SLC Cannot Supply The Original Agreement

[joneshousehold]

I have read and reread this thread so much I am now boggle eyed! The whole thread has moved around the whole issue such a lot that I had to back track several times just to keep up.

When I first read through it I went back to my papers to look at Argos and Homebase cards. A DPA request had produced a copy of a document I took to be an agreement. Both are in fact the same and they both are now run by Argos Retail Group. They have a box in the top left hand corner saying 'Your application for the XXX card'. Across the top of both forms they also say 'credit agreement regulated by the Consumer Credit Act 1974'. They both have a box for my signature which is present along with the date. There is a right to cancel note and a note that it should only be signed if I want to be legally bound by its terms. It does not make any further mention about what those terms and conditions are. A letter I received from them states the charges are in accordance with the terms and conditions I agreed to when I signed the forms. They say I confirmed I had read them when I signed but that is not what the forms say. There is something that may at a push be described as a signature on them although one looks more like a stamp than a true signature but without the original this will be difficult to establish.

I initially took the view these were valid agreements but now I am not so sure. The terms and conditions are not present at all so it doesn't meet the requirements of the CCA. I am still not convinced that a judge would accept my arguments as I understand them so far that this is unenforceable.

These latest comments are very interesting about whether an application can be agreement and I shall watch with interest. My own thoughts just seem to be rolling around normal contract law. If the agreement form is the offer, where is the acceptance. Is it when the credit is given (and say the goods taken) or the card issued. If however the card issuer reserves the right to refuse the application then is the application more akin to an invitation to treat (as all law students learn to love!) but in reverse to the usual scenario of the Boots case. If it is then there is no contract. I am still musing I think and I am probably way off the mark.

Keep up the good work however and I will keep watching. Thanks for giving me an interesting conundrum to think about and I hope I don't stay awake puzzling it!

[joneshousehold]

Actually I have read some document that was published by the OFT giving an explanation of parts of the CCA. It said that an exemption can be granted (by whom? The DTI/OFT perhaps?) and a list is published of exemptions. However it also went on to say a general exemption from the S77-79 part of the Act was granted to the Bank of England and all other banks. This seems to be the reason why they claim to be exempt from that part of the Act. That exemption does not extend to the requirement to issue default notices and the like, hence the reason why they do issue them.

 

Sorry I am a bit vague. Tamadus gave me a link to see this document and I think it was a reply to a posting I made in the Consumer Credit Agreement thread

Found it, this is the link. There's a lot to wade through but I am sure I saw it here

http://www.oft.gov.uk/NR/rdonlyres/C...D/0/oft018.pdf

[joneshousehold]

Sorry about the link. Try this

http://www.oft.gov.uk/NR/rdonlyres/CC4C7B5C-2152-4EC7-B850-C3B6E646869D/0/oft018.pdf

[joneshousehold]

I wrote back to BC and told them mine was illegible because parts were unreadable. They had already missed the 12 working days + 1 month deadline so I have told them so. I have had a 'we are looking into it' reply. Interestingly they did say the delay was due to the large number of identical requests!

[joneshousehold]

My husband actually said I wonder if we should say 'my heart bleeds for you' but we decided not! Serves them right for being so badly behaved to us in the past.

[joneshousehold]

On the application form thing, when I did a store card I remember the person who sorted it out rang someone up and came back to me to say that was approved. It meant I could take the goods straight away. Does that action then convert an application to an agreement?

[joneshousehold]

Actually I've just read my agreement and it says they will send them seperately.....never received them, oh my god how the mighty have fallen!!

 

Me too! Is this right? It seems so simple, I cannot believe they would not send a copy. I have looked back at what we have and I definately don't have a copy with the cancellation rights on other than the note that they will send me details of how and when I can do this.

[joneshousehold]

I am now up to my neck in these OFT documents, with a big highlighter pen. Cancellable agreements are more complicated but I also have a non-cancellable agreement that I am awaiting a copy agreement under S77 CCA. They are currently in default and about to become criminals.

 

I can see that the statement of Protections and Remedies have to be included in the signature document and I believe it may be printed on the reverse with the T&C's. The OFT guidance for non-cancellable agreements however doesn't include the additional comment that some specific information may be shown on the reverse of the agreement providing a reference to them is included with the financial particulars. Does that mean a different interpretation for non-cancellable agreements or am I reading too much into this?

 

Oh and thanks very much Pam for pointing this out to me

[joneshousehold]

For a cancellable agreement there should be a statement of your cancellation rights in the agreement and a copy should be given to you at the time of signing. Then within 7 days the creditor should either send you a second copy of the agreement containing a cancellation notice telling you how you can cancel, or a separate notice (depending on where agreement was signed).

 

You then have 5 further days from receipt of this notice in which to cancel. I stated to PPF that since I had not yet (after 11 years ) received this 2nd notice then my 5 days grace had not even begun - so I wrote and cancelled!!

 

Good one eh?

 

Regards, Pam

 

Pam

Sorry to labour the point, although I see you have in the meantime posted to urge caution.

I cannot get how by cancelling the agreement you got your money back. I can see that if you cancel, the trader has to return all the payments but the customer must also return the amount loaned. There is also a separate requirement to pay interest if the trader demands it. I read that to mean the customer effectively has to pay the balance off. Have I missed something?

Is it because the court had already said it was an unenforceable agreement. If so, does that mean you can still cancel it, force the trader to honour their commitment under the cancellation rights but you cannot have your commitment enforced because the agreement is unenforceable. How come it's not unenforceable on the trader as well?

[joneshousehold]

Does the comment by JonCris in Post 1496 have any merit? (JC - does your later post suggest you have a different view in the light of Pam's later explanation?) It sounds logical and my own reasoning seems logical too but as Pam says you would normally have to repay the loan if you cancel. It's just the impact of the enforceability issue that I think may need clarifying.

 

Any great minds willing to give this some thought and throw their hat into the ring?

 

I am not saying my understanding is right, just that I would like more clarity especially on the arguments that the bank would come up with if this line was taken.

[joneshousehold]

I am trying to read this judgement in JonCris's link (although it is an excellent aid for insomnia!) and I have found this

 

31. These restrictions on enforcement of a regulated agreement are for the protection of borrowers. They do not deprive a regulated agreement of all legal effect. They do not render a regulated agreement void. A regulated agreement is enforceable by the debtor against the creditor. It seems, for instance, that a borrower may insist on making further drawdowns under a regulated agreement even though the agreement is unenforceable against him. Further, section 173(3) expressly permits consensual enforcement against a borrower. A borrower may consent to the sale of a security or to judgment. Moreover, the creditor is entitled to retain any security lodged until either an application for an enforcement order is dismissed or the court makes a declaration under section 142 that the agreement is not enforceable. That is the effect of sections 113(3) and 106.

Not sure if this is part of the final opinion or a just of one that is overridden by the majority of other opinions at the hearing. My reading is that if the agreement is unenforceable it is a one sided affair which suggests the cancellation point could allow recover of all payments without the creditor being able to enforce his side of the agreement on cancellation

[joneshousehold]

Another bit that covers unjust enrichment

49. I consider, however, that there is no relevant restitutionary remedy generally available to a lender in the circumstances now under consideration. The message to be gleaned from sections 65, 106, 113 and 127 of the Consumer Credit Act is that where a court dismisses an application for an enforcement order under section 65 the lender is intended by Parliament to be left without recourse against the borrower in respect of the loan. That being the consequence intended by Parliament, the lender cannot assert at common law that the borrower has been unjustly enriched. That would be inconsistent with the parliamentary intention in rendering the entire agreement unenforceable. True, the Consumer Credit Act does not expressly negative any other remedy available to the lender, nor does it render an improperly executed agreement unlawful. But when legislation renders the entire agreement inoperative, to use a neutral word, for failure to comply with prescribed formalities the legislation itself is the primary source of guidance on what are the legal consequences. Here the intention of Parliament is clear.

 

50. This interpretation of the Consumer Credit Act accords with the approach adopted by the House in Orakpo v Manson Investments Ltd [1978] AC 95, regarding section 6 of the Moneylenders Act 1927 and, more recently, in Dimond v Lovell [2002] 1 AC 384, another case where section 127(3) precluded the making of an enforcement order. In Dimond's case the restitutionary remedy sought was payment of the hire charge for a replacement car used by Mrs Dimond. The House rejected a claim advanced on the basis of unjust enrichment. Lord Hoffmann observed that Parliament contemplated that a debtor might be enriched consequential upon non-enforcement of an agreement pursuant to the statutory provisions. It was not open to the court to say this consequence is unjust and should be reversed by a remedy at common law: [2002] 1 AC 384, 397-398.

This seems to say it was parliament's intention that the debtor is enriched as a consequence of S127(3) CCA74 and so that cannot be reversed using some other law. I think this means not only common law but also Human Rights legislation.

 

Please feel free to shout me down. I am still trying to get to grips with all this.

[joneshousehold]

Hi Jones

 

My claim re: cancellation was settled under court ordered arbitration - it never went to hearing so I will never know what the judge's interpretation would have been.

 

Regards, Pam

 

 

Pam, it must make you smile to see us going back over what to you is old ground. I am grateful for your comments as it really helps to understand what I am looking at. I wonder how the judge in your case got around these extracts and still managed to say the payments you made were voluntary.

 

It would have been interesting to get the judges thoughts though on the final outcome. Did the creditor display the characteristics, albeit suppressed, of a Homer Simpsonesque D'Oh moment!

 

As you have already said, the last laugh most definately. Much respect to you as my children would say!

[joneshousehold]

Here's another quote

122. As Lord Hoffmann pointed out in Dimond at p 398, the conclusion which he reached in that case was consistent with previous authority. In Orakpo v Manson Investments Ltd [1978] AC 95 the transaction entered into under which loans were made to enable the borrower to acquire and develop certain properties were held to be unenforceable under sections 6 and 13(1) of the Moneylenders Act 1927. The effect was to enrich the borrower, who had fallen into arrears of payments of interest and moneys due but was successful in his defence that all the transactions including those which provided security rights to the creditor were unenforceable. Lord Diplock observed that, while the Moneylenders' Acts were designed to protect unsophisticated borrowers from being overreached by unscrupulous moneylenders, they were capable of being used by unscrupulous borrowers to avoid paying their just debts to moneylenders. He considered whether a remedy in subrogation to redress the unjust enrichment might be available. But he concluded that, much as he should have liked to have done so, it was not open to him to mitigate the harshness to the moneylender and the undeserved enrichment of the borrower which had resulted from the technical failure to observe the provisions of the Act.

 

This is reference to another case where payments have been made during the life of the agreement but the outcome seems to be just that the agreement stops as a result of the decision. There is nothing to suggest a repayment of the debtor's payments. However I will read on!

[joneshousehold]

Well I got to the end mainly because a large chunk of the rest deals with Human Rights only and not with the enforceability issue.

 

I have to wholeheartedly agree with you Pam. I cannot see how the judge in your claim could justify his decision based on this wealth of evidence. As you say it must have just been the sense of natural justice and unjust enrichment. The way the Lord's judgment reads however is that this is a deterent for money lenders to prevent them from exploiting the most vulnerable. So far it hasn't worked because the lenders firstly get the debtor to admit the debt. Then the court doesn't get the opportunity to look at the validity of the agreement at all. The legislation hasn't worked so far but perhaps the tide could be turning.

 

Thanks for a fantastic debate. Let's see what anyone else has to say. I'm wrecked now!

 

I'm off on a residential course next week so I shall have to catch up when I get back home. I hope not too much gets posted in the meantime or my weekend will be gone before I know it.

[joneshousehold]

I read this to support the defence.

a benefit which cannot be legally justified should not be retained where it was a mistaken--and thus unintended--benefit.

which presumably is what they used. The fact that there is an unjust enrichment however is an intended consequence of S127(3) CCA. The two are opposites and the CCA is deliberately written in the way it is to provide a deterrent to the lenders.

 

Is that how you argued it?

[joneshousehold]

Ah, too clever for me. Is the declaration of intent the actual payment. Methinks the judge was just looking for ways to stop you having your payments back. How can you have intended to give the creditor a benefit when you didn't know you were doing so. You thought you were repaying a debt. That does not seem to be a declaration of the intent alleged. Surely you would have to know that was the intent when you made the alleged declaration?

 

Anyway what do we know, we aren't judges or barristers. No wonder we are a little suspicious of the legal process. Here we are faced with strong case law and statute and the judge just says 'I don't like this so I will take another view'. The trouble here is that both the judge and the barrister have gone away thinking they won the argument or were right. I still think it sounds wrong and I can see why you thought so too.

 

What we need is Mrs Wilson on the case. She seems to have the resources to take her cases further. Did you look into how much it would have cost to appeal?

[joneshousehold]

Definition of declaration in Cambridge online dictionary

 

an announcement, often one that is written and official

 

Still don't quite get the judges interpretation. Like you say it should be something stronger than actually happened in this case. It doesn't have to be written but it has to intended and knowingly surely.

[joneshousehold]

In the case of a bank loan where the money was debited into your account , then the monthly payments were made , would this not be considered evidence that the loan was in place in the absence of a agreemant and used in the loan providers defence. If you coninue with the repayments is this not acknowledgement that there is an awareness of a contract being in place.

 

Tumble, ordinarily the courts would take the sort of evidence that you have outlined to show that a contract is in place because that's how case law have defined it. However CCA specifically says that irrespective of any other evidence if there are any of the specified requirements of the Act not fully complied with, the agreement whether it exists or not cannot be enforced so any attempt to take you to court would fail.

[joneshousehold]

Do you know M55, after all this time I am slowly beginning to understand what you are getting at. I am not sure if you are right or wrong and it would be really interesting to see this in the courts and finally settled.

 

It's been an interesting (and at times amusing, heated and even exhausting) debate. Thanks for stretching our collective minds on this subject. I think I now need a very large glass of wine! Cheers

[joneshousehold]

Leave it!!!!

[joneshousehold]

You boys need to think of the whole of the 1966 World Cup winning squad to take your mind off this. Say after me.. Bank, Cohen, Stiles, Charlton.....

[joneshousehold]

Wow, glad I was offline yesterday!

 

Now I am interested in debating this whole unenforceable agreement and processing data point but only if you boys PROMISE not to shout again. I think we could have a worthwhile debate so can I dip my toe in here. If anyone starts arguing again I shall tell you off.

 

So here goes - referring to M55's post No 1767, what about the argument that the ability to process data is a right. The right to process about that particular agreement is a right under that agreement. In one of the cases the judge says the creditor lost all rights under the agreement where it is ruled to be unenforceable, not just the right to recover its money. In the case (one of the fabulous Mrs Wilson's I think) in particular they lost the right to retain the car. Is there any way this would hold up to examination or not? Could it be used to prevent any processing at all. It may be that the whole argument as to who's data it is becomes redundant if that is the case.

[joneshousehold]

Just to go back to the first posting on this thread - I asked Lombard for a copy of my agreement and they have just written back to admit they cannot find it! I am bursting to tell everyone!

 

I shall do some research tonight about my options but it will entail rejecting any attempt to recommence payments and removing all CRA entries - no default but a few missed payments now following their default from February. I might even look at asking for my payments back in the light of Baconbuttyman's success. Stonelaughter gave a lot of advice about this but I think someone else (Battleaxe perhaps?) has had such a claim rejected by the courts. I need to look at this in more detail.

 

I really must do some work but I don't think I can at the moment!!!!

[joneshousehold]

FS - that is more to do with the usual law on contracts. What prevents that applying in loans and credit cards is the CCA. It specifically says that the agreement must comply with specific regulations and overrules normal contract law. If there is no agreement available then the creditor cannot prove they have complied with those regulations and therefore the agreement becomes unenforceable. CCA then goes on to say that the creditor cannot enforce the agreement without an order of the court (unless it was one where even the court cannot rule it is enforceable).

The creditor in your case can do very little and I would suggest you complain loudly to everyone - TS, OFT, FOS, Uncle Tom Cobbleigh and all. As long as you have said the amount is in dispute there is little they can legally do. If they try just write back and point it out and if they try court action just deny existence of an agreement. The creditor will have to prove it exists and then....they will realise they can't do that! Most creditors are too stupid to actually check out their case until it's too late. They have minions carrying out these tasks as a routine matter who do not understand the law nor are given any training.

 

It's a test of nerves but just hold yours and you will prevail. Just meet everything they throw at you with a straight bat.