Liability Advice - Six Years Plus

[Uncle Peter]

Hi all.

 

I'll try and keep this short and to the point.

 

I was given a loan by someone in excess of ten years ago, which I defaulted on at least eight years ago.

 

During the time from then right up until now, I have had no contact from the person concerned, asking for repayment.

 

A simple open and shut case of 'statute barred'...

 

Or it would have been had I not, having decided to try and be honorable by way of contacting said creditor off my own back recently to ask for a balance of account and to offer payment.

 

Contact was made by way of an email account which doesn't bear my name, if that makes any difference...

 

The lender has now come back to me reeling off the terms of the loan and pointing out the part of the agreement which stated if I defaulted, they reserved the right to apply quite a high rate of compound interest from that date on until the loan was settled.

 

I understand from browsing the forums the limitation period is therefore now reset due to my effectively admitting the debt and offering some form of payment?

 

But then I've also read other literature than suggests that maybe the debt isn't legally enforceable should the person decide to try to pressurise me into paying quicker by way of court action etc, because it's over six years old.

 

Not paying is not an option - the reason this has dragged on for as long as it has is not all my fault (health issues etc), but I would like to know exactly where I stand in terms of being able to state 'I can afford X and X is what you will get until such times as my circumstances improve'.

 

Many thanks in advance for any advice given.

[dx100uk]

so is this a person to person loan

or is it from a Co.

 

diff to totally understand if it is?

 

dx

[Uncle Peter]

so is this a person to person loan

or is it from a Co.

 

diff to totally understand if it is?

 

dx

 

Hi

 

It's a 'person to person' loan with what looks like an agreement that's been drawn up using a template, that states the following amongst other things:

 

"This agreement shall be governed by English Law and both parties agree that any dispute shall be heard within the appropriate English Court."

 

Cheers

Edited March 6, 2010 by Uncle Peter

[macie]

How much money is involved? What is the interest rate?

 

Are they licensed to lend money, if not I suspect it is unenforceable.

 

Loan shark hotline set up - mirror.co.uk

 

Loan sharks in Surrey to meet their match

 

Joan Fionda: 'Joan the Loan' escapes jail | This is Money

[Uncle Peter]

How much money is involved? What is the interest rate?

 

Are they licensed to lend money, if not I suspect it is unenforceable.

 

Hi

 

The original loan was for £1500, repayable in four instalments over period of just over two years.

 

I'm pretty sure I paid the first instalment of £270 but have no bank statements from the period concerned to back this up, so given the length of time that has lapsed since, I'm happy to work on the assumption this payment wasn't made and I therefore still owe the full amount.

 

The interest charged was at a rate of 7.5%, and according to a copy of the agreement they've now sent me (and which is not the signed original), equates to £142.50.

 

There is then a clause that states that the following:

 

"The lender reserves the right to impose interest charges at the rate of 7½% per month compounded on any outstanding balance if the borrower does not meet the final repayment date. The lender shall notify the borrower of this action in writing if he chooses to exercise his rights in this respect."

 

The final repayment date was January 2003, so as you can imagine, I'm rather concerned by the amount of interest the person could ask for should they decide to enforce this clause.

 

The last communication I had from them said they would let me know in due course whether they had decided to invoke the above clause or not.

 

The loan was from an acquaintance who isn't a registered money lender.

[Uncle Peter]

Any advice anyone?

[dx100uk]

sorry i have been busy.

 

as it is clearly making ref to 'english law', and thus std legal proceedures, thus it can quite be constroud as now being very statute barred.and NOTHING can unbar it. not even a court.

 

now, i would offer [as you indicate you wish to pay your just dues] the remainder of what you own [regardless to any subsequent interest £1500.

 

pers if they start to argue, quote statute barring , in the vain of i don't legally have to pay you anything, take it or leave it.

 

be clear, they have NO legal recourse on you & certainly it would never get to court.

 

dx

[Uncle Peter]

sorry i have been busy.

 

Hey, no worries.

 

Many thanks for the advice.

 

I'm trying to keep things as pleasant as possible given I perhaps could have done more to sort the situation out sooner.

 

I'm not doubting what you say, but are you quite sure that 'statute barred' definitely applies, as I have approached the person off my own back, acknowledging the sum owed together with making an offer of payment.

 

I just want to make sure I get my facts straight before replying to their last email, as I suspect it is going to get nasty from their perspective, the moment I start 'dictating the pace', so to speak.

[dx100uk]

yes it applies

if a period of 6yrs has elapsed since last financial transaction in/out or the last time you SIGNED a letter specifically stating you owed the debt.....its statute barred, and once a debt is statute barred NOTHING [even you or a court] can do can unbar it.

 

the ONLY exception to this is if a CCJ has been granted within the 6yrs, then sadly it continues to run, but after 6yrs of no action on a CCJ, they must still go back to court to enforce it.

 

basically its this comment that sinks them:

"This agreement shall be governed by English Law and both parties agree that any dispute shall be heard within the appropriate English Court."

 

dx

[Uncle Peter]

yes it applies

if a period of 6yrs has elapsed since last financial transaction in/out or the last time you SIGNED a letter specifically stating you owed the debt.....its statute barred, and once a debt is statute barred NOTHING [even you or a court] can do can unbar it.

 

the ONLY exception to this is if a CCJ has been granted within the 6yrs, then sadly it continues to run, but after 6yrs of no action on a CCJ, they must still go back to court to enforce it.

 

basically its this comment that sinks them:

"This agreement shall be governed by English Law and both parties agree that any dispute shall be heard within the appropriate English Court."

 

dx

 

Excellent.

 

I've been stressing myself out over this for the last week or so...

 

 

Ahhh... that's better.

 

Many thanks once again for the advice.

[ozzywizard]

Just so you have a second opinion DX is totally right, once a debt is statue barred in accordance with the limitations Act 1980 it stays barred and nothing can unbarr it . . . if they wish to debate it then send the statue of limitations template and have no further contact. but your choice.

[Uncle Peter]

Okey dokey.

 

I have just sent them an email stating (amongst other things), that I acknowledge the original totals due, as in £1642.50 including interest, and as a gesture of goodwill I am willing to round the final total due up to £1800, subject to us reaching an agreement.

 

I have also outlined my proposals for repayment and I have gone to great lengths to avoid mentioning the actual legal state of play as things stand, as I believe at this stage mentioning such things will only serve to inflame the person concerned and I'd rather we, (as expressed in the email concerned), reach a mutual agreement without things deteriating any more than they already have.

 

However... if the gloves end up off, yes... I shall use all of the above and tell them what to do for the whole amount.

 

Cheers!