Reply by Egg to "Approved Limit" point

[seriously fed up]

Another point is that this is perhaps a "standard" reply as at one point their letter refers to "your client" as if perhaps replying to a solicitor when my complaint has only been dealt with by me?

 

Spot on - I got practically the same letter just this morning. It related to a letter that I sent to them in July, so it has taken them the best part of 4 months to reply. Waving or drowning

I see the point about strength DD and AC, but I have replied restating my opinion. I have always been of the view that if you seem to know your position they are going to be that wee bit wary of you.

Agree fully with all the other points - just noising us up (or trying to!)

[seriously fed up]

There is the view that if you reply to them all the time, you are just continuing a game of letter ping pong. I tend more to your view Exasperated. I think if they raise a new point then there is always a need to respond to it in as effective a way as we are able to in order to rebut it. However, if all we are doing is repeating the same point over and over, then i think its best to make clear to them that we are repeating and after repeating the point once (maybe twice) to leave it at that.

But otherwise I would agree with you - these are rubber people - they will not lie down and admit they are defeated. Even when they are wrong they are still right.

[seriously fed up]

you might want to advise them that NOWHERE in either the Act or the Regs is the phrase "approved limit" used - indeed they havent used it since 2005 (you might want to ask them why they changed their practice?)

Also a reference to the Regs (1983/1553 - Agreements regs) specifically part 2 para 4, which deals with how information is to be ordered/ sequenced, could be useful. For instance the LAST item is supposed to be the signature.

[seriously fed up]

I had drafted this reply which answers some of those points:

 

I refer to your letter of 13th January and, as ever, I still consider the account to be in serious dispute.

As you correctly state, schedule 6 does indeed state the requirement of a term “to state the credit limit or the manner in which it will be determined”. Surely one would assume that this statement would, as a bare minimum, require the use of the phase “credit limit”? Completely agree.

As I have already mentioned, your agreement refers only to “approved limits” and “individual limits” which are in no way deemed to be credit limits. I will once again state that I consider this makes your agreement unenforceable due to a missing prescribed term. Good

Your comments concerning the Hurstanger case are also interesting and looking at this case again, it was stated in relation to the core prescribed terms that: “they cannot be orally agreed; they cannot be found in another document; they cannot be implied; and above all they cannot be in the slightest mis-stated. As a matter of policy, the lender is denied any room for manoeuvre in respect of them”. Very good

With the above points in mind, I cannot agree with you that the basic requirements are satisfied.

I also note that you have not advised where the term “approved limit” has been shown to be a “well established point of law” and wonder if this was just an oversight on your part. Or ask them what their legal authorities (eg previous judgements/ OFT guidance etc) are in support of this claim

Turning to your points about your collection procedures, I did not state that I felt you were breaching any rules, I simply advised that I found your actions to be disingenuous when I had heard nothing from you for months and then started to receive several emails and telephone calls a day once you have replied to my letter without giving me chance to respond.

 

May I once again reiterate that I will only deal with this matter in writing? I feel this is sensible as it gives us both time to consider our responses and also means there is a written record of anything agreed. I would therefore be grateful if you stop your (twice daily!) attempts to contact me by telephone with immediate effect. dont justify this - just tell them that in writing is the only way you will deal with them. Otherwise you are giving them the basis of an argument imo

 

 

Once again, I trust this letter makes my position perfectly clear and I look forward to hearing that you will not be perusing this matter further. May I also respectfully remind you of the restrictions placed upon Egg being as this account is still in serious dispute?

 

 

See comments - hope they are helpful

SFU

[seriously fed up]

Hi

Ok Lets talk about law and contracts. Firstly there is no reason why a creditor cannot terminate an agreement for running account credit any tie he wants.

He can terminate it in total in part reinstate it terminate it again why cant he.

The notion that because it doesn’t say he can in the ac he cannot terminate is absurd,

The act does not work like that, in fact no act works like that. Law doesn’t work like that.

Legislation isn’t a list of things that you can do, it is a list of things you cannot.

The reason section 98 is significant is because it states that the creditor has to give notice prior to termination under certain conditions.

This then acknowledges that the creditor can terminate under all other conditions.

If there was a law saying you can’t walk your dog on Saturdays, wouldn’t it be sensible to assume that it was safe to walk it on the other days of the week.

To difficult

The OFT don’t seem to think so.

Peter

 

Peter, in relation to this letter that FTE has just received, this troubles me somewhat. I fully take your point that if something isnt specifically ruled out that doesnt mean its unlawful.

However, lets look at the letter that FTE has just received, and consider what termination means. My problem is

 

1. Egg themselves have made use of the word termination - in other words this is their description, not ours
   
2. The fact is they seem to have terminated it twice - first in 2008 and then again in 2010 (they admit this in the letter) - which sounds a bit to me like killing someone, digging them up and shooting/knifing them again, but lets allow that to pass for now at least
   
3. where i have real problems is that they say that the only difference the termination would make is that the card couldnt be used for further borrowing. However, Chambers online dicitionary defines termination as "termination noun 1 someone or something that terminates. 2 an abortion (sense 1). 3 the ending or a result of something." Thus termination has a finality to it - sort of "that's that" which leaving the remaining balance as repayment only does not seem to me to be consistent with. Leaving the remaining balance as repayment only just doesnt seem to me to be consistent with any meaning of termination that I can think of. if we focus on the second definition above, the phrase that comes to my mind is "you cant be a little bit pregnant". So what is it they have done?
   
4. I think that a better description of what they did in 2008, casting various people adrift by cancelling their cards, was not a termination - in the sense above (or I suspect in the sense intended in the CCA) - but actually a variation of terms such that the credit limit (which I think I am right in saying was the description they used by that time rather than approved limit ) would always be equal to the balance of the account. So for instance, if my account showed a debit balance of £1000 and I repaid £100 in any month, then the new credit limit would be £900 + the interest charged that month - the effect being of course that I couldnt spend anything on the card, only make repayments. But what they did was not a termination. That it seems to me is a serious misuse of English.
   
5. Lastly, as others have pointed out, how can you terminate something twice. As I said above its a bit like you knifed someone to death in 2008, and then you dig them up in 2010 and stick the knife in again. I am not sure what description one would give the second act (necrohomicide?) but it sure as hell cant be murder. Same thing?
   
6. But what does the Act say, I hear you cry. Well lets follow this through. Section 87 makes it clear that "87.—(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," But we could I think all agree that not everyone who got roped in to the 2008 termination was in default. I can remember letters to the press at the time from people screaming holy hell because they had been terminated because they didnt, in Egg's view, use the card enough. It wasnt that they were "delinquent" - Egg just werent making enough money out of them. So that cant be right.
   
7. But there is a further problem for Egg, I think, because s88 requires the default notice to be in the prescribed form - "88.—(1) The default notice must be in the prescribed form and specify—
   (a) the nature of the alleged breach;
   (b) if the breach is capable of remedy, what action is required to remedy it and the date before which that action is to be taken;
   © if the breach is not capable of remedy, the sum (if any) required to be paid as compensation for the breach, and the date before which it is to be paid." But as already pointed out, many whose cards were "terminated" had not committed a breach at all, or if they had in the past, werent in breach at the time that the account was terminated. Moreover, as I recall, there was no "get out" possibility as required by paragraphs b and c. It was "card terminated. End" - though it wasnt if you were still in debt. It was a variation of terms, wasnt it? But they didnt use that description and it seems to me that its quite legitimate for them to have to bear the consequences of that action.
   

[seriously fed up]

Eddie, I have a friend who used to work in the credit card trade (but he's got changed jobs, so he's alright now), and I was asking him how it could be that the credit card industry could have made such a horlicks of all this - I mean the 74 Act and Regs are, if anything, overly determined and certainly not vague about what lenders must do. He said "oh, but that's all down to Legal, and no one ever listens to Legal".

[seriously fed up]

You can get a tablet for most things these days