Is My Agreement Enforceable - Useful

[diddydicky]

That's CPR, rather than the CCA, in'nit?

 

ahh you have spotted my deliberate mistake- you have passed!!

[car2403]

ahh you have spotted my deliberate mistake- you have passed!!

 

Phew, I thought you were serious for a minute there - my eyes lit up when I heard the CCA demanded the original be in Court, in fact, a little bit of wee even came out! :eek:

[diddydicky]

ahhhhhhh yess brings back memories of short trousers and wee running dowm my leg as the local village bobby clipped me around the ear for throwing stones at the street lights!!

[foolishgirl]

in fact, a little bit of wee even came out!

 

ahhhhhhh yess brings back memories of short trousers and wee running dowm my leg as the local village bobby clipped me around the ear for throwing stones at the street lights!!

 

Yuk, too much info, guys!!

[car2403]

Yuk, too much info, guys!!

 

[lightningd]

Anybody had a reconstituted copy of cca instead of original from these companies. Apparrently they can now supply you with one of these & get your details off various correspondence you may have sent them.

[diddydicky]

a little oversimplified but yes they can "reconstruct" (not "construct") an agreement but it is frought with pitfalls and not as easy as they would have you beleive

[lightningd]

Thanks dick any further info let me know if you can

Regards

Lightlingd

[Mozz1]

But is it not, then, their word against ours? What sort of "pitfalls" should we be looking for in a reconstructed CCA?

[N.P]

But is it not, then, their word against ours? What sort of "pitfalls" should we be looking for in a reconstructed CCA?

 

 

Well, for a start, how do we know what they have made up is what the original would have been like?

 

You could argue that they have deliberately withheld the lame original in an attempt to fob you off with a compliant knock-up.

 

Also, sticking your signature on could be classed as a fraudulant attempt to extort monies from you via a knocked up agreement, when in fact their is no original to prove otherwise.

 

And, anything else you can think of

[vint1954]

Anybody had a reconstituted copy of cca instead of original from these companies. Apparrently they can now supply you with one of these & get your details off various correspondence you may have sent them.

Sorry to keep trotting this one out, but it has been used in responses from the OFT, including in a response to a written question from the then Chancellor:

 

The copy of the executed agreement need not be an exact copy but it must be a ‘true copy’ and not some reconstruction of what the original might have been and it must contain the same terms as the original. Where the terms have been varied as provided for within the agreement, the copy of the original agreement must be accompanied by a document setting out the current terms, as varied. Certain details may be omitted from the original agreement eg the signature but the debtor must be in no doubt as to the true nature of his obligations under the loan.

 

Should no original agreement be in existence it is very hard to say that the copy the creditor offers to the debtor is, in fact, a true copy as there would be no original with which to compare it. In our view the onus of proof would be on the creditor to show that the copy is a true one and where none existed he may have difficulty discharging this. Neither should creditors suggest that a consumer has signed a credit agreement where they are unable to provide evidence to support this — to do so is likely to be a misleading action under Regulation 5 of the Consumer Protection from Unfair Trading Regulations 2008 (the CPRs) and would also constitute an unfair or improper business practice.

[rdm2006]

Sorry to keep trotting this one out, but it has been used in responses from the OFT, including in a response to a written question from the then Chancellor:

 

The copy of the executed agreement need not be an exact copy but it must be a ‘true copy’ and not some reconstruction of what the original might have been and it must contain the same terms as the original. Where the terms have been varied as provided for within the agreement, the copy of the original agreement must be accompanied by a document setting out the current terms, as varied. Certain details may be omitted from the original agreement eg the signature but the debtor must be in no doubt as to the true nature of his obligations under the loan.

 

Should no original agreement be in existence it is very hard to say that the copy the creditor offers to the debtor is, in fact, a true copy as there would be no original with which to compare it. In our view the onus of proof would be on the creditor to show that the copy is a true one and where none existed he may have difficulty discharging this. Neither should creditors suggest that a consumer has signed a credit agreement where they are unable to provide evidence to support this — to do so is likely to be a misleading action under Regulation 5 of the Consumer Protection from Unfair Trading Regulations 2008 (the CPRs) and would also constitute an unfair or improper business practice.

 

 

useful bit of info - Is this from an official source if so do you have a link to it?

[vint1954]

A google or forum search will bring it up.

 

An almost identical letter was used by Head of enforcement at the OFT.

 

THE CONSUMER CREDIT ACT 1974 - Sections 77 and 78

 

Summary

On request and when accompanied by £1, a consumer has the right to:

 

• a copy of their executed agreement

• any other document referred to in it

• a statement showing

- the total sum paid under the agreement by the debtor

- the total sum which has become payable under the agreement by the debtor but remains unpaid, and the various amounts comprised in that total sum, with the date when each became due, and

- the total sum which is to become payable under the agreement by the debtor, and the various amounts comprised in that total sum, with the date, or mode of determining the date, when each becomes due. If the creditor is unable to give this information, he can state instead how the dates and amounts fall to be ascertained.

 

The copy of the executed agreement need not be an exact copy but it must be a ‘true copy’ and not some reconstruction of what the original might have been and it must contain the same terms as the original. Where the terms have been varied as provided for within the agreement, the copy of the original agreement must be accompanied by a document setting out the current terms, as varied. Certain details may be omitted from the original agreement eg the signature but the debtor must be in no doubt as to the true nature of his obligations under the loan.

 

Should no original agreement be in existence it is very hard to say that the copy the creditor offers to the debtor is, in fact, a true copy as there would be no original with which to compare it. In our view the onus of proof would be on the creditor to show that the copy is a true one and where none existed he may have difficulty discharging this. Neither should creditors suggest that a consumer has signed a credit agreement where they are unable to provide evidence to support this — to do so is likely to be a misleading action under Regulation 5 of the Consumer Protection from Unfair Trading Regulations 2008 (the CPRs) and would also constitute an unfair or improper business practice.

 

In our view a debt collector who has bought the debt is the ‘creditor’ and as such takes on the liabilities of section 77.

 

Under section 77(4), if the creditor is unable to provide this information, he is not entitled to enforce the debt while he remains in default (Decriminalised from 26 May 2008 on the coming into force of the CPRs).

 

Legal Argument

 

A copy of the executed agreement

 

Under the prescribed condition, section 77 of the Act requires the debtor to (Typo, she means Creditor I think) ‘...give the debtor a copy of the executed agreement (if any)....‘. The ‘if any’ most naturally refers to the exception for agreements older than 1985 (Not sure this is correct, "if any" was inserted to cover Verbal Agreements).

 

Where a creditor receives a request to supply a copy of the executed agreement, the Consumer Credit (Cancellation Notices and Copies of Documents) Regulations 1983 (‘1983 regs’) apply. Regulation 3(1) sets out the basic position that ‘every copy of an executed agreement... shall be a true copy’.

 

Regulation 3(2) goes on to concede that there may be omitted from this true copy various information such as details which are not required to be in the agreement by law: the signature box, signature (it should be noted that sub-ss 3-5 of section 127 do not apply to agreements entered into after 1 April 2007.A Court may then, for example, enforce unsigned agreements if it considers it is just to do so.) and date of signature. In our view the effect of Regulation 3(2) is that the creditor is only obliged to send out a generic copy of the agreement the debtor has signed up to. The creditor is not obliged to make an actual photocopy of the agreement.

 

However, the copy does have to be a ‘true copy’. This is a technical term, which has been discussed in a number of cases, mostly relating to bills of sale and the need to register a ‘true copy’ of the bill with the High Court. These cases come from the days before typewriters, when copies were made by hand. The consequences of filing a copy which was not a true copy were severe, since the bill would then be void and the creditor deprived of his security.

 

Meaning of ‘true copy’

 

In this context, the courts decided that a ‘true copy’ need not necessarily be an ‘exact copy,’ but it must be ‘so true that nobody reading it can by any possibility misunderstand it’ or be misled by it (In re Hewer ex parte Kahen (1882) LR 21 Ch.D. 871 at 875). The copy must contain ‘every material provision which is contained in the original’ (except that if the defect is made good by reading the document as a whole, the omission will not be fatal) (Court of Appeal in Burchell v Thompson [1920] 2 KB 80 at 98-99). Further, it is not sufficient for the copy merely ‘to state with complete accuracy in a summary form the effect of the stipulations contained in the original. It is not merely a document that is to state the true legal effect of the original; it is to be a copy of the original’ (per Atkin LJ in Burchell at 105).

 

Hewer, ex parte Kahen - the filed copy of the bill omitted the precise day of the month on which payment was to be made. The court held this was trivial, and no debtor would be misled by it.

Sharp v McHenry (1888 ) LR 38 Ch.D. 427- the copy contained blanks which were not in the original. The court decided that the blanks were unimportant, since the omitted words were not required for the original bill to be valid.

Burchell v Thompson [1920] 2 KB 80 - the copy failed to include the words ‘per annum’ after the interest rate of 55%. The reader of the copy would have to guess whether the interest was per annum, per month or something else but as one could sensibly assume, correctly, that it was per annum it was a true copy.

Commercial Credit Company of Canada Ltd v Fuiton [1923] AC 798 - suggested further that where there are a raft of smaller differences in a bill of exchange copy, this could prevent it being a true copy. However where the differences were such as to make the copy contract actually different to the original, the copy will not be true. Lord Sumner, speaking of the man who may wish to refer to the copy, concluded that ‘the Act promises him ... a true copy, not a puzzle. He is to inspect it, not to recover the original by a process of conjectural emendation’ (at 807).

 

Terms and Conditions

 

Regulation 7(1) of the 1983 Regs requires that a requested copy of an agreement which has been unilaterally varied under section 82(1) of the Act, shall be accompanied either by the latest notice of variation or a copy of the terms and conditions as varied. Regulation 7(2) extends the principle to copies of varied securities supplied either to the consumer or the surety.

 

Debt collectors as creditors

 

A consumer credit debt can be assigned in two ways: in law under the Law of Property Act 1925 or in equity but in practice we need to be concerned only with statutory assignments.

 

For a debt to be assigned in law, there are three conditions:

 

• the assignment must be absolute.

 

• the assignor must make the assignment in writing.

 

• express notice of the assignment must be given in writing to the debtor (see section 136 of the Law of Property Act 1925).

 

The reason the debt is assigned is immaterial. For instance, books of loans may be sold on to be collected as an asset rather than as a discounted debt.

 

In some instances, the debt collector may have purchased a debt but not have the relevant agreement. Whilst, in general, ‘liabilities’ cannot be assigned there must be a question mark over whether ‘duties’ are the same. This is important since there is a rule, expressed in Tito v Waddell (No 2) [1977] Ch 106 at 289 to 302, that where a benefit is conditional upon some burden, the assignee must also take the burden. An example is where the contractor has the right to mine on condition that they pay compensation to those disrupted by the mining. If they assign their right to mine, the assignee takes this right subject to the duty to pay compensation.

 

Therefore, there is a strong argument that under the Act, the right to payment is never absolute. It is always subject to duties (many of which are imposed under the Act). For instance, the right to enforce the credit agreement at all is subject to the duty to comply with section 77 or 78. This duty is not a ‘liability’ as such under the credit agreement but is a condition of the right to repayment.

 

There has been a suggestion that debt collectors can avoid complying with section 77 and 78 by claiming that the agreement is no longer `live’ in some way as it has been ‘terminated’ based on section 103 of the Act. This talks of a ‘trader’ who was the creditor under a regulated agreement, implying that ‘trader’ is no longer a creditor once an agreement is ended. Section 103, however, deals with where the customer no longer owes any money at all and therefore it is correct to say that he is no longer a debtor and the trader is no longer his creditor. Where money is still owed, section 103 would not apply, since the consumer would not be entitled to a termination statement.

 

The first issue on when the debt collector becomes the creditor is relatively simple. Section 189(1) of the Act defines ‘creditor’ as ‘the person providing credit under a consumer credit agreement or the person to whom his rights and duties under the agreement have passed by assignment or operation of law.’

 

Where the debt collector is not acting as the creditor’s agent, or otherwise on his behalf, the only legal basis he can have for demanding payment from the debtor is if the creditor’s rights and duties have been assigned to him. Therefore we can be reasonably confident that a debt collector who has bought the debt is the ‘creditor’.

 

Unpalatable though section 77 and 78 may be for some creditors, if the debt collector is unable to prove the debt, they should be more careful about the debts they buy. They cannot complain that the sections are somehow unfair as it is in the Act and so must be complied with. It is up to them to ensure they purchase and maintain sufficient records to be able to prove the debt and comply with the other requirements of the Act.

 

Misleading statements to debtors

 

Sections 77 and 78 refer to supplying a copy of the ‘executed’ agreement within 12 working days of receiving a written request from the debtor. Failure to do so makes the agreement unenforceable against the debtor until a copy is provided. In addition, if the default continues for a period of 1 month the creditor is in breach of the Act.

 

Execution involves signing the agreement. If no agreement has been executed, it is impossible to supply a true copy of the agreement. Should a creditor supply a copy agreement, even though the debtor has never signed any agreement with that creditor, no indication should be given that it is a true copy or a copy of an executed agreement. To do so may contravene Regulation 5 of the CPRs and be an unfair or improper business practice.

 

The consequence of the debtor not having signed a credit agreement with the creditor is that the agreement is unenforceable except where the court orders that enforcement may take place. Where the agreement was made before 6th April 2007 the court is not able to make such an order unless the agreement was signed by the debtor.

 

Therefore it is misleading to state, when complying with a section 77 or 78 request, that the debtor has signed or would have signed (or similar) the enclosed agreement where the debtor has not done so. From 26 May 2008 such a statement will be a breach of the Consumer Protection from Unfair Trading Regulations 2008 (CPRs). Regulation 5 of the CPRs states that a commercial practice is a misleading action if it contains false information in relation to the main characteristics of the product (amongst other matters) and is likely therefore to cause the average consumer to take a transactional decision he would not have taken otherwise. The product in question is the credit agreement and the main characteristics include the ‘execution of the product’ (Regulation 5(5)(d) of the CPRs).

 

Telling a consumer that he signed such an agreement is also a misleading statement about his rights and the risks he might face as covered by Regulation 5(4)(k) of the CPRs. It is our view that it is likely that a consumer will take a transactional decision to make a payment under the credit agreement or to refrain from exercising his rights under the agreement as a result of being misled about whether he signed it.

 

Breach of Regulation 5 of the CPRs is a criminal offence under Regulation 9 and can also be enforced under Part 8 of the Enterprise Act 2002. Under section 218A of the Enterprise Act, where an application for an Enforcement Order is made the court may require the Respondent ‘to provide evidence of the accuracy of any factual claim’ (such as a claim that a debtor has signed a credit agreement).

 

In addition, it should be noted that threats to take action that cannot be taken is listed as one of the factors that will be considered in assessing aggressive practices in Regulation 7(2) of the CPRs.

 

May 2008

 

xxxxxxx xxxxxxxxxxx

Head of Credit Investigations and Enforcement, Office of Fair Trading

[rdm2006]

Many thanks

[Peterbard]

Hi

Apologies if this has been covered on here before, but I have not been here for a bit.

 

DOUGLAS NAPIER v. HFC BANK LTD TRADING AS THE GM CARD, 31 March 2010, Sheriff D. Kelly

As you will see it is a Scots judgement but it discusses something that has been a bit of a grey area in respect to exactly what the prescribed terms and particularly the “credit limit” on credit cards actually mean in respect of the CCA and enforceability.

As you will see the Pusuer (plaintiff )says that the agreement is not properly executed because the credit limit does not conform with the requirements of schedule 6 “A term stating the credit limit or the manner in which it will be determined or that there is no credit limit.”

The requisite section of the agreement just saying” Your Credit Limit will be determined by us from time to time and notified to you."

This as you will know is quite common in other cards I don’t know if has been tested here but anyway.

The judgment seemed to hang on the judges take on the word “manner” in the schedule 6 definition.

In finding for the bank he reasoned that Manner in this sense meant the manner of communicating the information to the debtor, rather than the manner in which the figure was reached.

This then of course lets the creditor off the hook.

As an aside he links the schedule 6 definition to the definition given in schedule 1 saying that the two are complimentary.

Personally I think this is another case of reinterpreting the legislation to the advantage of the creditor.

Surely the debtor would have the right to know what criteria would be applied in setting there credit limit.

I think that there are pre-contractual issues here also, if you are shopping around for a credit card you need to be aware of all information in fact the act is designed to see that you are.

These days a major part of the decision as to whether to apply or not must be the likelihood of success of the application.

Apart from the embarrassment involved there is the matter of the negative marker on your credit file or at least the record that a request has been made and no account exists which to a future creditor amounts’ to the same thing.

Being able to asses the likely hood of making a successful application by looking at the agreement you are signing seems to me to make sense.

Also, and I must say that most of the consumer organisations are with me on this, I think that agreement for credit card should always be issued with a fixed credit limit on the agreement you sign.

The legislation does not support this at the moment as we have just said, this means that the creditor will make the maximum offer of credit that he thinks the debtor is likely to be able to bear, commercially this of course makes sense.

Many of the more savy consumers are wise to this now, we don’t want to be walking about with ten grand’s worth of available credit in our pockets, the lure and instant gratification of that HD TV or new Kitchen is just to strong for most of us to resist. Some of us just want a card we can use to top up the petrol with or make use of to purchase on line and take advantage of the section 75 protection, in short credit may be like a piece of string but we know how long our piece of string is.

Peter

[cymruambyth]

I'm sorry if I'm repeating an earlier question but I can't find the answer even though I know that I have read it somewhere!

I have a LTSB Asset/Asset Gold/ Asset Platimum Card application and agreement. It is a poor microfiche copy that has not been signed by the bank, only me. Does it have to be signed by the bank?

THe t&cs are a bit suspicious as they are a bank copy and include an 0870 number for 2002.

[cerberusalert]

Technically yes but a court tends to treat it as de minimis and let it pass.

 

If the copy is not fully legible it doesn't satisfy CCA 1974.

[cymruambyth]

Thanks for the prompt reply. It doesn't satisfy the CCA 1974 but i have learnt to my cost that DJs seem to believe that 1 word in 5 that is legible is satisfactory!

[cerberusalert]

It seems that certain DJs treat the whole of CCA 1974 as de minimis at times.

[diddydicky]

I'm sorry if I'm repeating an earlier question but I can't find the answer even though I know that I have read it somewhere!

I have a LTSB Asset/Asset Gold/ Asset Platimum Card application and agreement. It is a poor microfiche copy that has not been signed by the bank, only me. Does it have to be signed by the bank?

THe t&cs are a bit suspicious as they are a bank copy and include an 0870 number for 2002.

 

the lack of the creditors signature is not even (IMO) a de minimus matter- it is an irrelevant matter- since i cannot imagine any situation in which- if the judge finds that what they have provided is a true copy of an agreement- the lack of the creditors signature in any way prejudices the debtor by the lack of the creditors signature- which would only require a simple application to the court by the creditor to enforce- as it is a "re constructed" alleged true copy.

 

the judge would ask himself if it is likely that the creditor- having received the signed original back from the debtor- was likely to have not signed it- and, given that this was their file copy- that it matters even if they did not (as opposed to the OROGINAL agreement not being signed)

 

he would also be likely to conclude that since even an application form - signed by the debtor and containing all of the prescribed terms - would constitute an agreement- what would be the prejudice to the debtor by the creditor holding a debtor only signed agreement as opposed to a debtor only signed application form which is regarded as an agreement

 

however if the agreement- even if it is ruled as a true copy- is illegible- then it clearly cannot be a valid or enforceable agreement if (any of) the prescribed terms are illegible- since on that fact alone- the court cannot see what the prescribed terms are

 

do they for instance say that you must be "pimped out" down the old kent road?- who is to know- if they cannot be read!!

Edited July 23, 2010 by diddydicky

[Peterbard]

Hi

Yes

The lack of creditors signature breaches section 61 only in that it makes the agreement improperly executed not unexecuted as some would have you believe, this puts it under the hospices of section 65 and down to the court to decide.

A for legibility i would agree that it should be the case that it would be unenforceable, however there are several cases on here where a county court has enforced such an illegible document.

There reasoning being that the fact that it is there fills the requirement of 127(3).

The Legibility is again a section 60/65 matter.

Don’t kill the messenger you can check this for yourself. It is far better to have a legible copy that is incorrect..

The creditor will trot out witnesses that will swear that the agreement contained the correct terms and the original was totally legible. Dependant of course on the judge.

Peter

Edited July 24, 2010 by Dodgeball

[cymruambyth]

Hi

 

Don’t kill the messenger you can check this for yourself. It is far better to have a legible copy that is incorrect..

The creditor will trot out witnesses that will swear that the agreement contained the correct terms and the original was totally legible. Dependant of course on the judge.

Peter

 

I certainly don't want to kill the messenger I want to examine all avenues to try and protect myself!

Edited July 24, 2010 by cymruambyth

[Peterbard]

I certainly don't want to kill the messanger I want to examine all avenues to try and protect myself!

 

Hi Good for you

 

Francis B Says

"For every hour i spend on my own case i spend two on the oppositions,"

 

This ensures

A that you have a case and

B Stops any nasty supprises on the day.

 

Peter

[diddydicky]

must be a sick agreement if it puts it into a hospice!!

[diddydicky]

Hi

Yes

The lack of creditors signature breaches section 61 only in that it makes the agreement improperly executed not unexecuted as some would have you believe, this puts it under the hospices of section 65 and down to the court to decide.

A for legibility i would agree that it should be the case that it would be unenforceable, however there are several cases on here where a county court has enforced such an illegible document.

There reasoning being that the fact that it is there fills the requirement of 127(3).

The Legibility is again a section 60/65 matter.

Don’t kill the messenger you can check this for yourself. It is far better to have a legible copy that is incorrect..

The creditor will trot out witnesses that will swear that the agreement contained the correct terms and the original was totally legible. Dependant of course on the judge.

Peter

 

makes a BIG assumption- after many years- that the original staff who saw the original agreement were:-

 

a/ still there

 

b/ Have such fantastic memories of one particular agreement