Lowell Portfolio and Bankruptcy Proceedings

[nicklea]

I was in a similar situation to yourself about 10 years ago.

 

Although not relevant to the present it was for a mortgage indemnity guarantee after my house was repossesed with negative equity back in the late 80s.

 

The creditor has not necessarily already got a CCJ against you - they don't need to do that before presenting a bankruptcy petition.

 

What has happened is that they have issued a bankruptcy petition against you and the letter from the land registry is telling you that a caution has been placed against your property to prevent you selling it before the court can hear the petition.

 

As the others have said you need to get to the court as soon as possible and get all the documents and find out when the date is for the hearing.

 

The whole bankruptcy thing is governed by the Insolvency Rules 1986. You can find a copy here:-

 

http://www.insolvency.gov.uk/insolvencyprofessionandlegislation/legislation/uk/insolvencyrules.pdf

 

and the relevant bit for individuals starts from the bottom of page 385

 

As part of the bankruptcy petition they have to provide evidence of service of the Statutory Demand and they really should have done it by personal service or at the least recorded delivery - rule 6.11. I'm guessing that neither of these took place. This will be a strong argument in your favour.

 

Once you get all the paperwork from the court then we can deal with this properly.

 

You do need to take this seriously, if you do not oppose this then they can make you bankrupt.

[nicklea]

£5 fee. But they suggested I contact their solicitor directly for it. Is it too late to male an offer of installments or are they in control of the situation? The house equity is worth way more than the debt so bankruptcy is a a nightmare scenario.

 

I would suggest that you do not do anything like that yet. You do have some very strong arguments against bankruptcy.

 

I would suggest that as long as you do opoose the bankruptcy petition then the worst case scenario would be that they would give up on the bankruptcy petition and then issue a court claim against you which you can either pay then or defend depending on the circumstances.

 

THe best case scenario would be that you find out that the agreement is unenforceable and they go away all together.

[nicklea]

This is something that I did for someone else as a defence to a county court claim. It may help you to put something together for yourself:-

 

5. In order to prove its claim the Claimant must establish a number of matters. Firstly that there was an agreement between myself and Capital One, secondly that such an agreement complied with the requirements of Consumer Credit Act 1974 (“the Act”) and all consequential regulations made thereunder, both at the date of inception and at all times thereafter. Thirdly it must establish that Capital One complied with all of the provisions of the Act in that it must show that it served a proper default notice upon myself prior to terminating the agreement. Fourthly, it must establish that there was an “absolute assignment by writing under the hand of the assignor” (S136 (1) Law of Property Act 1925). Fifthly that proper notice of any such assignment was given to the Defendant (S196 Law of Property Act 1925). Finally it must establish that the sums claimed are lawfully owing both at the date of the alleged assignment and at all other times.

 

6. It is submitted that it is the obligation of the Claimant to prove all of the above matters.

 

 

 

 

Existence of a Written Agreement

 

 

7. It is accepted that I applied for a credit card with Capital One and that an Application Form was completed. It is not accepted that the Agreement was reduced to writing and it is not admitted that a valid agreement containing all of the prescribed terms required by the Act exists. The prescribed terms are, pursuant to Schedule 6 of the Consumer Credit (Agreements) Regulations 1983, as to repayment, credit limit and rate of interest.

 

8. In such eventuality the absence of a written agreement containing all of the prescribed terms is fatal to the claim as the alleged agreement was entered into before the 6th April 2007, being the date when s15 of the Consumer Credit Act 2006 came into effect. By operation of Schedule 3 of the 2006 Act the terms of S127 (3) Consumer Credit Act 1974 are not repealed in respect of this alleged agreement and therefore render it unenforceable.

 

9. The Court’s attention is drawn to the authority of the House of Lords in Wilson & Ors v Secretary of State for Trade and Industry [2003] UKHL 40 and Dimond v Lovell[2000] UKHL 27; [2000] 2 All ER 897both of which confirm that where a document does not contain the required prescribed terms under the Consumer Credit Act 1974 and the Consumer Credit (Agreements) Regulations 1983 (SI 1983/1553) the Agreement cannot be enforced.

9. Further, it is noted that the Act provides that the prescribed terms cannot be found in a secondary document as according to section 61(1) (a),(b) & © the agreement must at the time it is laid before the debtor contain all the terms of the agreement (Wilson & another v Hurstanger Ltd [2007] EWCA Civ 299).

 

 

Valid Default Notice

 

10. It is a condition that prior to the issue of Proceedings in respect of a Regulated agreement that certain steps must be taken. Specifically those steps are the issue of a valid default notice complying with the terms of the Act and the issue of a valid termination notice, also complying with the act.

 

11. It is not admitted that either a valid default notice or termination notice was ever served on me and the Claimant is put to strict proof.

 

 

 

The Assignment of the Debt

 

12.It is not admitted that there was a lawful assignment. The Claimant is put to strict proof that the assignment was lawful. It is not accepted that notice was given to myself of the assignment and the Claimant is put to strict proof that sufficient notice thereof was served upon myself before proceedings commenced. Without this proof the Claimant has no standing before the court.

 

13.The Law of Property Act 1925 is the relevant act that deals with the assignment of debts. Section 136(1) requires that for the assignment of a debt to be effective, express notice in writing must have been given to the debtor:-

 

136. Legal assignments of things in action.

— (1) Any absolute assignment by writing under the hand of the assignor (not purporting to be by way of charge only) of any debt or other legal thing in action, of which express notice in writing has been given to the debtor, trustee or other person from whom the assignor would have been entitled to claim such debt or thing in action, is effectual in law (subject to equities having priority over the right of the assignee) to pass and transfer from the date of such notice—

 

14. However, it is Section 196(4) that prescribes the requirements for giving sufficient notice by post:-

 

196. Regulations respecting notices.

(4) Any notice required or authorised by this Act to be served shall also be sufficiently served, if it is sent by post in a registered letter addressed to the lessee, lessor, mortgagee, mortgagor, or other person to be served, by name, at the aforesaid place of abode or business, office, or counting-house, and if that letter is not returned [by the postal operator (within the meaning of the Postal Services Act 2000) concerned] undelivered; and that service shall be deemed to be made at the time at which the registered letter would in the ordinary course be delivered.

 

15.It is noted that by the Recorded Delivery Service Act 1962 a recorded delivery letter is equivalent to a registered letter and that under the Postal Services Act 2000 Schedule 8 any reference to registered post is to be construed as meaning a registered postal service (eg Royal Mail recorded delivery or special delivery).

 

16.For the assignment of a debt to be effective and so giving the Claimant a right of action a valid Notice of Assignment must have been sufficiently served on me using a registered postal service pursuant to s196(4) before proceedings were commenced. The Claimant is put to strict proof that any notice of assignment was sufficiently served on me before proceedings were commenced. Without this proof, the Claimant has no right of action.

 

 

 

17.Further, it is submitted that the mere fact of giving a notice does not, of itself, create an assignment and that there must be an actual assignment in existence. It is the actual Assignment, not just the Section 136 notice, under which the Claimant derives title to bring the claim and the Claimant is put to strict proof that such Assignment exists. It is further averred that I am entitled, in any event, to view the document of assignment as a matter of law to ensure that the Asignee can give good discharge (Van Lynn Developments v Pelias Construction Co Ltd 1968 [3] All ER 824).

 

18.It is further averred that to be valid the alleged notice of assignment must accurately describe the assignment including the date (W F Harrison & Co Ltd v Burke & another [1956] 2 ALL ER 169).

 

 

Sums Claimed

 

19.It is not admitted that any or all of the monies claimed are lawfully owing. The Claimant is put to strict proof as to how the sums claimed have been calculated and as to how those sums are lawfully owing.

20.Further, it is denied that any alleged contractual account charges and the contractual interest subsequently applied to those charges which have been claimed are lawfully owing in that it is submitted that the charges are a penalty in that they do not reflect any actual losses sustained by the claimant nor does it reflect realistically any actual costs incurredand so are in breach of the common law and, in any event, unfair within the meaning of the Unfair Terms in Consumer Contracts Regulations 1999.

21.In case the Claimant should attempt to justify these charges by reference to the Office of Fair Trading Report of April 2006 “Calculating Fair Default Charges in Credit Card Contracts” (“the OFT Report”) I would like to draw the court's attention to the detail of the OFT Report. The OFT Report did notstate or give guidance that a level of £12 was fair; neither did it recommend this figure in any way, it was merely a statement of regulatory intent. The OFT Report set a threshold level of £12, below which it would not warrant regulatory intervention at that time (para 5.4 of the Report). The reason given for this was that their resources would be better directed at cases involving more serious economic detriment. Finally, the OFT Report specifically stated that the OFT had no power to constrain private civil actions or to determine what a court should decide (para 5.7) and that a court will certainly not consider that a default fee is fair just because it is below the threshold (para 5.5).