Invalid Default Notices

[welshperson3]

Will you post up a image of the back of the DN

And did it have your name and address on it ?

[welshperson3]

I think this is important for people who have not written and accepted

unlawful termination on the back of a faulty default notice.

 

so have look and let the debate Begin

 

 

The election to affirm or terminate a

contract after breach

The Court of Appeal has considered the principles which govern whether a party

has exercised an election to affirm a contract following a repudiatory breach

by the other party, as well as the effect of a “boilerplate” clause that was

designed to preserve a party’s rights to enforce the contract despite delays on its

part in seeking to protect or enforce its position. The principal judgment was

delivered by Aikens LJ, with whom Ward and Richards LJJ agreed. The case

also dealt with other matters, but the discussion as to the doctrine of election

is the one that is important for present purposes.

The facts concerned a contract which one party (T) had breached in a

repudiatory manner, which would have entitled the other party (P) to terminate

the contract. With full knowledge of the breach, P did nothing and continued with

its own performance for almost a year. At that point, P purported to rely on its

right to terminate the contract. T alleged that P had elected to affirm the contract

and so had lost the right to terminate the contract and that, in consequence, P’s

purported termination had itself amounted to a repudiatory breach of the

contract which gave rise to a right in T to terminate and claim damages.

In answer, P claimed that it was entitled to delay in exercising its rights as it

could rely on a clause in the contract which provided that:

“In no event shall any delay, neglect or forbearance on the part of any party

in enforcing (in whole or in part) any provision of this Agreement be or be

deemed to be a waiver thereof or a waiver of any other provision or shall

in any way prejudice any right of that party under this Agreement”.

Aikens LJ summarised the principles that apply to determine if a party has

elected to affirm a contract, as they had been set out by Lord Goff in Motor Oil

Hellas (Corinth) Refineries SA v. Shipping Corp. of India (The

Kanchenjunga) [1990] 1 Lloyd’s Rep 391, at 397- 399, as follows (at [53]):

“(1) If a contract gives a party a right to terminate upon the occurrence of

defined actions or inactions of the other party and those actions or

inactions occur, the innocent party is entitled to exercise that right. The

innocent party has to decide whether or not to do so. Its decision is, in law, an

election. (2) It is a prerequisite to the exercise of the election that the party

concerned is aware of the facts giving rise to its right and the right itself. (3)

The innocent party has to make a decision, because if it does not do so

then ‘the time may come when the law takes the decision out of [its] hands,

either by holding [it] to have elected not to exercise the right which has

become available to [it], or sometimes by holding [it] to have elected to

exercise it’ [per Lord Goff in the Motor Oil Hellas case at 398, left side

of the report]. (4) Where, with knowledge of the relevant facts, the

party that has the right to terminate the contract acts in a manner which is

consistent only with it having chosen one or other of two alternative and

inconsistent courses of action open to it (ie. to terminate or affirm the contract),

then it will be held to have made its election accordingly. (5) An election

can be communicated to the other party by words or conduct. However, in

cases where it is alleged that a party has elected not to exercise a right, such

as a right to terminate a contract on the happening of defined events, it will

only be held to have elected not to exercise that right if a party ‘has so

communicated [its] election to the other party in clear and unequivocal

terms’ [per Lord Goff in the Motor Oil Hellas case at 398, right side of the page]”.

His Lordship said that it is a question of fact whether a party has elected to

terminate or affirm a contract in a situation where it is in the position that it

has to decide whether or not to exercise the right to terminate. The party has

elected either to affirm the contract or it has not done so. If it has not affirmed the

contract then the right to terminate will remain exercisable. In that light, he said

that the clause set out above was of no help to P, except in emphasising that a

clear and unequivocal communication is required of the exercise of an election to

abandon the right to terminate and to abandon its right to terminate or it did

not. If it did elect to abandon its right to terminate then the whole contract,

including the clause, would continue in existence. He said that, “The general law

demands that a party which has a contractual right to terminate a contract

must elect whether or not to do so”. His Lordship did say, however, that a party

which had elected to affirm the contract and not to terminate it might still have a

action for damages arising from the breach that had occurred.

Aikens LJ also said that, on its wording, the clause quoted above did not deal at

all with the issue of whether or not an election had been exercised. By way of

commentary, it is difficult to imagine how much more explicit the clause could

have been. From other comments that he made, it appears that his Lordship was

doubtful whether any clause could exclude the operation of the doctrine of

election and the requirements as to its exercise.

It is also interesting to note that in another part of his judgment, his

Lordship referred to the principle that if a party to a contract purports to

terminate it for the wrong reason but subsequently discovers facts which

would have justified its action in terminating the contract, the termination

will be valid. In that regard, he referred to Boston Deep Sea and Ice Co. v.

Ansell (1888) 39 ChD 339 and Lord Sumner in British and Benningtons Ltd

v. North Western Cachar Tea Co. Ltd [1923] AC 48, at 72. By way of

additional comment, in the context of the operation of an events of default clause

and the enforcement of security, see Byblos Bank SAK v. Al Khudhairy

(1986) 2 BCC 99549, Anglo Petroleum Ltd v. TFB (Mortgages) Ltd [2003]

EWHC 3125 (QB), Brampton Manor (Leisure) Ltd v. McClean [2006] EWHC

2983 (Ch), County Leasing Ltd v. East [2007] EWHC 2907 (QB), at [120]-[124].

Tele2 International Card Co. SA v. PostOffice Ltd [2009] EWCA Civ 9 (21/1/2009).

wp3

 

 

[welshperson3]

The part i think is going to help is this

 

clear and unequivocal communication is required of the exercise of an election to

abandon the right to terminate and to abandon its right to terminate

[welshperson3]

Will need to pick the bones out but i think there is case law in there to show that the option to accept termination will always be there never mind how long has past or how Manny payments you make

[welshperson3]

1/ what part of what you posted leads you to that conclusion

 

this part

 

His Lordship said that it is a question of fact whether a party has elected to

terminate or affirm a contract in a situation where it is in the position that it

has to decide whether or not to exercise the right to terminate. The party has

elected either to affirm the contract or it has not done so. If it has not affirmed the

contract then the right to terminate will remain

 

2/ why, when it is so easy to write and accept it- would you want to

"take the risk"?

 

For some people they find out that they had this option month's or Even years after the fact this point shows that time is not a factor

Edited February 12, 2010 by welshperson3

[welshperson3]

I've received a DN from MBNA dated 08.02.10 but they registered the account as default with CRA - Experian with a status [8] on 29.01.10.

 

 

According to the Experian's explanation of status history, the status [8] means that: "The account is in 'default'. You failed to keep to your credit agreement and have not responded satisfactorily to requests to bring your payments up to date, so the credit agreement has ended."

 

 

Am I right in thinking that the account would be terminated from the date they registered the account as default, so any DN served afterwards would not save them from breaching the s87 of the CCA 1974, and surely it's a unlawful rescission.:?

 

just my opinion but i think that a default that is registered with CRA is not a act of termination it just says that the account is in default. a DN doesn't terminate the agreement a termination noticeis needed for that, or a act on they're behalf refusing you your rights to carry on with the agreement

Edited February 12, 2010 by welshperson3

[welshperson3]

hi diddydicky

 

On this default notice thread there are now over 1300 posts so it goes to show that there are a lot of dodgy DN about and it seems to me that a lot of people are still struggling to understand what it that makes a default notice invalid .

 

Now on to my point how do u feel about writing a list of things that make a DN dodgy

 

example

 

1 Demanding the full balance ?

answer they are only legally allowed to claim the arrears as a DN is a notice telling you that you are in arrears and giving you the chance to pay the arrears bring your account back up to date

 

2 14 days notice ?

Answer bla bla bla

 

3 Prescribed paragraphs ?

a bla bla bla

b bla bla bla

c bla bla bla

 

Then post it up get people to comment and add what they can when finished ask mods to make it a sticky

 

Then do the same with a acceptance letter

 

WP3

Edited February 12, 2010 by welshperson3

[welshperson3]

I also see this mentioned a lot unlawful rescission i cant quite get my head around this one.

I understand unlawful and i understand rescission.

what i don't understand is how they work together

 

I do understand unlawful termination

 

 

 

Noun1.rescission - (law) the act of rescinding; the cancellation of a contract and the return of the parties to the positions they would have had if the contract had not been made; "recission may be brought about by decree or by mutual consent"

Edited February 12, 2010 by welshperson3

[welshperson3]

A good post 1369 diddydicky it is this type of thing that can clarify how things work and if people put Their heads together then simple steps on how to deal with a dodgy DN could be achieved.

 

1 what is a dodgy dn ?

2 how to respond to a dodgy dn ?

3 how to defend in court on a dodgy dn ?

 

after 1300 posts there should be enough information to clear up the above points .

 

my point about unlawful rescission in post 1368 is if anyone sending letters to bank ,solicitors,etc, accepting termination and then gets the letter wrong the solicitor might by more inclined to push for it to go to court, in the assumption that the letter writer doesn't know what he is doing.

 

hence a acceptance template letter could be good, if people put Thayer heads together I'm sure something good will come out

[welshperson3]

emandcole

they're cock ups are our opportunities if they got it right all the time then cag would be one quiet site

[welshperson3]

this is from post 3 of A TALE OF DODGY DN it is a responce to surfaceagentx20 original post

 

I think this is a salutary tale of how knowing your topic properly can make the difference between winning and losing the battle. I often wonder about the bush lawyers on CAG who leap in with advice which I personally feel is dubious - and which sometimes fails to achieve the desired result.

 

In your example you have convinced the claimant's solicitors that you are well on top of the legalities and that they cannot make a winnable case. An amateur (like myself I have to admit) might with some research determine all the legalities of the matter but would certainly not convince the opposition that you were in any way an expert and that you regarded your defence as automatically won.

 

 

I think that a template acceptance letter detailing the precise points of law could prevent a lot of cases getting as far as court.

 

WP3

[welshperson3]

hi BRW

 

Plenty of valid points raised there and i understand were you are coming from with the idiot guide about people following it blindly and not understanding what they are doing.

 

The same can be said about much of the litigation that goes on around this site there are people who start litigation and don't know what cpr is, but they get help and they get stage by stage help and more often than not get the result they want.

 

My point about the acceptance letter is that this is pre litigation and if you get it right at this stage then it has the possibility of stoping it going to litigation.

If it goes to court then at least the paperwork is right for this part.

 

The basic form of this is two parts

1 accept the rescission

2 tell then that as the contract is over then so are they're rights to process your data

 

The point you make about not telling them how to put the DN right

most of the company's that we see on here that are issuing the faulty DN are banks building society and credit cards.

 

these are multi billion pound company's that at the time of writing up the DN didn't pay enough attention to detail when they start to reallies that a faulty DN can be terminal then they are going to pay it a lot more attention

 

at this point i find it hard to believe that such big company's are going to have some guy surfing the net trying to find out to fix the problem of a faulty DN.

Eureka he finds cag and saves the company.

 

This is how i think it will go

Bank gets more and more cases going to court on the DN issue,

Bank gets p****d **f calls in the barristers

They research CCA and case law and then come out with a all new DN

 

WP3

[welshperson3]

The barristers will get all the info of what is wrong by looking at what has gone thro court .

 

if you really think that they are going to be looking on cag for the answer to a multi million pound problem and take what you me and every other Jo blogs think then you really are thinking to hard

[welshperson3]

I agree with keeping things like individual litigation quiet were dca and the likes look on here.

 

But for a problem that is this big makes no difference

 

WP3

[welshperson3]

anybody think what was said on here helped the banks win in the

OFT-v-BANKS in the supreme court ?

 

i think we should have kept quiet on here and we might have won

 

take things in to contexts

[welshperson3]

spot on

 

 

I like a good debate and when i am shown to be wrong,it is then i have learned something

 

But DD the above quote shocked me

[welshperson3]

The reason that the creditors don't particularly care for the accuracy of their DN's is because to them it is all a "numbers game"

 

the amount of caggers and other sites breeding LIP's to fight them is but a pimple on a dimple on a fleas left ball!!

 

they send out 10,000 DN's 5,000 people pay up or come to an arrangement out of fear (and because they dont know about sites like this)

 

4750 dont respond because they are skint and the creditor goes on to get a CCJ by default

 

250 are caggers and the like

 

until the odds shift considerably against them, i venture to suggest they are quite happy with these odds!!

 

I agree with that Dicky

It is only when the snowball grows that they will do something about it exactly what happened with bank charges

 

If the CMC start pushing faulty DN then it wont be long before a faulty DN becomes an endangered species

[welshperson3]

they should be in a reply to a SAR if you have asked for all information held on you, but company's are very selective on what they think they can get away with sending, different company's send out different info in they're reply but i don't think any company sends it all.

[welshperson3]

If they are tacking you to court then you can request it under CPR rules,

If they don't supply one then go for a strike out or summery judgment.

but if you are thinking of taking them to court for no DN then don't bother

[welshperson3]

quick question...

 

DN is defective when 14 days is given rather than a date?

and if terminated on this DN makes unlawful termination/recission?

 

Only asking for clarity as Im reading myself in circles

 

 

technically you are right BUT if that is the only thing wrong then i would guess that your chances of winning on that are very low (JUDGE LOTTERY)

 

wp3

[welshperson3]

have you paid over one third ?

is there a statement on the DN like the one below ?

 

if the agreement is one of hire purchase or conditional sale, a statement saying: but if you have paid at least one third of the total amount payable under the agreement set out below (or any installation charge plus one third of the rest of the amount payable). The creditor may not take back the goods against your wishes unless he gets a court order.

[welshperson3]

the problem that i think you might have here is that they will come and take the car.

then it could be months or even years later that they then chase you for the outstanding balance. bye that time you lost the car .

 

I'm struggling with what options you have

 

1 try and workout a payment plan with them

2 take them to court

3 let them take the car and defend in court

 

i m not recommending any of the above but hopefully others can add to it

and then it is up to you to try and pick what you think is best way forward for you

[welshperson3]

do you have a thread on this ?

 

oop i need to pay more attention

Edited February 14, 2010 by welshperson3

[welshperson3]

most agreements allow the creditor to restrict or prevent use of the card, to reduce or increase the credit limit without terminating the agreement

 

providing the debtor is still able to enjoy the benefit of repaying what is owed by montly instalments of his own choosing (subject usually to a mimimum) then the agreement endures and the creditor is not in breach

 

Do DCA hold a license to operate credit cards if not then it is obviously terminated as they cant keep to the original agrrement.thus taking away your rights under the contract.

 

your right to more credit is not your only right under the contract

 

wp3

[welshperson3]

There is case law to show that if you have not specifically told the creditor that you wish to continue with the agreement then the option to accept rescission will always remain open.

 

It is always better to act promptly in this situation but the door is never closed until you tell the creditor you wish to carry on with the agreement.

 

wp3