Invalid Default Notices

[Bigdebtor]

In the terms and conditions of most credit agreement there will be a clause that states the creditor can terminate an agreement at any time by giving say 14 days notice and demand the repayment of all sums

 

a bank overdraft for instance

 

Overdrafts are quite different from term loans and credit card agreements in this regard.

[basa48]

So we dont mean resision now we mean not in accordance with the law.

OK Whos law your or the creditors

 

YOu cannot just stomp your feet and say this is unfair to me therfore it is illegal, the other side also have a point of view and it is the courts who decides who is right and who iwrong what is illegal and what is not.

 

At most you have a dispute

 

Peter

 

Not my law or the creditors, it is the law of the land. If it is unfair then yes I can stomp my feet, that is what the UTCCR is for - to protect ME the debtor from the unscrupulous creditor.

 

Where there is doubt about what has (or hasn't) been done there is room for the court to decide if the law has been broken. But where there is obvious and demonstrable contravention of the Act and Regulations e.g. a DN demanding repayment of the full balance not just the amount of the default or not allowing the debtor the prescribed time to repair the default, then there is no room for a court decide - it is there in black & white and the DN is illegal or unlawful or does not comply with the law - take your pick.

[postggj]

CORECT

 

YOU CAN HAVE ROLLING CREDIT ACCOUNT

FIXED SUM LOAN

ETC ETC

 

MIGHT I SUGEST PEOLE LOOK AT

 

Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) and amendment regulations the Consumer Credit (Enforcement, Default and Termination

[Bigdebtor]

Basa

 

100% agree (again:-)). I seem to use many more words but not express things as clearly.

 

We need to ensure any new CAGGERS reading thsi thread now are in n o doubt about how the land lies - exactly as you have described so eloquently!

 

Thanks

 

BD

[Peterbard]

Of course either side can terminate at any time. If the debtor wants to terminate then he has to repay the money or else the creditor would default him and demand the money back. But I don't see how the creditor can terminate and expect the debtor to continue repayments. That is an unfair situation. Shouldn't the debtor be able to default the creditor by saying he must continue to offer his side of the agreement, i.e. a credit facility. I've read the directive, the case law and the Act/Regs. Now where does it say a creditor can terminate an agreement AND then ask for the money back.

 

Hi

well he can

He can either just terminate the debtors right to draw credit or terminate the entire agreement and expect the debtor to continue to pay.

 

As i say see the previous posts on this thread where i have copied the EU directive that adds the requirement for the creditor to give notice when he does this at the moment he needs give no notice it is down to what he says in his agreement.

Peter

[postggj]

If the default notice is defective and the agreement terminated

 

it gives no room or scope to the creditor to enforce

 

 

 

[diddydicky]

i have read and re read all these posts since peter posted recently and it seems that his position is based solely upon one judgement (which i admit i have yet to fully read)

 

however i just don't buy it

 

it is true that the creditor cannot unilaterally (lawfully) terminate an agreement where the debtor is in arrears- and that he is correct - to say that if the DN is invalid- then so is the resultant (attempt at lawful) termination

 

to say however that the law neither tolerates or accommodates a party to an agreement acting " unlawfully" is patent nonsense. - it does- and is what gives rise to the right to the performing party to "elect" (to either hold the lawbreaker to his contract to to relieve himself of any continuing obligations)

 

To propose that the creditor could "temporarily" repudiate......... remove the benefits of the agreement to the debtor- whilst he then makes however many attempts to serve a valid DN is equally daft.

 

 

what sections of the CCA permit this- and which sections of the CCA dictate how many "months" this temporary repudiation may exist until the creditor eventually serves a valid DN?

 

What section of the CCA takes the act out of the scope of general contract law

 

what section of the CCA removes the obligations confirmed by high court judges that a man is "bound by his words" in a written communication

 

What section of the CCA states that a creditor may breach the terms of the agreement and not be held to account by the other party

 

What would have been the purpose of drafting s87/8 if parliament foresaw that any old wording in a DN would do - until the creditor got it right

 

In short, The CCa does NOT override contract law - and if the creditors actions step outside of the CCA by being unlawful then the performing party then has the right to "elect" either to hold the creditor to the contract- or to relieve himself of his continuing obligations by accepting the creditors unlawful action

 

the "proposition" that a creditor can unlawfully repudiate an agreement- following an invalid DN- and deny the benefit of the rights that the agreement gives to the debtor whilst he make umpteen attempts to serve a valid DN- until he gets it right- is just as barmy!

 

 

In fact the creditor needs only to ENVINCE the intention not to perform- for the other party to be able to elect.

 

 

It seems to me that it would be in the interest of creditors to divide discourage and dissuade caggers from defending these unlawful repudiations- and i wonder (yet again) about the motives of those attempting to do this work for the creditors

[Peterbard]

Hi

Sorry

"There is no room for the court to decide"

This is a legal agreemetn who else is to decide on a dispute.

 

That is what courts do.

 

It is not pedantic if you dont think you should pay then dont pay.

 

What will happen then of cours the court will decide if it is a doccument which conforms to the act or not.

 

If you are right then you will not have to pay untill you have been given your extra time to remedy.

 

Peter

[Bigdebtor]

Hi

well he can

He can either just terminate the debtors right to draw credit or terminate the entire agreement and expect the debtor to continue to pay.

 

As i say see the previous posts on this thread where i have copied the EU directive that adds the requirement for the creditor to give notice when he does this at the moment he needs give no notice it is down to what he says in his agreement.

Peter

 

The operative bit is "continue to pay" - i.e. NOT have to pay the lot outstanding straight away - UNLESS on the back of a CCA-compliant DN which can only be issued AFTER the debtor has defaulted. To demand full payment straight away without issuing any DN - or after issuing a dodgy DN - destoys the creditor's right to have the balance repaid AT ALL (apart from arrears less damages) either in one go or over time.

 

Getting REAL again - anyone who has had a DN probably knows they CAN'T continue to draw more credit and thus increase the creditor's potential loss or risk of loss - BUT UNLESS the creditor jumps through the correct hoops, the debtor does not need to repay the whole balance any faster than agreed - and if the creditor screws up then he could be off the hook with no need to pay another penny. It doesn't matter what it's correct label actually is - unlawful or illegal, 0 rescission, termination or repudiation. What matters is the effect on the debtor - off the hook - and we shouldn't try to have such a clear message confused by semantics or pedantic wordsmithery.

 

A Bank overdraft is different - repayable on demand even if always kept within its terms.

 

BD

[Bigdebtor]

Hi

Sorry

"There is no room for the court to decide"

This is a legal agreemetn who else is to decide on a dispute.

 

That is what courts do.

 

It is not pedantic if you dont think you should pay then dont pay.

 

What will happen then of cours the court will decide if it is a doccument which conforms to the act or not.

 

If you are right then you will not have to pay untill you have been given your extra time to remedy.

 

Peter

 

Most creditors will try it on up to the wire, hoping to scare the debtor into paying out - but most will give up when they know they'll lose in court (either based on previous experience or not having such experience by giving up to avoid setting such a precedent).

 

Our aim should be to re-assure any reader that the law is on their side - if they have a dodgy DN followed by TN, demand for full balance etc.

 

BD

[diddydicky]

i would caggers of the following observations by SurfaceagentX20- upon whom i would suggest more reliabilty should be placed in this matter

 

 

The contention I advance is that an ineffective DN does not prohibit the creditor from terminating the agreement. Termination after service of an effective default notice is lawful termination, but as we have seen, a party may still terminate an agreement and be in the wrong for doing so. The law operates on a wrongful termination to offer to the injured party the choice of accepting the termination or to hold the contract breaker to his promise.

 

In the world of consumer credit, I contend a termination of the agreement by a creditor in terms whereby he announced he would no longer permit the debtor time to repay the credit, was a creditor in repudiatory breach of the agreement, unless in leading up to termination, the creditor complied with the requirements of the Act in circumstances where the debtor was in first breach of the agreement.

 

Further, and it is worth remembering, the Act is an Act for the purpose of consumer protection. The purpose of the Act is not to preserve the rights of creditors in contracts and to protect them from misadventure where for example, they terminated an agreement where it subsequently transpired the termination had not been in their interests. If that were so, the Act would have been an Act for the better protection of financiers.

 

In a proper case, the law will come to the aid of the vulnerable to protect them from the consequences of their contracts (for example the unsound in mind, children, those under duress or undue influence). To suggest financiers fell into that bracket and the Consumer Credit Act

operated to protect them and not the consumer, was absurd. The civil law does not come to rescue the misadentures of the sain and the savvy.

 

The clue to the position of the creditor on termination is in the use of the word 'entitled' in section 87(1). 'Entitled' connotes a right or a benefit. The Act therefore confers rights, conditional upon the provisions of section 87(1) being fuilfilled. Fail to fulfill the condition and the entitlements do not become available.

 

In the case of a contract entered into by a person under duress and who then breaks the contract the law will come to that person's aid by recognising that person's plea that the contract was made under duress. If that person seeks a declaration of the court that the contract was made under duress the court wil readily declare the contract void.

 

If the Act had intended that a creditor's termination in circumstances where section 87(1) had not been fulfilled by the creditor and was to be of no effect, the Act would have declared that termination void. It doesn't. The termination is voidable at the option of the debtor.

 

[3] The Debtor's Point of View

Third, let us look at the position from the ordinary man as debtor's point of view in a consumer credit situation.

 

The DN is defective for failing to conform to the prescribed terms, or gives misleading information or at worse is plain nonsense so that the debtor does not know precisely what he has to do in order to comply with it and is consequently disadvantaged. Should the law disregard the fact that the creditor put the debtor at a disadvantage and thereby at risk the creditor might lawfully terminate the agreement?

 

'This statute was plainly enacted to protect consumers, most of whom are likely to be individuals. When contracting with a large financial organisation they are at a disadvantage. The contract is likely to be in standard form and relatively complex with a number of detailed provisions. If the hirer is said to have broken its terms, the hirer needs to know precisely what he or she is said to have done wrong and what he or she needs to do to put matters right. The lender has the ability and the resources to give that information with precision. If he does not do so accurately then he cannot take what Mr Gruffyd conveniently referred to as "the next step". [per Kennedy LJ in Woodchester v Swayne [1998]]

 

Moving on, if the debtor receives a notice from the creditor in which the creditor expressly states the contract is terminated, what is the debtor supposed to think? Would the law regard him as likely to think the creditor had terminated the contract or would the law regard him as thinking it had not terminated because strictly speaking, the creditor had served a default notice which was not in accordance with prescribed terms?

 

Or where perhaps the creditor did not expresly terminate but sent the bully boys over to demand the keys to the car. What was the debtor to think then? Would the debtor think the creditor had terminated?

 

It seems to me on the basis of the passages below, the courts will be ready to hold a creditor to his words and actions.

 

"... a person who signs a document, and parts with it so that it may come into other hands, has a responsibility, that of the normal man of prudence, to take care what he signs, which if neglected, prevents him from denying his liability under the document according to its tenor".

[per Lord Wilberforce in Gallie v Lee (1971)]

 

'.. a man cannot escape from the consequences, as regards innocent third parties, of signing a document if, being a man of ordinary education and competence, he chooses to sign it without informing himself of its purport and effect..'

[per Scott LJ in Norwich & Peterborough Building Society v Steed (1992)]

 

In short, the creditor is bound by his deed. All that is required is for the debtor to accept the creditor's termination. He can write saying 'thank you I accept you termination' or he can conduct himself in a way in keeping with that termination. Not paying the instalments would be in keeping with an acceptance of the termination.

 

[4] The fiction of the Second DN and the Enduring Obligation

The service of any second default notice, at a time when the contract is terminated, owing to the wording of the DN in its prescribed form, would perpetuate the fiction that the contract endured. The same can be said owing to the provisions of section 89 of the Act.

 

The form of words in the DN incorporate text in order to meet the intention of section 89 of the Act which provides:

 

'If before the date specified for that purpose in the default notice the debtor or hirer takes the action specified under section 88(1)(b) or © the breach shall be treated as not having occurred.'

 

In other words, in serving the second DN, the creditor would be suggesting:

 

[a] an obligation had persisted post termination by which the debtor was bound to make instalment payments (ie post-termination 'arrears'), and

that if payment of those 'arrears' was made, an obligation to make future instalment payments would endure.

 

The obligations at [a] and are obligations enduring during the currency of the agreement. Besides maintaining the fiction of the enduring agremeent as I say, it seems to me any second DN would be bound to be defective for over-stating the sums due. The creditor can not state as an amount due for 'arrears' of instalments that which he said in consequence of his termination was no longer due and payable by instalments. If the creditor sought to use a form of DN which made sense by getting round the fact the agreement had been terminated, the DN would not be in prescribed form.

 

The only way in which a second DN would be of value to the creditor would be where the contract had been re-instated. If the debtor has accepted the termination, re-instatement requires the consent of the debtor.

 

The net result of [1] to [4] is the agreement is terminated for all time. The creditor's remedy is now limited by section 87(1). All that is left for the creditor to recover is the sum truly in arrear at the date of the default notice.

[Peterbard]

Most creditors will try it on up to the wire, hoping to scare the debtor into paying out - but most will give up when they know they'll lose in court (either based on previous experience or not having such experience by giving up to avoid setting such a precedent).

 

Our aim should be to re-assure any reader that the law is on their side - if they have a dodgy DN followed by TN, demand for full balance etc.

 

BD

 

Hi

Yes as i said the court will not enforce a faulty DN.

 

BUt it does not mean the debt will just go away.

 

There is no reason why after the correct notice is issued the agreement cannot be enforced.

 

Why should there be.

 

Presumably there was a default, presumably the default was not remedied, the creditor is intitled to reclaim hes money, at least the court will think so.

 

Try using unlawful resision as a defence in court and you will see how rediculous it is.

 

Peter

[diddydicky]

Hi

Yes as i said the court will not enforce a faulty DN.

 

BUt it does not mean the debt will just go away.

 

There is no reason why after the correct notice is issued the agreement cannot be enforced.

 

Why should there be.

 

Presumably there was a default, presumably the default was not remedied, the creditor is intitled to reclaim hes money, at least the court will think so.

 

Try using unlawful resision as a defence in court and you will see how rediculous it is.

 

Peter

 

there are plenty of instances where creditors have been seen off- attempting to issue second DN's on the back of an unlawful termination

 

if you look on the forum you will even see a letter from Restons to one court accepting that the action cannot proceed due to a defective DN AND a refusal by the court from Restons to suspend proceedings to give the claimant the opportunity to issue a new DN and POC

 

Indeed i have just this minute read another post where a creditor has attempting to obtain a charging order on the back of a claim following and invalid and subsequent DN and the court has thrown it out

 

they are now attempting to sue again (on the same facts) - without even gaining the courts permission to do so (and which it would be highly unlikely they would get

[diddydicky]

Hi

Yes as i said the court will not enforce a faulty DN.

 

BUt it does not mean the debt will just go away.

 

There is no reason why after the correct notice is issued the agreement cannot be enforced.

 

Why should there be.

 

Presumably there was a default, presumably the default was not remedied, the creditor is intitled to reclaim hes money, at least the court will think so.

 

Try using unlawful resision as a defence in court and you will see how rediculous it is.

 

Peter

 

the reason "why" is that in the meantime the creditor has "unlawfully" repudiated and the debtor has "elected" to accept the unlawful repudiation and releive himself of his continuing obligations under the agreement.........

 

the second DN therefore is served against an agreement that no longer endures

 

it would seem that the WHOLE ARGUMENT comes down to the fact that you seem not to beleive that the debtor has the right to "elect" following the creditors unlawful act- and that once he has- the agreement no longer endures.

[Peterbard]

i would caggers of the following observations by SurfaceagentX20- upon whom i would suggest more reliabilty should be placed in this matter

 

 

The contention I advance is that an ineffective DN does not prohibit the creditor from terminating the agreement. Termination after service of an effective default notice is lawful termination, but as we have seen, a party may still terminate an agreement and be in the wrong for doing so. The law operates on a wrongful termination to offer to the injured party the choice of accepting the termination or to hold the contract breaker to his promise.

 

In the world of consumer credit, I contend a termination of the agreement by a creditor in terms whereby he announced he would no longer permit the debtor time to repay the credit, was a creditor in repudiatory breach of the agreement, unless in leading up to termination, the creditor complied with the requirements of the Act in circumstances where the debtor was in first breach of the agreement.

 

Further, and it is worth remembering, the Act is an Act for the purpose of consumer protection. The purpose of the Act is not to preserve the rights of creditors in contracts and to protect them from misadventure where for example, they terminated an agreement where it subsequently transpired the termination had not been in their interests. If that were so, the Act would have been an Act for the better protection of financiers.

 

In a proper case, the law will come to the aid of the vulnerable to protect them from the consequences of their contracts (for example the unsound in mind, children, those under duress or undue influence). To suggest financiers fell into that bracket and the Consumer Credit Act

operated to protect them and not the consumer, was absurd. The civil law does not come to rescue the misadentures of the sain and the savvy.

 

The clue to the position of the creditor on termination is in the use of the word 'entitled' in section 87(1). 'Entitled' connotes a right or a benefit. The Act therefore confers rights, conditional upon the provisions of section 87(1) being fuilfilled. Fail to fulfill the condition and the entitlements do not become available.

 

In the case of a contract entered into by a person under duress and who then breaks the contract the law will come to that person's aid by recognising that person's plea that the contract was made under duress. If that person seeks a declaration of the court that the contract was made under duress the court wil readily declare the contract void.

 

If the Act had intended that a creditor's termination in circumstances where section 87(1) had not been fulfilled by the creditor and was to be of no effect, the Act would have declared that termination void. It doesn't. The termination is voidable at the option of the debtor.

 

[3] The Debtor's Point of View

Third, let us look at the position from the ordinary man as debtor's point of view in a consumer credit situation.

 

The DN is defective for failing to conform to the prescribed terms, or gives misleading information or at worse is plain nonsense so that the debtor does not know precisely what he has to do in order to comply with it and is consequently disadvantaged. Should the law disregard the fact that the creditor put the debtor at a disadvantage and thereby at risk the creditor might lawfully terminate the agreement?

 

'This statute was plainly enacted to protect consumers, most of whom are likely to be individuals. When contracting with a large financial organisation they are at a disadvantage. The contract is likely to be in standard form and relatively complex with a number of detailed provisions. If the hirer is said to have broken its terms, the hirer needs to know precisely what he or she is said to have done wrong and what he or she needs to do to put matters right. The lender has the ability and the resources to give that information with precision. If he does not do so accurately then he cannot take what Mr Gruffyd conveniently referred to as "the next step". [per Kennedy LJ in Woodchester v Swayne [1998]]

 

Moving on, if the debtor receives a notice from the creditor in which the creditor expressly states the contract is terminated, what is the debtor supposed to think? Would the law regard him as likely to think the creditor had terminated the contract or would the law regard him as thinking it had not terminated because strictly speaking, the creditor had served a default notice which was not in accordance with prescribed terms?

 

Or where perhaps the creditor did not expresly terminate but sent the bully boys over to demand the keys to the car. What was the debtor to think then? Would the debtor think the creditor had terminated?

 

It seems to me on the basis of the passages below, the courts will be ready to hold a creditor to his words and actions.

 

"... a person who signs a document, and parts with it so that it may come into other hands, has a responsibility, that of the normal man of prudence, to take care what he signs, which if neglected, prevents him from denying his liability under the document according to its tenor".

[per Lord Wilberforce in Gallie v Lee (1971)]

 

'.. a man cannot escape from the consequences, as regards innocent third parties, of signing a document if, being a man of ordinary education and competence, he chooses to sign it without informing himself of its purport and effect..'

[per Scott LJ in Norwich & Peterborough Building Society v Steed (1992)]

 

In short, the creditor is bound by his deed. All that is required is for the debtor to accept the creditor's termination. He can write saying 'thank you I accept you termination' or he can conduct himself in a way in keeping with that termination. Not paying the instalments would be in keeping with an acceptance of the termination.

 

[4] The fiction of the Second DN and the Enduring Obligation

The service of any second default notice, at a time when the contract is terminated, owing to the wording of the DN in its prescribed form, would perpetuate the fiction that the contract endured. The same can be said owing to the provisions of section 89 of the Act.

 

The form of words in the DN incorporate text in order to meet the intention of section 89 of the Act which provides:

 

'If before the date specified for that purpose in the default notice the debtor or hirer takes the action specified under section 88(1)(b) or © the breach shall be treated as not having occurred.'

 

In other words, in serving the second DN, the creditor would be suggesting:

 

[a] an obligation had persisted post termination by which the debtor was bound to make instalment payments (ie post-termination 'arrears'), and

that if payment of those 'arrears' was made, an obligation to make future instalment payments would endure.

 

The obligations at [a] and are obligations enduring during the currency of the agreement. Besides maintaining the fiction of the enduring agremeent as I say, it seems to me any second DN would be bound to be defective for over-stating the sums due. The creditor can not state as an amount due for 'arrears' of instalments that which he said in consequence of his termination was no longer due and payable by instalments. If the creditor sought to use a form of DN which made sense by getting round the fact the agreement had been terminated, the DN would not be in prescribed form.

 

The only way in which a second DN would be of value to the creditor would be where the contract had been re-instated. If the debtor has accepted the termination, re-instatement requires the consent of the debtor.

 

The net result of [1] to [4] is the agreement is terminated for all time. The creditor's remedy is now limited by section 87(1). All that is left for the creditor to recover is the sum truly in arrear at the date of the default notice.

 

this from Brandon

 

 

 

"It was a running credit agreement which either party could terminate at any time. It follows that the claimants were entitled to terminate the

agreement, even though they had not served seven days notice of

termination. Mr Harrison has made the strong point hat they have

purported to serve a default notice. The default notice, because it was

served on a Sunday, did not give the adequate: seven days, therefore it

Was not valid."

I am quite satisfied there is nothing in that point for the reason that is apparent from

the references I have already made.

[Bigdebtor]

Peter

 

This is going to be my last response on this tonight. I am indeed sorry. I do now believe you ARE playing with words, being pedantic, trying to score points... whatever - unfortunately to the possible prejudice of any new CAGGER seeking advice on this thread.

 

The bottom line is exactly what you say - a court will not enforce after a dodgy DN. I agree the debt "remains" - but if it does not need to be repaid then for most "normal" debtors it can "remain" for as long as it likes as long aa it likes so long as they no longer need to worry about repaying it. The only practical effect of it "remaining" is in terms of a bad credit rating (and even this disappears after 6 years in any case?).

 

I am not interested in arguing on the legal niceities - just interested in how it practically affects a debtor in trouble who is lucky enough to get a "dodgy" - rather than a compliant DN - and has the good sense to wait on the creditor screwing up further at termination time - and can then sort out the wheat of what to do next from the chaff of point scoring semantics etc. in some of these posts.

 

No offence - but I shall not reply any further tonight.

 

I think the point I was wanting to reinforce has been further reinforced by more experienced and knowledgeable caggers tonight - job done - going to bed now - goodnight.

 

BD

[Peterbard]

the reason "why" is that in the meantime the creditor has "unlawfully" repudiated and the debtor has "elected" to accept the unlawful repudiation and releive himself of his continuing obligations under the agreement.........

 

the second DN therefore is served against an agreement that no longer endures

 

it would seem that the WHOLE ARGUMENT comes down to the fact that you seem not to beleive that the debtor has the right to "elect" following the creditors unlawful act- and that once he has- the agreement no longer endures.

 

This is all pure fantassy.

 

I am not even going to waste any more time on it.

 

Just do me a favour and imagine yourself in a court room saying this stuff.

 

YOur undersanding is just to far removed from reallity for me to even start to argue sensibly with you.

 

Please everyone else look at the lastt posts on this thread look at the evidence not the reteric.

 

Peter

[Gallahad]

This is all pure fantassy.

 

I am not even going to waste any more time on it.

 

Just do me a favour and imagine yourself in a court room saying this stuff.

 

YOur undersanding is just to far removed from reallity for me to even start to argue sensibly with you.

 

Please everyone else look at the lastt posts on this thread look at the evidence not the reteric.

 

Peter

No never mind the Rhetoric either just look at the case histories and successes and the number where the OCs pulled out to avoid setting precidents

G

[postggj]

QUOTE

 

No never mind the Rhetoric either just look at the case histories and successes and the number where the OCs pulled out to avoid setting precidents

 

THIS IS SOMTHING I MUST AGREE ON

 

I MYSELF HAVE HAD A CERTAIN CAR FINANCE COMPANY UP IN COURT ON THERE FAMOUSE DODGY DEFAULT NOTICE

 

THIS IS POINTED OUT IN A DEFENCE AND BOTH TIMES, THE CLAIMANT WITHDRAWS RATHER THAN SETTING A PRECIDENT

 

IT SEEMS CREDITORS DO NOT WANT TO ARGUE THIS POINT OF CASE LAW IN OPEN COURT

[Peterbard]

QUOTE

 

No never mind the Rhetoric either just look at the case histories and successes and the number where the OCs pulled out to avoid setting precidents

 

THIS IS SOMTHING I MUST AGREE ON

 

I MYSELF HAVE HAD A CERTAIN CAR FINANCE COMPANY UP IN COURT ON THERE FAMOUSE DODGY DEFAULT NOTICE

 

THIS IS POINTED OUT IN A DEFENCE AND BOTH TIMES, THE CLAIMANT WITHDRAWS RATHER THAN SETTING A PRECIDENT

 

IT SEEMS CREDITORS DO NOT WANT TO ARGUE THIS POINT OF CASE LAW IN OPEN COURT

 

Hi

You know there is nothing new in this approach. If any of you are old enough to remember back in the early eighties the back of the exchange and mart of the tabloids were full of ads stating that you could clear your credit record and get new credit accounts just send a postal order for £5 pounds to see how.

I at the time had about a dozen CCJs illness creditors closing in like vultures usual story so I sent of my postal order.

In due course I received a brown paper envelope, inside was a printed sheet of instructions and a couple of template letters.

The idea was that you wrote to the court asking them to set aside your CCJ on the grounds the Default was not received.

When you received your conformation back you then copied it and sent it on to the central registry they would then instruct the CRAs to remove the entry from your file . This took about two weeks ,it was in the time before computers of course I don’t even think they recorded defaults at the CRAs back then.

This would give you a window where your credit would be clear and you could apply for your new cards / loans and contact the lender with an offer of payment , the without prejudice letter was included in the kit. If not accepted the creditor would have to either produce proof of the delivery or re issue another default which takes time and cost him money, so the idea was they would except the offer and leave the judgement.

Never got to use it don’t know if it worked, I thought it may be better that I was not able to get credit for a few years so I could sort myself out . Best decision I ever made.

Please forgive this trip down memory lane, just shows there is nothing new.

Peter

[postggj]

Hi peter

 

yep

 

i myself responded to those adds and i had 3 ccj set asside

 

i think mine cost me 50 quid

 

how times have now changed:-)

 

and to think 20 tears down the line i would be debating case law

[Bigdebtor]

Peter

 

Not sure if that's an admission that the majority of us are right and you are admitting you are wrong?

 

Why do your posts have to be so confusing?

 

I think all the evidence shows it's very simple:

 

Dodgy DN followed by TN followed by debtor's acceptance of this (whatever label you put on it) = debtor off hook. Court would support debtor's position on this. Debt "remains due" but doesn't need to be paid - the same thing as "disappearing" for all practical purposes. Credit file still trashed but who cares?

 

Compliant DN followed by TN = Debtor has to pay all outstanding balance straight away - and Court would so order - but probably give "time to pay" if debtor had income but no capital - effectively back to square 1, so creditor no better off in real terms.

 

BD

[Peterbard]

HI

I see the focus of this discussion has shifted away from the idea of unlawful rescission to the apparent inability of the creditor to re issue a default notice.

There are two points about this.

Courts now more than ever are looking at the amount of prejudice caused by a breach of the creditor inactions of this nature.

Brandon is an illustration of this if the time element of the default is misquoted the court will ignore the technical error and ask was the remedy paid within the 14 days irrespective of what it says on the notice. If not why not.

In Swain the default amount was incorrect by a fair amount and the judge ruled that this should be returned. This is all that happened in this case. Nothing said about termination or what happened to the account either during this process or after it, the account could have continued for all we know and the refund just credited ,or the default may have been re issued or the debtor could have terminate it was not relevant to the case. Also the idea of minimus again raise its head, so small errors will be ignored when judging the enforceability of notices.

Technically there is nothing in the regulations that stops the creditor from re issuing a faulty notice, in practice it is a complete pain in the backside for them,

This is the real reason they do not like to do it.

This with due respect is nothing to do with setting a precedent, the precedent is already there in the legislation.

Realistically I do not see what is to be gained from this approach, other than it muddies the water for the creditor and makes them work harder in order to get there money back, this I suppose may be enough to justify it to some.

The problem is that sooner or later they say enough is enough and take it to court then it is another blow for the rest of us.

Far better to try and understand the legislation and case law and develop a strategy that has a realistic chance of success.

Peter

[Peterbard]

Peter

 

Not sure if that's an admission that the majority of us are right and you are admitting you are wrong?

 

Why do your posts have to be so confusing?

 

I think all the evidence shows it's very simple:

 

Dodgy DN followed by TN followed by debtor's acceptance of this (whatever label you put on it) = debtor off hook. Court would support debtor's position on this. Debt "remains due" but doesn't need to be paid - the same thing as "disappearing" for all practical purposes. Credit file still trashed but who cares?

 

Compliant DN followed by TN = Debtor has to pay all outstanding balance straight away - and Court would so order - but probably give "time to pay" if debtor had income but no capital - effectively back to square 1, so creditor no better off in real terms.

 

BD

 

HI

Sorry dont mean to be confusing,no the debt does not dissapear , no the creditor does not loose the right to enforce the agreement an incorrect default can be remedied by the creditor issuing a corrected one an then after the required period restarting the process.

 

There is no penalty for issuing a faulty default notice, other than that the creditor cannot temrminate and ask for accelerated payments. If there was it would have to be mentioned in the act and it isnt.

 

If you want to try and sue the creditor for damages in tryin to collect his money when not entitled to then in theory i suppose you could, but the predudice would be difficult to prove wouldnt it ? after all it is him that is out of pocket.

 

Peter

[Bigdebtor]

HI

Sorry dont mean to be confusing,no the debt does not dissapear , no the creditor does not loose the right to enforce the agreement an incorrect default can bte remedied by the creditor issuing a corrected one an then after the required period restarting the process.

 

IF the creditor issues a TN after a dodgy DN then he CAN'T issue another compliant DN. If the debtor accepts the TN (unlawful, illegal, not allowed, not valid - don't care what label) then the Agreement is TERMINSATED - no further DN's compliant or not - ca be issued. The debtor is then NOT OBLIGED to pay a penny more othe rthan the lawful arrears less an amount deducted for damages. The debtor is in control at this point. The MOST he will have to pay is lawful arrears but he can try to deduct damages and it would be a brave creditor who took him to court to debate the validity of such damages - case law exists to support debtor. The balance is not enforceable - although I agree it does not "disappear" - but such technicalities are irelevant to the fortiunate debtor.

 

There is no penalty for issuing a faulty default notice, other than that the creditor cannot temrminate and ask for accelerated payments. If there was it would have to be mentioned in the act and it isnt.

Agreed - but if the dodgy DN IS incorrectly/illegally/unlawfully/without legal authority (whatever label you want) followed by a TN - then the penalty is losing the right to enforcement if TN is accepted by debtor.

 

If you want to try and sue the creditor for damages in tryin to collect his money when not entitled to then in theory i suppose you could, but the predudice would be difficult to prove wouldnt it ? after all it is him that is out of pocket.

No need to sue - debtor is in control and can just deduct it from arrears and offer the balance of such arrears only in F&F. If accepted game over. If not, debtor doesn't even pay arrears unless sued for them. SIMPLES.

Peter

 

Peter my responses are in bold above.

 

You have missed out vital parts of my point (about TN's) in your response which completely change the situation - and could confuse the casual reader into thinking the creditor could continue to issue new DN's NO MATTER WHAT.

 

THAT IS NOT TRUE - as I have responded above.

 

To answer your previous point - I believe the focus of this thread has ALWAYS been to help debtors understand how to get back on an even keel as quickly and in as stress-free a manner as possible - using the mistakes of the creditor wherever possible to best advantage.

 

IMHO fancy legal arguments, labels, partial and confusing answers do not contribute to this key and overriding aim.

 

BD

Edited September 20, 2010 by Bigdebtor