cheque cashers ltd

[robot00]

i recently employed a 'builder' to carry out some work. a price was agreed for the complete job, but half way through the builder demanded more money for addtional works he claimed were neccesary or he would not return to complete the work. these additional works had not been started but i agreed to pay £560 extra and handed over a cheque for this amount. the next day the builder dissappeared and was uncontactable by telephone. 3 days later i put a stop on the cheque with my bank.

 

1 week later the builder rang threatening to break my legs unless the monies were paid although he had left the job unfinished and had not even started the additional works.

 

a few days later i received a call from chequecashers ltd who claimed to have paid the builder on my cheque the day after issue. i explained why this cheque had been stopped, but chequecashers immediately issued proceedings through the county court claiming i am liable to them for this money plus court fees.

 

my bank advised taking legal advice as cheque is crossed a/c payee and not chequecashers ltd, but a local solicitor has quoted £200 to only look into case law and advise on this matter, which seems very high considering cheque was £560.

 

does anyone have any help or advice as to my liability to this company?

i am not even able to counter claim against them as they have provided no service to me.

[half ax I]

Cowboys!! You have no contract with CCL so they have no basis on which to claim IMO. A/C payee means just that. Your contract was with the cowboy who has breached it therefore you are within your rights not to pay.

 

If CCL have issued a claim then you should have a copy of their Particulars of Claim. Post them up here and I'm sure someone will be able to help you work out any response. It will probably be enough to deny the claim and request strike out on the basis that the claim has no merit!

 

Good Luck

[robot00]

thanks for reply and support half ax i,

 

here is particulars of claim;

 

on the 3rd of april 2007 the claimaint(chequecashers ltd) in the course of his business cashed a cheque for 'builder' in the sum of £560. the claimant had no reason to doubt the validity of this cheque. 'builder' was given £541.20, the difference between this and the cheques value is the claimants normal business charges. the cheque was draw on the account of 'robot00' was banked and subsequently returned payment stopped. under the bills of exchange act 1882(as ammended) the claimant who has valuable consideration of the cheque wishes to enforce the bill.

 

 

any help or advise gratefully received.

[half ax I]

There is an Amendment to the Bills of Exchange Act 1882 which is called Cheques Act 1992 which adds a section 81A.

 

81A. — (1) Where a cheque is crossed and bears across its face the words "account payee" or "a/c payee", either with or without the word "only", the cheque shall not be transferable, but shall only be valid as between the parties thereto.

 

Don't know of any case law but this would IMO be a valid reason to ask to strike out.

[robot00]

thanks again,

 

i have completed online an 'acknowledgment of service' form to get time extension and stated on form that i intend to defend claim and challenge juristiction of court to deal with this claim. how do you ask to strike out? or is that part of my statement of defence?

 

cheers

[dw190]

thanks again,

 

i have completed online an 'acknowledgment of service' form to get time extension and stated on form that i intend to defend claim and challenge juristiction of court to deal with this claim. how do you ask to strike out? or is that part of my statement of defence?

 

cheers

 

Keep a record of all you out of pocket expenses including all the time you spend researching. Time can be claimed at £9.25 per hour for a Litigant in Person.

[half ax I]

The request for strike out will be part of the response. The claimants POC are rather sparse so we can possibly learn from the likes of Cobbets responses for bank charges claims. You have some time now to develop a response.

[CAGisforME]

Cowboys indeed!

 

A/c payee cheque? Not a leg to stand on. You seem to have that under control.

 

The "builder" - now have you contacted the police about his threat and subsequent actions, and reported him to any convenient Trade Association?

 

Certainly if he was legitimate he would have paid the money into his business bank account, instead of which he uses a check cashing facility at extortionate interest rates. Tells a story in itself.

 

As a little "revenge" have you considered seeing if there were others stung by him in the same way.

 

An email to "Rogue Traders" would be an idea too.

 

Good luck - not that you need it - excellent help on here and the Bills of Exchange Act amendment covers you.

[Isiris]

Couple of things

 

The amount he has been charged (3% +£2) seems exceedingly low for a cheque of such a small amount.

 

The cheque cashers make you sign an indemnity IE between them and the builder that says if it bouncers, the builder is still liable.

 

I also believe 3rd party companies will only cash Business cheques (IE from a business) and not personal cheques

 

This all indicates to me that they are friends with the builder and are trying it on. They havent got a leg to stand on

 

As advised, charge £9.25 per hour and keep records.

[alanfromderby]

Having real problems locating this company. Can you post the exact name of the company as shown on the claim. I would suggest a call also to the Trading Standards department closest to their office.

 

From what you have said their only claim is against the builder.

[half ax I]

Alan

 

WebCHeck - Select and Access Company Information

 

A dormant one if a space is placed between the 2 words. Of course validaton of the address of the entity making the claim would be needed.

 

Looking at the dates also suggests that CC didn't get the cheque the day after (unless postdated). Could be worth asking bank when the cheque was presented and by whom.

[Guest express]

Not sure if this is the same company, details obtained from Companies House;

[half ax I]

express

 

I wouldn't have posted such details - hence my obfuscated referenece just pointing where to look to draw own conclusions.

[alanfromderby]

The problem is that there are numerous similar companies. I have, of course, looked through the normal sources available.

 

My particular areas of interest are whether they are properly registered, what their position is with the FSA, whether they are registered under the DPA, are they are subsidiary of a bigger company, are they a franchise - it all helps to produce a picture of what one is dealing with.

[robot00]

company details;

 

cashflow chequecashers ltd

cashflow

110 the stow

harlow

essex

cm20 3as

 

the cheque i wrote was from my business account, does this make a difference?

 

cheque written 02/04/07, claimant says paid out 03/04/07, my bank were not due to clear it until 10/04/07 due to good friday and easter monday.

 

thanks for all the feedback.

[Guest louis wu]

Certainly if he was legitimate he would have paid the money into his business bank account, instead of which he uses a check cashing facility at extortionate interest rates. Tells a story in itself.

 

I would be inclined to tell the Inland Revenue as well, they are very interested in this type of thing.

 

Louis

[Isiris]

 

the cheque i wrote was from my business account, does this make a difference?

 

quote]

 

robot00

It makes no difference it was just that the companies normally only accept cheques from companies and not drawn from personal accounts.

[alanfromderby]

Interestingly, they don't appear to be registered under the Data Protection Act.

 

I do wonder whether they are going through an aggressive process, which would normally result in a company/small business paying up, just to avoid the hassle of court.

 

My inclination would be to hit them with everything - including a warning that you will be asking the Judge for full costs on the basis that their claim is without merit, and purely intimidatory.

[robot00]

I have spoken to the British Cheque Cashers Association of whom Cashflow Chequecashers LTD are a member, they have sent their interpretation of an issued 'cheque being as good as cash' and sent some notes posted below. Also they have said I should request agreement between payee and chequecashers ltd as this will have details of liability should cheque be stopped. BCCA have said that cheque being passed to chequecashers is same as mortgages and loans being passed by original lenders to other agencies/lenders for collection. anyhow here are BCCA details below;

 

DISHONOURED CHEQUES

Bills of Exchange Act 1882 (as amended)

3 Bill of exchange defined

(1) A bill of exchange is an unconditional order in writing, addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future time a sum certain in money to or to the order of a specified person, or to a bearer.

47 Dishonour by non-payment

(1)a bill is dishonoured by non-payment (a) when it is duly presented for a payment and is refused or cannot be obtained, or when presentment is excused and the bill is overdue and unpaid.

(2) subject to the provisions of this Act, when a bill is dishonoured by non-payment, an immediate right of recourse against the drawer and indorses accrues to the holder.

In addition, you have the Civil Procedure Rules 1998 Part 24.6[1](5)

Set-off and counterclaim in respect of dishonoured cheques: it is trite law that a cheque is equivalent to cash. Accordingly, any action upon a cheque will (in the absence of a total failure of consideration) almost invariably succeed irrespective of any set-off or counterclaim raised by the defendant. It is submitted that the circumstances when this previous practice is not followed will be most exceptional (for example, where the cheque was obtained by fraud .....) A direct debit instruction is now regarded as equivalent to a cheque : Esso Petroleum Co Ltd v Milton [1997]2 All ER 593.[1997]1 WLR 938.CA

Case law:

Fielding & Platt Ltd v Najjar [1969]: the plaintiffs entered into an agreement with a Lebanese company to make and deliver an aluminium press. Payment was to be made by six promissory notes given at stated intervals by the defendant personally. The defendant, who was the managing director of the Lebanese company, told the plaintiffs that they ought to invoice the goods as part of a rolling mill, his intention being to deceive the Lebanese import authorities into believing that the import of the press was authorised whereas in fact it was not. The first promissory note was dishonoured and the plaintiffs stopped work on the press and cabled a message to the Lebanese company to that effect. The second promissory note was then dishonoured and the plaintiffs sued upon the notes. The case eventually reached the Court of Appeal where it was held that:

(a) since the first note covered work in progress there was no defence based on the failure of consideration;

(b) any illegality in connection with the importing of the press was not part of the contract or agreed to by the plaintiffs;

(c ) the plaintiffs' claim was not, therefore, affected by illegality:

 

(d) since the plaintiffs had repudiated the contract before the second note was dishonoured they had no claim for the amount of the note as such but could only sue for the damages; the defendant was not liable on the second note.

Isovel Contracts Ltd v ABB Building Technologies Limited 2001: ABB issued a £70,000 cheque to Isovel in payment for work. Soon after, ABB stopped the cheque on the basis that the value of the work done by Isovel merited a nil valuation. Isovel commenced proceedings for the payment of the cheque.

The judge in this case explained that a cheque is like a Bill of Exchange and is as good as cash in the hand. Once issued, the party who issued the cheque is not entitled to argue that the goods have no value and therefore there is no consideration for the payment, nor can a counterclaim be used to avoid payment. ABB were therefore required to make payment of the sum of £70,000 to Isovel.

 

 

can anyone decipher this and give me the facts/explain its relavence to my case?

 

Cheers

[alanfromderby]

The bottom line is that you have never entered into any contract with Chequecashers. The cheque you gave to the builder was conditional on the work being completed - the builder failed to finish that work, therefore the contract was broken.

 

The only contract that Chequecashers can rely upon, is the contract between them and the builder.

 

Effectively, the presentation of the cheque by the builder to Chequecashers, in the full knowledge that he had no intention of completing his side of the contract has to be fraud. I would also suggest that his actions in using such a service as this would back-up the contention that he never had any intention of finishing the job.

 

The argument being used by the BCCA seems to go totally against the view of the banks, and contract law. Indeed, if they are correct, then the very process of stopping a cheque would be unlawful - this is clearly total nonsense.

 

It is worth noting that the BCCA have no legal status, and there website makes it clear they have been set up to look after the interests of their members - not their customers. This is an extract:

 

The British Cheque Cashers Association exists to serve its members. As stated in the overview, it's key role is to provide representation of their interests to Government -whether in Whitehall or Brussels - and to the relevant regulatory bodies.

 

It also seeks to enhance understanding of the industry, and to promote the interests of cheque cashers generally, by helping to shape a climate of opinion which enables members to conduct their businesses profitably.

 

I also have some serious questions over CashFlow Chequecashers Ltd.

 

1) The are not registered with the FSA - okay, probably fine.

2) The do not hold a Consumer Credit Licence - but they are offering credit.

3) They are not registered as a data processor under the Data Protection Act - but they clearly hold personal information.

 

If it was me, my next call would be to Trading Standards.

[alanfromderby]

Just as a post script to the above - the BCCA are effectively doing the same job as the British Bankers Association. Don't forget that the BBA are the ones that keep saying to the press that bank charges are perfectly legal.

 

The BBA have no choice but to promote the views of its members (the banks), just as the BCCA is promoting the views of its members (cheque cashing companies).

[dw190]

I have spoken to the British Cheque Cashers Association of whom Cashflow Chequecashers LTD are a member, they have sent their interpretation of an issued 'cheque being as good as cash' and sent some notes posted below. Also they have said I should request agreement between payee and chequecashers ltd as this will have details of liability should cheque be stopped. BCCA have said that cheque being passed to chequecashers is same as mortgages and loans being passed by original lenders to other agencies/lenders for collection. anyhow here are BCCA details below;

 

 

DISHONOURED CHEQUES

 

 

Bills of Exchange Act 1882 (as amended)

3 Bill of exchange defined

(1) A bill of exchange is an unconditional order in writing, addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future time a sum certain in money to or to the order of a specified person, or to a bearer.

47 Dishonour by non-payment

(1)a bill is dishonoured by non-payment (a) when it is duly presented for a payment and is refused or cannot be obtained, or when presentment is excused and the bill is overdue and unpaid.

(2) subject to the provisions of this Act, when a bill is dishonoured by non-payment, an immediate right of recourse against the drawer and indorses accrues to the holder.

In addition, you have theCivil Procedure Rules 1998 Part 24.6[1](5)

Set-off and counterclaim in respect of dishonoured cheques: it is trite law that a cheque is equivalent to cash. Accordingly, any action upon a cheque will (in the absence of a total failure of consideration) almost invariably succeed irrespective of any set-off or counterclaim raised by the defendant. It is submitted that the circumstances when this previous practice is not followed will be most exceptional (for example, where the cheque was obtained by fraud .....) A direct debit instruction is now regarded as equivalent to a cheque : Esso Petroleum Co Ltd v Milton [1997]2 All ER 593.[1997]1 WLR 938.CA

Case law:

Fielding & Platt Ltd v Najjar [1969]: the plaintiffs entered into an agreement with a Lebanese company to make and deliver an aluminium press. Payment was to be made by six promissory notes given at stated intervals by the defendant personally. The defendant, who was the managing director of the Lebanese company, told the plaintiffs that they ought to invoice the goods as part of a rolling mill, his intention being to deceive the Lebanese import authorities into believing that the import of the press was authorised whereas in fact it was not. The first promissory note was dishonoured and the plaintiffs stopped work on the press and cabled a message to the Lebanese company to that effect. The second promissory note was then dishonoured and the plaintiffs sued upon the notes. The case eventually reached the Court of Appeal where it was held that:

(a) since the first note covered work in progress there was no defence based on the failure of consideration;

(b) any illegality in connection with the importing of the press was not part of the contract or agreed to by the plaintiffs;

(c ) the plaintiffs' claim was not, therefore, affected by illegality:

 

(d) since the plaintiffs had repudiated the contract before the second note was dishonoured they had no claim for the amount of the note as such but could only sue for the damages; the defendant was not liable on the second note.

Isovel Contracts Ltd v ABB Building Technologies Limited 2001: ABB issued a £70,000 cheque to Isovel in payment for work. Soon after, ABB stopped the cheque on the basis that the value of the work done by Isovel merited a nil valuation. Isovel commenced proceedings for the payment of the cheque.

The judge in this case explained that a cheque is like a Bill of Exchange and is as good as cash in the hand. Once issued, the party who issued the cheque is not entitled to argue that the goods have no value and therefore there is no consideration for the payment, nor can a counterclaim be used to avoid payment. ABB were therefore required to make payment of the sum of £70,000 to Isovel.

 

 

can anyone decipher this and give me the facts/explain its relavence to my case?

 

Cheers

 

IMO the Cheques Act quoted above applies to the cheque you issued.

 

81A.

Non-transferable cheques

81A.--(1) Where as cheque is crossed and bears across its face the words "account payee" or "a/c payee", either with or without the word "only", the cheques shall not be transferable, but shall only be valid as between the parties thereto.

(2) A banker is not to be treated for the purposes of section 80 above as having been negligent by reason only of his failure to concern himself with any purported indorsement of a cheque which under subsection (1) above or otherwise is not transferable.

[ Cheques Act 1992 ]

 

Do they class themselves as Bankers.

[alanfromderby]

Do they class themselves as Bankers.

 

 

And if they do, they are breaking the law as they don't hold a Consumer Credit Licence.

 

Banged to rights, I think!

[robot00]

Hi All,

I am just about to submit my defence statement below, please let me know how you think it reads, or any areas requiring improvement.

 

Cheers

 

On Monday 2nd April 2007 the defendant had issued a crossed a/c payee cheque, amounting £560 payable to E.R.Marshall, supposedly a Building Contractor, in respect of kitchen installation works, agreed to be commenced Tuesday 3rd April 2007. E.R.Marshall failed to start said works on the agreed date and failed to respond to telephone messages until Thursday 5th April 2007. When contact was eventually made by telephone, E.R.Marshall demanded the defendant paid further additional monies before commencing the works. It became immediately apparent E.R.Marshall had never had any intention of starting the agreed works.

The defendant suspecting fraudulent actions on behalf of E.R.Marshall in taking the cheque, contacted Lloyds TSB Bank, who advised stopping the cheque, as it had not yet been cleared. A fee was paid by the defendant to stop the cheque.

E.R.Marshall contacted the defendant by telephone11th April 2007, verbally threatening to ‘break the defendants legs’ as payment had been stopped. The defendant was at this time still unaware a cheque encashment facility had been used.

Wednesday 25th April 2007 the defendant received a telephone call from the Claimant, Mr Assheton of Cashflow Chequecashers Ltd, requesting information why payment for this cheque had been stopped. The defendant explained the circumstances and that having taken advice from Lloyds TSB Bank, was perfectly obliged to request the cheque be stopped. The Claimant contested that issuing a cheque was ‘as good as cash’ and requested immediate payment by the Defendant. The Defendant again verbally denied any liability for payment to this company and the Claimant abruptly ended the call.

Upon receipt of this Summons the Defendant has sought advice in respect of the Particulars of Claim.

Lloyds TSB Bank have advised that as the cheque was crossed a/c payee to E.R.Marshall, no liability or contract exists between the defendant and the Claimant.

Bills of Exchange Act 1882 (as amended)

81A. [ Cheques Act 1992 ]

Non-transferable cheques

81A.--(1) Where as cheque is crossed and bears across its face the words "account payee" or "a/c payee", either with or without the word "only", the cheques shall not be transferable, but shall only be valid as between the parties thereto.

(2) A banker is not to be treated for the purposes of section 80 above as having been negligent by reason only of his failure to concern himself with any purported indorsement of a cheque which under subsection (1) above or otherwise is not transferable.

 

Furthermore in respect of paragragh (2) of the above act, the Defendant is advised by the Consumer Action Group, that the Claimant is unable to class themselves as a banker for the reasons detailed below;

1) They are not regulated by or hold membership of the FSA

2) They do not hold a Consumer Credit Licence

3) They are not registered as a data processor under the Data Protection Act

The Citizens Advice Bureau have also provided information relating to the use of cheque encashment facilities, such as the Claimant provides, and also with regard to stopping a cheque.

The CAB advise that ‘it is not illegal to stop a cheque’.

The CAB advise that ‘when a cheque encashment centre (Claimant) cashes a cheque made out to a client (E.R.Marshall), this will usually be negotiated with recourse to the client. This means that if there is a problem with the cheque, for example, if the cheque bounces, the cheque encashment centre can take action against the client to recover payment However this must be made clear to the client before the cheque is cashed. If this is not made clear, the cheque encashment centre cannot take action against the client’.

The Claimant has not provided details of any contract or liabilty between Cashflow Chequecashers Ltd and the Defendant. The Defendant believes this claim has no merit and is purely intimidatory.

[alanfromderby]

I would change your last paragraph as follows:

 

The Claimant has not complied with any pre-action protocols, has failed to provide details of any contract or liability between Cashflow Chequecashers Ltd and the Defendant. The Defendant believes this claim has no merit and is purely intimidatory, and will be seeking an early Application to Strike Out this claim, along with a counter claim for the costs.

 

I would then write to Cheque Cashers with a copy of your defence, and give them 14 days to confirm that they will withdraw the action - otherwise you will make an application to Strike Out - along with a counterclaim for costs.

 

If you do have to apply for a strike-out, you will have to pay a £65 fee - but of course that would be reclaimable, I would also include within any strike out application, a request for costs due to the behaviour of the claimant. If it comes to this I will advise on the relevant CPR's at the time.