Cap1 & CCA return

[car2403]

In that case the Lender had proceeded to terminate the account, liquifying the total amount outstanding, grossly misstating arrears in process and then issued court proceedings.

 

If the lender had realised that they had issued a invalid default notice PRIOR to the termination of the account etc then they are able to "cure" the defect simply because they have not actually terminated the account at that point they are merely saying what they are going to do if the breach isn't remedied. Court proceedings being issued are in themselves effectively termination of the agreement as the lender is not entilted to all the money owing unless they have complied with s.87. Therefore any court proceedings are dealing with a DN after the account has been terminated by a invalid DN.

 

The case also provides the basis on which a DN is invalid and unlawful and, when read in conjuction with the Wilson cases, provides a basis on which further Default/Termination can happen. In short, Woodchester shows the precedent for what happens with invalid DN's and Wilson outlines the creditors right to terminate - IMO, these 2 mean an unenforceable debt that is unlawfully Defaulted is incapable of further Default and subsequent Termination on a second pass.

 

As I said, this is my opinion, based on pursasive precedent not binding, but it's worth a shout - and I think I can convince a Judge, should it be necessary. I have discussed this in lots of my small claims cases already and the Judges all seemed to lean towards my interpretation. Unfortunate none of that is binding on other Judges.

 

The Default Notice is the Termination Notice if it states the agreement will be terminated should the default not be remedied - that is the nature of DN's. A separate Termination Notice isn't necessary if a DN isn't complied with. It only is necessary if they are Terminating for something other than Default on agreement terms. (s.98 CCA 1974)

 

The Default process under the Act isn't expressly clear, so is open to attack on these interpretations.

[tinkerbell20]

The case also provides the basis on which a DN is invalid and unlawful and, when read in conjuction with the Wilson cases, provides a basis on which further Default/Termination can happen. In short, Woodchester shows the precedent for what happens with invalid DN's and Wilson outlines the creditors right to terminate - IMO, these 2 mean an unenforceable debt that is unlawfully Defaulted is incapable of further Default and subsequent Termination on a second pass. An unenforceable debt is unenforceable full stop. Doesn't matter whether you lawfully or unlawfully terminate it.

 

As I said, this is my opinion, based on pursasive precedent not binding, but it's worth a shout - and I think I can convince a Judge, should it be necessary. I have discussed this in lots of my small claims cases already and the Judges all seemed to lean towards my interpretation. Unfortunate none of that is binding on other Judges.

 

Thats my point you are already in the courts arena so the agreement has been terminated.

 

The Default Notice is the Termination Notice if it states the agreement will be terminated should the default not be remedied - that is the nature of DN's. A separate Termination Notice isn't necessary if a DN isn't complied with. It only is necessary if they are Terminating for something other than Default on agreement terms. (s.98 CCA 1974) Until they actually carry out what is stated as the penalty within the DN for railing to remedy the breach then a fresh DN can be issued becuase they haven't

 

The Default process under the Act isn't expressly clear, so is open to attack on these interpretations.[/quot

 

From Goodes

"This section, with CCA 1974, ss 88 and 89, governs the exercise by the creditor or owner of: (i) a remedy expressly provided by the terms of a regulated agreement in the event of a breach by the debtor or hirer; and (ii) a remedy available to him under the general law by virtue of such a breach (eg to terminate the agreement by reason of a major or repudiatory breach). Thus none of the steps listed in sub-s (1), paras (a)–(e), may be taken before the service and expiry of a default notice complying with CCA 1974, s 88 (but see note ‘Exceptions’ below). Once the notice expires without remedial action by the debtor (see CCA 1974, s 89) the creditor may take any of these steps.

The creditor’s position is slightly different where he wishes to demand accelerated payment. Before he may do so, he must give warning of his intention in a default notice: sub-s (1) and the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (see III[13.61]). The payment does not fall due automatically when the notice expires, however; the creditor is then merely entitled to make the demand"

[Viscount Stair]

I think I'm beginning to understand:

 

If Creditor A serves an otherwise valid DN but does not do anything else at that time and then later sends a second otherwise valid DN (eg to reflect another interest payment or charge), then the second DN is operative.

 

If Creditor B serves an invalid DN but does not do anything else at the time and then sends a second DN that is valid, then the second DN "cures" the defect in the first.

 

If Creditor C sends an invalid DN and does terminate (eg by express notice of termination, by sending a formal demand for accelerated payment of the total balance or starting court proceedings), then the defect can no longer be "cured".

 

Next question (of, hopefully, general interest and application): assuming that the DN was invalid and the agreement has now been terminated, does that mean that enforcement proceedings can no longer be started because no valid DN was served and none can now be served?

[MAGDA]

I think I'm beginning to understand:

 

If Creditor A serves an otherwise valid DN but does not do anything else at that time and then later sends a second otherwise valid DN (eg to reflect another interest payment or charge), then the second DN is operative.

 

If Creditor B serves an invalid DN but does not do anything else at the time and then sends a second DN that is valid, then the second DN "cures" the defect in the first.

 

If Creditor C sends an invalid DN and does terminate (eg by express notice of termination, by sending a formal demand for accelerated payment of the total balance or starting court proceedings), then the defect can no longer be "cured".

 

Next question (of, hopefully, general interest and application): assuming that the DN was invalid and the agreement has now been terminated, does that mean that enforcement proceedings can no longer be started because no valid DN was served and none can now be served?

 

As Car was just saying though, if a DN was issued, surely they don't need to do anything else. The DN itself is stating what action needs to be carried out in order to remedy any breach, and if you do not comply, i.e., by making the required payment, then the DN is valid (provided of course it is in the correct form and the amounts stated are accurate (allowing for a small degree of error) and no further action is necessary on the part of the creditor in order to terminate the account? The creditor should not then issue a second default, for whatever reason, as the account has already been terminated at the time of the orignal default. Also, if the debt was incorrectly defaulted, or not at all, and then assigned or, if court action was taken, then this cannot be remedied by re-defaulting. Magda

Edited November 2, 2008 by MAGDA
added text

[tinkerbell20]

Goodes consumer credit law & practice makes it clear that any steps the lender takes after the debtor fails to comply with a DN are optional.

 

"Once the notice expires without remedial action by the debtor (see CCA 1974, s 89) the creditor may take any of these steps.

The creditor’s position is slightly different where he wishes to demand accelerated payment. Before he may do so, he must give warning of his intention in a default notice: sub-s (1) and the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (see III[13.61]). The payment does not fall due automatically when the notice expires, however; the creditor is then merely entitled to make the demand""

[car2403]

An unenforceable debt is unenforceable full stop. Doesn't matter whether you lawfully or unlawfully terminate it.

 

Try telling that to any Creditor that records a Default against an unenforceable debt and refuses to remove it when prompted by the debtor.

 

Until they actually carry out what is stated as the penalty within the DN for railing to remedy the breach then a fresh DN can be issued becuase they haven't

 

And that opinion is based on... ???

 

From Goodes

"This section, with CCA 1974, ss 88 and 89, governs the exercise by the creditor or owner of: (i) a remedy expressly provided by the terms of a regulated agreement in the event of a breach by the debtor or hirer; and (ii) a remedy available to him under the general law by virtue of such a breach (eg to terminate the agreement by reason of a major or repudiatory breach). Thus none of the steps listed in sub-s (1), paras (a)–(e), may be taken before the service and expiry of a default notice complying with CCA 1974, s 88 (but see note ‘Exceptions’ below). Once the notice expires without remedial action by the debtor (see CCA 1974, s 89) the creditor may take any of these steps.

The creditor’s position is slightly different where he wishes to demand accelerated payment. Before he may do so, he must give warning of his intention in a default notice: sub-s (1) and the Consumer Credit (Enforcement, Default and Termination Notices) Regulations 1983 (see III[13.61]). The payment does not fall due automatically when the notice expires, however; the creditor is then merely entitled to make the demand"

 

Which is Goodes interpretation. I said it's open to interpretation, so I don't really see your point here - can you explain? Also, the Default Notice is the formal demand for payment, so I'm unclear on the context of the quote you've provided Tinkerbell?

[andrew1]

I don't want to stop this previously posted line going, but could I just nip in and ask one question on Default Notices please?, A car hire-purchase, late payments by Debtor and the creditor issues a Default Notice on 2 late payments. Another Default Notice is then issued for £25 admin charge which arose as a result of the late payments. What exactly happens? Does the second DN get added to the first, do 2 DN's get registered at the CRA - anyone know?

[angry cat]

Post Deleted.

 

AC

Edited July 13, 2009 by angry cat
Deletion

[Viscount Stair]

Thanks for clearing that up. What, therefore, is the actual consequence (if any) of the "unlawful repudiation" point I see bandied about?

[car2403]

I don't want to stop this previously posted line going, but could I just nip in and ask one question on Default Notices please?, A car hire-purchase, late payments by Debtor and the creditor issues a Default Notice on 2 late payments. Another Default Notice is then issued for £25 admin charge which arose as a result of the late payments. What exactly happens? Does the second DN get added to the first, do 2 DN's get registered at the CRA - anyone know?

 

Were the payments made under the original Default Notice, before it expired, then the 2nd was issued as the admin charge wasn't paid before it was due?

 

To be accurate, there should only be one Default registered with the CRA. That should then be kept up to date with payments made, balances reducing, etc, etc.

[car2403]

A Default Notice is required if the lender is to terminate the agreement, or to demand earlier payment of any sum.

 

Sorry, no it isn't - if you read s.98, you'll see they can Terminate the agreement by following the Termination process outlined in that section - this doesn't require a Default Notice, nor does it require any default under the agreement, depending on the terms of it.

 

A Default Notice (a Notice issued under s.87/s.88) is a pre-action protocol required before taking enforcement action via the Court. The Notice outlines the default that has occurred under the original agreement and states what action is required to remedy that default within the prescribed period. If the action is taken, no default (or Default) can be said to have taken place. (Note: some agreements allow subsequent defaults to be final, incapable of remedy, resulting in Termination despite compliance with the Notice - this is totally dependant on the terms of the agreement, though)

 

A Default Notice would have to be served. There is no penalty for seeking to terminate without serving a Default Notice;

the consequence is that the purported termination is inneffective.

 

This contradicts what you said earlier? (They need a Default Notice if they want to Terminate) You can't say a Notice has to be served, then say there is no penalty for Terminating without one. I'm assuming what I've said above, regarding Termination without a DN, explains why.

 

If the creditor brings proceedings for the whole debt it will have to serve a Default Notice in accordance with section 88 before terminating and enforcing;

if it fails to do so one would have a defence to the claim for the amount due on termination.

 

If the action was due to default on payment, yes.

 

Any failure on the part of the creditor to serve a Default Notice can be rectified by discontinuing the proceedings, serving a Default Notice and re-issuing a claim;

 

I assume you meant stay? If they discontinue, they are unlikely to get permission from the Court to bring another claim. CPR Part 38.7;

 

Discontinuance and subsequent proceedings

 

38.7

 

A claimant who discontinues a claim needs the permission of the court to make another claim against the same defendant if –

(a) he discontinued the claim after the defendant filed a defence; and

 

(b) the other claim arises out of facts which are the same or substantially the same as those relating to the discontinued claim

 

 

 

Failure to serve a Default Notice does not create an irredeemably bar to enforcement

 

It may create a situation where the Court decides that the subsequent Termination is unlawfull and is a rescission of contract resulting in an inability to Terminate again, though. This is where this discussion started, so I won't restate the reasons why here as they are in the thread already.

[angry cat]

If the creditor brings proceedings for the whole debt it will have to serve a Default Notice in accordance with section 88 before terminating and enforcing;

 

If it fails to do so one would have a defence to the claim for the amount due on termination.

 

AC

[andrew1]

Were the payments made under the original Default Notice, before it expired, No, and they just issued the 2nd one for the £25 Admin Charge then the 2nd was issued as the admin charge wasn't paid before it was due?

 

To be accurate, there should only be one Default registered with the CRA. That's what I thought, but is it usual to send out a 2nd one and does it have any influence on the way the Default notice is treated? That should then be kept up to date with payments made, balances reducing, etc, etc.

 

The payments have not been kept up to date recently as my chums business is suffering badly with the current trading downturn, he's just in a tis because he doesn't know how to handle the HP Finance company.

[FANTASY CHARGES]

BBC - Radio 4 You and Yours

 

Credit Series

 

Tell us about your experience....

 

 

Over the next few weeks we’ll be taking a look at:

• the availability of personal loans
  
• credit and store cards
  
• door step lending and pay day loans
  
• the increasing rise of credit unions and saving clubs
  

Have you had a problem getting credit? Let us know on the form below. Please include your number so we can call you back.

[uptoneck]

Thanks for posting. I've filled in the contact form and await a response.

 

I wonder when it's going to be on? Don't usually listen to Radio 4.

[foolishgirl]

Well spotted FC. Hope it's 'in-depth' unbiased reporting.

 

This is a great prog. uptotheneck, usually interesting issues aired & good consumer advice. Change your dial at 12.00pm lunchtime weekdays.

[FANTASY CHARGES]

BBC - Radio 4 You and Yours

 

Credit Series

 

Tell us about your experience....

 

 

 

Over the next few weeks we’ll be taking a look at:

• the availability of personal loans
  
• credit and store cards
  
• door step lending and pay day loans
  
• the increasing rise of credit unions and saving clubs
  

Have you had a problem getting credit? Let us know on the form below. Please include your number so we can call you back.

 

 

todays programme at midday focused on how "credit card companies" by putting their "staff" into dca 's offices were able to circumnavigate the FSA rule about cold calling and ofering subprime mortgages to people who could not afford them

 

basically they "allegedly" got people to turn unsecured credit card debt into subprime mortgages that people could not afford

 

to quote the programme and an "insider whistleblower " a barrow boy was put down AS EARNING £100,000 a year ....... in order to get a subprime mortgage (which on the balance of probabilities he could not afford) .. the insider said " he had a big barrow:wink:"

 

thought for the day with 20,000 redundancies on the way with the HBOS lloyds bank merger there will be a lot of whistleblowers out there soon like 20,000

[foolishgirl]

todays programme at midday focused on how "credit card companies" by putting their "staff" into dca 's offices were able to circumnavigate the FSA rule about cold calling and ofering subprime mortgages to people who could not afford them

 

And what d'you suppose the FSA will do with that snippet of info? - Probably sweet F (S) A !!

[tinkerbell20]

And what d'you suppose the FSA will do with that snippet of info? - Probably sweet F (S) A !!

 

 

Absolutely nothing would be my guess!!

[foolishgirl]

Exactly Tinkerbell - sweet FA, an old Lancashire expression short for Fanny Adams meaning nothing

[clare77]

can someone tell me how i start a thread please - i dont know how to do it

[foolishgirl]

Sure, Clare. Select the forum you wish to post in, look for the button on the LH side of the page marked 'New Thread' & you're away!

 

This link may help:

http://www.consumeractiongroup.co.uk/forum/welcome-consumer-forums/107001-how-do-i-dummies.html

[clare77]

thankyou

[uptoneck]

This is a great prog. uptotheneck, usually interesting issues aired & good consumer advice. Change your dial at 12.00pm lunchtime weekdays.

 

Will do!

 

thought for the day with 20,000 redundancies on the way with the HBOS lloyds bank merger there will be a lot of whistleblowers out there soon like 20,000

 

Oh well. Every cloud has a silver lining :grin:.

 

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

Uptoneck vs Barclaycard (Visa)

Uptoneck vs Barclaycard (Mastercard)

Edited November 3, 2008 by uptoneck
Update comment

[Having_A_Knightmare]

Sorry to but in!!

 

Just had a massive row with Cahoots about unlawfully charges ERRRRR:mad:

 

Anybody got the Court cases titles for unlawfull overdraft & credit card charges!!

 

HAK