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Martel

Big Overdraft - must respond to Court Claim - Please help!

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Here’s the story so far (sorry it's so boring!):

 

 

I CCA'd my Highstreet Bank in September re a Loan Account and my Overdraft in Feb. They replied that, while they no longer had my Loan Agreement, it was unenforceable but I should keep paying (doh!). I never had a reply re my Overdraft CCA.

 

So, this all relates to my Overdraft:

 

I have rec'd DN ('Notice served under Sections 76(1) and 98(1) of the CCA 1974') dated 12/08 and a 'Termination' ('in compliance with the CCA 1974 because you have failed to make the required payments') which doesn't appear to be dated, tho it lists payments due in 1/09 (Formal Demand) and a HUGE amount of interest.

 

According to my CRA files as of 3 months ago, there is no reference to either one these 'debts' (I will check again).

 

I have a collection of the usual 'we are disappointed' and 'please send us a cheque for the full amount' letters. THEN I get a letter from Incasso Debt Recovery Solicitors ('Thinking Differently About Debt' is their reassuring motto), stating that they will commence legal proceedings in 14 days unless they hear from me. The amount is now about £3,000 more than that on the Termination Notice. And more than a third of total amount is comprised of fees.

 

I had been with the bank for YEARS and always had an Overdraft that I serviced. Suddenly, I was told I had to convert it into a loan I could not afford - as anyone could tell by looking at my account. So I didn't take them up on the offer of a loan.

 

I wrote to Highstreet Bank, reminding them of my CCA request. In response they said:

 

‘Under section 78 of the Act, on receipt of a written request, the Bank is obliged to provide:

A copy of the signed agreement (if any)

Any other docs referred to it the agreement

A note of the state of the acc’t (i.e., the balance, details of interest and charges outstanding and the applicable interest rate) signed by a representative of the Bank

 

It is important to point out that the Bank does not require customers to sign an agreement under the CCA in order for an overdraft to be applied to their acc’t. Therefore, a copy of the signed agreement is not available, and is not required to be provided to you under the terms of Section 78.

 

All borrowing facilities are agreed in accordance with the T&Cs of your acc’t, and OD facilities are finalised by way of confirmation letter.

 

I can confirm: agreed OD limit, current balance, nominal monthly rate, annual rate on agreed facility, etc on unarranged facility.

 

Accrued unarranged borrowing fees ad interest which has accrued on your acc’t but not yet applied: A GIANT SUM.’

 

In response to my SAR, they’ve sent a letter telling me they have 40 days to respond and do I want copy statements? YES!

 

I sent Incasso an ‘I am bemused as to why this acc’t has been passed to you as it’s in dispute with the original Bank, etc. etc.’ letter about two weeks ago. No response.

 

Last week I rec’d a Court Claim. The POCs are simply the amount they THINK I owe them.

 

I need to respond. Presumably, I should say I dispute the entire amount? As I’ve yet to receive a response to my SAR, can I start with an ‘I am embarrassed’ defence?

 

I know I’m thin ice here, but would love any advice or suggestions! Am desperate!!!

 

Thanks in advance! Mx

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First obvious question - Have you acknowledged service yet?

 

SH


All opinions of ScabHunter are offered in good faith and believed to be accurate and true. Please note, though, that I have no legal training and am human like the rest of us (except the DCA trolls).

 

If you have received court papers, PLEASE POST EARLY. We can help, but only if we are within the timescales.

 

I am happy to receive PMs (and friendship requests!), but if you want me to look at your thread please leave a link to it.

 

If I have been helpful, please feel free to click the old scales!

 

____________________________________________________

 

LIGHT RELIEF - SCABHUNTER STYLE

 

A reply to a DCA troll with a limited vocabulary

 

http://www.consumeractiongroup.co.uk/forum/bear-garden/131409-cheekiness-towards-dca-199.html#post1840093

 

A template letter accepting a full and final settlement

 

http://www.consumeractiongroup.co.uk/forum/debt-collection-industry/104668-cabot-windywoo-4.html#post1813490

 

A reply to ARE letter dated 13th November 20088

 

http://www.consumeractiongroup.co.uk/forum/debt-collection-industry/172657-mbna-letter-asking-me.html#post1863523

 

A reply to a naughty DCA suggesting that the alleged debtor was ignoring the poor dears, and promising a nice social visit

 

http://www.consumeractiongroup.co.uk/forum/debt-collection-industry/167422-help-needed-re-letters-3.html#post1850119

 

 

 

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wow, thanks for the fast reply.

 

No, I haven't acknowledged service yet.

 

MX

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wow, thanks for the fast reply.

 

No, I haven't acknowledged service yet.

 

MX

 

That must be the first step. It gives you 33 days from the date on the form.

 

Give yourself as much time as possible because this is not going to be the simplest of defences to compile. You will need to send off at least one request for information under the Civil Procedure Rules.

 

Let me have a think about exactly what you need to send, and come back tomorrow.

 

The one thing which would be helpful is if you could type out (or scan in) the exact Particulars of Claim. Leave out any amounts as they can be used to identify you. All we need to know is a very rough range, to see which track the case is likely to be allocated to.

 

Knowing exactly which documents are mentioned in the PoC is important, because it dictates what can be included in CPR requests.

 

To get the defence right, we will need to see the default notice, and also get some information on how much of the balance is derived from penal charges and interest levied without any contractual stipulation, but that can wait for another day.

 

SH


All opinions of ScabHunter are offered in good faith and believed to be accurate and true. Please note, though, that I have no legal training and am human like the rest of us (except the DCA trolls).

 

If you have received court papers, PLEASE POST EARLY. We can help, but only if we are within the timescales.

 

I am happy to receive PMs (and friendship requests!), but if you want me to look at your thread please leave a link to it.

 

If I have been helpful, please feel free to click the old scales!

 

____________________________________________________

 

LIGHT RELIEF - SCABHUNTER STYLE

 

A reply to a DCA troll with a limited vocabulary

 

http://www.consumeractiongroup.co.uk/forum/bear-garden/131409-cheekiness-towards-dca-199.html#post1840093

 

A template letter accepting a full and final settlement

 

http://www.consumeractiongroup.co.uk/forum/debt-collection-industry/104668-cabot-windywoo-4.html#post1813490

 

A reply to ARE letter dated 13th November 20088

 

http://www.consumeractiongroup.co.uk/forum/debt-collection-industry/172657-mbna-letter-asking-me.html#post1863523

 

A reply to a naughty DCA suggesting that the alleged debtor was ignoring the poor dears, and promising a nice social visit

 

http://www.consumeractiongroup.co.uk/forum/debt-collection-industry/167422-help-needed-re-letters-3.html#post1850119

 

 

 

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I thought that Overdrafts did come under the CCA, but under section 10??

Or should I get some sleep?;)


Who ever heard of someone getting a job at the Jobcentre? The unemployed are sent there as penance for their sins, not to help them find work!

 

 

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SH, thanks so much for your considered reply. V reassuring!

 

I will send off A of S, ticking 'I intend to defend all of this claim'. I'l make a copy for my files and send it Recorded.

 

The POCs say only: ' The claimants claim is in respect of monies due pursuant to a account maintained with the claimant. and the claimant claims: -------'

 

I believe the amount will qualify it for 'Multi Track'.

 

Will organise a scanner - which I think will get a work out!!

 

thanks for your advice - hugely appreciated!

 

MX

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I thought that Overdrafts did come under the CCA, but under section 10??

Or should I get some sleep?;)

 

EEEkk!! I don't know! I understand the CCA and credit cards and loans, but am out of my depth when it comes to ODs!

 

Mx

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Overdrafts are not covered by the CCA 1974 in the same way a loans and credit cards. They are at the behest of the bank and can be given or withdrawn at will although they still have to produce proof of the amount and interest rate.

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Martel,

 

I have done quite a bit of research into defaults and overdrafts, but I must say I am no expert, and would recommend you check out for yourself what I am about to say.

 

I suspect that the bank have not issued you the correct default notice in the first place.

 

Section 76 of the Consumer Credit Act exists so that the bank can call in the overdraft at any time under the circumstances where the customer is not in default of the agreed overdraft.

 

They might do this, say where they decide that you have too much credit on the go elsewhere and decide that they are over exposed to risk.

 

I have set out below the relevant part of the CCA 1974 for you to examine. The most important bits for you are subsections 76(1) and 6.

 

76.—(1) The creditor or owner is not entitled to enforce a term of a regulated (Regulated by the Consumer Credit Act, which an overdraft is..)

agreement by—

(a) demanding earlier payment of any sum, or

(b) recovering possession of any goods or land, or

© treating any right conferred on the debtor or hirer by the agreement as

terminated, restricted or deferred,

except by or after giving the debtor or hirer not less than seven days' notice of his (seven days bit is now longer)

intention to do so.

(2) Subsection (1) applies only where—

(a) a period for the duration of the agreement is specified in the agreement, and

(b) that period has not ended when the creditor or owner does an act mentioned

in subsection (1),

but so applies notwithstanding that, under the agreement, any party i5 entitled to

terminate it before the end of the period so specified.

46

(3) A notice under subsection (1) is ineffective if not in the prescribed form.

(4) Subsection (1) does not prevent a creditor from treating the right to draw on

any credit as restricted or deferred and taking such steps as may be necessary to make

the restriction or deferment effective.

(5) Regulations may provide that subsection (1) is not to apply to agreements

described by the regulations.

(6) Subsection (1) does not apply to a right of enforcement arising by reason of any

breach by the debtor or hirer of the regulated agreement.

 

By my reckoning, you should have been defaulted under Section 87(1) which deals with default cases, so the default notice is defective as far as I can see!

 

I stand corrected if I am wrong, but check it out in any case.

 

Overdrafts are regulated by the Consumer Credit Act 1974 in every way, apart from they are exempt from Part V of the Act.

 

Part V deals with the 'making of the agreement' as in most cases there is no credit agreement as such for an overdraft, which is why the bank have told you they can't provide you with an agreement.

 

They can't because there isn't one!!!

 

There is possibly a second line of defence if I am wrong as above, but this gets very complicated and depends to some extent on the circumstances of why you went over your overdraft limit.

 

Before I explain the next bit, what caused you to go over your limit?

 

Was it a bank charge by any chance?

 

Regards,

 

3tea

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Martel,

 

Just read your post again, and realised I had missed the bit about the bank offering you the loan to clear the overdraft, before they defaulted and terminated.

 

It would appear that on the face of it, you were not in default at the time they offered you the loan, so section 76(1) and 98 would be correct.

 

Sorry if I confused you, it was the bit of the default notice which said 'you have failed to make the required payments' which led me astray!!

 

What were the payments you had not made? Was it an agreed amount you should have paid in each month, or was it the amount they wanted paying in to clear the overdraft?

Edited by 3tea

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Overdrafts are not covered by the CCA 1974 in the same way a loans and credit cards YES . They are at the behest of the bank and can be given or withdrawn at will although they still have to produce proof of the amount and interest rate This isnt really that different to any regulated agreement.

 

 

YES ... BUT NO pinky

Coutts v Sebastyen

a. The agreement was a regulated debtor-creditor agreement within the meaning of s.8 and s.13© of the Consumer Credit Act 1974, providing for 'running-account credit' within the meaning of s.10(1)(a) of the Act (in effect, a revolving credit within an agreed credit limit); and

b. That, as such, it was subject to the requirements of Part V of the Act (including the requirements as to documentation set out in sections 57 to 63 of the Act) save and in so far as it was excluded or exempted from such requirements.

 

Section 65 in Part V of the Act provides that an "improperly executed" regulated agreement is unenforceable by the creditor without a court order. It is common ground that a regulated agreement is "improperly executed" for this purpose if the requirements of sections 57 to 63 have not been complied with.

 

Section 74 of the Act provides for the exclusion of certain agreements from Part V. It provides as follows (so far as material):

"74. – (1) This part …. does not apply to –

(b) a debtor-creditor agreement enabling the debtor to overdraw on a current account, …

(3) Subsection 1(b) … applies only where the OFT so determines, and such a determination –

(a) may be made subject to such conditions as the OFT thinks fit …

(3A) …. in relation to a debtor-creditor agreement under which the creditor is …. a bank …. the OFT shall make a determination that subsection 1(b) above applies unless it considers that it would be against the public interest to do so.

 

THE DETERMINATION:

 

The Determination (which is signed by the Director of Fair Trading) is made under section 74(3) of the Act. I set it out in full:

"1. Under the powers conferred upon me by s.74(3) and (3A) and s.133 of the Consumer Credit 1974, I, the Director General, being satisfied that it would not be against the public interest to do so, hereby revoke with effect from 1st February 1990 the Determination made by me in respect of Section 74(1)(b) and dated 3 November 1983 and now determine that with effect from 1st February 1990 Section 74(1)(b) shall apply to every debtor-creditor agreement enabling the debtor to overdraw on a current account, under which the creditor is a bank.

2. This Determination is made subject to the following conditions:-

(a) that the creditor shall have informed my Office in writing of his general intention to enter into agreements to which the Determination will apply;

(b) that where there is an agreement between a creditor and a debtor for the granting of credit in the form of an advance on a current account, the debtor shall be informed at the time or before the agreement is concluded:

- of the credit limit, if any,

- of the annual rate of interest and the charges applicable from the time the agreement is concluded and the conditions under which these may be amended,

- of the procedure for terminating the agreement;

and this information shall be confirmed in writing.

© that where a debtor overdraws his current account with the tacit agreement of the creditor and that account remains overdrawn for more than 3 months, the creditor must inform the debtor in writing not later than 7 days after the end of that 3 month period of the annual rate of interest and charges applicable.

3. In this Determination the terms 'creditor' and 'debtor' shall have the meanings assigned to them respectively by Section 189 of [the Act]. The term 'bank' includes the Bank of England and banks within the meaning of the Bankers' Books Evidence Act 1879 as amended."

Edited by hungrybear

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Quote from the original post:

I have rec'd DN ('Notice served under Sections 76(1) and 98(1) of the CCA 1974') dated 12/08 and a 'Termination' ('in compliance with the CCA 1974 because you have failed to make the required payments') which doesn't appear to be dated, tho it lists payments due in 1/09 (Formal Demand) and a HUGE amount of interest.

 

This is a termination notice. IT is not a default notice.

 

Did you ever receive a notice under section 87(1) defaulting you?

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Right to sum up so far.

 

Your overdraft agreement is the letter sent to you under the terms of item 2 in the determination - not any old letter but in those time scales. - Have they supplied this letter or letters?

 

You have a termination notice under 76/98 for the overdraft so they are not arguing that it isnt a regulated agreement.

 

As far as your post goes, you have never received an default notice under 87(1)

 

Have I got it right so far?

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We are forgetting that overdrafts can be recalled at anytime by a bank and that is in the terms and conditions.

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We are forgetting that overdrafts can be recalled at anytime by a bank and that is in the terms and conditions.

 

given that there is a TN, that seems a bit of a mute point. However that is true for most regulated agreements. I have dug out a CCA for fixed sum credit. Term 3 on the back of it states:

 

'Either you or us may terminated this agreement by giving at least 7 days written notice of such to the other.........'

 

There really is very little difference between an OD and any other regulated agreement except exemption from part v form and content which amounts to not needing a fully compliant agreement that you would need for other types of regulated credit

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we are going to see far more of this now that the banks have done a deal to avoid bank charges (in my opinion, a view NOT shared by thhis site).

 

DCA's are going to be hitting consumers hard to recover OD rather than the usual not a pray unenforceable CCA loan & CC


We live in an unmoderated country why should the net be any different?

Bring back free speech we miss it!

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we are going to see far more of this now that the banks have done a deal to avoid bank charges (in my opinion, a view NOT shared by thhis site).

 

DCA's are going to be hitting consumers hard to recover OD rather than the usual not a pray unenforceable CCA loan & CC

 

 

Well we'll just have to bring everyone up to speed then wont we:D.

 

I agree, standard guff along the line of 'it's an overdraft so it's not covered by the cca' will be landing on many a doormat.

-I've had two of those letters myself and have seen of 1st and capquest on this very matter.

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There is no agreement in the contractual sense. The bank decide whether you will have an overdraft and what the limit will be - it's a unilateral decision by the bank. Then they send you a letter telling you what the limit is and what the interest rate is will be and when it will be reviewed. An overdraft is an extension of a current account, which has no agreement. It is not fixed sum credit as it can be reduced, increased or withdrawn by the bank at any time.

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There is no agreement in the contractual sense. The bank decide whether you will have an overdraft and what the limit will be - it's a unilateral decision by the bank. Then they send you a letter telling you what the limit is and what the interest rate is will be and when it will be reviewed. An overdraft is an extension of a current account, which has no agreement. It is not fixed sum credit as it can be reduced, increased or withdrawn by the bank at any time.

 

A current account is covered by the banking code of the FSA and may NOT provide ANY credit facilities. An overdraft is running account credit under the cca. They are two different agreement. There is no unilateral action. They can offer an overdraft and you accept or decline and you can ask for an overdraft and they can offer or decline.

 

The fixed sum credit terms quote was just an example that technically pretty much any regulated agreement can be withdrawn and that it is not a special feature of an overdraft.

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Whether they offer or you ask an overdraft is at the behest of the bank - they grant or take away and it has nothing to do with you agreeing or rejecting - there is no contractual agreement and they can withdraw the facility at anytime. It is related to the current account because it is on that account that they give you permission to draw more money than is in the account, hence its name.

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Whether they offer or you ask an overdraft is at the behest of the bank - they grant or take away and it has nothing to do with you agreeing or rejecting - there is no contractual agreement and they can withdraw the facility at anytime. It is related to the current account because it is on that account that they give you permission to draw more money than is in the account, hence its name.

 

I am running out of ways to say the same thing:

Coutts v Sebastyen

a. The agreement was a regulated debtor-creditor agreement within the meaning of s.8 and s.13© of the Consumer Credit Act 1974, providing for 'running-account credit' within the meaning of s.10(1)(a) of the Act (in effect, a revolving credit within an agreed credit limit); and

b. That, as such, it was subject to the requirements of Part V of the Act (including the requirements as to documentation set out in sections 57 to 63 of the Act) save and in so far as it was excluded or exempted from such requirements.

 

Section 65 in Part V of the Act provides that an "improperly executed" regulated agreement is unenforceable by the creditor without a court order. It is common ground that a regulated agreement is "improperly executed" for this purpose if the requirements of sections 57 to 63 have not been complied with.

 

Section 74 of the Act provides for the exclusion of certain agreements from Part V. It provides as follows (so far as material):

"74. – (1) This part …. does not apply to –

(b) a debtor-creditor agreement enabling the debtor to overdraw on a current account,

(3) Subsection 1(b) … applies only where the OFT so determines, and such a determination –

(a) may be made subject to such conditions as the OFT thinks fit …

(3A) …. in relation to a debtor-creditor agreement under which the creditor is …. a bank …. the OFT shall make a determination that subsection 1(b) above applies unless it considers that it would be against the public interest to do so.

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I should have just gone to bed:oops:


Who ever heard of someone getting a job at the Jobcentre? The unemployed are sent there as penance for their sins, not to help them find work!

 

 

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I should have just gone to bed:oops:

 

and spoilt all the fun - SHAME ON YOU:D

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I'm that confused that I have forgotten the question?

Can't it just be a simple Yes or No?

My head hurts...;)


Who ever heard of someone getting a job at the Jobcentre? The unemployed are sent there as penance for their sins, not to help them find work!

 

 

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I thought that Overdrafts did come under the CCA, but under section 10??

Or should I get some sleep?;)

YES

 

(that do you)

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