Complicated discussion about assignment of debt

[Peterbard]

The assignment of a thing under chose. LoPA 1925

 

136

Legal assignments of things in action.

(1)

Any absolute assignment by writing under the hand of the assignor (not purporting to be by way of charge only) of any debt or other legal thing in action, of which express notice in writing has been given to the debtor, trustee or other person from whom the assignor would have been entitled to claim such debt or thing in action, is effectual in law (subject to equities having priority over the right of the assignee) to pass and transfer from the date of such notice—

(a)

the legal right to such debt or thing in action;

(b)

all legal and other remedies for the same; and

©

the power to give a good discharge for the same without the concurrence of the assignor:

Provided that, if the debtor, trustee or other person liable in respect of such debt or thing in action has notice—

(a)

that the assignment is disputed by the assignor or any person claiming under him; or

(b)

of any other opposing or conflicting claims to such debt or thing in action;he may, if he thinks fit, either call upon the persons making claim thereto to interplead concerning the same, or pay the debt or other thing in action into court under the provisions of the M1Trustee Act, 1925

[Guest]

...to establish a new contract....on the question of whether in these circumstances outlined the consent of the borrower is needed in order to transfer the original creditor's rights and responsibilities in respect of the debt insofar as that affects the borrower directly.

are you thinking of Novation, which requires consent. but that is different to the assignment that takes place re these debts sold on as the guys say.

[Peterbard]

are you thinking of Novation, which requires consent. but that is different to the assignment that takes place re these debts sold on as the guys say.

 

Yes a novation requires all parties consent.

 

An assignement only requires notice be given by one of the two contracting parties(the assignee or the assignor) to the debtor.

[dx100uk]

how many more times will this be debated on CAG for newbie to not understand..

 

must be :loco:

[Varuna]

Thanks. that's helpful. I'll check through the law, and more particularly later amendments.

[Varuna]

Thanks @Dodgeball

 

I accept that "a thing in action" denotes a creditor's right to be paid and therefore although this Act appears to be entirely about land and buildings and hence mortgage debt (which is several times specified) the inclusion of "thing in action" may thereby extend. From the fairly rapid searching I've done there appears to be disagreement about this. Even though electronic cards and accounts were not in use in 1925 bank loans and debts clearly were and therefore it would seem reasonable that monetary loans should have been specified. Against that "thing in action" may well serve as a catch-all and it's true that there are some comments to the effect that case law clarifying this point exists. However, against this the provisions of the CCA and, elsewhere, contract/consumer protection law may quite possibly have modified some of the provisions even though there's no direct reference to such later changes on the copy of the Act itself. That's going to take a little time to clarify, perhaps.

 

I'm not being dismissive of what you and others have said about this - it's all be very helpful and I appreciate the input - but I think it's something I have to dig around in a bit further. It seems also that if an assignment is permissable, quite apart from issues of termination of an existing contract and the absence of any clause permitting post hoc reliance, there are several complex matters around both advising the debtor and proving good title which may need further investigation.

 

Trouble is I'm away for over a fortnight in a couple of days time and so I probably shan't be able to investigate very thoroughly further until I get back - and then it's Christmas so my comments and responses are likely to be sporadic. But, thanks again very much to everyone who contributed - it's been helpful and informative.

[Varuna]

Oh, and one thing which has surfaced is the possibility of calling on equitable estoppel, that is, objecting to an action which is contrary to a previous claim or action. Here the point would be that if the original creditor had said nothing about selling on debt but had said or implied that he would continue to deal with the debtor in ordinary creditor/debtor manner, perhaps particularly if he had agreed with the debtor to freeze interest and accept reduced payments until matters improved or the debt was cleared, then he would be barred from taking action inconsistent with those earlier claims or actions. Estoppel is a slippery concept, of course, but can be useful on occasion and that may be so here.

[ericsbrother]

where is here? I see no actual case cited, just a question about a general application.

[Peterbard]

It may be helpful to look up Jones v link regarding cca issues

 

It is worth noting that debt purchases use this thousands of times every day

[Varuna]

where is here? I see no actual case cited, just a question about a general application.

 

This began on a different thread and was moved here so the first part is missing. However, no specific case was cited and it was stated that it was not a matter of seeking a loophole to avoid debt payment, merely process. In summary, the question was whether, given that a lender may terminate an agreement following a default, and given that the new agreement then between lender and debtor generally does not (or may not) include a provision permitting onward sale, is this onward sale of necessity permitted or can the borrower insist that s/he will continue to deal only with the original lender. Arguments against that view have been advanced in both threads, most particularly referencing the Law of Property Act 1925, section 136. Arguments in favour of that view have also been raised around, specifically, privity and now novation, estoppel and later consumer protection legislation.

[Peterbard]

This began on a different thread and was moved here so the first part is missing. However, no specific case was cited and it was stated that it was not a matter of seeking a loophole to avoid debt payment, merely process. In summary, the question was whether, given that a lender may terminate an agreement following a default, and given that the new agreement then between lender and debtor generally does not (or may not) include a provision permitting onward sale, is this onward sale of necessity permitted or can the borrower insist that s/he will continue to deal only with the original lender. Arguments against that view have been advanced in both threads, most particularly referencing the Law of Property Act 1925, section 136. Arguments in favour of that view have also been raised around, specifically, privity and now novation, estoppel and later consumer protection legislation.

 

There. Are no issues. The procedure is well established in law.

 

Sorry

[Varuna]

It may be helpful to look up Jones v link regarding cca issues

 

It is worth noting that debt purchases use this thousands of times every day

 

Thanks. That's helpful in clarifying that the CCA does apply (as I'd assumed it probably would). However, that doesn't directly address the question of a right to assign regardless and because later consumer and contract legislation will also apply there may be issues regarding the application of LoPA 1925/136. I do appreciate that, as you say, debt purchasers appear confident of their rights and of course they may well be justified in that but despite being standard practice their confidence may be misplaced. After all one could also say that private parking enforcement firms are confident of the legality of their predatory activities but I've personally seen off three instances on behalf of others where it's been clear that they've glibly asserted legal justification where none existed or was dubious at best.

[Varuna]

There. Are no issues. The procedure is well established in law.

 

Sorry

 

Well, thank you again. However, I've followed all the links or comments about legislation variously made and nothing that I've seen is definitive. Sure, I can see the force of LoPA/136 and I accept that if this question were being asked in the 1920s that would probably be definitive, even though the "property" there cited is clearly physical or directly related to physical property and even more specifically land based.

 

I'm not a legal professional in any way but what I have learned about law is that it can be worth looking closely at later legislation because of the real modifying effects it may have on earlier, unintended in some case of course. Over the past few decades there's been brought into English and wider UK legislation substantial amounts of consumer protection legislation and I'm aware from other work I've been involved in of issues around precedence and conformity which may also surface here, hence my apparently wilful refusal to accept what others may consider, with reasonable justification, something done and dusted.

 

I note that in the Jones v Link case Mrs Jones's agreement - contract - was terminated and therefore a new agreement must of necessity have been established (though not necessarily in a formal manner, of course) and it's unclear whether the right to sell on was a continuing part of the original contract or perhaps was confirmed by Mrs Jones agreeing with the buyer or whether indeed there was a common law or other right for the original lender to do that quite irrespective of these other points; LoPA indeed appears to suggest that last but that confidence may now be ill-founded for the various reasons I've earlier given.

 

But, anyway, I do appreciate the information and help given, so thank you and others.

[Peterbard]

termination of contract does not mean that sums under it cannot be recovered of course. In fact they cannot be recovered until the agreement is terminated and its terms no longer apply.

 

 

http://www.bailii.org/ew/cases/EWHC/QB/2012/2402.html

 

The issue here is the role of duties under the assignment.