Letter of Claim from Howard Cohen for Hoist Finance UK Holdings 2 Ltd

**Amethyst** · 19th November 2018, 17:44:PM

Does the SAR from Santander include a copy of the credit agreement ?

Yes complete the response form, saying you don't know if you owe the debt and requesting more information , requesting the agreement and terms, notices of assignment, notices of default / termination and transactions of the account from inception to date. Do both yours and your husbands the same - I'm assuming this was a joint loan ?

Also send a CCA request to Hoist. https://legalbeagles.info/library/gu...etter-example/

**oxfordgirl** · 19th November 2018, 18:28:PM

Thank you Amethyst, the SAR contains the credit agreement from Cahoot, but no

notices of assignment, notices of default

and only statements up to 2013.
It was a joint loan, but since Hoist took over the account Robinson Way wrote only to my husband, but now Howard Cohen have now written to me also.

I will get the letters off first thing tomorrow.

Regards
oxfordgirl
.

**pt2537** · 20th November 2018, 15:53:PM

We beat hoist on a Cahoot agreement if i recall correctley. Heres the Judgment

Deputy District Judge Jane Campbell :

This judgment relates to the fast track trial of a claim by the Claimant for damages for breach of a loan agreement. I read the pages in the trial bundle to which I have been referred and the very helpful skeleton arguments of counsel: Ms Tandy on behalf of Hoist and Mr Brennan on behalf of Mr Davis. I also heard the evidence on oath of Ms Charlotte Hodgson on behalf of Hoist and Mr Davis. In addition, I had the benefit of very full submissions from counsel.

Background

It is common ground that on 19 August 2003 Mr Keith Davis (“Mr. Davis”) entered into a flexible loan agreement (“the agreement”) with Cahoot (a division of Abbey National Plc, now Santander). The agreement is a regulated agreement under the Consumer Credit Act 1974 (“The Act”). On 15 October 2014 Santander assigned Mr Davis’s account to Hoist Portfolio Holding 2 Ltd (“Hoist”).

Mr Davis accepts he stopped paying the sums due under the loan in 2009. He states that at some point during that year he could no longer access the account online. In any event, by paragraph 3 of the order of District Judge Robinson dated 1 October 2015, Mr Davis was deemed to have accepted the balance owing under the agreement because he did not challenge the schedule of loss. The sum outstanding is therefore £10,089.22.

Hoist state that a default notice (“the notice”) was served on Mr Davis. The notice is dated 18 August 2011 and stated:

“IMPORTANT – YOU SHOULD READ THIS CAREFULLY
Default Notice served under Section 87(1) of the Consumer Credit Act 1974. Dated:18/08/11 Personal Loan Number: 090644 14373267 Arrears £1,647.43 Re: Re: Your Flexible Loan Agreement with Santander UK plc
PROVISION OF AGREEMENT BREACHED: The clause that requires you repay any amount which is when we ask for it.
NATURE OF BREACH: Failure to pay the minimum payment on or before the payment date stated in the agreement.
ACTION REQUIRED TO REMEDY: Payment of the overdue amount of £1,647.43 to us within 14 days of service of this notice.

IF THE ACTION REQUIRED BY THIS NOTICE IS TAKEN BEFORE THE DATE SHOWN NO FURTHER ENFORCEMENT ACTION WILL BE TAKEN IN RESPECT OF THE BREACH. IF YOU DO NOT TAKE THE ACTION REQUIRED BY THIS NOTICE BEFORE THE DATE SHOWN THEN THE FURTHER ACTION SET OUT BELOW MAY BE TAKEN AGAINST YOU.

If the payment required is not received by us before the date shown we shall become entitled to demand payment of the whole outstanding balance on your account. We may take legal proceedings for the recovery of this balance which currently stands at £10,089.22 or we may refer your account to debt recovery agents…..”

Mr Davis did not respond to the notice and alleges that he did not receive it. Following unsuccessful attempts by Hoist to recover the balance due, this claim was issued on 4 February 2014. A Defence was filed on 18 May 2014, Hoist having agreed to an extension of time for filing the Defence.

Matters in dispute

This case essentially turns on two points: first, whether a valid notice was served in accordance with section 87(1) and sections 88(1)(b) and 88(2) of the Act; and secondly, whether Hoist complied with section 78 of the Act by providing (1) a copy of the original agreement between Mr Davis and Cahoot and (2) a copy of any variations of that agreement as it is made clear is necessary by paragraph 234(4) of Carey v HSBC Bank Plc and Others [2009] EWHC 3417 (QB). It is Hoist’s case that they have complied with these requirements but if, contrary to their primary case they have not, then any non-compliance is de minimis and should be disregarded.

The significance of the first point is that by section 87(1) a debtor must be served with a valid notice in order for a debt to be enforced. Thus, if the notice is not served or is not valid, the claim fails. As to the second point, the position is essentially the same: if the creditor does not comply with a proper request from the debtor under section 78 by providing a copy of the agreement and any subsequent variations of its terms then by virtue of section 78(6) the creditor is not entitled to enforce the agreement.

The first point: Sections 87 and 88 of the Act

It is convenient to set out these sections of the Act:

(1)Service of a notice on the debtor or hirer in accordance with section 88 (a “default notice ”) is necessary before the creditor or owner can become entitled, by reason of any breach by the debtor or hirer of a regulated agreement,—

(a)to terminate the agreement, or
(b)to demand earlier payment of any sum, or
(c)to recover possession of any goods or land, or
(d)to treat any right conferred on the debtor or hirer by the agreement as terminated, restricted or deferred, or
(e)to enforce any security.

(2)Subsection (1) does not prevent the creditor from treating the right to draw upon any credit as restricted or deferred, and taking such steps as may be necessary to make the restriction or deferment effective.

(3)The doing of an act by which a floating charge becomes fixed is not enforcement of a security.

(4)Regulations may provide that subsection (1) is not to apply to agreements described by the regulations.

[(5)Subsection (1)(d) does not apply in a case referred to in section 98A(4) (termination or suspension of debtor's right to draw on credit under open-end agreement).]
88 Contents and effect of default notice.

(1)The default notice must be in the prescribed form and specify—
(a)the nature of the alleged breach;
(b)if the breach is capable of remedy, what action is required to remedy it and the date before which that action is to be taken;
(c)if the breach is not capable of remedy, the sum (if any) required to be paid as compensation for the breach, and the date before which it is to be paid.
(2)A date specified under subsection (1) must not be less than [14] days after the date of service of the default notice, and the creditor or owner shall not take action such as is mentioned in section 87(1) before the date so specified or (if no requirement is made under subsection (1)) before those [http://www.legislation.gov.uk/ukpga/1974/39 - commentary-c1882161114] days have elapsed.
(3)The default notice must not treat as a breach failure to comply with a provision of the agreement which becomes operative only on breach of some other provision, but if the breach of that other provision is not duly remedied or compensation demanded under subsection (1) is not duly paid, or (where no requirement is made under subsection (1)) if the [14]days mentioned in subsection (2) have elapsed, the creditor or owner may treat the failure as a breach and section 87(1) shall not apply to it.
(4)The default notice must contain information in the prescribed terms about the consequences of failure to comply with it [and any other prescribed matters relating to the agreement].
[(4A)The default notice must also include a copy of the current default information sheet under section 86A.]
(5)A default notice making a requirement under subsection (1) may include a provision for the taking of action such as is mentioned in section 87(1) at any time after the restriction imposed by subsection (2) will cease, together with a statement that the provision will be ineffective if the breach is duly remedied or the compensation duly paid.

Mr Brennan for Mr Davis submits that there are a number of failures to comply with sections 87 and 88 of the Act in respect of the notice. He says that some of these failures, if proved, are fatal to Hoist’s claim. The alleged failures Mr Brennan identifies are as follows:
1. There is no evidence the notice was sent.
2. The sums set out in the notice do not correspond with the transaction summary.
3. The notice does not set a specific date for compliance.
4. The notice does not set out correctly the nature of the breach.
5. The notice does not give sufficient prominence to particular phrases.
6. The notice does not give at least 14 days to comply with the alleged breach.

In response, Ms Tandy for Hoist says this:
1. There is clear evidence the notice was sent.
2. The sums set out in the notice and transaction summary do correspond when interest calculated on a 15 day basis is taken into account. However, as Mr Davis has not served a counter schedule of loss he is precluded from challenging the sum owed.
3. The notice does not need to set a specific date for compliance and a formulation for the calculation of time is permissible.
4. The notice clearly sets out the nature of the breach.
5. Any failure of emphasis in the notice is a de minimis breach as the notice is clear with significant phrases being given prominence by virtue of being in capital letters.
6. The notice does give the requisite 14 days’ notice.

Analysis
Service of the Default Notice

Mr Davis says he did not receive the notice and explained when he gave evidence that he was away on holiday at around this time. The written evidence of Ms Hodgson is that the notice was sent. She expanded on this when she gave oral evidence. She explained that she was familiar with the procedures for generating default notices and calculating arrears. She said the notices are computer generated when accounts fall into arrears and the notices are then automatically sent to the defaulter by first class post. Further, she had made enquiries about this particular notice and whilst Cahoot could not definitively confirm the notice had been sent there was nothing to suggest it had not been sent; indeed, the very existence of the notice suggested it would have been sent in accordance with standard procedure.

Ms Tandy submits that by virtue of section 176 of the Act a document may be served if it is “delivered or sent by an appropriate method to the subject, or addressed to him by name and left at his proper address” or “sent by post to, or left at, the address last known”. There is no requirement for actual receipt. I accept that submission.

As to whether or not the notice was sent, I accept the evidence of Ms Hodgson that it would have been highly unusual if it was not sent as it was clearly in existence and it is standard procedure once a notice is generated to send it out by first class post. Ms Tandy draws my attention to Rankine v American Express Services Europe Limited and Others [2008] CTLC 195 where His Honour Judge Simon Brown QC (sitting as a High Court Judge) at paragraph 8 made the point that financial institutions are highly sophisticated and their “systems and programmes have long since been well geared to the mechanics of the Consumer Credit Act…” I therefore accept on the balance of probabilities that this notice was sent to Mr Davis and that the service was valid.

The sums in the notice

It was not open to Mr Davis to dispute the sum owed in view of the failure to serve a counter schedule of loss. Notwithstanding this the point was explored in evidence and Ms Hodgson explained the discrepancy which was the result of the regular 15 day calculations of interest. Quite properly the point was not pursued by Mr Brennan in submissions. I accept the sum claimed in the notice is correct.

Absence of a specific date for compliance

By virtue of sections 88(1)(b) and 88(2) the notice must be in the prescribed form, state the action required to remedy the breach and the date specified for it to be remedied must not be less than 14 days after the date of service of the notice. Mr Brennan says that the absence of a specific date for remedy in the notice is fatal to Hoist’s claim. He submits that the words “within 14 days of service of this notice” are not good enough. Ms Tandy draws my attention to Rankine v American Express Services Europe Limited and Others [2008] CTLC 195 where at paragraph 37 His Honour Judge Simon Brown QC said this:

“There is no merit to the contention that the fact that the default notice failed to specify the precise term which D had breached was fatal to the effect of the default notice served. It was clearly stated when read as a whole what the breach was and what was required to remedy it. Second, even if there was a breach, it was de minimis breach of the provisions of the Enforcement Regulations and of no significance.”

Ms Tandy also referred me to Brandon v American Express Services Ltd [2011] EWCA Civ 1187 and in particular to paragraphs 29 and 30 where it is clear that the Court of Appeal, whilst taking issue with whether the required 14 days had been complied with in that case, took no issue with the use of a formulation that allowed for the calculation of time rather than provided a specific date. I accept Ms Tandy’s submission that Hoist were not required to provide an actual specific date for compliance and that a formulation for the calculation required for compliance was sufficient. The point is addressed directly in Rankine which I find persuasive. The passages referred to in Brandon bolster my view that a specific date is not required provided the time for compliance is not less than 14 days.

Failure to specify the nature of the breach

Mr Brennan did not pursue this point with any great vigour and, in my view, he was right not to do so. As Ms Tandy submitted, the notice clearly sets out that the breach was the failure to meet the minimum payments under the numbered flexible loan agreement. It is quite apparent from reading this notice that this is the breach complained of and that payment of the overdue amount is required to remedy it. Ms Tandy drew my attention to paragraph 37 of Rankine again in this regard. I have no hesitation in concluding that the breach was clearly set out in this notice. I also agree with Ms Tandy that if there was any breach in this respect it was de minimis and can be overlooked. No prejudice was caused to Mr Davis.

Failure to emphasise important phrases

Mr Brennan conceded, that this was not a major point. Ms Tandy accepted, as she had to, that the words “BEFORE THE DATE SHOWN”, whilst capitalised, were not in addition underlined as in the Schedule 2 Notices Regulations. But she submitted that this was no more than a de minimis breach in circumstances where some text on the notice was capitalised and other text was not. This she said gave these words a suitable degree of prominence. I agree. The critical parts of the notice are visually clear. The notice is clearly legible with the important phrases clearly identifiable by virtue of them being in capital letters. In my judgment, the breach was de minimis and did not prejudice Mr Davis.

Whether at least 14 days for compliance was given

This is a point which Mr Brennan pursued with force. He submitted that by virtue of section 88(2) the notice must give at least 14 days to comply with any breach. The notice states that the action required to remedy the breach must be taken “within 14 days of service of this notice” and then states that if action to remedy the breach is not taken “before the date shown” the creditor may take enforcement action. His point is that these two forms of words are contradictory. The words “within 14 days of this notice” include a period of 14 days but the words “before the date shown” have the effect of requiring Mr Davis to comply in less than 14 days.

Mr Brennan drew my attention to Harrison v Link Financial Ltd [2011] EWHC B3 (Mercantile). In this case, the notice was clearly invalid as only 12 days were given for the debtor to comply. His Honour Judge Chambers QC (sitting as a High Court Judge) at paragraph 75 of his judgment said this:

“The notice of enforcement was a statutory pre-condition of enforcement. It was a bad notice and enforcement and enforcement cannot be attempted in dependence upon it. However, bad notices can often be remedied by the service of good notices and I see no reason why that should not be so in respect of credit agreements.”

Mr Brennan also referred me to Brandon v American Express Services Ltd [2011] EWCA Civ 1187. In that case, the notice stated that the 14 day period ran from the date of the notice. The notice was served by post. The debtor argued that it was served after the date given in the notice and therefore he was not given 14 days to comply with it. The creditor applied successfully for summary judgment. The debtor appealed. The Court of Appeal reluctantly allowed the appeal (Gross LJ commented at paragraph 27 that the debtor’s stance was “devoid of merit”). At paragraph 30, Gross LJ, who gave the leading judgment, said this:

“…if, as a matter of construction, the Default Notice has not or may not have allowed the minimum statutory period for Mr Brandon to remedy the breach, then it is (at least) realistically arguable that the defect cannot be overlooked as de minimis. To my mind, this conclusion applies both to the failure to allow a minimum 14 day period and to the absence of prejudice flowing from the defect in the default notice.”

Ms Tandy in response submits that if there is any breach in relation to the 14 day period for compliance it is de minimis. She correctly observes that that at no time has Mr Davis sought to remedy the breach of this agreement by making any payments and no enforcement action was taken during the 14 day period. In relation to Brandon v American Express Services Ltd [20110 EWCA Civ 1187 she stresses that the court were concerned with the test to be applied in summary judgment: they were dealing with whether a point was seriously arguable not whether or not it was correct. She also makes the point that Gross LJ is not saying that de minimis breaches in relation to default notices can never be overlooked.

Whilst there is undoubtedly force in Ms Tandy’s argument, I am afraid I have to reject it. In my judgment, Mr Brennan is right when he says the notice did not give Mr Davis 14 days to comply. The wording is confusing and unfortunate. The operative words are inherently contradictory. The breach cannot be remedied both “within 14 days of service of this notice” and “before the date shown” which is “within 14 days” of service of the notice. These contradict each other. If the breach is to be remedied before the date shown it must be done before the expiration of 14 days. The Notice is therefore not compliant with the requirements of section 88(2). In my judgment, it is a bad notice. I regard the judgment of His Honour Judge Chambers QC in Harrison v Link Financial Ltd [2011] EWHC B3 (Mercantile) as highly persuasive. A notice which does provide at least 14 days for compliance in fundamentally flawed; it is more than a de minimis breach. It follows that enforcement on this notice fails. I therefore dismiss this claim.

The second point: Section 78

In the light of what I have already concluded, it is obvious that any arguments about 78 are now academic. However, if I am wrong in my analysis of the position as regards the default notice, I should make clear that had I needed to consider the conflicting arguments about compliance under section 78, I would have found for Mr Davis. I set out my reasons briefly below.

At the beginning of the trial, Hoist made an application to introduce in evidence a further statement from Ms Hodgson exhibiting the terms and conditions that applied when Mr Dvais made a request under section 78 on 20 October 2015. Ms Tandy’s application was in effect an application for relief from sanctions. It was not CPR 3.9(2) compliant and applying the test in Denton v TH White Ltd [2014] EWCA Civ 906 I refused it. The effect of this decision was that there was no evidence before the court of the terms and conditions which applied when Mr Davis made the request.

Section 78 states that the creditor must give the defendant a true copy of the original agreement and any other document referred to in it following a proper request. In Carey v HSBC Bank Plc [2009] EWHC 3417 (QB) at paragraph 234(4) His Honour Judge Waksman QC (sitting as a High Court Judge) said this: “If an agreement has been varied by the creditor under a unilateral power of variation, the creditor must still provide a copy of the original agreement, as well as the varied terms.”

It was accepted that the current terms and conditions were not supplied to Mr Davis hence the application to introduce Ms Hodgson’s second statement. Further, it was clear from the transaction summary and I find that the interest rate had been varied on a number of occasions. Ms Hodgson when she was cross examined rightly conceded that a number of the documents supplied to Mr Davis including the terms and conditions did not tally with the agreement and that other terms and conditions were not supplied at all. It is clear and I find that Hoist failed to provide Mr Davis with a copy of all the variations to this agreement. By their own admission they have failed to provide the terms and conditions that applied at the date of the request. Carey makes clear that any variations to the agreement must be provided. They were not. It follows that the agreement cannot be enforced under section 78(6) as there has been a significant failure to comply with section 78(1).

Other points raised by Mr Davis

Mr Brennan raised a number of less significant arguments about why this claim should fail. For example, he submitted he was deprived of any argument about unfair contract terms in the absence of a copy of the current terms and conditions. I do not think it is necessary for me to explore these points in any detail in the light of the conclusions I have reached on the significant arguments above. Mr Brennan rightly did not pursue them with any vigour and sensibly Ms Tandy did not take up much of the court’s time in responding to them.

Costs

This judgment has been distributed to the parties in advance of formal handing down. Ordinarily costs would follow the event. I ask the parties to attempt to agree costs. In the event that the parties cannot reach agreement, I will summarily assess the costs on paper providing application is made within 1 month of this judgment being handed down. The Claimant shall file the Statement of Costs and any Response within two months and the papers are then to be referred to me.

Dated:11 February 2016

Letter of Claim from Howard Cohen for Hoist Finance UK Holdings 2 Ltd