That's gotta hurt

[MostUncivilised]

Same story as everyone else on here. Totally unreasonable and ridiculous conduct on the part of Minicredit. I got a letter from Muck Hall demanding almost £1000 (on a principal of £150) I chained myself to the beast; Westlaw and the White Book on one monitor and Gmail on the other, and got to work.

 

Dear XXXX,

 

Re:− M987654321

 

This letter is a notice under s77 of the Consumer Credit Act 1974 to provide a copy of the executed agreement, an s77B (2) note and statement of account. I have made payment of the prescribed £1 fee through Paypal; by now you will have received an email providing instructions on how to claim the funds. As you will be aware, you have 12 days to comply.

 

Separately to the s77 notice, I will address the substance of your letter/email that purports I owe £928.50 (on a principal of £150). I think it's fair to say that seeking to recover more than double the value of even the inflated subsequent claims of Minicredit / Microcredit verges on delusion; even Cosa Nostra loan sharks don't have the audacity to claim late penalties of 4% per day.

 

I would draw to your attention to the fact that I have made repeated offers to settle over the last 5 months that, if accepted, would have meant the debt would have been paid by now (principal and interest). The failure of your client to exercise forbearance and reasonableness, in accordance with OFT guidelines, is both disappointing to me and damaging to their interests.

 

I believe that the purported CCA may in fact be improperly executed and formulated due to the failure to fully disclose the information prescribed in the Consumer Credit (Disclosure of Information) Regulations 2010/1013 in the pre-contract or contract documents, the failure to include basic contract terms such as the principal and the date of repayment. As you would be aware, agreements that are improperly executed under s65(1)(a) are precluded by s127(3) from being enforced.

 

If you have access to my record of correspondence with Minicredit / Microcredit, you will be further aware that they threatened to disclose protected financial data to my employer as a means of securing my compliance. They also communicated the possibility of sending individuals to my home, with all the implicit physical threat that implies. The debtor also conveyed that they would commence legal proceedings if I failed to meet their extortionate and ever increasing claims regarding the amount owed; naturally, I never received a Notice of Claim.

 

It would also appear that the purported CCA is unfair under s140 of the Consumer Credit Act definitions, due to the failures of disclosure, the excessive penalty fees that did not bear any relation to actual costs, the post-agreement behaviour of the debtor in seeking to coerce compliance, their failure to adhere to OFT guidelines relating to reasonableness and forbearance by freezing additional penalty charges and their failure to respond to my many offers to settle or make counteroffers based on a reasoned assessment of affordability.

 

I would also argue that the purported CCA is also unfair from the perspective of the Unfair Terms in Consumer Contracts Regulations 1999/20183 with respect to schedule 2, paragraphs 1 (e) and 1 (p).

 

The post-contract behaviour of your client has also been unconscionably deceptive and aggressive and seems to be a prima facie breach of the Consumer Protection from Unfair Trading Regulations 2008; their actions beg for regulatory scrutiny, and the timing could not be more favourable for a debtor in terms of the attention of OFT and policy-makers and the media interest in such matters.

 

Considering the aggressive, agitated and unreasonable attitude of your client in their dealings with me regarding my offers to settle, the irregularities in relation to the formalities required in consumer credit contracts, the inappropriate threats and the fact that they would now have received the entire principal and interest charge in the original purported agreement, it can be fairly said that the amount claimed in your letter is one entirely detached from reality.

 

In view of the extreme unlikelihood that you will obtain anything near what you claim in a County Court Judgement, the total failure to take reasonable steps to mitigate loss, the possibility it may be deemed spent for reasons of s140 unfairness, the possibility of unenforceability due to an unexecuted CCA and the regulatory scrutiny that will result in respect of prima facie breaches of the UTCCR, I would put it to you that the ice on which you are standing is very thin ice indeed.

 

With that in mind, I offer you £1 as full and final satisfaction of the debt.

 

I will also take the opportunity to formally communicate that failure to settle this matter promptly and satisfactorily cause me to commence pre-action conduct in preparation for filing a notice of claim that seeks have the claimed debt declared spent under s140 of the Consumer Credit Act 1974 or the agreement unenforceable under s60 / s127. I would also provide relevant information to the regulators to give them an opportunity to assess fitness to hold a consumer credit licence and will explore whether any of the actions of your client have been tortious and warrant additional civil remedy.

 

I eagerly await your reply.

 

Yours sincerely,

 

MostUncivilised

 

This is not legal advice; it is for educational purposes only and I accept no liability for the accuracy of the claims. Always seek advice from a legal professional before making decisions about legal matters

Edited June 18, 2012 by MostUncivilised

[renegadeimp]

Nice letter

 

Make sure you send formal complaints to the regulatory authorities anyway, as if they continue unchecked, they will simply wash their hands of you and do the same to other people.

[MostUncivilised]

I suppose I'd have to wait for their response. Forbearing to pursue legal action or a regulatory complaint is good consideration in contractual terms; a fair construction of my letter would indicate that I am proposing to exchange final settlement of the existing debt on the proposed terms in exchange for my forbearance in relation to the actions mentioned in the final paragraph.

 

If we contracted on those terms, and then I made a subsequent complaint, it could leave me liable for breach of contract, and considering my industry could be a breach of professional ethics.

 

But I do take your point; the payday lender industry in the UK is totally out of control, and the regulators and policy makers will only act when they see a popular groundswell demanding it.

[sillygirl1]

You deal with Mucky Hall by reporting them to East Ayrshire Trading Standards - they cannot do the things they say in their letter and most of this loan is unenforceable via court.

 

You are on the wrong level when you state that a breach of contract could be a breach of professional ethics - these contracts have been proven to be uneforceable with their penalties and terms and conditions. This is NOT the route to go down with a payday loan lender anyway.

 

You need to stick to the fact that you borrowed £150.00 and are being 'forced' unreasonably to repay far far more than that.

[citizenB]

I think any letter as above is likely to confuse the hell out of the administrative staff at Muck Hall

 

It looks good though

[citizenB]

MostUncivilised, you emailed this by the looks of things - can you please let us know if they respond and what they say Thanks.

[sequenci]

You are on the wrong level when you state that a breach of contract could be a breach of professional ethics - these contracts have been proven to be uneforceable with their penalties and terms and conditions. This is NOT the route to go down with a payday loan lender anyway.

 

 

Not sure I agree with you, the OP speaks a lot of sense.

[MostUncivilised]

You are on the wrong level when you state that a breach of contract could be a breach of professional ethics - these contracts have been proven to be uneforceable with their penalties and terms and conditions. This is NOT the route to go down with a payday loan lender anyway.

 

The breach of contract is where we have modified the bargain, and the "consideration" (the contractual promise) on my part is forbearance from regulatory complaint (a practical benefit in the Roffey Bros sense), and then I breach on that promise. I'm not talking about breach of the original loan agreement.

 

I'm curious how you think the Law Society would view pre-meditatively and deceptively contracting with another party, and then breaching? This is quite serious misconduct. If I am offering MH a deal that includes my forbearance in terms of complaints to regulators as contractual consideration for full and final satisfaction of the debt on the terms mentioned above, it would be unethical (not to mention an indisputable legal breach of contract) to subsequently complain to regulators.

 

In terms of your opinion that my strategy is not a good one, I think we'll have to agree to disagree and I suppose we'll see how I do. I'm confident that I'm in a pretty strong position, and the reasonableness or lack thereof of the £ figure they're claiming is the least compelling point in my email.

 

You need to stick to the fact that you borrowed £150.00 and are being 'forced' unreasonably to repay far far more than that.

 

Again, we'll have to agree to disagree. I'm often circumspect about saying this, but I'm skeptical you understood many of the points in my email, as I feel you would not be as dismissive of the other assertions if you understood the implications of what I was claiming.

Edited June 21, 2012 by MostUncivilised

[MostUncivilised]

I think any letter as above is likely to confuse the hell out of the administrative staff at Muck Hall

 

It looks good though

 

Cheers I suspect this letter will cause them to kick the dog, as it were. It has enough legal red meat in there that they may need to get a lawyer rather than an admin to take a look at it. I actually subsequently picked up a few other irregularities on their part / the part of their client, withdrew my offer for final settlement for £1 and tentatively said that I would allow full and final settlement if they paid me £100. Will see how they respond ;-)

 

As I said above to sillygirl1, I'm not going to them as a supplicant; I'm 100% going on the offensive and that's the best way to go about it imho.

 

I'll most definitely tell you how it turns out (unless they make an offer which is favourable to me but requires non-disclosure; I hope you'd understand there if I go for it).

Edited June 21, 2012 by MostUncivilised

[MostUncivilised]

The OP speaks a lot of sense.

 

Cheers matey Payday lenders and recovery agents rely heavily on the fact that most of the people they deal with are not particularly well-informed about the law or their rights, they don't have access to legal databases and caselaw, they're not confident about their rights and able to identify misrepresentations when they encounter them.

 

I suspect that MH will have a fit when they realise not only that they can't bully or intimidate me into paying their pie in the sky demand, but it taking on this debt may actually cost them money.