Mercedes Benz Claim via Blake Morgan LLP - URGENT HELP Pls

[ohjsim]

Received a claim? Yes

Issue Date: 14/03/2019

Have you Acknowledged the Claim? NO I have not acknowledged the claim

Total Amount Claimed : £13,000

Claimant’s Name: Mercedes Benz Financial Services UK limited (MBFS)

Solicitors Firm: Morgan Blake LLP

Original Debt: Car Hire Purchase - car was damaged and written off by another driver

Particulars of Claim:
Monies due under regulated finance agreement. The defendant (me) breached the finance agreement as a result of which the claimant has suffered loss and damage being teh sum of £11,400 (recovery costs of £1950 and damage costs of £9,500). The claimant has demanded that the defendant pay the sum outstanding in accordance with the terms of the finance agreement. However the defendant has failed to do so.

And the claimant claims £11,400 together with contractual interest from 1/08/2016 to 7th March 2019 at 4% annually being £1,100 and further interest on a daily basis until the date of payment at the rate stated for the principal sum the daily rate being £1.25 together with the costs of an indemnity basis pursuant to the agreement.


Is the debt Statute Barred: No

Any Other Information or Background Details:

I had a hire purchase from MBFS which was written off by a friend who was driving with my permission - but unfortunately lied about having the appropriate insurance levels - I am however liable for the debt.

MBFS sent me an invoice of £9,500 and the next day sent me a credit note for the same amount of £9,500. MBFS sent a letter stating that the car would be auctioned, and I would be required to pay the shortfall in value after the sale. Something I stated in a letter to them was not what my credit agreement stated.

I thereafter received directly a letter from Morgan Blake LLP (strong arm tactics) advising me that I would be taken to court if I didn't pay the amount stated. This was surprising as I had no communication from MBFS that they would be passing my details to a debt collector or that I had to now deal with a third party. I contacted MBFS who said that Morgan Blake were trying to recover the shortfall in the value of the car and that there was nothing further they could advice me on.

I got differing values from MBFS and Morgan Blake on what was owed - and no clarification from Morgan Blake after multiple emails. I thereafter offered to pay £2,500 to Morgan Blake to settle the matter - they acknowledged receipt and said they would come back to me with a response. I heard nothing back.

They have now taken me to the county court to claim the money - what are my options here? Can I do anything, or contact a solicitor? Do I have any chance of contesting this claim? Or is it advisable to pay and take MBFS to the ombudsman? I was literally thrown over to these sharks, and my offer to them whilst acknowledged was never responded to.

[R0b]

So I have some questions below, it would be helpful if you could answer as best you can:-

1. Did Mercedes terminate the agreement and if so, on what grounds did it seek to terminate?

2. You mentioned that there was nothing in the agreement to say that MBFS would auction the car and seek the recovery of the shortfall. You said it doesn't state that, but is there anything in the contract about the vehicle being written off and what rights does MBFS have in that regard?

3. Does the contract allow MBFS to claim back recovery costs?

4. What was your reasoning behind offering £2,500 as that seems way off the mark. Is the shortfall for the vehicle exactly £9,500? I say that because it is a round number and if sold at auction may not necessary be the case. Do you have evidence of the value it was sold for?

5. You said you heard nothing back from Blake Morgan, did you contact them after not a period of time and if not, why not? I see this happen all the time, people say they waited to hear back but did nothing to follow up and then wonder why claims are issued against them. I'm not saying its the case with you, but you obviously need to be proactive when legal proceedings are in play, not take a back seat.

Depending on the answers you give above, might alter your position but on the face of it, MBFS would probably be entitled to sell the car at auction as that would be seen as mitigating their losses, and then recover the difference between the proceeds and the total amount payable. I understand MBFS and Blake Morgan haven't been so forthcoming with their responses and it might be that you could make an application to the court to seek a stay of proceedings for a period of 3-6 months (I would suggest you go for the latter to give more time) to enable the parties to discuss settlement terms. If you do that, it might be wise to write to Blake Morgan and seek their consent, whilst setting out the reasons, particularly their unreasonable conduct in the matter given their failure to respond to your offer of settlement (although do check your junk mail in case its there and you look foolish).

If MBFS didn't terminate at all then it could be deemed a wrongful termination in which case it is a repudiatory breach and your obligations are discharged altogether. So it's important to know the timeline of what's happened and if MBFS have correctly terminated the agreement. It may also help sending a subject access request to MBFS seeking all information they hold about you including account notes, letters, etc.

[ohjsim]

Hi Rob - many thanks for your prompt response, sincerely appreciated. I have answered below to the best that I can. Apologies for delay, had to go scrub through the regulated agreement to answer some of your questions.

1. Did Mercedes terminate the agreement and if so, on what grounds did it seek to terminate?

The agreement was coming to an end when the accident happened, so it terminated naturally and MBFS recovered the car from where it was stowed - as it was totally written off. It was a 36 month agreement.

2. You mentioned that there was nothing in the agreement to say that MBFS would auction the car and seek the recovery of the shortfall. You said it doesn't state that, but is there anything in the contract about the vehicle being written off and what rights does MBFS have in that regard?

No it doesnt particularly state a case of written off - however it does say that MBFS will sell the car at a reasonable market value if necessary (when damaged). I guess this covers it - first time I have actually seen this very relevant one liner.

3. Does the contract allow MBFS to claim back recovery costs?

Yes it says they are entitled to reclaim recovery costs.

4. What was your reasoning behind offering £2,500 as that seems way off the mark. Is the shortfall for the vehicle exactly £9,500? I say that because it is a round number and if sold at auction may not necessary be the case. Do you have evidence of the value it was sold for?

I made this estimate based on the market value of what I perceived the written off vehicle to be worth, and what I owed MBFS.

5. You said you heard nothing back from Blake Morgan, did you contact them after not a period of time and if not, why not? I see this happen all the time, people say they waited to hear back but did nothing to follow up and then wonder why claims are issued against them. I'm not saying its the case with you, but you obviously need to be proactive when legal proceedings are in play, not take a back seat.

I wrote them with the offer, and asked for a response in 14 days - I then followed up 20 days later and asked for a response. They did come back saying they were evaluating the offer and would come back. They didnt respond to this and started legal proceedings.


I think that I might not have any recourse here and have to settle this with Morgan Blake. What would your recommend:

1. Could I ask for a stay of proceedings for 3 months and work a settlement with Morgan Blake - would this affect my credit profile or incur a CCJ?
2. Is it worth asking MBFS for a subject access just in case? I cannot find the termination letter - but I remember seeing one, but cannot be 100% sure now.

I would prefer an option that avoids me having a CCJ on my profile for credit.

[ohjsim]

Hi Rob, Hi Community - please did you have a chance to see my response?

Received a claim? Yes

Issue Date: 14/03/2019

Have you Acknowledged the Claim? NO I have not acknowledged the claim

Total Amount Claimed : £13,000

Claimant’s Name: Mercedes Benz Financial Services UK limited (MBFS)

Solicitors Firm: Morgan Blake LLP

Original Debt: Car Hire Purchase - car was damaged and written off by another driver

Particulars of Claim:
Monies due under regulated finance agreement. The defendant (me) breached the finance agreement as a result of which the claimant has suffered loss and damage being teh sum of £11,400 (recovery costs of £1950 and damage costs of £9,500). The claimant has demanded that the defendant pay the sum outstanding in accordance with the terms of the finance agreement. However the defendant has failed to do so.

And the claimant claims £11,400 together with contractual interest from 1/08/2016 to 7th March 2019 at 4% annually being £1,100 and further interest on a daily basis until the date of payment at the rate stated for the principal sum the daily rate being £1.25 together with the costs of an indemnity basis pursuant to the agreement.


Is the debt Statute Barred: No

Any Other Information or Background Details:

I had a hire purchase from MBFS which was written off by a friend who was driving with my permission - but unfortunately lied about having the appropriate insurance levels - I am however liable for the debt.

MBFS sent me an invoice of £9,500 and the next day sent me a credit note for the same amount of £9,500. MBFS sent a letter stating that the car would be auctioned, and I would be required to pay the shortfall in value after the sale. Something I stated in a letter to them was not what my credit agreement stated.

I thereafter received directly a letter from Morgan Blake LLP (strong arm tactics) advising me that I would be taken to court if I didn't pay the amount stated. This was surprising as I had no communication from MBFS that they would be passing my details to a debt collector or that I had to now deal with a third party. I contacted MBFS who said that Morgan Blake were trying to recover the shortfall in the value of the car and that there was nothing further they could advice me on.

I got differing values from MBFS and Morgan Blake on what was owed - and no clarification from Morgan Blake after multiple emails. I thereafter offered to pay £2,500 to Morgan Blake to settle the matter - they acknowledged receipt and said they would come back to me with a response. I heard nothing back.

They have now taken me to the county court to claim the money - what are my options here? Can I do anything, or contact a solicitor? Do I have any chance of contesting this claim? Or is it advisable to pay and take MBFS to the ombudsman? I was literally thrown over to these sharks, and my offer to them whilst acknowledged was never responded to.

[R0b]

Hello

Sorry I have missed it - I'll take a look at your response today and get back to you with any thoughts.

[R0b]

So on the basis of your response, I think you could make an application to the court to seek a stay of the claim pending settlement negotiations between you and Mercedes. It would cost you £255 to make that application but given Blake Morgan's failure to get back to you on your offer, you could argue your costs of the application given Blake Morgan could be seen as being unreasonable, particularly that legal proceedings should be last resort. You may want to consider writing to them with a sense of urgency, pointing out their failures and asking whether they would consent to a stay to enable settlement discussions.

That said, I also noticed in your first post that you haven't acknowledged the claim and in which case you only have 14 days to respond. I think you should immediately acknowledge the claim to allow you a further 14 days to prepare an application and/or file a defence.

You do not get a CCJ against you simply because legal proceedings have been issued. Like the name, a county court judgment is a decision of the court made in favour of one party i.e. the successful party. If a CCJ is given against you, then you will have one month from the date of the decision to repay any monies ordered by the judge following the hearing. If you don't that's when a CCJ is applied and will generally show on your credit file.

Alternatively, you could avoid paying the application fee and agree to settle their claim in full, subject to a Tomlin Order and payable by instalments; maybe the same rate you were paying under the agreement?