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could someone explain a full and final settlement and a short settlement please?

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  • could someone explain a full and final settlement and a short settlement please?

    I settled a balance of £2000 with Marbles at 30% or £600 which they offered me as FULL AND FINAL SETTLEMENT. This included £1100 of charges.

    They defaulted me for £1400 (70% of the balance) and satisfied the accounts at credit ref agencies, except 1 which they carried on reporting to as due.

    I claimed charges back in April and they offered me £1100 in writing but no interest after offering the total of £2600 over the phone. I refused.

    I passed the matter to FOS.

    At the FOS, HFC showed a SHORT SETTLEMENT of £1400 owing which they had written off. They showed interest of £150.

    So FOS awarded me £1200 in charge and interest from HFC and £300 compensation for wrong default. They say HFC are entitled to the £1400 written off so i am to receive £100. I have refused this decision.

    HFC say they took charges into account at the time of settlement which left a balance of £800 out of which i paid £600, hence the remaining £200 given from my compensation.

    But they did not reflect this in the defaults and i was told i was paying 30% (£600) out of £2000. They misled me into believing i was paying less when they knew internally i was paying more of the balance at 70%.

    They say they took charges into account at the time which they may have but misled me into believing it was a 30% settlement so the defaults may be accurate and now the FOS say they are entitled to the written off amount of £1400 so i have ended up paying all the amount of £2000.

    What can i do as they are either wrong with the defaults, wrong in misleading me or i am due the charges and interest at todays rate which would clear the written off amount and give me some change (FOS are not paying me any interest which is £1500 at statement rate)?

  • #2
    Re: could someone explain a full and final settlement and a short settlement please?

    This seems quite complicated but here is how I read the decision which on the face of it seems correct.
    Marbles, debt owed=£2000. £600 paid as full and final settlement and so remaining amount is £1400.

    Ok, FOS offered in total £1500 which is £100 more than the amount remaining which on simple reading is correct.

    The question is, if you settle as full and final settlement and then go back to it, whether the original sum settled can be retrieved and used. What is the law surrounding full and final settlement?

    If you have refused the decision of the FOS can you appeal and on what grounds can you appeal?

    Comment


    • #3
      Re: could someone explain a full and final settlement and a short settlement please?

      i would argue that i have paid the whole amount which included charges as that is what i was given.

      the crucial part here which the FOS also have no answer to is that it was a 30% settlement of whatever was outstanding, which happened to be £2000.

      the bank say they took charges into account, or repayed them back to me, and so i settled £800 with £600, not really the £600 of £2000 which was the agreement.

      so under the settlement i have either paid too much as my 30% but none of the charges OR have paid the right amount and the charges.

      if we go by what the bank are now saying, i have been misled by them into paying a higher amount in settlement than i should have.

      the defaults they maintained back my side and not what they are saying now.

      the FOS say there is no more appeal as it has gone through an Ombudsman. The FOS decision and HFC offer is how it should have happened at the time in 2004 and not now, so i am denied any interest which is normally awarded in these claims.

      HFC offered me the whole amount asked (£2600) in June over the telephone and then only the charges in writing. This is why i took it to the FOS as at that time they never mentioned settlements etc. but simply accepted i am due the refund.

      Comment


      • #4
        Re: could someone explain a full and final settlement and a short settlement please?

        Full and final settlement is a load of rubbish frankly unless consideration is shown from both parties.

        This means that your part of the consideration is to sign to say you will not sue for any more, but the bank has not shown you any consideration in return. They have just simply returned what was never theirs to take.

        However, this is where I am confused though with your post.

        Have they written off an amount that you have not had to repay? Is this the amount that you now want to claim? If this is so, I would say they have shown consideration in writing it off, but if you could clarify it it would help.

        Comment


        • #5
          Re: could someone explain a full and final settlement and a short settlement please?

          Originally posted by Amy View Post
          Have they written off an amount that you have not had to repay? Is this the amount that you now want to claim? If this is so, I would say they have shown consideration in writing it off, but if you could clarify it it would help.
          I paid £600 of £2000 (including £1200 charges) as a 30% agreement. They wrote off £1400. The defaults got changed to £1400 default, balance £0.

          My claim is for charges of £1200 and i've been awarded £300 compensation for a wrongful default they had. With interest i asked for £2600.

          So i get the £1200 + £300 but no interest. HFC can keep £1400 the FOS say and i can accept the £100 remaining.

          HFC said they paid the charges back to me when we made the settlement or that they took it into consideration. Meaning they are telling me i settled £800 with £600, which is 75% of the balance. I was told i was settling £2000 with £600 at 30% of the balance. The agreement was 30%, not £600.

          If they took charges off at the time then i should have paid £240 as 30% of £800 and i would have no claim for charges as they have been taken off the total balance. But this did not happen.

          Looking at it another way, i paid 30% of the balance of £800 at £240 and 30% of the charges of £1200 at £360.

          Somewhere along the line i am due some money back.

          The balance of £1400 they are claiming is from the 'loss account' they hold into which all write off's are written from the main account, which shows £0. But this would mean they have received a tax rebate on this write off and possibly claimed insurance as well.

          Comment


          • #6
            Re: could someone explain a full and final settlement and a short settlement please?

            I think I understand a bit better now.

            Do you have any of this in writing from HFC?

            Comment


            • #7
              Re: could someone explain a full and final settlement and a short settlement please?

              the settlement of 30% or £600 i have no paperwork as was done over the phone.

              but in their decision they have stated i settled £2000 and even though i have kept repeating the 30% agreement to the FOS, they have ignored this and just looked at amount paid, amount written off, refund now - written off = offer to me.

              Comment


              • #8
                Re: could someone explain a full and final settlement and a short settlement please?

                Hi Tifo,

                My head is hurting reading this,the way I see it ( and could be totally wrong) is if they pay it back to HFC then they are paying them the charges that shouldn't have been there in the first place????

                Sorry if this is just going to add to more confusion.
                Member of the Beagles £2 coin and small change savers clubs, both based in the Debt Forum:11:

                Comment


                • #9
                  Re: could someone explain a full and final settlement and a short settlement please?

                  Hi Tifo,

                  I agree with you about having overpaid them if you had to settle it at 30%,but I wouldn't have thought you could claim for charges that you didn't pay (if they were written off)

                  Saying that you have overpaid them by £360.00( I would ask for interest on this also) plus the compensation of £300.00 so by my reckoning they owe you £660.00 plus interest

                  Does any of this makes sense ( it does in my headmsl
                  Member of the Beagles £2 coin and small change savers clubs, both based in the Debt Forum:11:

                  Comment


                  • #10
                    Re: could someone explain a full and final settlement and a short settlement please?

                    Its confusing me as well, but this is the way I see it. If the charges weren't paid in the first place, ie they were part of the written off debt, then I can't see how you could claim them now. The way I understand it ist, charges are recalimed and either offset against an outstanding balance, or if there is no outstanding balance, ie you've paid them, then you should get them back as a cheque. It seems to me that neither of these apply.
                    Is no longer here

                    Comment


                    • #11
                      Re: could someone explain a full and final settlement and a short settlement please?

                      Originally posted by scottishlass View Post
                      Saying that you have overpaid them by £360.00( I would ask for interest on this also) plus the compensation of £300.00 so by my reckoning they owe you £660.00 plus interest
                      I agree with this and this is the second choice i would make.

                      Comment


                      • #12
                        Re: could someone explain a full and final settlement and a short settlement please?

                        Originally posted by WendyB View Post
                        The way I understand it ist, charges are recalimed and either offset against an outstanding balance, or if there is no outstanding balance, ie you've paid them, then you should get them back as a cheque. It seems to me that neither of these apply.
                        There is no balance.

                        I paid off the whole amount of £2000 with £600. The bank agreed to this. It made a commercial decision to write off the £1400. This amount no longer exists on the account.

                        It is no different to me paying £2000 to clear £2000. Then you would agree i am due the refund?

                        The bank is trying to have it both ways and trying to make the situation as it would have been in 2004 had they done what they are doing now.

                        As above, either they owe me £360 plus interest and £300 OR they owe me £1200 plus interest and £300. They cannot have none of these. They offered a 30% settlement then inflated the amount to be paid to get more out of me, now deflating this amount to show they refunded charges at the time (which is clear they did not even mention these).

                        I'm thinking of taking this to court as i can show i have been misled in terms of the settlement. I would also ask for £1000 + value of default (£2000) as per precedent Kpohraror vs Woolwich 1996 and financial loss does not have to be shown with this as it is assumed as part and parcel of the default.

                        If they stick to their story as they want it now, it means the defaults they maintained at £1400 should have been £240 and i would ask for additional compensation of £2400 x 2 for these. The defaults are either right if i am right and wrong if they are right.

                        They have more to lose at court and the settlement would come under scrutiny as well.

                        Comment


                        • #13
                          Re: could someone explain a full and final settlement and a short settlement please?

                          Hi Tifo,

                          I am glad you were able to see where I was coming from
                          Last edited by Tools; 21st March 2010, 16:46:PM.
                          Member of the Beagles £2 coin and small change savers clubs, both based in the Debt Forum:11:

                          Comment


                          • #14
                            Re: could someone explain a full and final settlement and a short settlement please?

                            Originally posted by scottishlass View Post
                            Hi Tifo,

                            I am glad you were able to see where I was coming from
                            This is what i've asked of them in the alternative, but they and the FOS want to ignore the 30% settlement agreed and simply talk figures, i.e. £600 paid out of £800 or £2000 (30%).
                            Last edited by Tools; 21st March 2010, 16:46:PM.

                            Comment

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