used it is not a contractual feature or it would have to be in the terms of the agreement, so what is it. What is it that the act regulates, what was it before 1985 what is it on unregulated agreements.

Now there’s a thing

Peter

 

Mmmmm, interesting point.(in red)

 

so, if the default is dodgy due to not allowing service by post. then they terminate the agreement, the argument being the termination is also dodgy, so the agreement is still live.

 

it is not a contractual feature or it would have to be in the terms of the agreement,

so what is your opinion if the above quote was actually true.

 

11.13. Notices under this agreement must be in writing.

They must be sent by Fax or Post or delivered by Hand, to the addresses shown in this agreement or any other address provided.

Notices will be considered as delivered at the time they are sent if sent by Fax.

Two days after posting if sent by Post, and at the time of delivery if delivered by hand

 

cab

[Pumpkinhead]

Just thought you might be interested in my thread which is discussing this same matter and that is about to go to court. http://www.consumeractiongroup.co.uk/forum/showthread.php?257032-RBS-Mint-Loan-Court-Action-Started-amp-Dodgy-DN-issues/page5

[ltc1607]

I have a DN giving me 14 days from service to rectify and a TN issued the same day are they no longer anygood to me if it goes to court.?

[basa48]

H

 

 

would like to challenge again this idea of accepting a termination. A termination cannot be accepted or declined if it could you could declined it and they would not be able to enforced.

 

peter

 

We are confusing termination and repudiation again. No I don't suppose the debtor can refuse the creditors termination. But he can refuse to accept the creditors repudiation and insist he continues to perform the agreement, which of course the creditor will not do because he would also have to de-terminate!

[basa48]

H

 

 

...........most contracts on a consumer credit agreement have the contractual right to be terminated at any time.

 

peter

 

But only within the constraints of the governing legislation, i.e. CCA1974.

 

I would argue the 'termination for convenience' type clauses are unfair terms.

[pt2537]

basa

 

you are missing the point,

 

he cannot de-terminate something that he cannot terminate in the first place.

 

The act is clear on what must be done, common law, contract law, cannot defeat a statute, and the statute says you must do this before you can do that end off.

[basa48]

Hi you mean that the debtor not paying may be missundertod by the court as`being the fault of the creditor.

 

interesting

 

Peter, you are being deliberately obtuse.

 

What Elsa is saying is that whilst the defaulting debtor is in breach it is not a fundamental breach as it can be remedied (as per the DN and s89). However when the creditor then says the agreement is terminated I want my money back, if he had no entitlement to say that (due to a faulty DN) he has demonstrated a definite intention to never again perform the contract, i.e. a fundamental repudiatory breach in that it goes to the whole basis of the contract i.e. credit.

[basa48]

basa

 

you are missing the point,

 

he cannot de-terminate something that he cannot terminate in the first place.

 

The act is clear on what must be done, common law, contract law, cannot defeat a statute, and the statute says you must do this before you can do that end off.

 

I agree that is what the law says - but people do break the law and pay the penalty.

 

Most creditors who terminate after a faulty DN would never admit the faulty DN and still regard the contract as terminated.

 

I have to admit, I cannot see for the life of me that a creditor who has issued a faulty DN and probably an ineffective TN can just keep going back and starting again and again. Why the hell have the CCA if a creditor can just do as they like even down to terminating for convenience?

Edited October 14, 2010 by basa48

[pt2537]

I have been speaking to a number of people, Qc down, and only one supports the view on repudiation but the problem is conceded that there is a statutory prohibition on termination unless a default notice is served , setting aside an de minimis points.

 

The Act also clearly states NO SANCTION CRIMINAL OR CIVIL but for that provided by the act, so i think you may struggle there, as the act does not allow acceptance of termination

 

We will know more when we get the Brandon appeal heard

[Lord_Alcohol]

Maybe the solution to this is s140?

 

A lender that sues a debtor on the basis of a DN that cannot be complied with due to its inherant defects (too much demanded to remedy, insufficient time) breaches ss 88 and 89 to the detriment of the debtor in very real terms (mangled credit file, stress of being sued, repossession, etc).

 

The debtor also receives from the lender notices that state that the agreement is ended, which he accepts believing that the lender is 'allowed' to take this action. To then find that the lender is wrong on this point, in addition to all the others, must lead him to s140.

 

s140A(1)© "any other thing done (or not done) by, or on behalf of, the creditor" may be deemed as unfair to the consumer, allowing a court to consider the sanctions set out in s140B(1), which include "reduce or discharge any sum payable by the debtor or by a surety by virtue of the agreement or any related agreement".

 

It is clear that s87(1)(b) prevents the lender from claiming unpaid amounts where s88 is not complied with, and that s89 requires that the debtor is given an opportunity to remedy the breach as though it had not occurred. It is therefore hard to see how the Act allows the lender to subsequently 're-open' the agreement and expect the debtor to comply with a new DN without the lender being in breach of s89 and s140.

 

It seems to me that CCA fails both parties here, by not identifying the process to be followed when s88 is not properly followed by the lender (and by not specifying sanctions for breach of s88 ). But, as CCA was designed to protect consumers, and as lenders have a wealth of resources at their disposal with which to ensure that full compliance with CCA is attained, I do not understand why the debtor should in any way be penalised by failings of statute and of the lender himself while the latter suffers no loss for his appalling mistakes.

 

For that reason perhaps s140 is worth a look.

 

LA

[basa48]

For that reason perhaps s140 is worth a look.

 

LA

 

Especially when you read: 140B(9) If, in any such proceedings, the debtor or a surety alleges that the relationship between the creditor and the debtor is unfair to the debtor, it is for the creditor to prove to the contrary.”

[cymruambyth]

So, am i right in a basic assmption that Lord A's arguments aside, unless Brandon is won at appeal, the argument of a defective DN will not work as he has not been given right to appeal and the DJ has allowed a DN without sufficient time and with penalties?

[pt2537]

yes, you may well be correct LA

 

But the one thing that is often missed, is people jump on the "consumer protection" band wagon and expect the CCA to come to their aid, however, what is meant by protection as nearly all the commentators agree, is that it is information provision

 

For example the prescribed terms set out the information parliament felt was sooo important to be made clear to the debtor.

 

The problem however, is the High Court has moved to narrow the scope of s140 in McGuffick , Carey, Sternlight etc, so i think it will take some work to get the courts to change tact

[Lord_Alcohol]

I see what you mean PT.

 

My understanding, though, is that the protection offered to consumers includes setting out the procedures that both parties must follow in order to perform the agreement, and these include ss 88 and 89.

 

The old s140 offered protection from extortionate credit bargains and this is now extended to cover general 'unfairness'. The OFT covers this in their leaflet which can be seen here;

 

http://www.oft.gov.uk/shared_oft/business_leaflets/enterprise_act/oft854.pdf

 

The provision of information is, of course, an important part of the Act but I would not say the only or even the main part that offers consumer protection - at the moment.

 

LA

[DeBilde]

I have an invalid DN due to dates and the arrears total both being incorrect. I need to send my defence in next week. Do I mention in my defence the reason the DN is invalid or do I just state that the DN is not compliant?

 

Any help much appreciated

[DeBilde]

I have an invalid DN due to dates and the arrears total both being incorrect. I need to send my defence in next week. Do I mention in my defence the reason the DN is invalid or do I just state that the DN is not compliant?

 

Any help much appreciated

[Bigdebtor]

DB

 

I wouldn't help them any more (or any earlier) than you must - just tell them you dispute the validity of the DN and wait on them asking why.

 

Good luck!

 

BD

[Bigdebtor]

I have been speaking to a number of people, Qc down, and only one supports the view on repudiation

PT - Can you clarify what you mean by this? Was it a QC (I accept no names can be given) who supported this view?

 

but the problem is conceded that there is a statutory prohibition on termination unless a default notice is served , setting aside an de minimis points.

 

The Act also clearly states NO SANCTION CRIMINAL OR CIVIL but for that provided by the act, so i think you may struggle there, as the act does not allow acceptance of termination

 

We will know more when we get the Brandon appeal heard

 

PT

 

Is your one person (above) perhaps giving us a glimmer of hope? Can you please clarify this further - as much as you're allowed to do?

 

I understand the point about any TN on the back of a dodgy DN perhaps not being unilaterally enforceable by the creditor on the debtor. However it is surely evidence that the creditor WISHES to terminate - and if the debtor ALSO WISHES TO TERMINATE and DOES NOT CHALLENGE the OC's intention to treat the agreement as ended and agrees there is a mutual desire to terminate then surely both cannot be forced to remain bound to the agreement against the stated wishes of both?

 

It's a bit like banning divorces and not only forcing a warring couple to remain married - but insisting they continue to live together and conjugal activities must continue as before "until death do us part".

 

As I said earlier I can't believe either Bennion or our expense-sodden MP's intended to foist this situation on us? It has been said many times the CCA was to PROTECT the DEBTOR - not shield the Creditor from the consequences of mistaken non-compliance.

 

Given this then surely the Courts could interpret the invalid TN as not only an ineffective intention to terminate (as in Brandon) - but also an irrevocable evidence of the desire of the creditor to terminate? If the debtor then agrees to the termination, then it was done by mutual consent - no one party foisted it on the other party!

 

If so, the agreement is terminated by mutual consent. Thereafter, given the original DN was not valid, no further (valid or invalid) DN could be issued as the agreement had been mutually terminated at that point in time when the debtor agreed to do so. The debtor would just need to pay the arrears (less damages) and then walk away from the outstanding balance, which would only have been due over time under an enduring agreement - not due right now in one lump sum.

 

Surely this would be an equitable outcome with the debtor being relieved of his obligation to pay the outstanding balance (only arrears less damages to be paid) in return for the Creditor having wrongly issued the invalid DN and thus not given him the necessary information or time to remedy the default, unjustly screwed his credit rating and removed his right to draw further credit?

 

Surely this would not be a SANCTION or PENALTY on either side - just a trade off of respective loss of rights enjoyed under the (now dead) agreement - which is surely what Parliament meant to have as an outcome?

 

I accept the debt does not disappear - but surely the balance is not collectable since the faulty DN removed the creditor's right to collect it - and given the mutual agreement to terminate no further DN can be issued?

 

I believe what am I saying is simply natural justice and common sense - and I cannot see how this could possibly be against the will of Parliament.

 

BD

Edited October 15, 2010 by Bigdebtor

[DeBilde]

DB

 

I wouldn't help them any more (or any earlier) than you must - just tell them you dispute the validity of the DN and wait on them asking why.

 

Good luck!

 

BD

 

Cheers BD. Shall I just simply state it as 'I dispute the validity of the DN' in my defence then?

 

Cheers