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Help / Advice please re monies due

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I wonder if someone can give me any advice please. i am really worried.


I owed £5000 in respect of services supplied, lost my job at the time and found myself unable to meet the bill. I advised supplier and they agreed very kindly to settle for half the bill .i.e.£2500. I accepted there offer and asked for 2 years in which to pay the balance off. This time scal essentially because my mortgage would be paid off in next 12 months and thus I would be able to pay monies by Feb 2009. I did not receive any further letter until 10 days ago stating that at a recent meeting directors on reviewing debtors had said that they had had no response to a letter in March asking for more detailed proposals of when payments would be made and stating that they had received no response. In fact I had not received this and wrote immediately for a copy. This arrived today with letter saying that they were disappointed with lack of response and were instructing solicitors to commence proceedings for £5000.

Help. :confused:

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Did u get the agreement to repay 2500 in writing?

If not they can pursue the full amount.

\even if you have agreement in writing, have you stuck to it?

Again if not they can pursue for the full amount although you can produce the agreement in court.





I am not legally trained or qualified, any advice i offer is gleaned from experience and general knowledge, if you are still unsure after receiving advice please seek legal advice.




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Yes I have written offer from them which I accepted in writing.

The agreement was that the amount was to be repaid by February 2008. This was agreed then they wrote asking me to timetable the payments by letter early March. This was the letter I did not received and requested a copy after the most rercent letter threatening court action for payment. Today I have received handwritten Court summons stating monies due £5000. it contains no ref to agreement reached.


I am minded to first of all see if they will withdraw it based on:

1. No letter before action

2. possible no cause of action as £2500 was agreed and is not disputed and can be evidenced in writing likewise timescale for repayment and that it is inequitable / abuse of process to placer the matter before the Court


Am i right

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The rule in Pinnels Case states that satisfaction of a debt for a lower sum than the amount originally due does not strike out the original debt UNLESS a fundamental part of the agreement is changed, such as the date or payment type.


However, as you have an agreement in writing, it may be that you could argue in your defence that the original contract had been discharged and replaced with the new one - the principle of accord and satisfaction has taken place, and the doctrine of promissory estoppel will prevent them from suing for the full amount.


In English (!), what this means is that the 'accord' is the agreement to accept a lower sum in respect of a debt owed by yourself, and the acceptance is the agreement formed between you and them when they accepted your offer - you have this in writing, so at the moment it's looking ok for you.


The doctrine of promissory estoppel is basically a maxim set by the courts which prevents people from going back on their word once it is established that an agreement has been formed and a legally binding contract has been formed.


There have been many posts on here where banks and firms have used Pinnels case to sue for a larger amount than what was agreed, and it's a bit 50/50 because the law surrounding contracts is quite complex.


However, I am more inclined to say that you are in the right here, having received a new agreement, but I would seek legal advice to prepare a defence to be on the safe side.

  • Haha 1

Lived through bankruptcy to tell the tale! Worked in various industries and studied law at university. All advice is given in good faith only :)

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Many thanks for your helpful comments. Idid a politics and law degree so many years ago I have almost forgotten the legal side!! Or perhaps it is just not the same when trying to advise yourself. Overnight when initial panick had subsided I did consider:

1. That as a lesser amount had been agreed and that same was to be paid in 24 months that I could plead in Defence that there was no cause of action and a right of action would only arise on the date of the 2 year anniversay should full payment have not been received by the creditor.

2. As there has been no LBA and apparently no consideration given to CPR protocols i.e every avenue should be explored before resorting to issuing proceeding am I right in thinking that this would make it difficult for them to pursue any costs etc??


I understandthe principle of estoppel and certainly I should consider pleading in defence in alternative.


I have not read Pinnel's case but will try and do so.


I am wondering whether letter to creditor may be worth my while pointing out above prior to formal defence and seeing if they would withdraw claim.


Owing to being low wage earner at the moment I think this is going to have to be a DIY job.

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No problem.


Although this was the first case in 1602, it is still used in defences and arguments in the 21st century legal world - I still see it on defences in the small claims court!


Also look up Foakes vs Beer (1884) and D & C Builders Ltd vs Rees (1965), although the latter was Denning LJs ruling on when equity (i.e. estoppel) can and can't be used.


Good luck :D

Lived through bankruptcy to tell the tale! Worked in various industries and studied law at university. All advice is given in good faith only :)

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Thanks Chesham for your help.

One other thing I have thought of after initial posting was that when they offered to accept £2500 from me they deducted from the £2500 the sum of £200 which they owed me in respect of a refund on unrelated matter leaving balance of £2300. Does this help my case?

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A little further help please if anyone can.


Received letter this morning from Creditor:


"I confirm that if you complete admission form to formally admit liability for £2300 and you adhere to a payment schedule then we are prepared to defer taking steps requesting a judgment. If there is a breach we will apply for judgment"


it occurs to me that if I took above course of action I wold end up with County Court judgment against me whether they seek to enforce or not. Also the corrrect debt as they say is £2300 which replaced the first contract for £5000. The Defence would be the second debt replaced the first, they are estopped from pursuing it, the second debt has taken its place and i could agree certain payment terms in respect of it but those terms do not form part of the first action which is ill founded but form part of a separate action which would in its own right be enforceable. Should I write poiting out this and get them to withdraw current action.

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  • 2 weeks later...

Hi, Is there anyone out there who can look at my post 4 June and let me have their thoughts, they will be gratefully received. Thanks

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