Contract hire extension rental - statutory demand

[42man 8,347]

Did they at any stage attempt to come and collect the vehicle or telephone to pick up ?

 

Were they aware of any kind of dispute prior to the stat demand ? i.e anything in writing..../ not just phone calls

 

How was the statutory demand delivered to you ?

[42man 8,347]

Have you used the vehicle at all during the 12 months ?

[42man 8,347]

I would also for good measure get a SAR from the bank too.

[B-B 1]

Hi 42Man, thanks for looking.

 

All rentals during the 24 month term were paid yes. This was via d/d and after this our account was marked with settled on the credit file and they didn't attempt to take any further d/d.

 

We only rang to pursue a quote, nothing in writing

[42man 8,347]

Was this disputed before the stat demand arrived ?

[B-B 1]

We were just asked on the telephone "do you want to return the vehicle" to which we said no but we would like a quote to keep hold of it.

 

We did use it yes. Although after 6 months it didn't have road tax,which it is their responsibility to provide . I think they may have declared it off road.

 

They never requested the vehicle back and when they did we made an appointment straight away and it was collected.

[42man 8,347]

If it were me in your shoes then I would be stating on the demand that no extension agreement had been signed or executed despite your request. I think I read somewhere above that the company do not allow extensions unless there is a signed agreement ? (am I correct).

 

If I were a judge, then I may say that you benefitted from the use of the vehicle, which in light of the fact that you have a major dispute, and they are trying to collar you for 12 months then it shouldn't make any difference.

 

However it is preferable that you had a major dispute before the demand arrived (I have to ask how was the demand served on you ?). If you had a major dispute before they sent out the demand then I have an inclination to add this is your set aside/affadavit.

 

HHJ Peter Coulson QC sets out in Jacob v Vockrodt [2007] EWHC 2403 (QB) when petitioning is an abuse of process that could involve the tort of malicious presentation of a bankruptcy petition.

 

The key parts of the judgement on abuse of process are:

 

Mr. Davies relied on the well-known passage in the judgment of Harman J in Re a Company [1983] BCLC 492 in which he said:

 

"First, it is trite law that the Companies Court is not and should not be used as (despite the methods in fact often adopted) a debt-collecting court. The proper remedy for debt collecting is an execution upon a judgment, a distress, a garnishee order or some such procedure. On a petition in the Companies Court, in contrast with an ordinary action there is not a true lis between the petitioner and the company which they can deal with as they will. The true position is that a creditor petitioning the Companies Court is invoking a class right (see Re Crigglestone v. Coal Co. [1986] 2 Ch 327) and his petition must be governed by whether he is truly invoking that right on behalf of himself and all others of his class rateably, or whether he has some private purpose in view. It has long been an order that a petition presented for the purpose of putting pressure on the company is not properly presented: see Re a Company [1894] 2 Ch. 349 and, in a slightly different context, Re Bellador Silk Ltd. [1965] 1 All ER 667."

 

It is, of course, right that a bankruptcy petition must not be utilised where the petitioner knows that the debt is the subject of a bona fide dispute, but chooses to proceed with the petition in any event, so as to put illegitimate pressure on the other party to pay the debt. But the authorities cited above cannot be taken as authority for any wider principle or proposition. In my judgment, the correct approach to the facts, in a situation where the petition has failed and it is subsequently suggested that the presentation was malicious, was that applied in Partizan Ltd v OJ Kilkenny & Co Ltd [1998] 1 BCLC 157 by Rimer J, when he concluded at page 173:

 

[42man 8,347]

I personally think you have a strong case to set aside.....

 

I like this - monies claimed pursuant to the terms of agreement (no agreement number or details) but the agreement states 1. The agreement shall subsist for the period of hire. (Which was fixed for 24 months) 2. No agent, employee etc can alter, warranty or extend the terms of the agreement in confirmed in writing and signed by an authorised signatory of the owner etc etc....

 

Can you write the full particulars of the claim on the demand down here ? but don't include names/dates or amounts....

[42man 8,347]

If you write down the particulars of the claim on the demand and tell me exactly how they served the demand too I can assist in a defence......

[42man 8,347]

Adding this to help too - Hammonds (a firm) v Pro-Fit USA Ltd [2007] EWHC 1998 (Ch)

 

So far as disputed debts are concerned, the practice of the court is not to allow the insolvency regime to be used as a method of debt collection where there is a bona fide and substantial dispute as to the debt. Save in exceptional cases, the court will dismiss a petition based on such a debt (usually with an indemnity costs order against the petitioner).

[B-B 1]

Thanks 42,

 

I'll copy the particulars down shortly.

 

The SD was sent in the post. I think they may have attempted personal service though as an oddment called at the house asking for my wife yesterday. When I told him she was un-available he just left but wouldn't tell me anything

[42man 8,347]

OK...get the POC's down, that would be helpful, also list the clause where it says ..... 1. The agreement shall subsist for the period of hire. (Which was fixed for 24 months) 2. No agent, employee etc can alter, warranty or extend the terms of the agreement in confirmed in writing and signed by an authorised signatory of the owner etc etc....

 

And so far they have attempted no personal service....is the statutory demand in your wife's name ?

[42man 8,347]

It is also worth checking that the court mentioned on the stat demand is YOUR local court. And even if it is you must check that the court mentioned do handle bankruptcies/insolvencies if not then this could be an abuse of the process. You can check here -

http://www.hmcourts-service.gov.uk/HMCSCourtFinder/

(for example although Epsom has a County Court, it does not handle bankruptcies/insolvencies) It should also have the name of a person you can ring to state that you will be applying to set aside the demand along with a telephone number to contact that person. Indeed it might be worth a phone call to state that you will be applying to set aside the demand.

[B-B 1]

Quote............................

 

 

The creditor demands the sum of £....................

 

1. The creditor is a finance company and at all material times the owner of the vehicle stated below.

 

2. The claim is respect of a regulated agreement in writing dated 29/08/2006 wherein the creditor agreed to hire to the debtor a..........( The vehicle)

 

3. Pursuant to the terms of the agreement, sums remain due and owing to the creditor in respect of rectification costs, excess mileage charges, administration fees and extension rentals, full particulars of which have been supplied to the debtor.

 

4. Invoices have been raised by the creditor between 06/10/2008 and 27/01/2010 and despite repeated demands for payment, the sum of £......... remains due and owing to the creditor.

 

5. The creditor is entitled to claim ongoing interest pursuant to contract at a rate 5.5%(being 5% above finance house base rate) (or such other rate as may be determined in accordance with the contract) equivalent to sum of £...... and continuing to accrue at a rate of £...... per day until payment.

 

6. And the creditor claims:

i. £..........

ii. Interest as aforesaid of £.............

 

At the date of this demand the total amount due for payment is £..................

 

Quote.....................................

 

 

 

I attached pdf's of the agreement earlier.

 

Thanks in advance....

[B-B 1]

In the Terms & Conditions:

 

2. Agreement for Lease.

The owner shall hire to the hirer the vehicle upon these terms and conditions and those contained in the preceeding pages of this agreement. This agreement shall be deemed to be made when signed by the owner or authorised signatory.

 

3. Period of Agreement to Lease

Subject to the provisions for earlier termination as provided in clause 7, this agreement shall subsist for the period of hire.

 

4. Hirers Payments

(d) Without prejudice to the rights of the owner, the hirer shall pay to the owner interest on any sum payable by the hirer to the owner under THIS agreement and not received on the due date for such payment at the annual rate of 5% over finance house base rate in force for the time being, calculated on a daily basis. ( would this cover extension rentals and interest thereon?)

 

8. Delivery-up of the vehicle.

Upon the termination of this agreement however so arising the hirer shall cease to be in possession of the vehicle with the owners consent and shall return the vehicle in good condition( wear & tear etc etc) If the hirer retains possession or use of the vehicle (with or without the consent of the owner) after the termination of this agreement the obligations of the hirer under this agreement shall continue as if this agreement had not so terminated and such use or possession of the vehicle shall not be construed as a renewal of this agreement, the hire being obliged to deliver up the vehicle following a request to do so by the owner.

 

9. General

© No servant or agent of the owner has any authority to make, agree or give any variation of or addition to this agreement, unless expressed in writing and signed by a duly authorised representative of the owner.

 

----------------------------------------------------------------

 

Just a couple of points that may be relevant ?

[42man 8,347]

I'm not sure that I like this part 8....it seems to be able to cover their backsides in the event of what happened in your case.....if you only wanted the vehicle for 6 months then they can still make you BR for the 6 months you had the car. However the interesting aspect is the lack of any new agreement, and whether or not they would be required to carry on any obligations under the Consumer Credit Act. This would be a completely new scenario for me. There is still a major dispute obviously as you only wanted it for 6 months and they are trying to invoice you for 12 months (and they failed to supply any tax for the vehicle)

 

8. Delivery-up of the vehicle.

Upon the termination of this agreement however so arising the hirer shall cease to be in possession of the vehicle with the owners consent and shall return the vehicle in good condition( wear & tear etc etc) If the hirer retains possession or use of the vehicle (with or without the consent of the owner) after the termination of this agreement the obligations of the hirer under this agreement shall continue as if this agreement had not so terminated and such use or possession of the vehicle shall not be construed as a renewal of this agreement, the hire being obliged to deliver up the vehicle following a request to do so by the owner.

[B-B 1]

Do you think these obligations could be interpreted as extending to and repeating the payment profile & rentals ?

 

Quote:

 

4. Hirers Payments

The hirer shall pay to the owner the rentals, administration fee and if applicable the excess mileage charges in cleared funds and on the due dates for payment as specified in the key financial information.

 

KEY FINANCIAL INFORMATION:

 

Period of Hire & Rentals:

 

First Rental £

 

Subsequent Rentals : 23

 

Period of Hire is for 24 Months from and including (insert date of delivery)

 

---------------------------------------------------------------------------------------------------------------------

 

We have also never received any kind of default notice for breaching any agreement, is this relevant ?

[sequenci 3,735]

Sure is.

 

NO default means they have NO right to take further action.

[B-B 1]

No default or No Default notice ? Could they serve one now ?

 

 

They seem to be relying on selectively trying to enforce certain parts of the original agreement whilst not using any specific breach as a default under or referring to the CCA1974. Just "regulated agreement in writing" or "the agreement"

 

Are all arguments ultimately going to come back to this original agreement ?

 

Would they need to produce this ?

 

What other processes could they have been in default of that would prevent enforcement ?

 

Thanks Guys

[citizenB 10,187]

No default or No Default notice ? Could they serve one now ?

 

 

They seem to be relying on selectively trying to enforce certain parts of the original agreement whilst not using any specific breach as a default under or referring to the CCA1974. Just "regulated agreement in writing" or "the agreement"

 

Are all arguments ultimately going to come back to this original agreement ?

 

Would they need to produce this ?

 

What other processes could they have been in default of that would prevent enforcement ?

 

Thanks Guys

 

There is a difference between a default and a Default Notice. A default is that which is recorded at the Credit reference agencies and a Default Notice is a notice of your defaulting issued under s87(1) of the CCA1974. Which it appears they havent sent to you. It should set out the reasons for them issuing the default notice ie non payment as per contract and should give you a time no less than 14 days (not including postage times) for remedy of the breach.

 

Postage times are 2 business days if sent via 1st class post or 4 business days if sent 2nd class or other inferiior mail service.

 

IMHO, they cannot now issue a Default Notice as they have issued this claim, which effectively terminates any agreement that you had with them.

[sequenci 3,735]

IMHO, they cannot now issue a Default Notice as they have issued this claim, which effectively terminates any agreement that you had with them.

 

Absolutely!

 

And they cannot serve a stat demand until the default notice expired!

[B-B 1]

Do the CCA1974 Regulations extend through all avenues of recourse, insolvency, bankruptcy, County Court ?

[sequenci 3,735]

They sure do.

[B-B 1]

By default would a Stat Demand Terminate a credit agreement ?

[sequenci 3,735]

By default would a Stat Demand Terminate a credit agreement ?

 

No. For a creditor to get to a position where they can actually send a stat demand out they would at first need to give you the chance to remedy the breach. This is when they send the default notice to you, which gives 14 days for you to try and bring the arrears up to date. if you do not do this then they can terminate the agreement and then choose to take matters further. if they have sent a stat demand without going through the default notice process they have unlawfully sent it to you.

 

Hope that makes sense!