Wolfy vs Howard Cohen/C L Finance

[Wolfy]

Can someone provide confirmation on a thought thats just occurred to me. They are alledging that Egg provided me with a default notice in June 2006. In September 2007 the Financial Ombudsmen found in my favour that Egg had been adding PPI to the account without my agreement and instructed Egg to refund a sum of money. By my reasoning any DN they issued before that date must therefore be invalid as it would have contained PPI that had been misapplied and the figure must therefore be wrong. By the same token they cannot now reissue a new DN as they have taken the matter to court and have therefore terminated the agreement. Am I right?

[unclebulgaria67]

The details on the DN would certainly have been wrong. BUT I am not sure how you would take this forward now.

 

Perhaps someone else will be able to shed some light on points of law or cases that might assist you.

[citizenB]

Wolfy, I have flagged your question for the attention of the site team. However, you might want to contact either diddydicky or vint1954, they may be able to help.

[Wolfy]

Thanks for the help so far all. Any more opinions. I need to decide whether to include the correspondence, or at least the final letter from the FOS telling me they have found in my favour, in my disclosure bundle which I have to have with the court and HC on Friday.

[Wolfy]

Slight update in that they have now provided me with their disclosure list. Its almost embarrassing in its brevity.

 

1. Credit agreement dated XXXX

 

2. Copy statements of account

 

3. Copy template of Default Notice and screenprint

 

4. Copy Notice of Assignment

 

So no mention of the Deed of Assignment? And they havent even bothered to try and reconstruct a DN?

 

However given that this is now Fast Track and I do have rights of inspection, and the CPR 31.15 permits inspection of any document mentioned in their statement of case (such as oh I don't know, the Deed of Assignment) I feel a trip to Leeds coming on. Seeing how everything else is a copy other than the credit agreement I may as well take a look at that as well. Should be an interesting trip.

[citizenB]

Thanks for the help so far all. Any more opinions. I need to decide whether to include the correspondence, or at least the final letter from the FOS telling me they have found in my favour, in my disclosure bundle which I have to have with the court and HC on Friday.

 

 

I would say yes, include the FOS letter in your bundle, especially if you intend to rely on it.

 

Enjoy your trip to Leeds

[citizenB]

Can someone provide confirmation on a thought thats just occurred to me. They are alledging that Egg provided me with a default notice in June 2006. In September 2007 the Financial Ombudsmen found in my favour that Egg had been adding PPI to the account without my agreement and instructed Egg to refund a sum of money. By my reasoning any DN they issued before that date must therefore be invalid as it would have contained PPI that had been misapplied and the figure must therefore be wrong. By the same token they cannot now reissue a new DN as they have taken the matter to court and have therefore terminated the agreement. Am I right?

 

Just a couple of things. If the DN was issued in June 2006, then they would have only been required to give you 7 days to remedy the breach. 14 days came into force in December 2006.

 

If the amount they were requesting on the DN was incorrect then that would make the DN invalid.

 

I would say yes, as they have issued a claim against you, then the agreement has been terminated , therefore they cannot issue a further Default notice, as there is no agreement.

[Wolfy]

Thanks again CitizenB. Unfortunatley I have no way of telling how long the DN provided for remedy as all they have provided to me is a template DN with absolutley no details entered on it. This they say is evidence one was sent to me.

[Wolfy]

Really need further opinions and any case law would be appreciated:) I need to submit copies of any documents by Friday ( the judge ordered that I could provide copies rather than fill in the normal disclosure form). Have some nice letters from the FOS which are really scathing of Eggs practices.

[citizenB]

Ummm, not certain what help you require.

 

 

Have you referred to any case law in your witness statement/defence. If so then you will need to provide copies of whatever you have mentioned.

 

Any document you want to rely on or mentioned in witness statement/defence will need to be provided as well ie your FOS letters, communications between yourself and the Claimaint, original creditor and solicitor.

 

You will find copies of case law etc in the CAG library..

 

Cases Library

 

Statutes

 

HTH

[Wolfy]

Not yet at the stage of witness statements. What I really want to confirm is that I am correct in my supposition that if the DN included the PPI which the FOS later said was misold then the DN must be invalid and they can't simply issue a new one as the account is terminated. You kindly said that you thought it was but I am really looking for confirmation. If I am correct then I will need to disclose three lettters to them, and that is pretty much all I have to disclose. The remainder of my case relies on challenging the defective documents they are providing and that will be case law to be sent at the bundle stage.

[citizenB]

Aha, right.. well this is taken from an earlier post...

 

 

 

27. Notwithstanding point 25, I put the claimant to strict proof that any default notice sent to me was valid. I note that to be valid, a default notice needs to be accurate in terms of both the scope and nature of breach and include an accurate figure required to remedy any such breach. The prescribed format for such document is laid down in Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) and Amendment regulations the Consumer Credit (Enforcement, Default and Termination Notices) (Amendment) Regulations 2004 (SI 2004/3237)

 

28. 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 a unlawful rescission of contract which would not only prevent the court enforcing any alleged debt, but give me a counter claim for damages Kpohraror v Woolwich Building Society [1996] 4 All ER 119

 

So that deals with the accuracy of the default notice... and the following is a specific defence drafted for a dodgy default notice and it includes all the information you would need..... take special note of the final paragraph which I have highlighed/bold/italicised:D

 

 

 

 

The requirement for a valid Default Notice to lawfully Terminate an Account whilst in default

 

1. Notwithstanding the matters pleaded above, the Claimant must under Section 87(1) of the Consumer Credit Act 1974 serve a valid Default Notice before they can demand early payment of sums not yet due under a Regulated Credit Agreement.

 

2. Under the Interpretation Act 1978 Section 7, it states:

 

Where an Act authorises or requires any document to be served by post (whether the expression "serve" or the expressions "give" or "send" or any other expression is used) then, unless the contrary intention appears, the service is deemed to be effected by properly addressing, pre-paying and posting a letter containing the document and, unless the contrary is proved, to have effected at the time at which the letter would be delivered in the ordinary course of post."

 

2. Practice Direction

Service of Documents - First and Second Class Mail.

 

With effect from 16 April 1985 the Practice Direction issued on 30 July 1968 is hereby revoked and the following is substituted therefore.

1). Under S7 of the Interpretation Act 1978 service by post is deemed to have been effected, unless the contrary has been proved, at the time when the letter would be delivered in the ordinary course of post.

2). To avoid uncertainty as to the date of service it will be taken (subject to proof to the contrary) that delivery in the ordinary course of post was effected:-

(a) in the case of first class mail, on the second working day after posting;

(b) in the case of second class mail, on the fourth working day after posting.

"Working days" are Monday to Friday, excluding any bank holiday.

3). Affidavits of service shall state whether the document was dispatched by first or second class mail. If this information is omitted it will be assumed that second class mail was used.

4). This direction is subject to the special provisions of RSC Order 10, rule 1(3) relating to the service of originating process.

 

8th March 1985

J R BICKFORD SMITH Senior Master

Queen's Bench Division

 

3. Further to point 2 above, CPR rules on service also state the required timescales to be given for serving of documents :-

 

Under CPR 6.26 First class post (or other service which provides for delivery on the next business day) is deemed to be “served” The second day after it was posted, left with, delivered to or collected by the relevant service provider provided that day is a business day.

 

4. The Default notice supplied by the Claimant is dated Friday 3rd August, to allow service in line with the statutory requirements mentioned in points 2 & 3 above, 2 working days were required to allow for 1st Class postage. Thus the Rectify date should be 14 calendar days from Wednesday 8th August, namely Wednesday 22nd August 2007, not the 14 calendar days from the date of the letter as stated in the Default notice which would have been 17th August.

 

5. I therefore put the Claimant to strict proof that any Default Notice sent to me was valid and allowed the statutory 14 clear days to rectify the breach. I also note that to be valid, a Default Notice needs to be accurate in terms of both the scope and nature of breach and include an accurate figure required to remedy any such breach. The prescribed format for such document is laid down in Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) and amendment regulations the Consumer Credit (Enforcement, Default and Termination Notices) (Amendment) Regulations 2004 (SI 2004/3237).

 

6. The 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 would not only prevent the Court enforcing any alleged debt, but give me a counter claim for damages Kpohraror v Woolwich Building Society [1996] 4 All ER 119.

 

7. It is submitted that the above Default Notice served s87(1) Consumer Credit Act 1974 failed to comply with the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561).

 

8. For a Creditor to be entitled to terminate a regulated Credit Agreement where there is a breach, demand repayment in full or take any legal action to recover any monies due under the Agreement, a creditor must serve a Default Notice under section 87(1) of the Consumer Credit Act 1974 which states:

 

Section 87. Need for Default Notice

 

(1) Service of a notice on the Debtor or hirer in accordance with section 88 (a "Default Notice ") is necessary before the creditor or owner can become entitled, by reason of any breach by the Debtor or hirer of a regulated Agreement -

 

(a) to terminate the Agreement, or

 

(b) to demand earlier payment of any sum, or

 

© to recover possession of any goods or land, or

 

(d) to treat any right conferred on the Debtor or hirer by the Agreement as terminated, restricted or deferred, or

 

(e) to enforce any security.

 

9. The Act also sets out via Section 88(1), that the Default Notice must be in the prescribed form, as below:

 

Section 88. Contents and effect of Default Notice

 

(1) The Default Notice must be in the prescribed form…

 

10. The wording must make it clear that no variation is acceptable. Therefore it cannot be dispensed with as a De Minimus issue.

 

11. I note that the regulations do not allow any variation in the form of these statements and therefore it is suggested that where the statements are not as laid down in the regulations the Default Notice is rendered invalid as a consequence.

 

12. In the case of Woodchester Lease Management Services Ltd v Swain & Co - [1998] All ER (D) 339 in the Court of Appeal, the Court addressed in some detail the issue of the contents of a Default Notice and should the notice fail to comply with the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) it would render the Default Notice invalid I quote the comment of KENNEDY LJ: "This statute was plainly enacted to protect consumers, most of whom are likely to be individuals" the judgment appears to confirm the consumer credit legislation made under the Consumer Credit Act 1974 as plainly enacted and set out to offer protection to the consumer. Therefore it is suggested that the failure of the Claimant to set out the Default Notice in accordance with the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) could unduly prejudice me as it failed to allow the required time to remedy the alleged default.

 

13. The Claimant’s failure to issue a valid Default Notice must surely prevent a right of action and would make any termination of the Agreement unlawful, as statute provides the procedure that must be followed. Since the Claimant has failed to adhere to statutory procedure it is averred that the Claimant does not have a right of action, and can never now have a right of action having terminated the Agreement unlawfully.

 

14. Furthermore, the Arrears Total outlined cannot be accurate, as the Balance on the Account was at least partly comprised of Unlawful Charges plus additional Charges and interest added unlawfully whilst the Account was in Dispute. Therefore, the Arrears claimed cannot be accurate, as they are themselves calculated using a Total that was itself inaccurate.

 

15. This is at all times an Agreement Regulated by the Consumer Credit Act 1974. There is no provision in the Act that allows a large financial institution to terminate an Agreement that is in alleged default or breach simply by giving notice to the Consumer. Section 98(6) makes that quite clear. The Creditor must follow the steps outlined in Section 87 and Section 88 if they are to lawfully Default and Terminate, and enjoy the benefits of Section 87.

 

16. Finally, an invalid Default Notice cannot be remedied by simply issuing a new Default Notice. The Claimant may not serve a second effective default notice in prescribed form post-termination of the agreement. Any such second default notice will necessarily state a date by when I would be required to comply after which in default the agreement would terminate. The second default notice would therefore contain the fiction that the agreement endured when that cannot be the case, as it was terminated on XX/XX/XX. Terminating an Agreement on the back of a defective Default Notice, simply confirms the undeniable truth that Termination of the agreement by the Claimant was carried out in circumstances which then prohibited them from enjoying the benefits of Section 87, namely the opportunity to seek early Payment of a sum that was, prior to Termination, only payable in the future.

[Wolfy]

Rather an unusual step on their part. They have provided me with a witness statement from an Egg employee stating that she has personal knowledge of how the default letters were generated. Not seen Egg weighing into one of these before. I have to wonder how she will get on in the witness stand as there will be a lot of questions for her to answer.

[Bosund]

Hi Wolfy,

 

Hope you don't mind me subbing to this thread, best of luck.

 

Bosun.

[Wolfy]

Well matters have moved on. A trial date is looming next Tuesday. Today I attended a hearing for Specific Disclosure that I had made in respect of the Deed of Assignment. Despite four letters requesting disclosure and inspection of the deed (of course it didn't appear in their disclosure list) all they have ever sent me is a fron page saying basicaly this is an agreement between Egg and C L Finance and we agree to be bound by the terms of the agreement and a second page showing signed by and some signatures. Evidently everything else is commercialy sensitive and this is all they are required to supply to me. Unfortunatley the court agrees with them so I now have no evidence, or ability to defend myself, in respect of the DOA. I am really starting to feel that the courts will do everything they can to accomodate big business whilst ignoring the rights of the little people.

 

It would also appear that there is a further document mentioned in their witness statement called a forward flow agreement and unsuprisingly I cant see that either. What is the point of the CPR when it can be ignored when the claimant feels like it and the court will support them instead of punishing them as they should?

 

Just to add I have put myself at risk of costs by fighting to have this case put into the Fast Track for the sole reason that I wanted the extended disclosure and inspection rules that Fast Track is supposed to provide. The claimant wanted small claims and I am starting to wish now I had let them.

[bamboo2]

Hi Wolfy

Can totally empathise with this being in a similar space myself in the fast track process with my hands tied up to now.

Just because they are saying this is so doesn't make it factual however.

My case has been enlightening so far with some belief stretching manoevres going on which seem to be acceptable by the Judge however I am looking for the law to prevail. Fingers crossed - please email me privately on this if you want to compare case notes.

[Wolfy]

Bamboo thanks for the words of encouragement but I am starting to feel that no matter what I say or can proove it won't matter. "oh mr creditor that default notice is invalid, well don't worry about we'll find for you anyway. No deed of assignment, well thats a bit silly but we'll ignore it just for you"

 

Getting to the point that I am thinking about not even turning up for the hearing. Justice isn't blind its dead!!

[Wolfy]

Ok quick update. Please forgive the above I was feeling a bit low.

 

There is now a court order ordering that the orignal copy of teh agreement be present at the trial. Just spoken to HC who state they haven't got the original only copies. Trial is in a few days so I need help quick to deal with this. What defence can I offer?

[Wolfy]

Sorry just to add this is in spite of telling a judge in a cmc that off course they have the original agreement

[citizenB]

Hmm, well now if they advised the Judge that they DID have the original document, then they are going to have a hard job abiding by the court order if they are now telling you that they DONT have it.

 

Will flag your post for site team attention. When do you need to get this amended defence/witness statement to the court ?

[Wolfy]

What I really need is information on how to counter this at trial when it will be brought up for the first time

[citizenB]

judgment-carey-v-hsbc.pdf

 

Be sure to note points: 95 - 105, 112, 116 and the conclusions

 

Here you go wolfy. Courtesy of vint1954

[Wolfy]

Just another random thought but this also means a HC employee filed a false disclosure statement. Methinks an application to the court for contempt of court may be called for.

[caro]

Ok quick update. Please forgive the above I was feeling a bit low.

 

There is now a court order ordering that the orignal copy of teh agreement be present at the trial. Just spoken to HC who state they haven't got the original only copies. Trial is in a few days so I need help quick to deal with this. What defence can I offer?

 

What exactly does the court order say?

[Wolfy]

The order says

 

The claimant do produce the original of the agreement made between the Defendent and Egg Plc on XXXXX (and not referred to as a copy in the claimants disclosure statement) at the trial on 19th October

 

Also just found out this is before a circuit judge rather than a DJ and they have moved the trial to a court 15 miles away.