Can Interest be applied post Judgment/urgent advice needed

[AndyOrch]

Hi Flint and welcome to Cag

 

The general rule

 

2.—(1) Subject to the following provisions of this Order, every judgment debt under a relevant judgment shall, to the extent that it remains unsatisfied, carry interest under this Order from the date on which therelevant judgment was given.

(2) In the case of a judgment or order for the payment of a judgment debt, other than costs, the amount of which has to be determined at a later date, the judgment debt shall carry interest from that later date.

(3) Interest shall not be payable under this Order where the relevant judgment—

(a)is given in proceedings to recover money due under an agreementregulated by the Consumer Credit Act 1974(1);

Regards

Andy

[AndyOrch]

The County Courts (Interest on Judgment Debts) Order 1991

[AndyOrch]

The important thing is to separate right to interest before and after judgment.

 

Pre-judgment, interest can be claimed from the date the monies were due until the date of judgment IF contractual interest was not being applied.

 

Post judgment, no statutory interest can be added to a CCA agreement IF contractual interest is accruing. Statutory interest CAN be added to any debt where contractual interest is not accruing providing the debt is more than £5000 and then interest can only be added to any missed instalment or if a forthwith judgment has been given until the date for payment has passed.

 

A County Court has no jurisdiction to apply contractual interest before or after judgment. Therefore any order to pay interest before or after judgment can only be referring to statutory interest.

 

With reference to charging orders, if statutory interest is granted on the judgment then it will continue to run on the charging order whether or not the judgment order says this. However post judgment contractual interest may continue to run on the debt but will not be ‘charged’ as it cannot form part of the judgment debt.

 

Please note however, that most creditors do consider any contractual interest to be charged on the property so if a client wanted to sell they would have to challenge this.

 

Some useful reading:-

 

Interest Charged after Judgement

 

 

Consumer Credit Act 1974 - Post-contract information requirements

 

http://www.nationaldebtline.co.uk/en...redit_judgment

Edited December 9, 2011 by Andyorch

[AndyOrch]

In theory yes Flint " However post judgment contractual interest may continue to run on the debt but will not be ‘charged’ as it cannot form part of the judgment debt. Check with your Court though re Cert of Satisfaction.You now have a second ICO for PJI?

 

 

Regards

 

Andy

[AndyOrch]

The whole question revolves around my potential argument if i take that path, is that the only figure that has been proven is that of the Jugment figure and when that is fully paid, that a charge should not be applied to an amount which has yet to be decided in the eyes of the law.

 

Absolutely Flint.

[AndyOrch]

Its not from the DN date its from Judgment date.

 

Andy

[AndyOrch]

Contractual Interest

 

Contractual interest is the interest charged on a debt as per the terms of the credit agreement. Once a CCJ is in place, the creditor may still be able to claim for and be awarded additional contractual interest :

 

Contractual interest on CCJs issued before 1 October 2008

If you have a county court judgment that was made before 1 October 2008 then the rules on how your creditor may add interest to the debt are not very clear.

Some credit agreements allow a creditor to add additional (or contractual) interest on to the county court judgment. However, to allow this there must be a term in your credit agreement that states that the creditor is allowed to add interest after the judgment is made.

There was a court of appeal case called Director General of Fair Trading against First National Bank in 2001 confirming this. This decision said that in some cases while you are paying the county court judgment, contractual interest may be charged on the amount that you still owe on the judgment.

If interest is still being added, it may mean that when you have paid the original balance owed on the judgment, you will find that you have an extra amount that the creditor says you owe, even though the judgment has been paid in full. To force you to pay this, the creditor would have to take you to court again.

 

Contractual interest on CCJs issued after 1 October 2008

If you have a county court judgment made on or after 1 October 2008, there are new rules for creditors to follow if they want to add contractual interest to the judgment.

In order for the creditor to be allowed to charge additional interest, there must be a term in your credit agreement that states that the creditor is allowed to add interest after judgment is made.

Before your creditor can take you to county court, they must send you a default notice. If there is a term in the credit agreement to allow them to add interest after judgment then the creditor must include a special statement in the default notice to tell you this. This says:

‘You should be aware that if we take you to court and get a judgment against you requiring you to pay us the money you owe us under the agreement, you may have to pay us both the amount of the judgment and the interest under the agreement on all the sums owed by you at the date of the judgment until you have paid these in full. This means that even if you pay off the whole amount of the judgment, you may still have a further sum to pay’.

Once the CCJ is in place, your creditor must send you a notice to say they intend to charge interest on the judgment. They are not allowed to add interest until they have sent the first notice to you. The notice must tell you the outstanding balance on which interest will be charged. It must also tell you what the rate of interest is and what date the interest will run from. It must also tell you that you can ask the court to change the interest rate and the instalments you pay.

The creditor has to send you a new notice every six months if they want to keep charging interest. The notice must tell you how much interest has been added and the interest rate.

If the creditor does not send you a notice within six months, they are not allowed to charge interest until a new notice is sent. They are not allowed to add interest back in for the time they have missed.

 

How to stop contractual interest being added to a county court judgment

 

You can try to stop any contractual interest being added by asking the county court to make a ‘instalment order’. An instalment order is simply an agreement to pay off the debt you owe on the basis of affordable monthly payments.

If the court agrees to make the order, it can revise the rate of payment and alter the rate of interest, from that which is written in the agreement to that which it thinks is just and fair. This could mean a zero rate of interest, if the court agrees to make the order in those terms.

Edited January 12, 2012 by Andyorch

[AndyOrch]

Until 6 April 2008, agreements were excluded from regulation if the amount of credit or hire exceeded £25,000. However, this financial limit was removed for all new credit and hire agreements by the Consumer Credit Act 2006. Pre-existing agreements above £25,000 remain outside CCA regulation.

 

Regards

 

Andy

[AndyOrch]

Looking good then Flintstone:wink:

 

Andy

[AndyOrch]

If their WS was only exchanged minutes before then it should be disregarded, it must be exchanged at least 7 days pre hearing.

 

Andy

[AndyOrch]

If the WS was not taken into into consideration within the proceedings with no effect then you will have time to respond/prepare before the next hearing.If it was then you need to bring it to the Courts attention that you was served late.

 

Andy

[AndyOrch]

Hi Flint

 

The provisions were introduced by the Consumer Credit Act 2006. They applied to new agreements from 6 April 2007, and to pre-existing agreements from 6 April 2008. Agreements completed before the new provisions took effect remain subject to the previous extortionate credit bargains provisions.

 

The 2006 Act also enhanced the right to apply for a time order, which is a court procedure that can give borrowers more time to repay a debt

 

The unfair relationships provisions

 

Section 140A of the 1974 Act provides that a court may determine that the relationship between a lender and a borrower arising out of a credit agreement (or the agreement taken with any related agreement) is unfair to the borrower because of:

 

any of the terms of the credit agreement or a related agreement

the way in which the lender has exercised or enforced its rights under the credit agreement or a related agreement, or

any other thing done (or not done) by or on behalf of the lender either before or after the making of the credit agreement or a related agreement.

The courts have a wide range of powers where a credit relationship is found to be unfair, including:

 

altering the terms of the credit agreement or a related agreement

reducing the amount payable by the borrower

requiring the lender to refund money to the borrower

removing any duty placed on the borrower under the agreement, and

imposing requirements on the lender or an associate.

In addition, where unfair relationships harm the collective interests of consumers, the OFT and other enforcers (including Local Authority Trading Standards services) can take enforcement action under Part 8 of the Enterprise Act 2002.

 

The OFT has published guidance on Part 8 action and unfair relationships. The guidance was updated in August 2011. See Unfair relationships - Enforcement action under Part 8 of the Enterprise Act 2002.

 

It is not the role of the OFT to take up complaints on behalf of individual consumers. If a consumer has a complaint against a lender, and considers that the overall relationship is unfair, s/he should speak to a Citizens Advice Bureau or other debt adviser.

 

Alternatively, if the consumer has pursued the complaint with the lender but is dissatisfied with the outcome, s/he can approach the Financial Ombudsman Service.

 

 

Time orders

 

Section 129 of the 1974 Act provides that a court can make a time order, giving the consumer more time to repay a debt under a regulated consumer credit or consumer hire agreement, if the court considers it 'just' to do so. In addition, section 136 provides that an agreement may be amended as a consequence of a time order - for example, by reducing the rate of interest or extending the term of the agreement.

 

The consumer can apply for a time order following receipt of a default notice, or a notice of enforcement action under the Act. The court can also make a time order as part of proceedings brought by the lender for enforcement of the agreement or to recover possession of goods or land (for example, mortgage repossession).

 

A consumer can also apply for a time order following receipt of an arrears notice, provided that s/he first gives notice to the lender and submits an alternative payment proposal, and at least 14 days elapse before an application is made to the court.

 

Regards

 

Andy

[AndyOrch]

Sorry it didn't go so well Flintstone was he in a rush to get to the golf club? Looks like he is flagging The unfair relationships provisions to you.

 

 

 

Andy

[AndyOrch]

Quite frightening Sequenci when you consider the values involved here.

[AndyOrch]

Quick other point by us LIP it didnt seemed to help, as the Judge wanted to be guided and was dubious of my arguments. Maybe i get representation to speak for us next time or attach a opinion? Other point when i type up and space it is fine but once uploaded it is not doing?

 

This is a trend particularly now with the Salford set up most want guidance which the LiP cant afford and is putting justice out of reach for most LiP,s.

 

Check which browser you are using re the spacing.

 

Andy

[AndyOrch]

"Anyway pick up brush off,head up and start again"

 

Thats the spirit Flintstone.

 

Andy

[AndyOrch]

I recall this dates to 2007 so the new regs kick in here.

 

http://www.legislation.gov.uk/ukpga/2006/14/crossheading/unfair-relationships.

 

Regards

 

Andy

[AndyOrch]

Excellent point Paul

 

 

 

Andy

[AndyOrch]

Its interesting to note that the Court as allowed permission to set a side the original judgment Flint.

[AndyOrch]

Pro Bono ? http://www.barprobono.org.uk/

[AndyOrch]

That was superseded Macie with the Unfair Relationships Amendment CCA2006.The Consumer Credit Act 2006 removed and replaced sections 137-140 with sections 140A -140D. It is clear from a reading of these provisions that a court is given a much wider number of situations which may causes a relationship to become unfair.

For example the relationship can be unfair because: (1) of the terms of the agreement (2) the way in which the lender operated the agreement; or (3) anything done or not done by the lender by or on behalf the consumer before the agreement was made.

 

Regards

 

Andy

[AndyOrch]

Hi Macie

 

I'm sure you could fight it under either regime but the 2006 amendment is retrospective and far more in favour of the debtor.

 

Regards

 

Andy

[AndyOrch]

And the DJ has flagged to Flint that s140 may the appropriate course to follow.

[AndyOrch]

Evening Ford/Andy

 

I'd noted the order [re: s130 service]

 

Do either of you know what the score is with Barnes v Blackhorse or is it still waiting on a trial date?

 

Phil

 

http://www.bailii.org/ew/cases/EWHC/QB/2011/1416.html