Jump to content


Blackhorse terminate and then reinstate


Fan100
style="text-align: center;">  

Thread Locked

because no one has posted on it for the last 5120 days.

If you need to add something to this thread then

 

Please click the "Report " link

 

at the bottom of one of the posts.

 

If you want to post a new story then

Please

Start your own new thread

That way you will attract more attention to your story and get more visitors and more help 

 

Thanks

Recommended Posts

Hi Everyone

I'm a new cagger but am hoping someone can help. I'll try and be Brief we sent Blackhorse a CCA request, which they did not respond to so account went into dispute. During the non compliance period they sent a default notice (which included charges and interest) and then terminated on the back of this default sending court papers for repossession of vehicle.

I wrote to the company explaining that they were doing all this while the account was in dispute but excepted the termination. They eventually sent the CCA and default notices followed as though the agreement was still live. After various letters to blackhorse they agreed that they acted wrongly and that the first default and termination were invalid so they have withdrawn it so now the agreement was still live.

I sent all documents to the FOS explaing asking how can they just reinstate the agreement after termination. The FOS adjudicator has stated that even though the default, termination and court proceedings were invalid it would be unfair on the business to have no claim to the vehicle and the agreement is live as it was before.

 

Please can someone explain this as I have read on here that once an agreement has been terminated the business cannot treat the agreement as live.

 

thanks:-?

Link to post
Share on other sites

Well the FOS is wrong unfortunately. For the termination to have any effect it required your acceptance... the company cannot then reinstate the agreement without YOUR permission to do so. This would leave a ridiculous situation where a creditor could terminate and reinstate an account as many times as they like. Patently ridiculous!

 

If you have any documents to scan then please post them here minus your personal details.

 

Just out of curiosity, how much of the agreement was paid?

Link to post
Share on other sites

£5000 out of £8000

 

paperwork has already been scanned for the FOS so I'll find the docs and post them up asap

 

FOS agree that the default and termination were invalid but because blackhorse have withdrawn it then it is ok and would be unfair on the Business??????

Link to post
Share on other sites

Does anyone know where I would get more information regarding companies termianating agreements. I know there is the Enforcement, Default and Termination law but can't find the actual part I need.

Our case has been with an adjudicator who states this is her conclusion but can pass it on to an Ombudsman for final decision, I'm hoping they see it differently if not what wwould be our next step if they still insist that Blackhorse are right to treat this agreement as live?????

Link to post
Share on other sites

Please contact a member of the site team if you are offered help off the forum for a a paid or no win no fee service.

 

Please consider making a small donation to help keep this site running

Click here to donate through PayPal (opens in a new window)

Link to post
Share on other sites

the FOS may well have been at least partially right- if for the wrong reasons

 

first of all we need to know if the DN was valid as this will determine if the termination was unlawful

 

The Creditor will say (and succeed i suspect,- if the DN was invalid-) that the cca says that he may not terminate the agreement until he has first served a valid DN

 

the creditor will say that because the DN was invalid - then so was the termination as he was not allowed to terminate- if you did not accept their unlawful action- they would argue that they were simply restoring the "status Quo"- having recognised their mistake

 

you may have a claim if you suffered some loss as a result of their actions

 

If you want the agreement ruled as terminated then you would have to argue, if the DN was invalid, that this constituted an unlawful termination on the part of the creditor (which they seem to have accepted) but that you took the opportunity , as the performing party to relieve yourself of your continuing obligations under the agreement as you would have been entitled to do

 

if on the other hand the DN was valid then the termination was valid and the creditor terminated- then he could NOT re instate the agreement without your consent.

 

 

however it appears, at first flush as though the creditor was trying to assist you -by correcting his mistake - you therefore need to think which way you would be better off

 

if you challenge the re instatement in which case (if it was lawful) you will lose the car again and be liable for a residual bill when they sell it)

 

or allow the re instatement to hold since then you have the car

 

in the case of the unlawful rescission - your actions post repudiation would have a big sway as to whether a court considers you elected to accept the creditors unlawful act or in fact intended the agreement to endure.

 

decide which way you want to go then we can look at agreements.DN's etc

 

due to recent rulings- it is likely that although in breach of his s78 obligations, the DN and even the issue of court papers- did not amount to "enforcement"

Edited by diddydicky
Link to post
Share on other sites

Thanks for the info

 

Here is Blackhorse final response before I sent all documents to the FOS.

 

 

We have spoken to our solicitors, who have advised us that, contrary to our previous statements, the Default Notices served during the period of non-compliance with the S77 request are not enforcement of the agreement and there is nothing which therefore makes them invalid. Termination of the agreement pursuant to the Default Notices was also valid and we are advised that we may take steps to enforce the agreement by court action. Should you wish to avoid further proceedings, you are advised to contact our collections team as a matter of urgency.

Given that termination was valid, we do not propose to deal with your other arguments in detail. However, we are advised that the Regulations you quote do not have any bearing on allegations of defects within a default notice and that the case of Woodchester Lease relates to the overstatement of the amount of arrears in a default notice. As this has not happened in this case we cannot see the relevance to your complaint.

Therefore, and as peviously stated, this letter is our final response, which means that if you remain dissatisfied you may refer your complaint to the Financial Ombudsman Service. If you decide to pursue you complaint through the Financial Ombudsman Service you must do so within six months from the date of this letter, we have already provided you with a copy of their explanatory leaflet about the Service.

 

Please can someone tell me where we stand now as the FOS has stated the agreement is live even though Blackhorse last correspondense states otherwise and yet they still send me default notices regarding this account.

Link to post
Share on other sites

The figure in the DN did include charges and interest on charges so that should make the DN invalid and they terminated on this DN. We also excepted termination so surely they can now only claim the arrears up to the termination ?????????

Link to post
Share on other sites

The figure in the DN did include charges and interest on charges so that should make the DN invalid and they terminated on this DN. We also excepted termination so surely they can now only claim the arrears up to the termination ?????????

 

when you say you accepted termination- how did you do that- did you continue to make payments

 

i am still unsure as to what you are trying to acheive

 

are you wanting to give up the car and have the agreement ruled as terminated?

 

you have not made that clear

Link to post
Share on other sites

no further payments have been made since termination letter received as we took them at their word that the agreement has been terminated. Now they are saying that it isn't terminated and the agreement is still live that is why we went to the FOS as the DN was invalid and they used the DN to terminate. I'm sure I've read on here that if that is the case then they can only claim arrears up to termination and have no claim to the vehicle.

Surely sending a termination letter and court proceedings proves the agreement has been unlawfully terminated and with out our agreement they cannot just say sorry we got it wrong and withdraw their actions?

 

 

We asked for them to declare no claim to the vehicle and damages to my partners credit file, the FOS say this would be unfair on Blackhorse

Link to post
Share on other sites

I really dont know how to advise you on this one as i dont know what it is you are seeking to achieve

 

i presume that at the moment you still have the car and are making payments

 

or

 

you have the car and are not making payments

 

or are you

 

seeking to keep the car and get out of the agreement and only owe them the arrears at the time they unlawfully terminated?

Link to post
Share on other sites

seeking to keep the car and get out of the agreement and only owe them the arrears at the time they unlawfully terminated?

 

I thought due to their actions this is what we would be entitled to are you saying differently??????

Link to post
Share on other sites

I think youd be on a sticky wicket here.

Youve got the vehicle and you dont want to pay for it, albeit they cocked up somewhere. it would be an easy call for the court, to say, you have the vehicle so pay up, or have it repossessed.

If they are going to repossess, the only thing you can do to cover yourself would be go to a car dealer and ask what theyd give you for towards that nice shiney BMW M5 over there. That way youd have an offer independantly form what they tell you they sold it for at auction. So if they went for the difference its a nice card to hold.;)

Link to post
Share on other sites

So the DN was inavlid and they terminated the agreement.

They sent court papers to repossess but then withdrew all action and reinstated the agreement.

Sent us a letter saying that they didn't terminate and then their final response was they did terminate on the 15th July 2009 but no further action other than default notices have been sent to us and even these include charges and interest on charges.

 

So what I have read below by x20 doesn't apply?

 

[1] Termination of a Contract and General Principles

A good place to start would be to dispel the myth that the law will not tolerate contract breaking. On the contrary whilst not actively ncouraging it, the law will tolerate it. The courts will rarely impose upon one party an obligation to perform under a contract against its will, to do what it failed to do or redo what it tried and failed to do. Instead, what the law will do is on the one hand restrain the contract breaker from procuring the benefits it would have enjoyed had it fulfilled its contractual obligations and on the other, enable the injured party to recover damages flowing from the breach.

 

In Golden Strait Corporation v Nippon Yusen Kubishka Kaisha [2007], Lord Bingham said:

 

'The repudiation of a contract by one party ("the repudiator"), if accepted by the other ("the injured party"), brings the contract to an end and releases both parties from their primary obligations under the contract. The injured party is thereupon entitled to recover damages against the repudiator to compensate him for such financial loss as the repudiator's breach has caused him to suffer. This is elementary law.

 

The damages recoverable by the injured party are such sum as will put him in the same financial position as if the contract had been performed.'

 

[2] Termination in Non-Conformity with section 87.

The contention I advance is that an ineffective DN does not prohibit the creditor from terminating the agreement. Termination after service of an effective default notice is lawful termination, but as we have seen, a party may still terminate an agreement and be in the wrong for doing so. The law operates on a wrongful termination to offer to the injured party the choice of accepting the termination or to hold the contract breaker to his promise.

 

In the world of consumer credit, I contend a termination of the agreement by a creditor in terms whereby he announced he would no longer permit the debtor time to repay the credit, was a creditor in repudiatory breach of the agreement, unless in leading up to termination, the creditor complied with the requirements of the Act in circumstances where the debtor was in first breach of the agreement.

 

Further, and it is worth remembering, the Act is an Act for the purpose of consumer protection. The purpose of the Act is not to preserve the rights of creditors in contracts and to protect them from misadventure where for example, they terminated an agreement where it subsequently transpired the termination had not been in their interests. If that were so, the Act would have been an Act for the better protection of financiers.

 

Moving on, if the debtor receives a notice from the creditor in which the creditor expressly states the contract is terminated, what is the debtor supposed to think? Would the law regard him as likely to think the creditor had terminated the contract or would the law regard him as thinking it had not terminated because strictly speaking, the creditor had served a default notice which was not in accordance with prescribed terms?

 

Or where perhaps the creditor did not expresly terminate but sent the bully boys over to demand the keys to the car. What was the debtor to think then? Would the debtor think the creditor had terminated?

 

4] The fiction of the Second DN and the Enduring Obligation

The service of any second default notice, at a time when the contract is terminated, owing to the wording of the DN in its prescribed form, would perpetuate the fiction that the contract endured. The same can be said owing to the provisions of section 89 of the Act.

 

The form of words in the DN incorporate text in order to meet the intention of section 89 of the Act which provides:

 

'If before the date specified for that purpose in the default notice the debtor or hirer takes the action specified under section 88(1)(b) or © the breach shall be treated as not having occurred.'

 

In other words, in serving the second DN, the creditor would be suggesting:

 

[a] an obligation had persisted post termination by which the debtor was bound to make instalment payments (ie post-termination 'arrears'), and

that if payment of those 'arrears' was made, an obligation to make future instalment payments would endure.

 

The obligations at [a] and are obligations enduring during the currency of the agreement. Besides maintaining the fiction of the enduring agremeent as I say, it seems to me any second DN would be bound to be defective for over-stating the sums due. The creditor can not state as an amount due for 'arrears' of instalments that which he said in consequence of his termination was no longer due and payable by instalments. If the creditor sought to use a form of DN which made sense by getting round the fact the agreement had been terminated, the DN would not be in prescribed form.

 

The only way in which a second DN would be of value to the creditor would be where the contract had been re-instated. If the debtor has accepted the termination, re-instatement requires the consent of the debtor.

 

The net result of [1] to [4] is the agreement is terminated for all time. The creditor's remedy is now limited by section 87(1). All that is left for the creditor to recover is the sum truly in arrear at the date of the default notice.

 

Damage to Credit

A man's credit is damaged when it is impugned. He learns it is damaged when he seeks credit to fund a transaction and is turned away or when his creditors seek to call in debts. The effect can be simple embarrasment to being totally destabilising. A learned his credit was impugned when he was warned by his bankers. The damaging effect of the adverse reporting could have been a lot worse.

 

I had deliberately tried to keep my first post as simple and straight forward as I could. I hope this expanded version showing the way strands of law can intertwine to build a case is of assistance.

 

x20

Link to post
Share on other sites

So the DN was not valid due to the figure to be paid included charges and interest on charges.

They terminated on the back of the DN on the 15th July 2009.

They sent court papers for repossesion and then withdrew all action.

Their final response states they did terminate but still send default notices regarding this agreement. Now they say the agreement is still live.

So what x20 wrote on here does not apply see below?????

 

[2] Termination in Non-Conformity with section 87.

The contention I advance is that an ineffective DN does not prohibit the creditor from terminating the agreement. Termination after service of an effective default notice is lawful termination, but as we have seen, a party may still terminate an agreement and be in the wrong for doing so. The law operates on a wrongful termination to offer to the injured party the choice of accepting the termination or to hold the contract breaker to his promise.

 

In the world of consumer credit, I contend a termination of the agreement by a creditor in terms whereby he announced he would no longer permit the debtor time to repay the credit, was a creditor in repudiatory breach of the agreement, unless in leading up to termination, the creditor complied with the requirements of the Act in circumstances where the debtor was in first breach of the agreement.

 

Further, and it is worth remembering, the Act is an Act for the purpose of consumer protection. The purpose of the Act is not to preserve the rights of creditors in contracts and to protect them from misadventure where for example, they terminated an agreement where it subsequently transpired the termination had not been in their interests. If that were so, the Act would have been an Act for the better protection of financiers.

 

In a proper case, the law will come to the aid of the vulnerable to protect them from the consequences of their contracts (for example the unsound in mind, children, those under duress or undue influence). To suggest financiers fell into that bracket and the Consumer Credit Act

operated to protect them and not the consumer, was absurd. The civil law does not come to rescue the misadentures of the sain and the savvy.

 

The clue to the position of the creditor on termination is in the use of the word 'entitled' in section 87(1). 'Entitled' connotes a right or a benefit. The Act therefore confers rights, conditional upon the provisions of section 87(1) being fuilfilled. Fail to fulfill the condition and the entitlements do not become available.

 

[3] The Debtor's Point of View

Third, let us look at the position from the ordinary man as debtor's point of view in a consumer credit situation.

 

The DN is defective for failing to conform to the prescribed terms, or gives misleading information or at worse is plain nonsense so that the debtor does not know precisely what he has to do in order to comply with it and is consequently disadvantaged. Should the law disregard the fact that the creditor put the debtor at a disadvantage and thereby at risk the creditor might lawfully terminate the agreement?

 

'This statute was plainly enacted to protect consumers, most of whom are likely to be individuals. When contracting with a large financial organisation they are at a disadvantage. The contract is likely to be in standard form and relatively complex with a number of detailed provisions. If the hirer is said to have broken its terms, the hirer needs to know precisely what he or she is said to have done wrong and what he or she needs to do to put matters right. The lender has the ability and the resources to give that information with precision. If he does not do so accurately then he cannot take what Mr Gruffyd conveniently referred to as "the next step". [per Kennedy LJ in Woodchester v Swayne [1998]]

 

Moving on, if the debtor receives a notice from the creditor in which the creditor expressly states the contract is terminated, what is the debtor supposed to think? Would the law regard him as likely to think the creditor had terminated the contract or would the law regard him as thinking it had not terminated because strictly speaking, the creditor had served a default notice which was not in accordance with prescribed terms?

 

Or where perhaps the creditor did not expresly terminate but sent the bully boys over to demand the keys to the car. What was the debtor to think then? Would the debtor think the creditor had terminated?

 

It seems to me on the basis of the passages below, the courts will be ready to hold a creditor to his words and actions.

 

"... a person who signs a document, and parts with it so that it may come into other hands, has a responsibility, that of the normal man of prudence, to take care what he signs, which if neglected, prevents him from denying his liability under the document according to its tenor".

[per Lord Wilberforce in Gallie v Lee (1971)]

 

'.. a man cannot escape from the consequences, as regards innocent third parties, of signing a document if, being a man of ordinary education and competence, he chooses to sign it without informing himself of its purport and effect..'

[per Scott LJ in Norwich & Peterborough Building Society v Steed (1992)]

 

In short, the creditor is bound by his deed. All that is required is for the debtor to accept the creditor's termination. He can write saying 'thank you I accept you termination' or he can conduct himself in a way in keeping with that termination. Not paying the instalments would be in keeping with an acceptance of the termination.

 

[4] The fiction of the Second DN and the Enduring Obligation

The service of any second default notice, at a time when the contract is terminated, owing to the wording of the DN in its prescribed form, would perpetuate the fiction that the contract endured. The same can be said owing to the provisions of section 89 of the Act.

 

The form of words in the DN incorporate text in order to meet the intention of section 89 of the Act which provides:

 

'If before the date specified for that purpose in the default notice the debtor or hirer takes the action specified under section 88(1)(b) or © the breach shall be treated as not having occurred.'

 

In other words, in serving the second DN, the creditor would be suggesting:

 

[a] an obligation had persisted post termination by which the debtor was bound to make instalment payments (ie post-termination 'arrears'), and

that if payment of those 'arrears' was made, an obligation to make future instalment payments would endure.

 

The obligations at [a] and are obligations enduring during the currency of the agreement. Besides maintaining the fiction of the enduring agremeent as I say, it seems to me any second DN would be bound to be defective for over-stating the sums due. The creditor can not state as an amount due for 'arrears' of instalments that which he said in consequence of his termination was no longer due and payable by instalments. If the creditor sought to use a form of DN which made sense by getting round the fact the agreement had been terminated, the DN would not be in prescribed form.

 

The only way in which a second DN would be of value to the creditor would be where the contract had been re-instated. If the debtor has accepted the termination, re-instatement requires the consent of the debtor.

 

The net result of [1] to [4] is the agreement is terminated for all time. The creditor's remedy is now limited by section 87(1). All that is left for the creditor to recover is the sum truly in arrear at the date of the default notice.

 

Damage to Credit

A man's credit is damaged when it is impugned. He learns it is damaged when he seeks credit to fund a transaction and is turned away or when his creditors seek to call in debts. The effect can be simple embarrasment to being totally destabilising. A learned his credit was impugned when he was warned by his bankers. The damaging effect of the adverse reporting could have been a lot worse.

 

I had deliberately tried to keep my first post as simple and straight forward as I could. I hope this expanded version showing the way strands of law can intertwine to build a case is of assistance.

 

x20

Link to post
Share on other sites

I have to say that on the basis of what you have said- that you appear to me trying to "pull a fast one" over your finance company rather than be in a genuine situation from which you need help to get out of

 

If i can see through you from where i am- a judge will see through you ion 10 seconds flat

 

I would strongly advise you not to continue with what you are attempting to do an i think if you end up in court on this one- you will end up a damn site worse off than you are now

 

I am afraid that personally i don't feel that i want to help you - sorry

Link to post
Share on other sites

Would you not be better to neg with BH and agree for the repossession of the vehicle in exchange for no liablity after sale & deletion of your Credit reference!!

 

The vehicle will be losing value every month & thus potentially increasing your post repo liability. Plus doing it this way you can have a clean cut exit & no liability of BHF agree

Link to post
Share on other sites

Thanks for your opinion diddydicky.

 

I can asure you we are not pulling a fast one as you put it, our payments were never missed until I got made redundant and decided to check what was left outstanding on our agreement to see if I could pay it off. That's when looking at the statements we had received the figures didn't add up I decided to get a copy of the agreement as we couldn't find the original it was only then that this situation arose. If Blackhorse hadn't sent the default notice and then terminated on it we would have come to some arrangement to continue paying but we felt we had a case expecially regarding the fact that this was done during non compliance.

 

Please don't tar me with a brush i feel I don't deserve.

Link to post
Share on other sites

Thanks for your advice MVM.

 

Everytime I have contacted blackhorse one person tells me the agreement is terminated and another tells me it isn't so that is why I came on here for advice not to get accused of something I certainly don't deserve by other members maybe I came to the wrong place...

Link to post
Share on other sites

Thanks for your opinion diddydicky.

 

I can asure you we are not pulling a fast one as you put it, our payments were never missed until I got made redundant and decided to check what was left outstanding on our agreement to see if I could pay it off. That's when looking at the statements we had received the figures didn't add up I decided to get a copy of the agreement as we couldn't find the original it was only then that this situation arose. If Blackhorse hadn't sent the default notice and then terminated on it we would have come to some arrangement to continue paying but we felt we had a case expecially regarding the fact that this was done during non compliance.

 

Please don't tar me with a brush i feel I don't deserve.

 

i haven't "tarred you" with any brush i was giving you my honest advice- sometimes it is not what the poster wants to hear- sometimes others have better advice - read my footers

 

i just don't think, based on what you said in your posts- that you have a winnable case and so i consider i should not try to advise you or encourage you to do something which i think you would regret

 

good luck with it

Link to post
Share on other sites

  • Recently Browsing   0 Caggers

    • No registered users viewing this page.

  • Have we helped you ...?


×
×
  • Create New...