Bristol and Wessex Water & Charging order, they say they want paying now..

[chiefmegawatty]

I have a charge order placed on my house by Bristol & Wessex Water for £1800.

 

They recently sent me a letter stating that if I don't pay the full amount they will be taking legal action and apply for an order for sale.

I then will be sent an order to vacate my property within 28 days.

 

My house is owned outright with no mortgage and currently valued around £200K.

I am living on a small private pension with no chance of paying back the debt.

 

I went to the CAB who told me that I will end up homeless and living on the streets as there is no social housing available for single men.

 

The Water company placed a CCJ on my credit record so it's impossible for me to borrow money to pay back the debt and keep my house.

 

I could never understand why there were homeless people on the streets, but I do now. I will be joining them soon.

 

What an idiot I was buying a house.

If I had a council house I would have nothing to worry about and a safe roof over my head.

 

I know a chap near here who lives in a housing association bungalow.

 

He owes banks £73k and will not end up homeless.

 

Comments welcome.

[Lea_HTH]

The logical thing to do is to sell the house, pay the debt and buy something smaller with what is left over.

 

But...it is very unlikely that a court will order sale of someone's home on the basis of owing such a small debt (relatively).

 

What you need to do is make an offer in writing to the company of a monthly or weekly sum to reduce the debt

and start paying it as soon as you offer it.

 

By the time they get you into court (months unless they have already started proceedings),

you will be able to show the judge that you have made regular payments since offering a fixed amount

 

(you'll need to do an income and expenditure form to show that the amount you are offering is as much as you can afford, not as little),

 

and that there was no need to take you to court as you were doing your best.

 

A reasonable judge will give them judgment for the outstanding amount,

 

but so long as you attend the hearing,

 

you can ask for your payments to continue as they are.

 

Once under a court order, if you don't miss a payment, the company can't ask for a charging order

 

and therefore won't be able to ask the court to allow them to get a sale order.

[chiefmegawatty]

The coalition government were considering a threshold for charge orders to be set at £25,000.

They then decided to set it at £1000.

 

The government said that setting the threshold that low would reduce bankrupcy petitions.

 

I have looked into the laws on bankrupcy and discovered that a debt of only £750 can bring about a bankrupcy petition against a debtor.

 

However, in order to be made bankrupt your debts must be greater than your assets.

 

So if you have a charge order on your house for £1000 and you own your house outright

you will loose your house even though the debt is far smaller than your assets.

 

I therefore assume that the government brought in this low threshold for charge orders to deliberately make house owners with a very small debt homeless.

 

An outright home owner with a house worth £250,000 could find himself evicted due to charge order of only £1000.

 

I am of the impression that the government encourage people to buy houses so they can take them off them due to a very small debt.

 

Why the government want people who have paid thier mortgages off living on the streets due to small debt is beyond my understanding.

 

I assume that the government hate people who buy their houses, live on private income and never claim benefits despite paying into the tax system for decades.

[chiefmegawatty]

I have recently discovered that orders for sale after a charge order can only be obtained for debts under the Consumer Credit Act 1974. This includes credit card debts and unsecured personal loans such as bank loans and HP. However, debts to utility companies such as gas, electricity, water and even council tax (which are not under the Consumer Credit Act),can bring about a charge order but cannot result in a order for sale.

Such creditors have to wait until your house is sold to get their money back.

They may threaten you with further enforcement action after obtaining a charge order on your house, but they are empty threats. I hope this information is of help to anyone worrying about a possible order for sale from debts to any utility company who has obtained a charge order against their property.

[eggboxy1]

As far as I am aware any creditor with a CO can attempt to obtain an Order for Sale? I don't think any reason for the debt prevents an OFS being attaempted?

 

 

And whilst they are extremely difficult to obtain (as there is case law and TOLATA that stacks up against them being granted as well as the difficulty in persuading a Judge they are proportionate?) I'm fairly sure Councils have a legal duty to follow to the max attempts to recoup debts owed?

 

 

Would be interesting to know where your info came from, though?

[AndyOrch]

Section 94 of the Tribunals, Courts and Enforcement Act 2007 was brought into force on 17 May 2012. The Act incorporates a new section 3A into the Charging Orders Act 1979 and has given the Lord Chancellor the power to make regulations providing that:

 

charging orders may not be imposed to secure an amount below a certain threshold; and

charging orders may not be enforced by orders for sale if the amount in question is below £1,000. This will only apply to debts regulated by the Consumer Credit Act. Indications at the current time are that this change will be introduced in December 2012.

 

The Second Change

Section 93 of the Tribunals, Courts and Enforcement Act 2007 will come into force on 1 October 2012. The amendments allow an application for a charging order to be made in cases where the debtor has not defaulted on payment of an instalment judgment. However, it should be noted that:

 

The court must take into consideration the fact that there has been no default when deciding whether to grant the order for sale; and

An order for sale to enforce the charging order may not be made at the same time as the application for the charging order unless the whole or part of an instalment which falls due under the judgment remains unpaid.

[Ganymede]

I have recently discovered that orders for sale after a charge order can only be obtained for debts under the Consumer Credit Act 1974. This includes credit card debts and unsecured personal loans such as bank loans and HP. However, debts to utility companies such as gas, electricity, water and even council tax (which are not under the Consumer Credit Act),can bring about a charge order but cannot result in a order for sale.

Such creditors have to wait until your house is sold to get their money back.

They may threaten you with further enforcement action after obtaining a charge order on your house, but they are empty threats. I hope this information is of help to anyone worrying about a possible order for sale from debts to any utility company who has obtained a charge order against their property.

 

 

 

Do you have a source for this information?

[chiefmegawatty]

I found the information in a PDF document from the House Of Commons Library.

The document is titled "Enforcing A Charge Order". The document reference is SN/HA/6614 and the author is Lorraine Conway. Section 3.2 deals with orders for sale. Paragraph 3 says "Creditors not covered by the Consumer Credit Act 1974 (such as individual creditors, utility companies and local authority) are unable to take this measure and have limited means to recover monies owed to them"

[eggboxy1]

The new Regulations relate only to regulated debts defined within the Consumer Credit Act 1974. According to the Government, the reason for introducing a financial threshold only to these types of debt and not all debt is because the lender has priced the recovery risk into their premium interest rates. Creditors not covered by the Consumer Credit Act 1974 (such as individual creditors, utility companies, government and local authority) are unable to take this measure and have limited means to recover monies owed to them.6

 

 

I think this may be the passage you are referring to? It is confusing as I think the paper is referring to the £1000 threshold only applying to Charging Orders on CCA debt? Certainly any individual owed money can apply for a CO and OFS so it is a liitle confusing?

 

 

Edited January 22, 2014 by eggboxy1

[chiefmegawatty]

Yes that is the passage I was referring to and it does seem confusing. However the £1000 threshold applies to all charge orders whether the dept is covered by the Consumer Credit Act or not. The passage is from section 3.2 which is dealing with orders for sale. Knowing that utility companies can obtain charge orders I interpret the passage means that they can't obtain an order for sale.This implies that utility companies who obtain a charge order would have to wait until the property is sold to recover their money.

Edited January 22, 2014 by chiefmegawatty

[eggboxy1]

It's badly worded (and I think wrong, too!), but my understanding was that the £1000 limit was only for CCA debts? With all other debts still not having any minimum threshold to pursue.

 

 

And if you look here

 

 

http://www.northampton.gov.uk/info/200028/council-tax/96/council-tax-recovery-of-non-payment/8

 

 

this council is laying out it's case to the contrary.

[chiefmegawatty]

I've just had a long phone conversation with National Debt Line and realise that the document

from the House Of Commons library is super confusing. Utility companies CAN apply for an order for sale once they have obtained a charge order. I therefore recommend that anyone reading a document from the House Of Commons Library just take it with a pinch of salt.

[sequenci]

You really don't need to worry about orders for sale. Less than .2% of charging orders end up with orders being granted - and that's generally for business-related charges rather than consumer-related debts.

[eggboxy1]

Quite right Sequenci!

 

 

The trouble is a lot of "official" information regarding CO's fail to highlight the rarity of OFS, especially for consumer debt.

 

 

Hence, the tabloid scare headlines when the £1000 threshold was introduced.

[chiefmegawatty]

Thanks for that sequenci. I have been worrying myself stupid for the last two years after my water supplier obtained a charge order for £1870 against my house. I was afraid that I would end up living on the streets. However, once a year the water supplier send me a reminder stating that they may take enforcement action if I don't repay the debt. Does that mean that they could obtain an order for sale and I would be living on the streets?

[eggboxy1]

The juxstaposition of Charging Orders and Orders For Sale is the prior is extremely easy to obtain, whereas, the latter is extremely difficult to obtain. Judges have virtually no discretion in granting CO's but they have absolute discretion in granting Orders For Sale.

 

 

If your house is your family or sole residence then, no, you won't get an OFS made against you for the amount owed.

[sequenci]

It's interesting when you read the statute - it implies that a court should have a fair amount of jurisdiction:

 

(Charging Orders Act 1979)

 

(5)In deciding whether to make a charging order the court shall consider all the circumstances of the case and, in particular, any evidence before it as to—

(a)the personal circumstances of the debtor, and

(b)whether any other creditor of the debtor would be likely to be unduly prejudiced by the making of the order.

 

I guess there is a far stricter test when it comes to sale orders - and quite rightly so.

[sequenci]

Thanks for that sequenci. I have been worrying myself stupid for the last two years after my water supplier obtained a charge order for £1870 against my house. I was afraid that I would end up living on the streets. However, once a year the water supplier send me a reminder stating that they may take enforcement action if I don't repay the debt. Does that mean that they could obtain an order for sale and I would be living on the streets?

 

Unlikely. If the property is jointly owned and you have children it would be impossible anyway - as there is statute pretty much preventing it. Even regardless, I don't think any judge worth their salt would allow an order for sale for such a small amount of money (in the grand scheme of things).

[eggboxy1]

It's interesting when you read the statute - it implies that a court should have a fair amount of jurisdiction:

 

(Charging Orders Act 1979)

 

(5)In deciding whether to make a charging order the court shall consider all the circumstances of the case and, in particular, any evidence before it as to—

(a)the personal circumstances of the debtor, and

(b)whether any other creditor of the debtor would be likely to be unduly prejudiced by the making of the order.

 

I guess there is a far stricter test when it comes to sale orders - and quite rightly so.

 

 

I agree and it does make you wonder why there is virtually no resistance from Judges in granting CO's given the above??

[sequenci]

I guess there isn't a massive amount of prejudice in relation to the granting of a charge compared to losing your home.

[chiefmegawatty]

All my children are now adults and live elsewhere. The house is in my name only. My wife disappeared just over two years ago to live with another man. I guess that if the charge order doesn't kill me the impending divorce will. Either way I guess I will end up living on the streets.

Edited January 22, 2014 by chiefmegawatty

[eggboxy1]

If the house is in your name only, then the CO will be deducted from your sale proceeds if and when you sell. But (and I'm not diminishing your problems) it does seem a "manageable" amount? Many people on this site have CO's against them for amounts far in excess of your order amount which they have no way of discharging without selling up.

 

 

But as Sequenci has stated, OFS are a rarity and there is strong caselaw opposing such if the house is your primary residence. But I would look to see if there is interest accruing on the debt as it's usually 8% and will stack up if you don't discharge the debt in a reasonable time.

[chiefmegawatty]

Thanks for your reply. I have discovered that interest can only be added to charge orders over £5000 so no problem there. The house is my only and primary residence which raises another question in my mind. I own a large plot of land in Wiltshire which is on the land registry in my name. The plot is worth about £30,000. I assume that the water supplier and the county court failed to secure the charge order on my land and stuck it against my house so they could threaten me with being homeless. They could have obtained a charge order

on my land and then obtained an order for sale without having to threaten me with being homeless. I therefore consider water suppliers and County Court Judges to be evil people who want house owners to live on the streets. They had the choice of sticking the charge order on my house or on my land. They chose my house just to be nasty when I have another asset that would easily cover the debt many times over and could be sold without causing distress. Should I ever meet a County Court Judge in public I would be tempted to punch him in the face for being a house owner hating nasty person.

[AndyOrch]

Irrelevant and argumentative posts removed...please lets keep this civil and on track.

 

Regards

 

Andy

[Ganymede]

Thanks for your reply. I have discovered that interest can only be added to charge orders over £5000 so no problem there. The house is my only and primary residence which raises another question in my mind. I own a large plot of land in Wiltshire which is on the land registry in my name. The plot is worth about £30,000. I assume that the water supplier and the county court failed to secure the charge order on my land and stuck it against my house so they could threaten me with being homeless. They could have obtained a charge order

on my land and then obtained an order for sale without having to threaten me with being homeless. I therefore consider water suppliers and County Court Judges to be evil people who want house owners to live on the streets. They had the choice of sticking the charge order on my house or on my land. They chose my house just to be nasty when I have another asset that would easily cover the debt many times over and could be sold without causing distress. Should I ever meet a County Court Judge in public I would be tempted to punch him in the face for being a house owner hating nasty person.

 

 

 

 

Can't you sell the land yourself to settle your debts?

 

Were they aware you owned this land?