statute-barred debts

[Gerald Gardner]

Where do we now stand with this, is the date you last acknowledged or made a payment now  irrelevant ?

 

https://www.bailii.org/ew/cases/EWCA/Civ/2019/12.html

 

I've read the court of appeal ruling and to my layman's eye it looks to me that the debt becomes statute barred 6 years after the expiry of the default notice, this is now backed up on the stepchange website 

 

The earliest date the creditor could have started court action to recover the debt

This will vary depending on the type of debt. For most common consumer debts such as personal loans, credit or store cards, catalogues or payday loans, this will be the date your account defaults. This is normally 14 days after you are sent a default notice warning you to bring your account up to date.

It was previously understood that the limitation was based on the earliest date the account could have defaulted, regardless of when the default notice was issued.

This is no longer the case, following a Court of Appeal ruling which confirmed a debt becomes statute-barred six years after the default notice expires. This applies only to England and Wales, but there is a similar case law in Scotland.

For example, if you live in England and the account was defaulted on 1 January 2015 and your debt has a six year limitation period, it’ll become statute-barred from 1 January 2021.

For other debt types, the earliest date court action could have been started can be harder to work out, so contact us if you have need help with this.

To work out when a debt becomes statute-barred or prescribed, take whichever of these events happened most recently and add the limitation period.

For example, if you live in Wales and the most recent of these events was a payment you made on 1 January 2015 and your debt has a six-year limitation period, it’ll become statute-barred from 1 January 2021.

If a creditor has already started court action before the end of the limitation period, this doesn’t apply – the debt will never become statute-barred or prescribed.

 

Edited July 8, 2020 by Gerald Gardner

[dx100uk]

default notice date + 14 days.

BUT 

if the creditor took months to actually default you - then it can be argued that its the last payment date.

its not 100% clear cut ruling as that was only with regard to a loan under the consumer credit act.

 

if you take say an OD  

it has been successfully argued the SB was from the last payment not months or years later when the original creditor finally defaulted you and a defaulted date got registered on your credit file.

 

whats the debt please?

hoist and barclaycard par chance?

 

 

[Gerald Gardner]

The delay in issuing a default notice was covered in the judgement and dismissed 

 

34.Mr Brennan-Banks advanced two policy arguments in support of Mr Doyle's appeal. First, he said that the decision of Judge Madge removes the certainty which the limitation period gives a debtor that he or she can "move on with their lives" because, on Judge Madge's approach, a default notice can be served at any time. Secondly, he said that delay benefits the creditor and is detrimental to the debtor because the information available to the debtor (obtainable from the creditor) to investigate and challenge the creditor's claim and the default notice is likely to have become lost or destroyed, particularly, as in the present case, where there have been successive assignments of the benefit of the credit agreement and the debt. I do not consider that either of those policy arguments carries any material weight

 

 

This was more clarifying the legal argument than a specific debt, although i do have a hoist / barclaycard one i will be looking into but unfortunately it has to go on the back burner for now because of covid, once i get my hands on that paperwork it looks like i may be able to test this ruling as it appears the last payment / acknowledgement was over 6 years but they squeezed in a court claim 1 month before the 6 years was up from the date of the default notice expired , claim forms sent to old address, default judgement entered.  

[dx100uk]

there have been numerous wins against DCA's and discontinued claims here and elsewhere since this supposed game changing judgement ......whereby it appear this allows the original creditor to effectively run the SB date to infinity just because they issued a default notice months even years after the actual last payment. or indeed issued a second default notice to further extend and control the SB date...they can't.

[AndyOrch]

Topic moved to Default Issues Forum.

 

Andy

[Gerald Gardner]

I agree and I've no doubt that will happen in the future, but if a court claim is issued and a ccj successfully registered against the debtor then it will never be sb anyway, so are we more likely to see more court claims in the future ?   

 

Can it not work both way though, if the sb date is ultimately aligned to the date of the default notice, essentially giving the creditor 6 years to collect or issue a court claim then regardless of when the debt was last acknowledged / payment made, a debtor could just tell the creditor to eff off after the 6 years is up, figuratively speaking 

 

 

[dx100uk]

the issuance of a court claim halts the sb clock.