Personal Guarantee Advice !

[losser]

I received a letter from Nat West addressed to my company calling in the overdraft of £30K. This was inspite of a repayment proposal I had already made to them which had been acknowledged but not accepted or declined. At the same time they issued default notices on my personal account and loan account effectively shutting everything down.

 

The letters were written in the name of my Business Manager who was on holiday. There was no one that could help me. Upon his return he said my proposal relating to the company overdraft had been passed on. Nevertheless, I then received a letter calling upon the personal guarantee because no ''proposal" had been received which was not the case. The bank refuse to discuss this matter any further and continue to pursue the personal guarantee and payment of my overdraft and personal loan. They have now turned down my offer of £250 per month for the business overdraft.

 

Question: The company never received a default notice prior to the personal guarantee being called upon. Do they have to issue one.

 

Question: In relation to my personal accounts, I was not given any opportunity to respond to the default notice since my manager was away and no one else could help me. I have written proof of this. Where do I stand? I

 

Advice gratefully received

 

I would be grateful for any advice.

[The Mould]

Good afternoon losser

 

In what capacity did you sign the personal guarantee - i.e; As the Director of the company or as Mr John Smith?

 

Can you scan the personal guarantee in and post it up for inspection please?

 

Kind Regards

 

The Mould

[losser]

I can't scan at the moment. The document is signed by me saying 'Signed and Delivered as a deed by (my name) in the presence of. No mention of Director. Interestingly it is witnessed, but the witness has not provided an address.

[The Mould]

I can't scan at the moment. The document is signed by me saying 'Signed and Delivered as a deed by (my name) in the presence of. No mention of Director. Interestingly it is witnessed, but the witness has not provided an address.

 

Thank you for that losser, that is most certainly a Personal Guarantee then, if you had of signed it as the Company Director then you would not be liable for the sum claimed because you Mr Losser and you as the Director of the Company are two entirely different legal entities.

 

What about the Default Notices, are the figures stated on them correct, timescale to remedy breech correct?

 

If you can get your post count up to 20 in number, then you should be able to scan documents in and post up the attachments.

 

Kind Regards

 

The Mould

[losser]

the default notices may well be correct in content, however I was not given any opportunity to remedy breach because my business manager, in whose name the documents were issued, was away and knew nothing about the action. Despite many efforts, the bank could not provide me with anyone to speak to or correspond with in relation to this matter.

[losser]

Also would the company need to receive a default notice re the overdraft. Nothing has been received, just a letter calling in the overdraft.

[Chipmeister]

In respect of a default notice for an overdraft - I don't think one is required - generally they will just write to you and tell you that they are calling it in, which they will claim they are entitled to do at any time under their terms and conditions.

[oilyrag]

A couple of things. When was the guarntee signed? There has been discussion elsewhere that for a limited company OD requiring a personal guarantee it has to be signed and renewed each year by the guarantor AND the business manager of the bank concerned to be valid.

 

However have you considered the Full & final settlement route to sort this out. We have just won one at 10% final figure for the investment cost of a couple of solicitors letters. There is quite a bit about F & F s on here plus a good blog by site team member sequenci which is worthwhile reading. We used the solicitor to ensure that the agreement was watertight. If you want any more guidance because you think that might be possibility, give me a shout and i will point you to a couple of law firms websites ( I have no connection other than I found them when looking for information on this as a possible for us). Thes have good write ups, one with lots of case law references, the other is advice for creditors on what they can do and what they cannot do and the consequences for such actions. The two combined make interesting reading. You will still get a load of nastiness at some stage when they wake up to the facts of what they have done but all can be seen off quite easily. A lot of low percentage level F & Fs are won really on the basis of the banks not really knowing what their own staff are up to department to department.

 

It might be worth a thought and certainly worth a bit of reading.

 

best regards

oilyrag.

[losser]

Thanks so much for this advice.

The personal guarantee was signed in 2005, nothing since. I will check when overdraft was last renewed. It's a couple of years I'm sure. F & F @ 10% would be worth consideration if I could get that kind of thing agreed. I would be grateful if you could forward the info on the law firms.

[oilyrag]

Hello Losser,

 

Glad to be of help.

 

Firstly when making trying to make our minds up about a F&F I looked around for information. Much was confusing and contradictory as it is a huge subject on its own and extant case law still referred to includes the infamous Pinnel case going back to 1602, yes 1602! However all is not lost if it is tackled in a logical way.

 

My links from here never seem to work properly so it is probably quicker for you to Google up firstly:

 

Gannons London Solicitors. They have a write up on F & F. Please note that this is advice for the CREDITOR on what they may and what they may not do and the consequences of those actions. It does make good reading.

 

Secondly Google up:

 

Addleshaw Goddard. These are a firm of solicitors and although the site is not that easy to navigate they do have an exceptionally good guide to Full & Final settlements. This write up gives you case law references from 1602 up to current date and Lord Justice Lloyd speking in judgement from the Court of Appeal.

 

I did the reading on here and spoke by PM with sequenci (site team member) who is most helpful on these issues. I spoke with our own solicitors who are handling our credit card disputes who immediately took it up. It was they who suggested the 10% opening bid, we expected a much higher figure. A total of three letters,one of which took "serious issue" with the bank concerned very frosty indeed, from them closed it all up watertight and they were told try it on if you wish see you in court.

 

Basically what happens is that if you follow the guidlelines given to you, the banks in their greed and arrogance will immediately bank the "third party" cheques and fail to inform you within the time frames laid down that they have not accepted your offer (within 7 days is contained within the Lloyd LJ rulings but i woudl suggest 8 weeks is really the cut off). The banks are now so large that the left hand does not know what the right hand is doing and they fall into the legal quagmire by their own actions. Our solicitor is quite happy in all our dealings to sit back and let them hoist themselves on their own petards, then take them apart if they do try litigation.

 

Despite as I said a load of nastiness 3 months after the event when they woke up to what they had done, they have retreated to lick their wounds and find some other unfortunate to have a go at.

 

I know one of the people who is helping out on this thread is likely to take issue with what I have said, but there are differing opinions and several ways of tackling the issue. We won ours the way I said and it was done by the solicitor almost exactly as sequenci suggests in his blog.

 

regards

oilyrag.

[oilyrag]

Sorry I missed the guarantee issues. I haven't got any real authority to back what I am saying but there have been several posts from differing people on CAG which have stated that the guarantee is invalid if not renewed annually. What I can say is that in the nastiness following our F & F, this was one of the things they tried, sols shrugged their shoulders and said ignore it was irrelevant now.

 

regards

oilyrag.

[The Mould]

Losser

 

Firstly, it would be advisable to start another thread in respect of your personal loan account and the issues thereof, this will avoid any confusion with the Personal Guarantee subject of this thread.

 

Oilyrag, are you referring to me as far as Full and Finals are concerned?

 

Losser, during the course of operating your company, did you request for any increases on the overdraft facility?

 

Kind Regards

 

The Mould

Edited February 9, 2011 by The Mould
Doubled up on a word!

[The Mould]

You brought up the Full and Final oilyrag.

 

I did not post on this case to advise OP on Full and Finals, the subject of the thread is Personal Guarantee.

 

Losser, the Personal Gurantee Agreement that you signed acting as guarantor for the company is absolutely 100% binding in law.

 

Statute of Frauds 1677 applies to guarantee agreements.

 

Do not be fooled into thinking that you can simply send or offer a 10% payment (third party or not) in Full and Final Settlement against a debt of £30,000.00.

 

If you are going to enter the field of law in Full and Finals, then you should engage in discussion with your creditor in respect of a compromise agreement, by all means put your proposals to him in writing and await his written response. That is all I am going to advise on Full and Final in your thread.

 

Did you make any request to the bank for an increase on the company's over draft facility?

 

Kind Regards

 

The Mould

[AndyOrch]

Well done Martin.Enough threads being ruined lately.8-)

[MARTIN3030]

Off topic and personal comments removed.

Members should remember,that we expect threads and help to be done openly and do not encourage pm exchanges which set out to or appear to set out a course that will take matters of use to the wider members into closed discussion.

Those found to be encouraging this,or breaching site rules could find their private message facility withdrawn.

[The Mould]

Off topic and personal comments removed.

Members should remember,that we expect threads and help to be done openly and do not encourage pm exchanges which set out to or appear to set out a course that will take matters of use to the wider members into closed discussion.

Those found to be encouraging this,or breaching site rules could find their private message facility withdrawn.

 

Thank you very much indeed MARTIN, I thoroughly appreciate that.

 

Kind Regards

 

The Mould

[MARTIN3030]

Mouldy,this is not personal to those here-its the same for all.

In fact you will remember on a number of times in the past you were told about this,and I can acknowledge that you took it onboard.

There is far too much of it.

Dont take my word for it-look at how many threads cease after pm intervention.

Look how many cease and later return months down the line.

[The Mould]

Yes Martin, I do fully understand what you mean and yes, I must admit, that there have been quite a few threads that I have worked on where the OP and myself discussed the issues of their case in private and then we exchanged email addressess. I have worked on a number of cases from this forum, undertaking all documentation into court and all correspondence to the claimant's Solicitors on behalf of those OPs, however, I have undertaken all of this Civil Litigation for the OP without a single penny in payment being asked for and you can request those caggers to confirm this fact if should like to.

 

Anyway Martin, I am going to eat a curry now, (a little treat tonight), then tea and smoke, I shall return in 30 mins.

 

Kind Regards

 

The Mould

[losser]

The only increase in the overdraft facility has been made by the bank recently to account for interest they have added. I did not request or agree to it.

[The Mould]

The only increase in the overdraft facility has been made by the bank recently to account for interest they have added. I did not request or agree to it.

 

Thank you for that Losser.

 

Interest being added to a debt is ordinary practice and acceptable in law.

 

So, the £30K overdraft facility for the company was the agreed limit that you signed the Guarantee Agreement for? Is that correct to say?

 

Have you considered holding discussion with your personal advisor from the bank to invite them to give their consideration to a settlement or an arrangement to repay the overdraft sum at a rate that is within your means?

 

Kind Regards

 

The Mould

[losser]

The issue I have with the bank is that the company made proposals to make monthly payments to repay the loan over a year ago. Our business manager confirms he was in receipt of this proposal and the bank has finally admitted it had a proposal. This proposal was not responded to and a year later we received a letter from my 'Business Manager' calling in the overdraft and asking for proposals which they already had. My business manager was away on holiday and the bank could not provide anyone to speak to to resolove matters. Upon his return he states he did not write the letter, it was done in his name by another dept. and he knew nothing about it. In the meantime, because no proposals were put forward to 'him' within the time period in the letter, they called in the personal guarantee. The Company was not given any opportunity to resolve matters because even our Business Manager did not know who had written the letters which were in his name (or so he says). We complainted to HO. The bank admits it has made mistakes in its communication with our Business Manager. The personal guarantee should not have been called in until the Company had had an opportunity to resolve matters with our Business Manager.

[The Mould]

The issue I have with the bank is that the company made proposals to make monthly payments to repay the loan over a year ago. Our business manager confirms he was in receipt of this proposal and the bank has finally admitted it had a proposal. This proposal was not responded to and a year later we received a letter from my 'Business Manager' calling in the overdraft and asking for proposals which they already had. My business manager was away on holiday and the bank could not provide anyone to speak to to resolove matters. Upon his return he states he did not write the letter, it was done in his name by another dept. and he knew nothing about it. In the meantime, because no proposals were put forward to 'him' within the time period in the letter, they called in the personal guarantee. The Company was not given any opportunity to resolve matters because even our Business Manager did not know who had written the letters which were in his name (or so he says). We complainted to HO. The bank admits it has made mistakes in its communication with our Business Manager. The personal guarantee should not have been called in until the Company had had an opportunity to resolve matters with our Business Manager.

 

Thank you again Losser for the above.

 

All you need to do then, is put the ball back into their court, they have admitted their errors, so the door should be open to discuss and reach a mutually agreeable resolution between you two parties.

 

simply ask them to review your previous correspondence and ask them to reply to said proposals therein.

 

Kind Regards

 

The Mould

[losser]

They have now rejected the original offer, however it is more complicated since because of the Bank's actions and mistakes, they terminated all my personal accounts and issued default notices which they refuse to withdraw.

I have requested that since this is all because of their errors, they put matters back to pre 31st march i.e. withdraw claim on personal guarantee and let the Company continue to discuss proposals, re instate personal accounts since they were only affected by their action on the business account, but they refuse to do this and continue to demand repayment proposals from me personally for everything. I have referred to Ombudsman