GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

[Legal Beagles]

Grace v Black Horse approved jgt ( PDF DOWNLOAD) * Neutral Citation Number: [2014] EWCA Civ 1413 Case No: B2/2013/0424 IN THE COURT OF APPEAL (CIVIL DIVISION) ON APPEAL FROM CHESTER COUNTY COURT JUDGE HALBERT 9CH05795 Royal Courts of Justice Strand, London, WC2A 2LL Date: 30/10/2014 Before : THE MASTER OF THE ROLLS LORD JUSTICE […]

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[gonewiththewind]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

Paragraph 39 of the Judgment is very pleasing. At last we can dispense with creditors describing their failure to comply with the law as a 'technicality' to be overlooked by the Courts. Well done.

[Amethyst]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

I reckon we can also dispense with creditors threatening consumers with default markers on their credit files when they have no agreement and thus the debt is unenforceable under the CCA.... might take a bit more work to get that set, but it is definitely the beginnings of overturning the ruling in McGuffick v RBS.

There will be a proper summary posted up tomorrow.

[Guest]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

An interesting judgment with some repercussions for the CRA industry I would think.

It should be noted that the judgment does not say that the default should not be registered on an unenforceable agreement exactly, but rather that the unqualified entry should not be, i would expect all future defaults would have some kind of indicator possibly a "u" after the d to indicate an nonenforceable agreement. Incidentally the argument expressed by the judge here regarding the registering of the default is very similar to one put forward by Lacours in 07 and rejected by the OFT.

It raises the interesting question of damages which may or may not be due by the defaults already placed on files.

Mc guffic was not really disproved, he gave no opinion on irredeemably unenforceable agreements, the mention of the same sanction being available for creditors breach of the copy regulations is interesting though and worth pursuing IMO.

Also there is the question of when should the default be removed(or modified) from the register, many times the debtor will claim the agreement is unenforceable and the creditor will dissagree, so should the entry be removed if the agreement enforceablility is bought into dispute or just after judgment.

[Bankers Reform]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

Paragraph 38 makes interesting reading;

38. As for the second submission, I have not been persuaded that the shortcomings in the
CRAs’ registration systems can excuse a registration which is in substance inaccurate
because of an omission (namely that the ‘default’ related to an unenforceable
agreement). If an accurate registration cannot be accommodated, then the answer is
for the industry to change its registration systems, and in the meantime for inaccurate
registrations not to be made.

Does this mean that the processing of data by the CRA's must be checked and proven to be accurate before further registrations can be made and if so does it apply to current defaults?

Just asking . . .:tinysmile_hmm_t2:

[Guest]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

Paragraph 38 makes interesting reading;

38. As for the second submission, I have not been persuaded that the shortcomings in the
CRAs’ registration systems can excuse a registration which is in substance inaccurate
because of an omission (namely that the ‘default’ related to an unenforceable
agreement). If an accurate registration cannot be accommodated, then the answer is
for the industry to change its registration systems, and in the meantime for inaccurate
registrations not to be made.

Does this mean that the processing of data by the CRA's must be checked and proven to be accurate before further registrations can be made and if so does it apply to current defaults?

Just asking . . .:tinysmile_hmm_t2:

I think it means that if the data that is being being recorded isn't accurate then it should not be recorded at all.

If the current default refers to an unenforceable agreement, then I think it should be questioned after this case.

[Bankers Reform]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

I think it means that if the data that is being being recorded isn't accurate then it should not be recorded at all.

If the current default refers to an unenforceable agreement, then I think it should be questioned after this case.

But how would a CRA know if the data is accurate or not?
Surely the onus is on the creditor to make sure data supplied to the CRA's is accurate and a fair reflection of the current state of an account. I thought that has always been the case anyway.

Would Banks, HP companies and the like need to enforce/prove a debt in court before a default can be registered?

If a credit agreement is then deemed unenforceable by a court on "technicalities" then any default recorded needs to reflect that.


I must read the whole thing again to get it clearer in my mind.
I do wish these judges would speak in laymans terms.

[Guest]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

But how would a CRA know if the data is accurate or not?
Surely the onus is on the creditor to make sure data supplied to the CRA's is accurate and a fair reflection of the current state of an account. I thought that has always been the case anyway.

Would Banks, HP companies and the like need to enforce/prove a debt in court before a default can be registered?

If a credit agreement is then deemed unenforceable by a court on "technicalities" then any default recorded needs to reflect that.


I must read the whole thing again to get it clearer in my mind.
I do wish these judges would speak in laymans terms.

Under data principles the CRA has a duty to ensure that the data recorded is accurate

Defaults are generally registered before any proceedings in court

The case dispels the idea that unenforceablity is a technicality

[Sparkie1723]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

HI everyone I'm back.....you have to read the judgement quite a few timesd to get the real jist of what they are saying... and what it could give rise to........reading it once does not get it all to sink home.......having readi it about 20 ntimes I have a lot to say about it............BUT I will have to be more than a little careful in what I try to say not be assessed as "meandering"

Sparkie

[persephone]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

Hello,

I just thought I would add to this thread as I have recently had an experience having a default removed from my credit file informally using this case. I posted about it in the Natwest forum. In my case, the agreement was unenforceable because the bank could not find a copy of the agreement and did not have enough information to recreate it. I wrote to them citing Grace v Blackhorse. Next time I checked, the default was removed. It was recorded in 2012 so technically should not come off until 2018.

My interpretation of the judgement is, that recording of a default in circumstances where the underlying agreement is unenforceable is not accurate unless it also recorded that the debt is unenforceable.

It is The Data Protection Act 1998 that requires organisations to ensure personal information they hold is accurate. This would apply equally to the bank and the CRA in my view. Effectively, the bank is in breach of these principles where it is not recording the default as being in relation to an agreement that is not enforceable.

I suppose the crux of it is that there isn't really any way the CRA can record the agreement as 'unenforceable' in practical terms. And the information cannot be reported at all if it is incomplete. I note someone has made a (un) helpful suggestion that a 'u' could be added to show the unenforceability. Why they currently don't seem to be able to do something so simple I don't know, but I for one hope they don't cotton on!

[Sparkie1723]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

Hello,

I just thought I would add to this thread as I have recently had an experience having a default removed from my credit file informally using this case. I posted about it in the Natwest forum. In my case, the agreement was unenforceable because the bank could not find a copy of the agreement and did not have enough information to recreate it. I wrote to them citing Grace v Blackhorse. Next time I checked, the default was removed. It was recorded in 2012 so technically should not come off until 2018.

My interpretation of the judgement is, that recording of a default in circumstances where the underlying agreement is unenforceable is not accurate unless it also recorded that the debt is unenforceable.

It is The Data Protection Act 1998 that requires organisations to ensure personal information they hold is accurate. This would apply equally to the bank and the CRA in my view. Effectively, the bank is in breach of these principles where it is not recording the default as being in relation to an agreement that is not enforceable.

I suppose the crux of it is that there isn't really any way the CRA can record the agreement as 'unenforceable' in practical terms. And the information cannot be reported at all if it is incomplete. I note someone has made a (un) helpful suggestion that a 'u' could be added to show the unenforceability. Why they currently don't seem to be able to do something so simple I don't know, but I for one hope they don't cotton on!

Hullo Persephone,
I am pleased that the case was able to assist you, it is not as simple for a CRA to do what this someone suggested as the Law Lords said if the CRA and the credit industry cannot enter that a debt is unenforceable it should not be entered at all.
The lenders system has no facility set up to record the suggested " U "for unenforceable and the CRA's systems ( which are all automated) do not have the facility to accept the "U " to change their systems to do this will cost a lot of money believe it or not .......so our case will be of use for quite a while yet..............at least until they all decide to change their systems to accommodate what our ruling stated.
Congrats on getting your default removed.
Sparkie

[persephone]

Re: GRACE v BLACK HORSE LIMITED [2014] EWCA Civ 1413 30/10/2014

That's awesome. I can see how it would cost a lot of money. It is heartening to see a silly technicality like that is actually working in favour of the 'average joe' for once!