PRA group (appealed) on limitation

[Amethyst]

Re: PRA group lose on limitation

Nope, it's still county court - annoying though.

BMW v Hart has been a thorn for ages so the issue needs sorting out, hopefully the further appeal will do that.

[Nibbler]

Re: PRA group lose on limitation

I have no doubt DCAs will try to quote or refer to this to mislead consumers or even other judges, but AFAIK there is nothing about this that prevents another judge on another day making a less loony decision (i.e. does not set precedent).

[warwick65]

Re: PRA group lose on limitation

If I have read this correctly, this judgement has harmed the consumer and definitely the LiP. While it was argued that unfair relationships could be used as a defence if the creditor did not default for a long time, how many LiPs would be able to argue this.

All in all a terrible day for consumers

[Amethyst]

Re: PRA group lose on limitation

I'd guess it would be different for say a credit card vs a fixed term loan / HP as they terminate at the end of a certain period whereas a credit card wouldn't terminate until a default notice is sent and not complied with ?

[thedirtyhound]

Re: PRA group lose on limitation

What would the scenario be if a debt owner didn't do anything for six years? Would the statute of limitation still apply?

I get the point that this case affirms that the limitation period does not start until after a default notice has been issued. Theoretically a lender could wait 5 years 364 days before issuing the default notice and would then have six years from that date. But if no default notice was issued in the six year period, surely they would not be allowed to carry on after that?

The scenario that they can still enforce after say 20 years can't be right?

[MIKE770]

Re: PRA group lose on limitation

what have I been saying for a long time now about DJs etc and legislation?? ummm =Treason

[R0b]

Re: PRA group lose on limitation

Seems like an extremely poor decision by the judge either way! However, it does raise some interesting points.

In West Bromwich Building Society v Wilkinson, Lord Hoffman quite succinctly confirms that English law attributes various limitation periods depending on the cause of action sought by the claimant:

... there are periods of limitation for personal injury actions, defamation actions, other actions in tort, actions founded on simple contract, actions on a specialty and so on. This method of classification suggests that ordinarily time will run from the moment when the cause of action designated by the appropriate rule has arisen. It would be strange if the lender could then stop time running by his own act in exercising the power of sale.

For those not aware of the case, the gist of the claim was that a mortgage was taken out by the defendants who defaulted on their payments. They argued that time ran from the first defaulted instalment which is when the lender had the earliest opportunity to bring an action. The lender tried to argue that they couldn't recover the money until the property was sold and quantified, hence Lord Hoffman's remark about stopping time by their own act.

The LA covers most causes of action but not all of them. So for example, if you give an undertaking to someone and breach it, the LA does not cover this. The common law position will of course mean there is no limitation period at all and that, I believe, is the only instance that there is no limitation period. There is old case law confirming this but no recent case law overruling this point, though correct me if I am wrong, but as the credit agreement is founded on a simple contract, it seems inherently perverse for a judge to rule that a consumer credit agreement falls outside of one of the defined causes of action in the LA. If a consumer credit agreement is not a simple contract, then what is it?!

It seems to me there are two ways a consumer credit type agreement where there are multiple breaches impacts on limitation - either the cause action accrues from the first defaulted payment and thus time runs for recovery of all sums under the agreement, as argued in WBBS above or, the cause of action will accrue for each individual breach in recovering the monies where the creditor has failed to supply a default notice and failed to terminate before the expiry of the agreement. So for example a 3 year agreement requires you to pay £100 per month but you default on every payment after month 6. So the time will run from month 7 when it became due, and month 8 when that became due and so on and so forth - you effectively get a multitude of various dates when time begins to run for each individual instalment.

I assume Paul you are arguing the former rather than the latter, both as alternatives?

[Onestepatatime]

Re: PRA group lose on limitation

So it begs the question when is a law not a law?!

[pt2537]

Re: PRA group lose on limitation

So it would be left to the debtor to argue that the failure to default/terminate in good time following a breach created an unfair relationship?

Yes, but where is the certainty, and what about the equitable doctrine of Laches, where does that sit with this ruling? Answer is it doesnt, its a shambles and doesnt clarify didly shit to be honest

- - - Updated - - -

I trust Tom's fired up for it?

He certainly is, its mental this ruling and with the judge falling asleep during submissions its quite likely there will be a JCIO complaint tooo

[Amethyst]

Re: PRA group lose on limitation

So it would be left to the debtor to argue that the failure to default/terminate in good time following a breach created an unfair relationship?

[EXC]

Re: PRA group lose on limitation

It will be a second appeal now i think to the Court of Appeal.

I trust Tom's fired up for it?

[pt2537]

Re: PRA group lose on limitation

Ohhhhhhhh, that's not good.

So the judge agree that the limitation period only runs from when they serve a default notice and that there is no restriction on how long a creditor can wait after a breach before issuing a default notice ?

Hope you can get that overturned through a further appeal.

Yes, in a nutshell thats the ruling, there is no limitation period applicable to a consumer credit agreement, the opponents QC argued that s140A provides all the protections a consumer needs, and the judge agreed.

It will be a second appeal now i think to the Court of Appeal. We have to get permission to appeal but it seems to me that this is the only option as the Courts ruling is absurd. Especially when the Court of Appeal approved contractual termination without the need for a default notice in Brandon!!

[thedirtyhound]

Re: PRA group lose on limitation

I think this issue has got to the stage where Parliament needs to make some decisive law.

The Common Law system has some good points, but its weakness is that the first judge to rule on a point effectively gets to make the law, no matter how bad a decision it may be. Then everyone else is stuck with it.

Nevertheless, the decision won't help the debt purchase companies to any great degree, because one of the problems they are having is that they are getting judgments but are not necessarily getting paid. You can't get blood out of stones. That's why Cabot's attempt to float was cancelled. The realisable value of their loan/debt portfolio was found to have been seriously overvalued.

Still, the decision is perverse in the extreme. Let's hope the COA can finally sort it.

[EXC]

Re: PRA group lose on limitation

It defies the entire purpose of the Limitations Act which is to bring certainty and finality to disputes.

[Amethyst]

Re: PRA group lose on limitation

Ohhhhhhhh, that's not good.

So the judge agree that the limitation period only runs from when they serve a default notice and that there is no restriction on how long a creditor can wait after a breach before issuing a default notice ?

Hope you can get that overturned through a further appeal.