Claimant Discontinued - What should I do next?

[postggj]

Viscount

 

My Point Being Is If An Account Has A Crap Default Notice And Has Been Sent To A Dca

 

The Account Has Then Been Terminated

[Blondie40]

That's what I'd argue, even if they get permission to start a second claim anyway.

 

VS, many thanks. Which would be the best case law to quote in such a circumstances. In my skeleton argument (which I never got to argue) I had used the following:

 

Failure of a Default Notice to be accurate not only invalidates the Default Notice (Woodchester Lease Management Services Ltd v Swain and Co [2001] GCCR 2255) but is an unlawful rescission of contract which could not only prevent the court enforcing any alleged debt, but would also give rise to a potential counter claim for damages where damage occurs to an individuals credit rating (Kpohraror v Woolwich Building Society [1996] 4 All ER 119).

[Viscount Stair]

Those are the two cases.

 

As for whether or not transferring an account to a DCA is a termination, I'd say "not necessarily".

 

Simply transferring the account to a DCA does not terminate the account, but if the full amount is demanded by the DCA, that is a repudiation.

 

This was discussed a few times a few months back when I first joined and a letter headed Notice of Termination or Termination Notice was generally regarded as the best of all, a letter which said the account had been terminated was more or less as good, a letter that demanded the entire balance in one fell swoop as the next best thing and anything else as a greyer area.

[Blondie40]

So VS, a letter to claimant's solicitors, pointing this out - good or bad idea?

[Viscount Stair]

I'd say good idea.

 

"Having terminated the agreement and commenced proceedings on the strength of a defective DN, they are no longer entitled to revive the agreement or to serve a further DN. Your clients would need the permission of the court to commence fresh proceedings. Any such application would be opposed."

[Bill Shidding]

Hi All, just had to point out that my case is not lost (hope VS doesn't have inside information!).

 

The (our) problem with the amended 2006 act is;

 

As long as your creditor has your enforceable agreement or you have admitted to the agreement.

 

If your creditor sends you a DN (effective or not) and does not terminate the agreement, they can claim any and all arrears accrued up to the issuance of the claim. And possibly beyond, up to the end of the natural end of the loan. Because they are not seeking a remedy a DN is not required. They need the CCA/your admittance and a conforming statement of arrears to pursue you - thats all.

 

If your creditor sent you a DN and a TN and EITHER notice is defective, your agreement HAS been unlawfully terminated and your claimant (hopefully) cannot pursue you for any arrears accrued after the termination date (I hope, please see my updated thread "fiddlesticks").

 

I must point out that all of this is irrelevant if there is no agreement / admittance. So you must NOT claim unlawful rescission of contract if they do not have your CCA/admittance. If you did, you would be admitting to the agreement!!! and thereby cutting your own b*lls off.

 

My case is still live and I'm still kicking, so I cant elaborate too much at the mo' on my attack/defence/pleadings/etc.

 

In the OPs particular position, I would probably let sleeping dogs lie because the claimant would need to obtain the courts permission to start a new claim or resurrect this one (with a damn good excuse).

With the question of costs - if the OP claims their costs, upon the claimant issuing or requesting to issue another claim, the DJ will take into account that the OP has been "adequately compensated" for the previous action. Therefore, if it is only a minimal amount, I wouldn't let them use that excuse at a later date (if they re-issue). Hope this makes sense.

 

However, notwithstanding the above. If the claimant issued a new claim that was substantially different from the first ie. the first claim was for payment in advance or earlier repayment (and thus required an effective DN and TN), but the second was for arrears and a different sum, they would not require permission from the court to claim.

This practise is currently unlikely from most sols, because they haven't got to grips with the new 2006 regs yet, but they will........eventually.

 

Watch out for those arrears notices on your doormat!!!

 

 

 

Regards

 

Bill

Edited April 26, 2009 by Bill Shidding

[Crapstone]

Blondie40,

 

If they have chosen to discontinue then make no further contact with them. The ball is in their court, literally, and they will have to ask permission to raise the claim again as they should have had their papers in order the first time around.

 

I dealt with a similar case 2 years ago for £14,000 + fees, charges and legal costs. The same as you, it was disputed that despite requested, no original copies had been provided and errors had been made in the evidence the claimant had made. Not to mention it was also statute barred and outside of the 6 year limit, although strictly speaking it wasn't but that was a mistake made on their part used against them.

 

They knew they were going to lose, but as you did, both I and the person I was helping attended the court on the day just to be sure that the case had been dropped. Sure enough the court hadn't heard from them, they failed to submit on time and not a peep has been heard since.

 

As previously said, let sleeping dogs lie. If they didn't have or send the correct stuff originally then it's highly unlikely they are going to throw good money after bad and go back to court after they threw the towel in at stage 1.

[Crapstone]

Forgot to add that in the case I referred to the defence was also given as the loan was not acknowledged because they hadn't provided a signed agreement either.

[Viscount Stair]

Hi All, just had to point out that my case is not lost (hope VS doesn't have inside information!).

No inside information, just half remembering your situation. Apologies for confusing the issue.

 

I am not as pessimistic about ANs as you are because I think it is creating a whole new set of opportunities for creditors to mess up but I agree that the implications need to be thought through by both sides.

[Blondie40]

Bill

 

"If your creditor sends you a DN (effective or not) and does not terminate the agreement, they can claim any and all arrears accrued up to the issuance of the claim. And possibly beyond, up to the end of the natural end of the loan. Because they are not seeking a remedy a DN is not required. They need the CCA/your admittance and a conforming statement of arrears to pursue you - thats all."

 

Issuing County Court Claim, does that not terminate an agreement?

 

"With the question of costs - if the OP claims their costs, upon the claimant issuing or requesting to issue another claim, the DJ will take into account that the OP has been "adequately compensated" for the previous action. Therefore, if it is only a minimal amount, I wouldn't let them use that excuse at a later date (if they re-issue). Hope this makes sense."

 

Was not going to claim costs, my costs had been minimal and as you say DJ may look on it as my having been compensated for previous claim if claimant chooses to start new claim.

 

 

"If the claimant issued a new claim that was substantially different from the first ie. the first claim was for payment in advance or earlier repayment (and thus required an effective DN and TN), but the second was for arrears and a different sum, they would not require permission from the court to claim.

This practise is currently unlikely from most sols, because they haven't got to grips with the new 2006 regs yet, but they will........eventually.

 

Watch out for those arrears notices on your doormat!!!"

 

This is what concerns me the most - and why I need to establish for certain that issuing County Court Claim terminates an agreement.

[Bill Shidding]

Hi Blondie40,

 

Issuing County Court Claim, does that not terminate an agreement?

 

This is what concerns me the most - and why I need to establish for certain that issuing County Court Claim terminates an agreement.

 

I'm not 100% on this, but I doubt it does terminate the agreement. As has been stated previously though, a creditor demanding earlier payment (of sums due in the future) is very likely to be seen to have terminated the account. A creditor seeking arrears is not terminating the account, just seeking payments the defendant "should" have already made. It boils down to exactly what the claimant is claiming on the new POC.

 

Hi VS

 

I am not as pessimistic about ANs as you are because I think it is creating a whole new set of opportunities for creditors to mess up

 

Yes, after a fashion you are correct. However ANs are not the same as DNs/TNs or FDs. If a creditor issues an incorrect DN/TN/FD then they are likely to have acted without a further recourse ie, they cannot issue a second notice. This is not relevant to ANs, because in the new regs the creditor gets a second/third/fourth attempt to get it right. Interest accrued during the period of non compliance is written off, but the sum of arrears are not. They get as many chances as they need because it is a rolling requirement (every 6 months). The only stage at which you could truly rest is after 6 years of making a payment/acknowledging the debt. Statute of limitations still apply.

 

Hope this helps a little to explain a new minefield of opportunity for our successful/desperate finance industry (and friends).

 

I'm surprised there are not more victims of this practise on this forum, I hope this serves as an eye-opener to some.

 

Regards

 

Bill

[Blondie40]

Hi Blondie40,

 

 

 

 

 

I'm not 100% on this, but I doubt it does terminate the agreement. As has been stated previously though, a creditor demanding earlier payment (of sums due in the future) is very likely to be seen to have terminated the account. A creditor seeking arrears is not terminating the account, just seeking payments the defendant "should" have already made. It boils down to exactly what the claimant is claiming on the new POC.

 

Bill

 

Original POC was for full amount due, and when issued in Jan 2008 agreement had another 4 years to run, now only 2 years and 9 months. If claimant now wait and do not issue another claim until agreement would have ended (2012) claimant could in theory issue claim for arrears which would equal to full amount of loan.

[diddydicky]

been following with interest

 

im not sure about the comments that by claiming a defective Dn you are admitting the agreement and therefore shooting yourself in the foot (also on another thread someone said that bys ending a SAR your are also similarly shooting yourself in the foot)

 

the argument that 99.9% of people are making is not that they did not have an agreement, but that in their precious ignorance they were unaware (as they have subsequently found to the contrary) that the agreement was defective or unenforceable. This is a legal argument not a moral one If one finds out that they have unwittinngly been subject to an illegal agreement is does not preclude them from acting on new information)

 

I defy anyone who is contesting these matters to say that some agreement did not exist when clearly they have been paying money to the creditor for some period of time.

 

indeed, where agreements are found to be defective/unenforceable they STILL exist,

 

therefore i see no disadvantage in people making SAR requests or defending on the basis that DN's are invalid.

 

EVERY

[diddydicky]

for precious read previous

[diddydicky]

regarding a default notice

 

although not legally qualified it is my opinion that a default notice IS a termination notice if it states that you must take steps to remedy the default by a certain date otherwise the agreement will be terminated.

 

if it then demands payment of the whole amount after the prescribed date in the DN (whether it is wrong or not) it has CLEARLY terminated the agreement and a county court (especially small claims) would in my opinion clearly see this as termination

[Bill Shidding]

Hi,

 

a default notice IS a termination notice if it states that you must take steps to remedy the default by a certain date otherwise the agreement will be terminated.

 

In a way, you have answered your own question within that statement. A default notice is not termination. A default notice;

Informs the debtor of what condition of the agrement has been breached.

Informs the debtor of the sum of the "arrears",

Gives the debtor a "specified time period" to remedy the default.

Tells the debtor what will happen if the breach is "not remedied" by that date, ie termination.

A default notice will not (usually) ask the debtor to repay all sums due under the agreement still outstanding (including future payments). But if it did, I concur it could be seen as a termination notice.

 

 

im not sure about the comments that by claiming a defective Dn you are admitting the agreement and therefore shooting yourself in the foot

 

therefore i see no disadvantage in people making Subject Access Request requests or defending on the basis that DN's are invalid.

 

No, you are correct. The point I was trying to make is that;

If there is no agreement or you have not admitted the debt, then claiming unlawful rescission of contract would imply that you knew of the agreement. By extension, you have agreed that there was an agreement and then the creditor could stop relying on DNs altogether, and chase the debtor for the whole sum of arrears due, upto the hearing.

Incidentally, you could make a SAR to any company, even if you have never had an agreement with them. So this cannot be construed as an acceptance of an agreement. With the caveat of "not quoting the account number" unless the creditor has already quoted it to you!.

 

Hi Blondie40

 

Original POC was for full amount due

 

Then personally, I would consider that the agreement was terminated upon issuance of the claim.

 

claimant could in theory issue claim for arrears which would equal to full amount of loan.

 

Not in theory, its happened (to me!) but I'm hanging in there.

 

In your particular case;

They would need the courts permission first if the sums claimed were similar. They can only claim again (without the courts permission) if the claim/POC are "substantially different".

 

 

If claimant now wait and do not issue another claim until agreement would have ended

 

This is my worry also. Many of the older threads/defences rely upon faulty DNs to make a winnable case. This line of defence will no longer apply in the case of "arrears". Subject to the DN is not also terminating the agreement (which personally, I've never seen).

 

Regards

 

Bill

[Viscount Stair]

Thinking this through, Arrears Notices do not create an opportunity that creditors did not already have (and some - but not many - them already took).

 

It has always been the case that a Default Notice was not necessary to claim arrears and that a creditor could just hold fire until the very end of the agreement before terminating and/or bringing proceedings rather than serve a DN or even if they had.

 

Whilst most creditors do terminate as soon as or relatively soon after a Default Notice expires, not all do. Maybe fewer will in the future but that is a different issue. Many creditors started to comply with the rules on agreements when they realised the consequences of not doing it.

 

If a creditor decides to serve Arrears Notices for the remaining duration of an agreement instead of serving a Default Notice, then that is a course of action that is open to them but it was open to them before to do nothing at all for the remaining duration of an agreement.

 

That is entirely consistent with Woodchester v Swayne and nothing to do with Arrears Notices.

 

Bear in mind that the obligation to serve Arrears Notices lasts until the arrears are cleared or until judgment is obtained, so if proceedings drag on then ANs still have to be served during proceedings as well.

 

Bear in mind also that, if proceedings are brought without a valid DN having been served, then even if nothing else had been done to terminate or repudiate the agreement first, that is itself a breach of section 87(1).

[mercyblue]

 

 

In your particular case;

They would need the courts permission first if the sums claimed were similar. They can only claim again (without the courts permission) if the claim/POC are "substantially different".

 

Bill

 

So what constitutes substantially different? and who decides it? Would you initially defend a new claim on the basis that the claim was basically the same and attempt to get the claim struck out at this early point?

 

[I've got no money]

Hi Blondie40,

 

 

 

 

 

I'm not 100% on this, but I doubt it does terminate the agreement. As has been stated previously though, a creditor demanding earlier payment (of sums due in the future) is very likely to be seen to have terminated the account. A creditor seeking arrears is not terminating the account, just seeking payments the defendant "should" have already made. It boils down to exactly what the claimant is claiming on the new POC.

 

Bill

 

Original POC was for full amount due, and when issued in Jan 2008 agreement had another 4 years to run, now only 2 years and 9 months. If claimant now wait and do not issue another claim until agreement would have ended (2012) claimant could in theory issue claim for arrears which would equal to full amount of loan.

 

I don't quite understand that - what does "full amount due mean" - was the claim for the whole amount of the loan or for the balance of the loan due up to the date of issue

[I've got no money]

So what constitutes substantially different? and who decides it? Would you initially defend a new claim on the basis that the claim was basically the same and attempt to get the claim struck out at this early point?

 

 

• 
  

 

In consumer credit terms - if the claim was based on the same agreement and included monies previously claimed I'd argue thast it was not substantially different - it is a question of fact in every case - you woould need to compare the pleadings - it is essentially a decision for the court but I'm pretty sure that there is some case law on the point - if I can find it I'll post it later.

 

If it happens then you say so in your defence to the second claim and make an immediate application to strike out

[Blondie40]

 

I don't quite understand that - what does "full amount due mean" - was the claim for the whole amount of the loan or for the balance of the loan due up to the date of issue

 

IGNM

 

Sorry if that wasn't clear - Claim was for whole outstanding amount of loan - not just amount due up to date of issue of claim.

[Blondie40]

The following is list of letters prior to Claim being issued:

 

1. Default Notice No.1 - claiming arrears (although amount incorrect). If not paid by xx/xx/2007 we will require payment of the outstanding balance. If payment not received, we may issue court proceedings against you.

 

2. Default notice No.2 - issue 2 months later (correct amount of arrears) I guess this was issued as they realised DN No. 1 was incorrect.

 

3. Letter from DCA No. 1 - requesting I call them

4. Letter from DCA No. 1 - account referred for legal action

5. Letter from OC - formal demand for outstanding balance

6. Letter from DCA No. 2 - requesting payment in full

7. Letter from DCA No. 2 - requesting payment in full or my proposal for payment plan

8. Letter from DCA No. 2 - court action instigated and OC will apply for charging order

9. Letter from DCA No. 2 - as above

10. Letter from DCA No. 2 - Letter Before Action

11. Letter from DCA No. 2 - Letter Before Action

12. County Court Claim received 4 months after last Letter Before Action

 

Do you think that the above would have terminated an agreement?

[Josie8]

The following is list of letters prior to Claim being issued:

 

1. Default Notice No.1 - claiming arrears (although amount incorrect). If not paid by xx/xx/2007 we will require payment of the outstanding balance. If payment not received, we may issue court proceedings against you.

 

2. Default notice No.2 - issue 2 months later (correct amount of arrears) I guess this was issued as they realised DN No. 1 was incorrect.

 

3. Letter from DCA No. 1 - requesting I call them

4. Letter from DCA No. 1 - account referred for legal action

5. Letter from OC - formal demand for outstanding balance

6. Letter from DCA No. 2 - requesting payment in full

7. Letter from DCA No. 2 - requesting payment in full or my proposal for payment plan

8. Letter from DCA No. 2 - court action instigated and OC will apply for charging order

9. Letter from DCA No. 2 - as above

10. Letter from DCA No. 2 - Letter Before Action

11. Letter from DCA No. 2 - Letter Before Action

12. County Court Claim received 4 months after last Letter Before Action

 

Do you think that the above would have terminated an agreement?

 

 

Yes

[diddydicky]

as i understand it (correct me if i am wrong) a creditor cannot demand repayment of the whole amount unless he has first terminated the agreement!

[I've got no money]

 

IGNM

 

Sorry if that wasn't clear - Claim was for whole outstanding amount of loan - not just amount due up to date of issue of claim.

 

On that basis - if they were to bring fresh proceedings they'd be claiming substantially the same as the previous proceedings and would therefore need permission