CCJ from VWFS (Car Finance)

[Unknown2023]

Hi all, new member looking for some advice. I recently received a CCJ for a car I had on finance a few years ago. Basically after 3 years I could no longer afford the car and it was taken back by VWFS. They obviously sold it on and came after me for the shortfall of the balance, but sent all documents to an old address.
In September I received notification of a CCJ on my credit file and decided to fight it. I applied for a set aside and had my day in court last week.

Whilst the judge was satisfied that the claimant had followed their procedure correctly, he was unhappy that £7,000 of my deposit that I put towards the car initially was not shown on any of my finance documents. He therefore set aside the CCJ on the basis that I can provide evidence of this deposit.

I now have 2 weeks to provide this evidence to the courts, which I now have. But I am unsure on how to put a defence together and submit this evidence, or even what grounds I can fight this claim on. Should I submit a counter claim also?

I am not clued up on this kind of stuff at all and would really appreciate any advice on how to take this forward.

Thanks in advance

[R0b]

Have you received the court order and if so, what does it actually say you have to do?

[Unknown2023]

Hi, I have never received the claim form as it was sent to an old address. I used the N244 and wrote a witness statement using a template to fight the CCJ and request a set aside. The only other paperwork I have is the witness statement from the claimant

[R0b]

Depending on the date of the hearing, the court will issue an order of its decision of the set aside hearing and usually this is within a week or two of it taking place. If you do not have that then I suggest you contact the court for an update ASAP and get them to confirm over the phone what the order actually states and you are required to do.

From there, we can work out the next steps but do you think you have any defence to claim being made against you?

[Unknown2023]

Ah that's great thank you, I will contact the court this afternoon as deadlines are tight!

I hope so, I mean the judge must think I have a good reason to defend part of or all of the claim or else he wouldn't have set aside the ccj, as per cpr 13

If I can write off the whole debt then great, if not it is still a win if i have no CCJ and a much lower sum to repay. My feeling is the court is looking to dismiss the claim.

Would drafting a defence be something you can help with then?

[Unknown2023]

Update -

There is no written direction from the court, only to submit a full defence with the evidence requested by 5th December

[R0b]

Do you have a copy of your agreement that you can upload, with personal information redacted?

Whilst the judge was satisfied that the claimant had followed their procedure correctly, he was unhappy that £7,000 of my deposit that I put towards the car initially was not shown on any of my finance documents.

The above, may very well be your golden gun on the assumption that you can satisfy the court with the evidence you have to prove you paid a deposit and the credit agreement did not exceed the credit amount of £60,260. It's a bit of a technical argument but, I'll try to summarise below.

Section 60(1) of the Consumer Credit Act 1974 requires a creditor to ensure that certain terms are always included in a credit agreement. These terms vary depending on the type of agreement you are entering into but these terms are known as 'prescribed terms'.

Some of the prescribed terms are listed in section 60 but there are other regulations that require additional prescribed terms, set out in The Consumer Credit (Agreements) Regulations 2010. Specifically, under Schedule 1 of the Regulations:

- Paragraph 5 requires the credit amount to be stated. This is calculated as the credit amount of the goods, less any deposit.

- Paragraph 9 then requires the creditor to calculate the total amount payable, this is calculated as being the total credit amount + total charges payable + the deposit amount.

You can see an example of a template hire purchase agreement and you will understand what I mean if you look at page 2: Link here

If the creditor fails to meet the prescribed terms, then by virtue of section 61(1)(a), the agreement is deemed to have been improperly executed. The consequence of a improperly executed agreement is explained in section 65, which says:

65 Consequences of improper execution.

(1)An improperly-executed regulated agreement is enforceable against the debtor or hirer on an order of the court only.

(2)A retaking of goods or land to which a regulated agreement relates is an enforcement of the agreement.

The court has discretion to make an order that to the improperly executed agreement is enforceable by taking into account sections 135 and 136 of the CCA.

So that's the technical side of things, if I were to sum up your arguments in a concise and easy way to argue in court, it would probably go something like this:

1. The hire purchase agreement is an improperly executed agreement contrary to section 61(1) of the CCA 1974 because the HP agreement fails to include the deposit amount paid under the agreement, which is a prescribed term that must be included as set out in The Consumer Credit (Agreements) Regulations 2010.

2. The effect of failing to comply means that the agreement cannot be enforced without an order of the court, taking into account section 135/136 of the CCA.

3. Under the Civil Procedure Rules, Practice Direction 49C applies to improperly executed agreements and sets out what must be included in the particulars of claim (see paragraph 3.1, link here). The Claimant has failed to meet these requirements.

4. Furthermore, the claimants claim is based on the assumption that the agreement was properly executed and therefore, entitled to enforce the agreement. As can be seen by evidence of the deposit, that is not the case. Accordingly, the court must dismiss the claim because:

(i) The requirements of Practice Direction 49C have not been met.

(ii) In order for the court to consider whether to enforce the improperly executed agreement, there would have to be a whole new set of pleadings and arguments such that it would mean a further trial and possibly further directions given. That would (a) unfairly prejudice the defendant because effectively allows the claimant a second bite of the cherry for something it never pleaded and (b) runs entirely contrary to the overriding objective in that it will create additional expense to both parties, will not be dealt with expeditiously and fairly, will be allocating further court resources which could be better allocated elsewhere for other cases. Note: You can read about the overriding objective here, paragraph 1.1

(iii) The most compelling reason being that the sole purpose of the judge is to determine the case according to what has been pleaded in the particulars of claim. It is not the role of the judge to assist the claimant nor introduce new pleadings that have arisen after the fact. It is up to the claimant to plead his case how he wants. The Claimant could have pleaded their case and bring an action to enforce the improperly executed agreement but they chose not to do that.

[additional argument if the claimant fails to amend its claim] Furthermore, the claimant has been on notice since receiving the defence from the court, that the defendant intended to argue that the agreement was improperly executed. It has had ample time to amend its pleadings to seek an order to enforce the agreement, but it has chosen not to do so. For these reasons, the court must dismiss the claim.

Finally, I might have an example defence lying around for improperly executed agreements that you could use as a base for your defence. Of course there may be other lines of defence that you could argue also but at the moment. I think this is enough for you to digest and I will have a think of other potential defences you could add.

In the meantime, I suggest you read the above and refer to the legislation and familiarise yourself with these provisions as you will need to refer to them to make your arguments.

[Unknown2023]

Rob,

Thank you so much for your detailed response. It will take me a few reads to take it all in and decipher, but to summarise the nitty gritty details of my agreement:

It was a 4 year PCP, I hope this does not change the credit consumer guidelines.

The credit agreement did not exceed £60k even with my deposit,

I have the evidence that I paid the 7k deposit however on my credit agreement which I signed, the total payable amount is not listed correctly as my deposit is not included on there at all. The deposit which they have laid out on my credit agreement is only a few hundred pounds.

This also means that the car was taken illegally, as I had paid more than a third of the balance of the agreement at the time the car was taken. Legally the finance company had to obtain a court order to take the car and this did not happen.

Rob I would much appreciate if I could liaise with you further about this as it is a massive help, will compensate you for your time of course. If you are able to find the defence template it would be an absolute life saver

[R0b]

PCP agreements are a branch of the umbrella term hire-purchase agreement. Both types of agreements are a contract for hire with the option to purchase at the end of the agreed term but the key difference is that under a true HP agreement, you are paying off the value of the vehicle over time whereas a PCP only pays off the depreciation value each year., leaving the actual market value of the vehicle as the option to purchase at the end of the agreement.

For your purposes, they are both still subject to the CCA requirements I mentioned. I'm happy to help where I can but you are going to need to drive most of this since it's your case and you have the knowledge about what has happened. I will help in as far as what I can post on this thread but I don't need to be compensated for it.

I will have to do some digging for the template as improperly executed agreement defences are not something that are frequently raised so will need find out where I have stored it, so will try to find it before the weekend is out if possible. Just to be clear there's likely to be additional work on your side to beef up the defence so don't just think that the template will suffice.

When you say the car was taken, you said you could no longer afford the car and it was taken by VWFS. The rules about repossession of the vehicle and one third payments will only apply if they have taken it against your consent. If you agreed to hand the keys back to them then that would not constitute unlawful repossession for the purposes of what you are talking about. If they did repossess against your consent, then you may have a defence and a counterclaim against VWFS for them to repay all monies under the agreement and discharge your liability.

A couple of other things:

Have you got a copy of the particulars of claim that were originally submitted when proceedings first started? if not, I suggest you ring the court and ask for a copy by email which they should provide you. The rules say copies can cost up to £10 from what I recall but most of the time the court will just email for free if you are polite about it. It would be nice to see those particulars because similar to the improperly executed agreements, hire purchase agreement claims need to include certain information similar to if not Practice Direction 49.

A copy of your PCP agreement would still be useful to see as there may be other deficiencies in the contract that you could rely on to support your case.

[Unknown2023]

Hi Rob,

Thank you so much. I appreciate the efforts you are going to and I am more than happy to put the work in also, I successfully defended the CCJ without representation so I know whats involved but it is absolutely justified.

The car was taken without my consent, it had a stolen marker placed on it without my knowledge and was taken by the police, I had a vulnerable person in the car at the time and we were left at the side of the road. I had told the finance company that I had wished to keep the car and make token payments for it until I could reasonably afford to pay but they did not accept this.

I am happy to upload the particulars of the claim and the contractual agreement which I signed, along with my supporting evidence. do you need to see the witness statements for both sides also?

Would you prefer me to private message these over or email as I am aware this is a public forum. I will blank out all personal details and get them uploaded today just let me know what you require

[R0b]

Sorry this is late, I struggled to find what I was looking for. Anyway I did in the end but it wasn't specifically relevant to your situation, so I have cobbled together a draft defence argument on s65. There may be other defences available to you so this could only be one part and you shouldn't put all of your eggs in one basket relying on s65 as that would be dangerous.

It's possible that VWFS have actually complied with Practice Direction 49C so you may need to consider removing the elements referring to them not complying although there is one section in PD49C that requires them to explain why they are seeking an enforcement of the unenforceable agreement so it's likely they wouldn't have complied with that at least.

Also, if the car was taken without possession and you have confirmed payment of at least 1/3 of the total price payable, you have a counterclaim under s91 which you should seriously consider doing but that will cost you and also may take you over the £10k mark which is the threshold for considering claims on the small claims track.

What is the value of the claim from VWFS and how much have you paid to date, including deposit?

I don't provide help by private message so only here in public. If you are not comfortable uploading a redacted version of the documents then what I can say or do is speculative at best otherwise when you upload I will see if there's other arguments to make.

[Unknown2023]

Hi Rob. As always, thanks so much for your endeavours, that example defence is very helpful. The claim amount is for 10599 plus contractual interest. To date I believe to have paid in around 17k of the agreement with my deposits included. The total payable amount should be around 47k but in my finance agreement they have laid out that the total payable is 39k with only a £401 deposit, no idea where that figure came from!

Do I include in the defence that I want to counterclaim? Or do I dismiss the claim first and then counterclaim?

I will be happy to supply a copy of the agreement and claim with redacted info, be warned there are about 20 pages!

[R0b]

So the value falls just over the the threshold for small claims so it's likely that this will be moving on to a different track meaning that legal costs are also in play if you lose or they lose. Given the amount at stake, it would be wise for you to maybe seek some legal advice even if it's only initial advice. Also check to see if you have legal expense insurance cover as you might be able to rely on that to defend your case.

However, if you wanted to proceed alone, then to bring a counterclaim and recoup all £17k back, you would need to pay a fee of 5% of the value of your counterclaim based on £17k which is about £800. Of course that fee can be lower but then you would be only able to recover a lower sum.

To draft a counterclaim, you would include it as part of your defence but after you have finished your last paragraph on the defence and before the statement of truth, you would then have a sub-heading in the middle that says "Counterclaim". Anything following that is your counterclaim which VWFS will need to file a defence to.

As I mentioned before, if the court accepts the fact that you have provided a £7k deposit, that certainly puts VWFS in deep doo-doo as I would fail to see how they could have a comeback to any defence for being in breach of the 1/3 rule. This is because in my mind, the 1/3 rule is a strict liability rule which means that you only need to show the act of retaking the goods was committed. The consequence and sensible response to your counterclaim would be to reach out to you for a settlement, whatever those terms they are proposing but by carrying on, they run the risk of losing at a hearing and not only paying you the £17k, but also you could claim back the time spent defending the claim at £19 per hour - so keep an accurate time of what work you have done, how long you have spend and sure to list it out in a table as that will be your costs schedule if it did go to the wire.

Please note that this is merely my opinion only and I can't predict what happens at court so you should decide carefully what you want to do. There's no harm in continuing to defend the claim and making a counterclaim whilst reaching out to VWFS for settlement whilst the case progresses. It may be even that you might want to consider an application for summary judgment against VWFS - again it's a cost to make on but it means you could get a quick court ruling in your favour.

Out of curiosity, what evidence do you have to prove you paid the deposit amount, is it a slam dunk as in evidence from the dealership or are you relying on bank statements or something else?

[Unknown2023]

Yes you're right about the small claims as they tried to claim their time and legal fees off me but the judge dismissed it. I stupidly didn't apply to have my set aside fee claimed back from them though, oops.

The 800 fee I will send with the defence and counter claim? Or at a later date? They have no clue how to account for the deposit as it tripped them up when questioned about it at the set aside hearing.

Applying to them for a settlement out of court does seem like a very good idea also but I imagine it won't be for the full amount?

To clear up, the evidence of deposit is clear cut I have the original receipt for £1000 cash and the part exchange form for my old car, it was actually 7k I received for that so an 8k deposit in total. All provided by the original dealership I purchased the car from

[R0b]

You can pay the fee by cheque or you can call up the court and pay over the phone. I prefer to file the defence and counterclaim by email but in the email body let them know that you will call up in the next couple of days to pay the counterclaim fee.

Why wouldn't you claim for the full amount? Given the fact you have evidence of the deposit being the original paperwork, I would reiterate my point about the 1/3 rule being that the goods are classed as protected goods which cannot be recovered without a court order. A breach of this rule means your liability is discharged altogether and you are entitled to full repayment of all sums you have paid under the agreement and that's the consequence of VWFS failing to comply. I'm pretty sure they are probably already aware of this and no doubt hoping you are not able to produce the evidence of the deposit amount.

Just make sure you keep hold of the original and only send a copy to the court and if you have to, I duplicate or triplicate that copy and scan it in to your computer, phone cloud or whatever just in case you somehow lose it, but that's just me being the cautious type!

I can't see a way out for VWFS on this one as the only defence they have to a s91 claim is that you consented to the repossession but the onus is on them to prve you consented. That's going to be pretty difficult if they reported the vehicle stolen and it was taken out of your hands. The vulnerable person with you at the time is also your witness when it comes to court and he or she can provide a witness statement to back up that story if they are willing. Suggest you also start collecting evidence that the vehicle had a stolen marker placed on it and any other relevant evidence at the time the vehicle was taken from you by the police e.g. the day, time you were stopped, the officer names and shoulder numbers who stopped you and repossessed the vehicle etc. Obtaining a written statement from those officers would also be a slam dunk.

I'm sorry to keep banging on about evidence but it's the one thing people forget to do until the last minute and when you rely on third parties, the evidence may no longer be available when you need it, so the sooner you get that the better.

Anyway, a lot to digest so maybe take a day or two at most before you draft your defence and counterclaim but do allow time to review. I am happy to look over anything you draft and give some pointers on what you might want to include but at this stage, I don't think there's much more I can add without seeing further documentation.