MBNA sold debt before DN expired

[Kayyak]

Thought I'd start my own thread as I am new and have some queries.

 

We have 2 accounts with MBNA with similar actions and I want to know what I should do now.

 

Partners account

MBNA sent DN but sold on to DLC before the expiry date. MBNA also sent a letter stating they had sold it to DLC, which is dated before the expiry date! DLC wrote to partner and I completed form saying we will pay x per month (I know, I was stupid). If it went to court, he didn't complete the form, I did. They then requested I&E and wanted details of our mortgage, house value, proof of income (which I didn't want to send as it has my NI No), and that is when I came accross this site.

I've since sent a letter to DLC stating that MBNA terminated the agreement unlawfully and do not acknowledge the debt.

Now, I'm not sure what action I should take now and in what order.

 

1. I thought I should send a SAR to MBNA (to get proof of sale and dates)

2. should I CCA MBNA or DCA now or both? (I don't think there are many unlawful charges only about 3 months worth). The debt is only about 3 years old. But on reading Ron 2015 earlier, SD seemed like that proof is good to have.

3. Should I immediately acknowledge unlawful rescindment with MBNA. I don't know how that will affect any records they send me and don't want to stir things up.

 

My account

Ditto, DN expires tomorrow and guess what, yep, I had a letter from DLC yesterday, the MBNA letter confirming it's been sold was received on Saturday (dated 16 March).

Should I do the same as above, all together now??

 

Thanks for your reply on the other thread Bigdebtor, hope this answers your queries.

 

Any help appreciated.

[Kayyak]

I sent a letter a letter to MBNA accepting their unlawful recission and have now received their response.

 

 

 

Yep, total drivell -

 

Fact - Had a letter from MBNA dated 19 Feb quoting "your outstanding balance due under the above account has been sold to DLC". MBNA now saying that it was only up for sale. DN was dated 8 Feb.

 

This is what I am thinking of sending:

Dear Sir/Madam

 

Many thanks for your recent letter outlining your legal team's response. I suggest that you should pass on this letter to your legal team outlining the following points and high court cases in relation to your unlawful recission of contract.

1. I have proof from MBNA informing me that on the 19 February 2010 my outstanding balance due under the above account has been sold to Direct Legal”.

2. It is submitted that the Default Notice served s87(1) Consumer Credit Act 1974 failed to comply with the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561).

 

3. I therefore put you to strict proof that any Default Notice sent to me was valid and allowed the statutory 14 clear days to rectify the breach. I also note that to be valid, a Default Notice needs to be accurate in terms of both the scope and nature of breach and include an accurate figure required to remedy any such breach. The prescribed format for such document is laid down in Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) and amendment regulations the Consumer Credit (Enforcement, Default and Termination Notices) (Amendment) Regulations 2004 (SI 2004/3237).

 

4. The failure of a Default Notice to be accurate not only invalidates the Default Notice (Woodchester Lease Management Services Ltd v Swain and Co - [2001] GCCR 2255) but is an unlawful rescission of contract which would not only prevent the Court enforcing any alleged debt, but give me a counter claim for damages Kpohraror v Woolwich Building Society [1996] 4 All ER 119.

 

5. In the case of Woodchester Lease Management Services Ltd v Swain & Co - [1998] All ER (D) 339 in the Court of Appeal, the Court addressed in some detail the issue of the contents of a Default Notice and should the notice fail to comply with the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) it would render the Default Notice invalid I quote the comment of KENNEDY LJ: "This statute was plainly enacted to protect consumers, most of whom are likely to be individuals" the judgment appears to confirm the consumer credit legislation made under the Consumer Credit Act 1974 as plainly enacted and set out to offer protection to the consumer. Therefore it is suggested that the failure of the Claimant to set out the Default Notice in accordance with the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (SI 1983/1561) could unduly prejudice me as it failed to allow the required time to remedy the alleged default

 

6. This is at all times an Agreement Regulated by the Consumer Credit Act 1974. There is no provision in the Act that allows a large financial institution to terminate an Agreement that is in alleged default or breach simply by giving notice to the Consumer. Section 98(6) makes that quite clear. The Creditor must follow the steps outlined in Section 87 and Section 88 if they are to lawfully Default and Terminate, and enjoy the benefits of Section 87

I trust this makes my position clear.

 

 

[banker_rhymes_with]

Hello Kayyak!

 

Don't write to them, just send them a full SAR and wait to see what comes back. If you have/had two Accounts, i.e. in your name and in your OH name, then send them two SARs, one for each person, and do not send them together...no point alerting them you are linked in anyway.

 

Send that to The Company Secretary at their Registered Office (see the bottom of the letterhead). It's £10 per SAR, but you only need one per person, not per Account.

 

By all means send the DCA a s78(1) CCA Request, and also a SAR too, to see what comes back from them.

 

My advice is to therefore hold back on the letters, but get the S-A-Rs and CCAs off.

 

It's far more important to get the ammunition first before taking too many shots at them!

 

Cheers,

BRW

[Kayyak]

Thanks BRW

 

I've already got both SARs, OH screen print reads:

8.2.10 NOD sent 8.2.10 exp 25.2.10

19.2.10 sold to Direct Legal

19.2.10 sold 18.2.10 balalnce at sale was £total

 

I haven't actually gone through what they sent me yet but I'm sure things are missing ie copies of notices etc. I presume like other creditors they do not keep copies and would only be able to re-construct one. What I presume is the CCA is a screen print of their database of personal details together with T&C. It was taken out on-line. (I can post it up tomorrow)

 

I know they have unlawfully terminated this one, is it worth me chasing them for the missing info, bearing in mind I have the most important screen print, as above?

[banker_rhymes_with]

Hello Kayyak!

 

I've already got both SARs, OH screen print reads:

8.2.10 NOD sent 8.2.10 exp 25.2.10

19.2.10 sold to Direct Legal

19.2.10 sold 18.2.10 balalnce at sale was £total

 

That'll do nicely for your OH!

 

But do check your own S-A-R to see if it says the same sort of thing.

 

Although in terms of your OH, it confirms the Sale Date and Amount. Do also check the rest of the details with a Fine Toothed Comb, and cross-check everything with particular emphasis on dates and Account Numbers.

 

Note the main Account Number when the Account started, and look for when that changed, say, when they issued a new Card (if it was a Card Account) or when they closed down the Account at the end. Follow these details all the way through, and see if it tells you when the AC was wrapped up by MBNA.

 

That final stage is called the Charge-Off, and is the point when they write the Debt off against Tax. By this point MBNA will usually have ballooned the Debt into orbit via their helpful maximum Interest Rate and many Charges!

 

Compare the Account Number with the s87(1) Default Notice. Do not accept anything at face value, and double check the digits and dates.

 

You may now spot their motives for ramping up Charges and Penalty Interest, because it inflates the Debt without anyone having to do anything: you on the one hand need not spend anything so no money changes hands, and they on the other, just sit back and watch the sucker balloon into a bigger Debt, at no further cost to them. Simples!

 

This does two things:

 

 

• It maximises their Charge-Off amount for Tax purposes, i.e. they set that off against other Profits so they get to pay less Tax (so the Tax Man loses out), i.e. £10,000 written off is not as good as £14,000 written off, because the latter saves them more Tax.
  

 

• It maximises their Debt Sale amount, because most DCAs will buy Debts from them at a few pence in the pound, i.e. a percentage of the Debt. You can see that, say, 5% of £10,000 is worth less to them than 5% of £14,000, so MBNA will pump up the Debt at the end to make sure the greedy DCAs will pay more (the DCA may lose out if they cannot get anything, but I doubt anyone will lose any sleep there...although you too lose out, because you now get a snarling DCA chasing you even harder than usual because they have their piggy little eyes focussed on a larger amount).
  

 

• Needless to say, if the DCA recovers the whole Debt from you, it's unlikely that MBNA will reverse the Tax Write Off! It's like magic, one Debt turns into two the same size as the first! Easy money if you can get it!
  

 

It may help if you set the key dates out into a Spreadsheet, like a large Calendar. Start with the oldest date at the bottom, and work up, adding all the days for every Month, and noting Weekends and Months, and Years. Then insert the details that you know, then the details from the SAR. Enter everything from the initial making of the Agreement, to Interest Rises to Credit Limit Rises, to any other Debt that they offered you along the way. You may spot they have made other errors, or spot a pattern such as, say, ramping up a Card Limit such that you need a Loan 12 Months later...and guess what arrives 12 Months later?

 

Going back to the DCA, the key now is to fine tune the Termination of the Agreement(s), and pin that down via any and all of the following:

 

 

• s87(1) Default Notice Date, Posting Date and Date of Service (note Account Number).
  

 

• s87(1) Default Notice Remedy Date.
  

 

• Termination Date (note Account Number).
  

 

• Charge-Off Date (note Account Number).
  

 

• Date of Sale to DCA (note Account Number).
  

 

If any of the above are not in that order, or the Account Number does not match what you expect, then Christmas may have come early for you depending on what is not in the correct order. But, just to be sure, send a S-A-R for each of you to the DCA, and see what comes back from that.

 

The key is not to alert them to a problem, wait until you have secured the hard evidence via S-A-R, backed up by your own Files.

 

The Letter from MBNA is just pind and wiss if the evidence from the S-A-R(s) reveals the weak claims in the letter to be complete nonsense.

 

HTH

 

Cheers,

BRW

[MeeBroke]

I sent a letter a letter to MBNA accepting their unlawful recission and have now received their response.

 

 

 

Hi Kayyak

 

Could I just ask how long(ish) it was between you sending the UR and you receiving that letter? I'm in the identical situation also. I sent my UR letter 8 weeks ago and have heard nothing from MBNA or the DCA. I have, however, had my SAR through confirming both a faulty DN and that they have sold the debt on before the DN period expired.

 

Just surprised I've heard nothing for this long.

 

Thanks

MB

[Kayyak]

Hi Meebroke

 

It took approx 5 weeks from my UR letter to their full response. I did have a letter in between explaining their investigations are taking longer than anticipated and will contact me within 4 weeks (they were aiming for 8 weeks to resolve my so called 'complaint'). I wasn't 'complaining'..... just accepting their UR!

[vint1954]

Hi kayyak,

 

Hopefully you have kept the envelope that the DN came in. If ukmail, that is second class deliver and the default notice fails in itself. ( 4 working days for service ) I note in their letter they refer to 17 clear days to remedy the default. Not sure what planet they live on as it should be 14 clear days from service. ( 14 + 2 or 4 working days for service )

 

The other problem that MBNA often ask for the full ballance in the DN, not just the arrears. Another failure and often they refer to the wrong clause in the agreement to identify the breach.

[Kayyak]

Interesting .......The account states "charge off code A" with a date of 8 days BEFORE the default notice was sent..... and now I realise the DN stated the incorrect amounts as I made a payment one week before the DN was issued and that amount had not been deducted. There is no termination date anywhere but I presume the charge off is the termination date that I am looking for.

 

MBNA haven't actually added lots of high charges/interest as it's only been just over 6 months when we first fell into arrears.

 

I will now have a go at that spreadsheet.

[vint1954]

This is probably a charge off for tax purposes.

 

Is there anything after that date and after the DN.

[Kayyak]

That sounds about right "charged off for tax purposes".

 

After this date the screen print shows NOD sent clearly with expiry date notes and 11 days later "sold to ...."

 

I haven't sent my letter to them yet (post of 16.5.10), could someone be kind enough to read through and let me know if I've missed anything or need to delete anything. Thanks

[Kayyak]

Received a letter from Hillesden admitting they bought the debt before the DN expired but they didn't start any collection activity until the 25th. This is true but MBNA evidence said they "sold it on the 19 Feb".

 

Is this unfiar practice according to the OFT guidelines "section 2.2 presenting information in such a way that it creates a false or misleading impression or exploits debtors lack of knowledge".

I just want to double check before I do report them (although I feel that I may get nowhere with the OFT)

 

BTW section 15 of the original T&C is not on the ones that MBNA sent although it mentions general conditions at the tick box on the application form. This seems rubbish as my main argument is that it was sold before I could rectify the breach.

 

Has anyone else had a similar letter with a response which I could send. I've been looking all morning. I may just send the letter I sent to MBNA but I expect Hillesden has received this anyway.

[Kayyak]

bump.

 

I've partly drafted a letter but my query is the section 15 bit which states:

"We may transfer our rights or duties under this agreement or arrange for any other person to carry out our rights or duties under this agreement".

 

Now to me, I would say that this means transfer as in the company being taken over but it is vague and open to interpretation.

 

Would a legal Default Notice over-ride this section 15 and can they transfer the account when a Default Notice is LIVE?. From what I've read they cannot, but they didn't really transfer the account, it was SOLD and the letter from MBNA states sold. Nornally a transfer would involve some kind of costs. If this was taken to court, I'm pretty sure the DN would be in my favour in that it was sold before I could rectify.

 

These are just my thoughts. Could someone kindly clarify this legal bit before I contact them.

[DonkeyB]

Interesting thread which I think the OP is about to reopen... wish it had been in the legal section! Some very illuminating bits on here, with MBNA dropping themselves in it, and clearly implying that if your complaint of selling on a certain date was valid, they accept that unlawful rescission would have occurred.

 

Of course, we now know they’re wrong – which shows just how stupid they are.

 

But what we also know is that their DNs were totally deficient – never enough time to remedy, as their postage was proven to be 2nd class.

 

Where’s this at, Kayyak? In what way has it ‘resurfaced’?

[Guest]

following

[Kayyak]

Thanks for looking in Donkey.

Last year DLC wrote to me setting out the dates the DN was served and the rectify date stating this should have given me enough time to rectify etc with copy of the DN. Then all was quiet until a few weeks ago when mercantile data bureau ltd contacted me. I know they are also known as dlc as they had the same registered address. I wrote to MDB ltd informing them of my dispute with dlc and it was immediately returned back. DLC/hillesden have now written to me asking for details of my dispute so they can investigate the matter fully requesting my evidence to substantiate my claim.

 

I am thinking of going down the F & F route based on the amount of arrears, as that is all they are entitled to (just to get rid of them and avoid any court). I know I should no longer use unlawful rescission, so what is the correct term to use following the Brandon appeal?

[renegadeimp]

Dont explain to DLC/hillsden what the dispute is, it is THEIR problem to find out what it is. Not for you to supply them with all the info they need to try and collect on the account.

[Kayyak]

I will not be sending them a copy of my DN but feel I need some bargaining tool ie unlawful rescission (the correct wording is required ) to assist with a full and final offer.

[DonkeyB]

Can you tell us the dates on the DN?

[Kayyak]

DN dated 8th March, remedy by 25th March, terminated and sold to DLC 16th March. DLC wrote to me requesting payment proposals 22nd March, ie 3 days before the remedy date!

[DonkeyB]

Hmmm. This raises a whole raft of questions about MBNA’s reply, and their conduct. Much of it is provably bare-faced lies.

 

Sadly, that won’t make this go away, but the basics have been missed, notably that the DN was clearly deficient and did not allow enough time to rectify, and that the account evidently WAS sold before the DN expired, and that also the new buyer disregarded or did not know of any DN being issued.

 

What you have at present is a non-defaulted account that cannot, therefore, be enforced in the courts.

 

But they can remedy this fairly easily. Sadly, until new case law makes it otherwise, the rescission argument is a bit of a false trail.

 

Even though MBNA implied that rescission had not taken place because you misunderstood the sale date, their legal arguments are actually wrong, IMHO, even though they claim to have consulted their legal team.

 

But in court they would surely change that argument.

 

However... I believe you have been misled severely in this matter, and have clearly been lied to. That is a matter of you not being treated fairly as a customer, which opens up a whole new box of tricks.

[Guest]

was the dn def 2nd class, can that be shown? was there anything else wrong with it re its form?

agree that the old 'unlawful rescission' argument is n/a. but, disagree generally that a defective dn can be remedied easily, depends on the circs. if they do a new correct dn with the old dates, too late, they have already acted unlawfully, and prejudice has ensued? if they do a new dn with new dates, if payment made in time re the offer then they would have to reinstate the original account and compensate for all that has followed from their original mistake. doubt they would want to do that. what would happen then? could a debtor refuse a new dn with new dates? anyway, thinking aloud/supposition.

anyway, as it is, they seemed to have messed things up, and it was clearly sold prior to dn expiry?

Edited June 14, 2013 by Ford

[DonkeyB]

You need to read the judgment from Harrison v Link to understand the issues re MBNA DNs and their 2nd class postage issue. They always claimed their supplier, UK Mail, sent items first class. They were forced to concede in court that they were posted second class.

 

http://www.bailii.org/ew/cases/EWHC/Mercantile/2011/B3.html

 

Look particularly at points 54 and 55, and read the prior arguments.

 

Point 56 is also very relevant to you. Unlike Mr Harrison, you WERE given notice of the sale within the DN timeframe, because the new owner demanded payment! That could be significant.

[theoldrouge]

was the dn def 2nd class, can that be shown? was there anything else wrong with it re its form?

agree that the old 'unlawful rescission' argument is n/a. but, disagree generally that a defective dn can be remedied easily, depends on the circs. if they do a new correct dn with the old dates, too late, they have already acted unlawfully, and prejudice has ensued? if they do a new dn with new dates, if payment made in time re the offer then they would have to reinstate the original account and compensate for all that has followed from their original mistake. doubt they would want to do that. what would happen then? could a debtor refuse a new dn with new dates? anyway, thinking aloud/supposition.

anyway, as it is, they seemed to have messed things up, and it was clearly sold prior to dn expiry?

Hi Donkey and Ford, very interested in your thoughts as regards remedy of defective DN, say new DN was issued by new owner 3 years after original , the arrears fig would have increased considerably so would a new DN be for the new arrears fig and could a debtor refuse a new DN anyway?

[Guest]

until a court provides some authority on the issue of a 'new' dn, it is pretty much all surmise. as has been posted on quite alot on cag.

the current case law, harrison i think as DB says or was it brandon?, mentioned the possibility, but it hasn't been authoritatively tested yet afaik?

save to say one eg, that 'sweet and maxwell' previously alluded to the law of 'mistake' as a poss remedy re a duff dn? which is what i allude to prior.

Edited June 20, 2013 by Ford