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Re: CCA Posts from Hillesden Thread
I actually ment to say "they can not issue a valid DN when the account has been sold". Have edited my post that you qouted to correct it.
I think the key issue here is not about termination of the back of an invalid DN whilst the account remains with the creditor but about the sale of the account of the back of a invalid DN. As such a sale means the agreement no longer exists between the creditor and debtor and the creditor no longer holds any rights under said agreement as a result of selling the account to a 3rd party. Off course you then have the 3rd parties rights as well. Yes its a whole can of worms, but it is not one we should ignore just because it may seem a difficult one to find an answer or effective legal argument too, that favours the consumer.
Originally posted by Lord_Alcohol
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Not sure about this.
If the debtor remedies the breach described in the new DN, S89 should apply and the agreement continue "as though the breach never occurred". The benefits of S89 are removed to the debtor where the account is sold to a DCA. - True thats the same for all valid DN but if the creditor sells the account prior to the effective date of remedy then they have done so when they are not entitled too, as such the DN becomes ineffective as the remedy date is no longer valid due to them taking action prior to the full stutory 14 days allowed for the debtor to remedy. As you said the benefits of section 89 are removed form the debtor when the account is sold, therefore if sold prior to the remedy date the debtor has therefore been denied his statutory right for the breach to have been deemed as not having occured. Not to mention section 87 denies the creditor the right to sell/terminate prior to the remedy date on a valid DN.
The wording required under S88 to be inserted in a DN (as described in the 1983 enforcement notices regs) certainly implies that an agreement should run as before (and not be ended).
A counter claim for "unlawful rescission" is I think a can of worms. Like Basa I don't like the term at all, especially in view of the complete absence of CCA-related case law. My understanding is that all that can be claimed for breach of contract is actual losses incurred by the injured party, nothing more. If you owe £10K on an "unlawfully rescinded" contract, you have no losses. - But your forgetting about the damage done to credit files, and the effect it has on the debtors ability to gain credit, that also counts as actual damages that are a direct result of the unlawful termination of the agreement and the inaccurate (and libellous) registering of a Default to file. Which they are not allowed to do when the DN is invalid.
Moreover, S170 removes the concept of sanctions against a lender for any breach. Section 170 is regarding enforcement of the consumer credit act 1974 istself by the authorities (OFT), and not the enforcement of the agreements or breaches of agreements regulated by the act, or breaches of the act that is a result of a breach of an individual agreement by the creditor. Therefore Section 170 appiles to OFT and how the enforce the act, when a creditor breaches it as made clear by section 161. If section 170 had applied then the following case would not have resulted in a £20,000 debt being wiped out by the judge - Harrison V Link Financial Limited (http://www.bailii.org/ew/cases/EWHC/...e/2011/B3.html)
I think the position of the agreement following a dodgy DN has to be that it is not terminated but that a debtor could claim for damages (poss under S13 of DPA for a default marker if the default is unfairly applied), unless it really is terminated (eg, the lender has repossessed goods, successfully sued the debtor, etc). Long term credit card ags could easily be mutually rescinded as it is quite possible that the sums paid on either side are similar. I agree damages should apply, and whilst the account is stilled owned by the creditor the invalid DN means the termination is nullified and therefore the account is not deemed terminated. However once they sell the account, then it's a different kettle of fish and the account has clearly been terminated and agreement ceases to exist between debtor and creditor upon the sale of the account. They simply can not buy back the account and reinstate without the debtors consent, as though the sale had never occured, because legally the sale did occur.
Even in Harrison the judge saw nothing wrong in serving a revised DN, but annoyingly didn't indicate if that might mean the agreement continued. On this particular point I think there is still a huge amount of confusion. Yes, but he failed to elaborate on whether he was referring to accounts that have not been sold off the back of the DN or accounts that had been sold. If it has been sold the creditor no longer has any rights under the act to issue the debtor with a valid DN as the agreement regulated by the act no longer exist between the debtor or the creditor.
Just my view of course ...
If the debtor remedies the breach described in the new DN, S89 should apply and the agreement continue "as though the breach never occurred". The benefits of S89 are removed to the debtor where the account is sold to a DCA. - True thats the same for all valid DN but if the creditor sells the account prior to the effective date of remedy then they have done so when they are not entitled too, as such the DN becomes ineffective as the remedy date is no longer valid due to them taking action prior to the full stutory 14 days allowed for the debtor to remedy. As you said the benefits of section 89 are removed form the debtor when the account is sold, therefore if sold prior to the remedy date the debtor has therefore been denied his statutory right for the breach to have been deemed as not having occured. Not to mention section 87 denies the creditor the right to sell/terminate prior to the remedy date on a valid DN.
The wording required under S88 to be inserted in a DN (as described in the 1983 enforcement notices regs) certainly implies that an agreement should run as before (and not be ended).
A counter claim for "unlawful rescission" is I think a can of worms. Like Basa I don't like the term at all, especially in view of the complete absence of CCA-related case law. My understanding is that all that can be claimed for breach of contract is actual losses incurred by the injured party, nothing more. If you owe £10K on an "unlawfully rescinded" contract, you have no losses. - But your forgetting about the damage done to credit files, and the effect it has on the debtors ability to gain credit, that also counts as actual damages that are a direct result of the unlawful termination of the agreement and the inaccurate (and libellous) registering of a Default to file. Which they are not allowed to do when the DN is invalid.
Moreover, S170 removes the concept of sanctions against a lender for any breach. Section 170 is regarding enforcement of the consumer credit act 1974 istself by the authorities (OFT), and not the enforcement of the agreements or breaches of agreements regulated by the act, or breaches of the act that is a result of a breach of an individual agreement by the creditor. Therefore Section 170 appiles to OFT and how the enforce the act, when a creditor breaches it as made clear by section 161. If section 170 had applied then the following case would not have resulted in a £20,000 debt being wiped out by the judge - Harrison V Link Financial Limited (http://www.bailii.org/ew/cases/EWHC/...e/2011/B3.html)
I think the position of the agreement following a dodgy DN has to be that it is not terminated but that a debtor could claim for damages (poss under S13 of DPA for a default marker if the default is unfairly applied), unless it really is terminated (eg, the lender has repossessed goods, successfully sued the debtor, etc). Long term credit card ags could easily be mutually rescinded as it is quite possible that the sums paid on either side are similar. I agree damages should apply, and whilst the account is stilled owned by the creditor the invalid DN means the termination is nullified and therefore the account is not deemed terminated. However once they sell the account, then it's a different kettle of fish and the account has clearly been terminated and agreement ceases to exist between debtor and creditor upon the sale of the account. They simply can not buy back the account and reinstate without the debtors consent, as though the sale had never occured, because legally the sale did occur.
Even in Harrison the judge saw nothing wrong in serving a revised DN, but annoyingly didn't indicate if that might mean the agreement continued. On this particular point I think there is still a huge amount of confusion. Yes, but he failed to elaborate on whether he was referring to accounts that have not been sold off the back of the DN or accounts that had been sold. If it has been sold the creditor no longer has any rights under the act to issue the debtor with a valid DN as the agreement regulated by the act no longer exist between the debtor or the creditor.
Just my view of course ...
I think the key issue here is not about termination of the back of an invalid DN whilst the account remains with the creditor but about the sale of the account of the back of a invalid DN. As such a sale means the agreement no longer exists between the creditor and debtor and the creditor no longer holds any rights under said agreement as a result of selling the account to a 3rd party. Off course you then have the 3rd parties rights as well. Yes its a whole can of worms, but it is not one we should ignore just because it may seem a difficult one to find an answer or effective legal argument too, that favours the consumer.
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