Barclaycard & dodgy Mercers DN/Cabot ***WON - DEFAULT DATE CHANGED***

[247orbital]

subbing.

 

Please read my thread about a similar situation with HFO and two incorrect default dates on two different CRA's.

http://www.consumeractiongroup.co.uk/forum/debt-collection-industry/245239-hfo-services-ltd-questions.html

[vjohn82]

The record has been removed from my credit file today; it no longer appears.

 

I think this is a considerable victory considering the dispute over Cabot's ability to record information about accounts they cannot prove.

 

The account was never even in my name!

 

Oh well; no court claim but I got what I wanted through reasonable negotiation and hard work.

[harlequin10]

Hi

 

subbing for future reference

 

I have a similar problem with cahoot my default notice is dated 26 August 2004 yet appears on my credit file as 15 June 2005.

 

regards

 

harlequin

[vjohn82]

I was reading a thread earlier (on another forum) where statute-barred debts were being discussed.

 

Statute barred debt was broadly agreed to be an account whereby 6 years had passed and no court action had been taken meaning the debt was not enforceable in court (I'll accept that definition for the record). The following points were notable for their split in opinion:

 

Some of the posters were of the opinion that the time period begins from the date of last payment.

 

Some of the posters were of the opinion that it was from the date of last contact with the debtor (i.e. a written acknowledgement of the debt).

 

Some of the posters were of the opinion that the date ran from the time the Default Notice demanded payment by.

 

Let's first look at the legislation which governs statute barred debts; the Limitations Act 1980.

 

5. Time limit for actions founded on simple contract

 

An action founded on simple contract shall not be brought after the expiration of six years from the date on which the cause of action accrued.

 

Payplan define this Act as only applying when no contact has been made between the creditor and debtor within the given time limit and only applies to residents of England and Wales. The time limit begins when you last admitted owing the money or made a payment.

 

The Insolvency Helpline states that:

 

You can argue that the creditor is out of time or “statute barred” from taking you to court for this debt if:

 

The creditor has not already obtained a judgment against you

and

You, or any one else owing the money (on a debt in joint names) have not made a payment on the debt during the last six years

and

You have not written to the creditor admitting you owe the debt during the last six years.

 

Fairly conclusive you would think. Not according to some DCA's though. Here is a letter I received fairly recently:

 

 

Here Cabot are claiming that the Default Notice date is the date from which the Limitations Act applies. Admittedly they are writing off the balance as a "goodwill gesture" and I cannot have much cause for complaint but it does raise questions.

 

Cabot are renowned for confusing debtors with meaningless statements, bits of legislation which don't actually apply and a myriad of other things.

 

Well let's use the Act for the purposes of ripping this argument apart. The Act refers to "cause of action". This means:

 

In law, a cause of action (sometimes called a claim) is a set of facts sufficient to justify a right to sue. The phrase may refer to the legal theory upon which a plaintiff brings suit (such as breach of contract, battery, or false imprisonment).

 

Gilhams Solicitors simply refer to it as "the basis for suing".

 

It is fairly well accepted that a Default Notice is required before a creditor can take any step of litigation. However, the debtor must have ceased making payments before a cause of action could have occurred. The DN is simply making the debtor aware that a cause of action for litigation has occurred and that the debtor has a reasonable period of time to resolve the issue before the creditor takes that particular step.

 

The cause of action is therefore not the result of the debtor ignoring the DN because a cause of action occurred to enact that notice to the debtor.

 

However, it is difficult to reconcile the fact that the last date of payment is not a cause of action because in the few days after a regular payment the creditor is unaware that a cause of action will occur. If this was the case then the day after making a payment the creditor would be forced to issue a DN in order to make the debtor aware of their obligations.

 

However, the cause of action date still cannot 100% be the date of the DN because it is not always issued on the date that the cause of action occurred. In my case the DN was issued 8 months after the missed payment date. It is therefore wrong for Cabot to state that the cause of action is the date on the DN.

 

Now, acknowledgement in the interim period...

 

A recent case between Ashcroft v Bradford & Bingley Plc Court of Appeal (Civil Division), 10 March 2010 demonstrated the effect of a part payment on an account (in this case a mortgage) which had the effect of "resetting the statute barred clock" but it was also acknowledged, by LJ Sedley in para 7, that

 

"An effective acknowledgment is required by s.30 to be in writing and signed by the debtor"

 

So if you write to your creditor with the express intention of referring to a particular debt which is in realm of the Limitations Act then the clock resets from the date of acknowledgement. This is then the new date of the cause of action referred to above.

 

This section is by no means complete... and I would appreciate further comments to inform others in light of the raft of speculative letters being sprayed out by cash strapped DCAs.

[Hardupnotfedup]

Cause of action! I keep reading it as course of action. Am I missing something

[Hardupnotfedup]

I liked the gesture of goodwill as if! They were snookered and they know it.

[gyos]

Cause of action is arguably the first instance of a failure to make payments in accordance with the provisions of the contract/agreement.

 

The ability to issue a DN an arbitrary time later is just a result of this breach.

 

As said, while the issue of a DN and the failure of the debtor to remedy the breach is required for the creditor to go ahead with court action, it is arguably not the actual cause of action.

 

So presumably the cause of action is the first missed payment that would allow the creditor to effect a DN? And the COA should be dated as such?

[gyos]

To add to the above, I think there is a fundamental difference between:

 

The initial cause of action which arguably occurs on the first breach of contract

 

&

 

Fresh accrual of the right of action which takes place when any subsequent part payment or acknowledgement is made.

[vjohn82]

So presumably the cause of action is the first missed payment that would allow the creditor to effect a DN? And the COA should be dated as such?

 

I would infer this but for the practical purposes of the Limitations Act I suspect that a court would look at the date of last payment rather than the date the next payment was due. Possibly because it appears to be a "clean date" of reference.

 

If I find anything different I will update the thread

[gyos]

Whichever a court may decide it is, it certainly isn't the date any DN was issued or expired.

[vjohn82]

I agree completely... a creditor could clearly create a DN some months after the fact which would have the effect of extending the LA timeline.

[straftat]

That letter is just face saving nonsense

 

but on another point .. The "until the creditor has obtained judgement"

 

if a dept is within a month of being statute barred I've been told that just begining legal proceedings suspends the clock , not actualy obtaing judgement

 

Any thoughts?

[lilly white]

thanks to x20

 

The Claimant contends that the Claimant's claim so issued is a claim in contract and is statute barred pursuant to the provisions of section 5 of the Limitation Act 1980. If, which is denied, the claimant contends that the Defendant is in breach of the alleged contract, in excess of 6 years have elapsed since the date on which any cause of action for breach accrued for the benefit of the Claimant.

So to them to prove it and not that easy so it is from the breach or when you stop paying

Also what are all you caggers doing on here it is Easter and i am on watch

As always kind regards to you all

[vjohn82]

This might help clarify the issue too:

 

The court may allow an action to proceed despite the expiry of the time limit (s. 33) if it would be equitable to do so, taking into account particularly:

• potential prejudice to the claimant and defendant;
  
• length of delay and reasons for delay;
  
• extent to which the evidence is likely to be less cogent;
  
• conduct of the defendant in responding to requests for information, etc.;
  
• extent to which the claimant acted promptly; and
  
• expert advice received by the claimant.
  

[vjohn82]

Also what are all you caggers doing on here it is Easter and i am on watch

 

Easter is just eggs to me ;-)

[lilly white]

just read the letter again god i wish we could get letters like that.

 

Yes it is SB full stop. ya and it took 6 months to issue a default which is denied.

So i am up for when we stop paying..................

Edited April 2, 2010 by lilly white

[Guest]

An H of L case of poss interest re LA:

 

Bradford & Bingley plc (Appellants) v. Rashid (FC) (Respondent) [2006] UKHL 37

Edited April 2, 2010 by Ford
link didn't work!

[lilly white]

hi ford do you have a link.............

[gyos]

I think that case is about later acknowledgement and payments, rather than the initial cause of action?

[Guest]

I think that case is about later acknowledgement and payments, rather than the initial cause of action?

 

still relevant/important though! if one acknowledges, then time starts again?

[Guest]

hi ford do you have a link.............

 

see below

Edited April 6, 2010 by Ford
broken link

[pompeyfaith]

Here you go I think this is it:

 

House of Lords - Bradford & Bingley plc (Appellants) v. Rashid (FC) (Respondent)

[gyos]

still relevant/important though! if one acknowledges, then time starts again?

 

Agreed

 

However that is very clearly stated in the Act itself, and is not really the issue at question here. That is covered under s29 which deals with fresh accrual of an already existing cause of action.

 

Here Cabot are trying to muddy the water as to when the original cause of action accrued. That is a different beast, and is not something that is specified in the Act with reference to a consumer credit agreement.

[Guest]

As vjohn states in OP

'..So if you write to your creditor with the express intention of referring to a particular debt which is in realm of the Limitations Act then the clock resets from the date of acknowledgement. This is then the new date of the cause of action referred to above...This section is by no means complete... and I would appreciate further comments to inform others in light of the raft of speculative letters being sprayed out by cash strapped DCAs.'

[lilly white]

Yes thank for the case very interesting i have read it once and will read it again,

 

It does put a light on WP letters ,