Dissecting the Manchester Test Case....

[PriorityOne]

In a bid to diffuse the panic and stop mini-threads popping up all over the place, I've started a new thread to try and dissect the above.

 

The link to the Judgement is here...

 

http://www.consumeractiongroup.co.uk/forum/debt-collection-industry/239693-why-no-news-coverage-7.html#post2672599

 

My own findings are as follows.... comments in red or bold are either my own or part of the Judgement that I've highlighted as important for CAG. This has all been put together quite quickly.... so I hope it's reasonably easy to follow my train of thought on it....

 

 

2. The purpose of this judgment is to give general guidance, in the context of the cases before me, in the hope that this will narrow or eliminate the issues arising in the hundreds of other similar claims issued in County Courts around the country, many of which have been stayed pending the outcome here.

From the outset, this para appears biased and indicates that there wasn’t a hope in Hell of the Claimants winning this…

the Claimants’ approach is driven to a large extent by the Proof Purpose. As I’ve been saying all along…

Page 14 (47) indicates that a stalemate was reached between Claimant & Defendant

Mrs Thompson laid great stress on the fact that the thing to be copied ie the executed agreement, is, by definition, the document signed by the debtor. I agree So he does…. But then refers to the provisions of the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 to explain why a signed copy is not needed to honour a CCA request (but not how it cann be re-enforced under Sec 127(3))... yet!but that does not take one very far when it is clear from the provisions of the Act and the Copies Regulations – and is accepted by the Claimants – that a photocopy is not required, and that the signature need not be reproduced. The effect of this is that in one vital respect the copy need not match the original. This emphasises that the key question is not what is to be copied – which is uncontroversial – but how that copy may be made and of what it is to consist. A continued focus upon the requirements of a CCA request ONLY

Page 15 (53) refers again to the proof that the debtor is after as claimant

Page 16 focuses entirely upon the requirements to fulfill a CCA request (not re-enforcement)

Page 18 refers to the Claimant going after the Proof Purpose and the language of a S78 request…. But the Proof Purpose is not necessary for complying with a CCA request, as the Judge says.

Page 19 (56) suggests an error on the part of the Claimant in trying to go for unenforceability, while going after PPI on the same Agreement….

Page 19 (57) Nice to see that the creditor now has to admit to not having a true copy J. Thanks Judge!

Page 22 (Issue 1(B)…. Explains what this is about once again…

Read this very carefully… especially the end part:

If McGuffick is rightly decided, the effect of the unenforceability provision is as follows: the contractual liability of the debtor to pay any sums due or falling due by reason of his use of his credit card remains. It is not the case that the creditor’s rights to payment were never acquired or that they were extinguished. The result is that if the debtor stops paying during the s78 breach period, interest will accrue. And if and when the s78 breach is cured, the creditor may sue him and recover all outstanding amounts. Moreover, during the breach period the creditor can still report the debtor to credit reference agencies (“CRAs”) without the need to tell them that the agreement is currently unenforceable.

And if and when the s78 breach is cured, the creditor may sue him and recover all outstanding amounts. Moreover, during the breach period the creditor can still report the debtor to credit reference agencies (“CRAs”) without the need to tell them that the agreement is currently unenforceable. It can demand payment from the debtor or instruct a third party to do so and can issue a default notice. None of that constitutes “enforcement”. The only restriction on the creditor is that he cannot, after starting proceedings, obtain a judgment which enforces the agreement. So he cannot obtain a judgment sum, a charging order to enforce that judgment or make the debtor bankrupt.

A further element of the dilemma prayed in aid by Mr Gun Cuninghame is that without a s78 copy the debtor will also not know whether the agreement is irredeemably unenforceable under s127 (3) ... which it might be. He mentions it, but doesn’t go into it due to this bias he has towards the banks, in my opinion… but it’s still law which needs to be satisfied before an Agreement can be re-enforced But that is entirely speculative and the point is undermined by (a) the fact that it is not the purpose of s78 to provide proof of a properly executed agreement, (b) the fact that regardless of any s78 breach, if the debtor wants to allege an IEA it behoves him to make some kind of positive allegation about it (see below) and © it is conceded by the Claimants represented by Mr Gun Cuninghame that a finding that there is an IEA does not, of itself, lead to an unfair relationship (see Issue 6 below).

Page 36 (133) The claimant was trying to get debts written off because of a Sec78 breach. I agree with him; it’s hopeless (and a stupid move)….

His conclusion was that there were statements of their Lordships in Wilson which supported the position of RBS, namely that unenforceability under s127(3) did not mean that the parties

no longer had any rights or liabilities thereunder. But in any event the context of Wilson was different from the context before him (and me) Yes it absolutely was….

the rights of the creditor and the obligations of the debtor did exist but were unenforceable. The creditor’s “rights continue but cannot be enforced”. Thank you… J

the words of Lord Hobhouse in saying that “The consequence of the failure to comply with the statutory requirements is clearly spelt out in the statute. The contract cannot be legally enforced by the creditor against the debtor: sections 65 and 127. It may be thought that this may sometimes produce a harsh result and an unmerited windfall for the debtor. But this is what Parliament has provided no doubt in accordance with a broader policy. Again I agree with your Lordships that there is no basis for implying an obligation of the hirer to pay contrary to the statute.”

MBNA has contended that neither the County Court nor the High Court has any jurisdiction to grant a declaration as to a breach or otherwise of s78.

Page 50 (191)

No evidence in reply was served. At the end of his submissions Mr Gun Cuninghame said that there was a WS from Mr Adris saying that he could not remember whether he signed the agreement or not but that was not before me and no application was made to put it in (Day 4/162-163). Thus RBS’s evidence is unchallenged… which it would be because They were only DEFENDING. They were not the CLAIMANT.

Page 51 (196) The first point made by RBS is that what paragraph 9 effectively does is to shift the burden of proof on to it to prove that there was not an IEA. There is no basis for any such reversal of the usual burden which would be on Mr Adris, since it is his claim and his allegation that there was an IEA. It is not suggested that there is any special rule in the Act reversing the burden of proof in the case of an alleged IEA as there is in other instances

 

(197) It was then said that while the evidential burden may shift in the course of the trial, the legal or persuasive burden remains on the party making the allegation (here Mr Adris)and that in any event there has been no evidence adduced to raise even a case to be answered because no facts have been alleged or put in evidence at all, other than reliance on s78.

(199) Mr Gun Cuninghame accepted that the burden of proof was on his client

Thirdly, and critically, it behoves the Claimant to put forward some kind of case as to what he alleges was the position.

The absence of any positive case or evidence is in my judgment fatal to Mr Adris’s case.

(200) For those reasons, I hold that there is no real prospect of Mr Adris succeeding in his allegation that there was an IEA and this head of his claim should be dismissed. It would also be appropriate to strike it out as disclosing no reasonable grounds for bringing the claim.

(201) Gives the reason why it all fell apart….

Ok.... discuss!!

Edited January 1, 2010 by PriorityOne

[PriorityOne]

P1,

 

Great idea to start a new thread but in view of the importance of these cases and the confusion that their use (or misuse by DCAs) can cause, would it not be an idea for the mods to make this a sticky with a summary of what the cases where about and the main conclusions?

 

It probably would, yes.... as people were beginning to panic and it saves us going over the same ground repeatedly on different threads.

 

It's up to the Mods though...

 

[PriorityOne]

Doesn't take us long to start fighting back, eh Guys?

 

[PriorityOne]

Where to start PriorityOne.

The first feeling I had after reading the judgement was that the Judge had ridden a coach and horses through the Act and overturned some of the foundations laid down by several Law Lords in earlier appeals. Agreed...

I have read quite a few cases relating to the consumer Credit Act 1974 mainly the ones that have gone to appeal and almost without exception the Law Lords point out how difficult the Act is to interpret in parts. Now it may be that the Wilson cases are not the best examples to use in this

thread since it involves a pawn. No so sure...

"No evidence in reply was served. At the end of his submissions Mr Gun Cuninghame said that there was a Witness Statement from Mr Adris saying that he could not remember whether he signed the agreement or not but that was not before me and no application was made to put it in (Day 4/162-163). Thus RBS’s evidence is unchallenged…"

These were claimants who had to prove their case, not the other way around. Therefore, if we are taken to court as Defendants, Wilson should still hold up.... but I see where you're coming from re. pawns.

Another observation is that it is a pity that the claimants were pretty naive and seemed to have very little knowledge of the Consumer Credit Act to challenge some of the Judge's observations. Unfortunately, thats what happens when you allow greed to enter into the equation... people get cocky and over-confident...And having the OFT involved-apparently on our side-may not have been to our advantage.

Had there been some Caggers there for example to point out to the Judge more pertinent reasons why the Act should not be weakened the final reasoning may have been different.

 

Yes, I agree with you here as well.... but CAG helps people for nothing. These people seemed to be in it for themselves and were bl**dy stupid to think they'd pull it off on the back of a s78 request, in my opinion.

[PriorityOne]

para 206

 

The letter also said that the bank was obliged to keep a copy of the signed agreement not only to comply with its statutory obligations but also to ensure that it could take enforcement action in the event of default. The latter does not follow. It is open to a credit card provider to commence enforcement action without a copy of the signed executed agreement. All it needs to do is persuade the Court that this the agreement would have been signed for example by reference to its records of this particular customer and his credit card and its standard procedures and terms at the time. In the absence of some positive evidence from the customer to challenge the execution of the agreement, such evidence is likely to be sufficient. The letter from Ascots contained no allegation of any kind from their client as to what he understood he had signed or when.

 

This looks very bad to me its opening the door for the banks to come up with any old crap they like I thought that they did have to have the original executed agreement not just say well we must have had it one time or we wouldn't have given you the card

 

No.... please stop.

 

There are two very important factors to remember in all of this.

 

1. The debtors were the CLAIMANTS and the creditors were the DEFENDANTS. This puts the onus of proof onto the claimant (consumer) in this case. People on here are being taken to court as DEFENDANTS... which means that the burden of proof falls on the creditor as CLAIMANT.

 

It's very important that the differences in procedure are made very clear.

 

2. The Agreements fell under CCA 1974 and not CCA 2006... which means that they have the protection of s127 (3), which the Judge does refer to but it's not relevant in the CLAIMANTS' case since they were not going down the route of s127 (3) in their POC.

 

[PriorityOne]

Not quite as I read it?

 

Obviously, from that they must declare when they are providing a reconstituted copy, but that is not the same as requiring them to declare whether they do indeed hold an original copy.

 

If they in some way try to mislead the debtor into thinking that they have an original when they don't then that would fall fouls of all sorts of unfair trading regulations, but the assertions above don't say anything about that. The creditor could just refrain from commenting on whether they hold an original or not, and still comply with the spirit of that paragraph.

 

Is there comment elsewhere regarding declaring if they have an original? Scanning the judgement now, but can't find anything yet?

 

On reflection, I think that came from the OFT and not the case.... The two points probably amalgamated themselves in my head last night while reading through it. You are right. He doesn't appear to be saying they must declare that they don't have a true copy of the original.... but I have read it somewhere.... and if a consumer was to ask for a copy as part of a legal request under CPR, then they would be obliged to provide an answer of sorts.

 

To say you do have a copy when you don't falls foul of CPUTR.... and is misleading.... so it's covered there anyway.

 

[PriorityOne]

I've always informed companies that payment will be suspended until such times as an enforceable Agreement can be produced.... which places the ball in their court completely.

 

It's all in the wordplay at times. Like chess, as Diddy says (and at the bottom of my signature)

[PriorityOne]

Apparently lawyers are reasonably happy with the judgment but are considering appealing on one issue.

 

 

Do you know which particular issue?

[PriorityOne]

Yes.

 

Are you willing/able to share?

[PriorityOne]

paulwlton and Baggio from the other thread appear to know, but I wonder if the sols for the CMCs etc don't want it put out in the public domain yet until they have had more time?

 

That's fair enough....

[PriorityOne]

 

Tell me I'm wrong (please!!) but the way I read it, the lenders can now send out any unsigned old *carp* in response to s78, so long as they confirm it is a true copy of what you would have signed at the time of the original agreement. They do not have to provide a signed, enforceable copy in response to a s78 request, but do have to produce an enforceable copy in court if it falls under CCA, 1974.... providing you defend any legal action. They're unlikely to tell you that though...

 

This has blown holes in my cases (application forms with separate page of 'prescribed terms') and I suspect a whole lot of others. Even if there were loopholes in this judgement I could utilise, I wouldn't trust a judge to not dismiss them and find for the bank. Not unless you're the CLAIMANT; which you wouldn't be (I assume)

 

The only possible unenforceable cases now are where an agreement has been supplied and has missing or incorrectly stated prescribed terms. Not under CCA, 1974.... but with CCA, 2006.... they do have more room to manouvre on it, yes

 

..

[PriorityOne]

 

That "reconstituted documents" can now be used for purposes of "compliance" wth CCA document requests. Under CCA, 2006.... a creditor can refer to payment history, but not in CCA, 1974 because of the benefit of s.127 (3). This was removed from CCA, 2006 (Agreements made after April 2007). I'm therefore assuming that a DCA can do the same if they've bought it under Absolute Assignment.

 

That DCAs etc can still chase people (threats etc) if they do not comply - but to be honest - they have always done that anyway, rrespective of the rules Pretty much, yes...

 

My main query is as to whether anythng has changed re ENFORCEMENT. Can they "cobble together" an agreement which would allow a judge to "make an order"? Or do they still need to provide THE agreement, wth all the terms contained in one document? Has the Manchester case changed this? See above...

 

My clear understanding was that a Judge CANNOT make an order unless the original/true copy was produced at TRIAL. Has this changed? It's not actually a "trial"...... but I get where you're coming from. See above once again....

 

 

[PriorityOne]

Conniff, I do like that statement at the bottom of your signature!!

 

Don't look down on anyone unless you're helping them up.

 

Think I might "borrow" it to put on the bottom of my work emails...

[PriorityOne]

Priority One, have we found our Joanna Lumbley at last?

thanks for starting the tread, I for one am fighting back at the establishment

 

Regards and thanks for all your imput, love the way you dissect, so easy to understand.

 

Hiya bach...

 

Glad to hear you've still got your fighting spirit after the awful time A&L gave you some time ago....

 

[PriorityOne]

Yes, especially thanks to you and other CAGs who set me on the right track in the first place, my fight still goes on, and on and on. Not still with A&L I hope....

I am still learning, thanks to discussions on threads like this, I will not give up now having got so far with it.

You are so clever at reasoning out the statements that have been made on threads, and you make such sence when dissecting them, making a lot of it crystal clear. Have you been doing a law course??? That's very sweet of you.... I haven't been studying Law, no.... but I do have a Pysychology degree, which probably explains why I enjoy playing mind games with these people and dissecting their garbage!

Watching with great interest and thanks again for your very much appreciated imput.

Lynn

 

[PriorityOne]

I only ever sent SAR out to my creditors and all complied, though with varying responses ie app form, illegible CCA and non whatsoever as they admit they had nothing! A SAR should yield everything they hold on you inc the CCA, but on another thread it was stated that if you dont request through s78 then you cant put into dispute!? I have with no problems apart from the likes of RBS and Cabot totally ignoring all my letters, no change there then.

 

You can raise a dispute through a SAR, but can only place an account "in dispute" legally through the CCA. The SAR on it's own won't legally prevent a creditor/DCA from instigating court action, so it cannot be used as part of a Defence in the way a CCA default can.

[PriorityOne]

Just to remind everyone once again....

 

The creditor's were DEFENDANTS in this action and the consumer's were CLAIMANTS. Please remember this before panic starts to overtake this thread once again.

 

[PriorityOne]

P1 I understand this very crucial point .Thanks for your patience here.

However where is PT2537?

It would be helpful if an opinion from PT were to be made.

What do you say PT?

Stripper

 

Paul hasn't been aroud since the beginning of December..... so I'm not sure when he'll be able to join this thread and give his views. I do know that he picked loads of holes in the Rankine judgement at the time though.... and this one is similar in some respects.

[PriorityOne]

Thanks for your reply BUT according to this judgement it does not matter who is the claimant or defendant, basically it has precedence over any future county court case or does it???

 

 

I really can not believe that every judge has got the opinion that if a reconstituted copy of agreement is

present that will do, surely the original agreement is still required in a hearing at court !!!!

 

Where do you come to that conclusion? The difference between being a Claimant or a Defendant is a shift in the burden of proof.... so yes, it does matter.

 

A re-constituted Agreement is not acceptable under CCA 1974.... but the creditor does have more leeway under CCA 2006, if thay can be prove (as a Claimant taking a consumer to court) that a payment history existed.

[PriorityOne]

It might depend on what you were contesting. If you were claiming unenforceability only through the lack of the OA, you would have surely shot yourself in the foot by producing your copy.

 

Which was why the Claimants in this action (consumers in case anyone's forgotten... ) couldn't get away with doing it.... even if they'd wanted/were able to.

 

Edited January 4, 2010 by PriorityOne
clarity... duh!

[PriorityOne]

Many, are missing the point!

 

DCA's cannot just reconstitute a purported credit agreement;

they must have all the details upon which to recreate.

 

Debt Buyers are not provided with information relating to what occured prior to their purchase of the Big Buckets of mixed debt;

the information that they are provided with is, extrermely limited;

amount;

contact details;

OC.

 

Therefore, how are they going to recreate the minutae of these agreements?

 

Look into their crystal balls?

 

AC

 

Very true AC.... but if you then produce an enforceable copy in court that you've kept hidden away, then there's a always risk that the Judge will just re-enforce it and claim that you're playing silly b*ggers. Would you really trust a Judge not to?

 

In this scenario, although you would be the Defendant... you would have just proved your Caimant's case for them; in a roundabout kind of way.

 

8)

[PriorityOne]

My comment related to an irredeemably unenforceable credit agreement!

 

In any event, one would not play this card, unless misleading, covert tactics had been employed by the, Bank/DCA:

 

Attempting to mislead a debtor that, an agreement is enforceable, when it is not!

 

AC

 

Ok... I see

 

They produce a reconstruction.... and you produce an unenforceable (which is noticeably different from the reconstruction)... but NEITHER of them are any good for the purposes of CCA, 1974.

 

In that case, you should be safe... but whether the Judge will do anything about that would depend on who you get on the day, I think.

 

Sorry for the misinterpretation though...

[PriorityOne]

plaintiffs often "find" missing documents "at the eleventh hour"

 

DCA's often find a new address for a defendant just after they obtained a ccj at a previous address.

 

since when was the law changed to say that the defendant could not be equally as fortunate?

 

Producing the OA in court yourself (when claiming that you never signed one) is not really fortunate.... as you'd be proving their case for them... that's what Lookinforinfo means, I think.

 

[PriorityOne]

 

Not necessarily true, I know, but it would seem that the CMC wagon is rolling again although they do seem to be counselling much more patience and admitted being the defendant is the most likely route to success.

 

So even the CMCs can see the pitfalls then....

 

Doesn't stop them touting for business though.... greedy gits.

[PriorityOne]

Can someone clarify something for me.

Is this case now saying that where a creditor has no original agreement they can now create a reconstructed one, which is fully CCA compliant and present that to a court as evidence of compliance with S.61 i.e. their agreement is fully enforceable.

 

As a DEFENDANT, a creditor can produce a reconstructed one to DEFEND themselves against greedy consumers who begin court action to try and say there isn't/was never one. That is what is being said here.

 

No more than that.